%PDF-1.5 1 0 obj <> endobj 3 0 obj <>] /Rotate 0 /Contents 4 0 R>> endobj 4 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 18.00 Tf ET q 0 0 0 rg BT 235.55 743.85 Td (UNITED ST) Tj ET Q q 0 0 0 rg BT 330.74 743.85 Td (A) Tj ET Q q 0 0 0 rg BT 342.41 743.85 Td (TES) Tj ET Q BT /F2 18.00 Tf ET q 0 0 0 rg BT 112.70 722.25 Td (SECURITIES ) Tj ET Q q 0 0 0 rg BT 225.25 722.25 Td (AND EXCHANGE COMMISSION) Tj ET Q BT /F2 12.00 Tf ET q 0 0 0 rg BT 244.15 707.85 Td (W) Tj ET Q q 0 0 0 rg BT 255.49 707.85 Td (ashington, D.C. 20549) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 691.85 Td ( ) Tj ET Q BT /F2 18.00 Tf ET q 0 0 0 rg BT 257.25 665.25 Td (FORM 10-Q) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 354.73 665.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 36.00 648.25 Td (\(Mark One\)) Tj ET Q /GS0 gs q 12.72 0 0 11.71 39.00 623.54 cm /I1 Do Q BT /F2 12.00 Tf ET q 0 0 0 rg BT 69.00 627.12 Td (QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15\(d\) OF THE SECURITIES) Tj ET Q BT /F2 12.00 Tf ET q 0 0 0 rg BT 69.00 615.12 Td (EXCHANGE ACT OF 1934) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 205.35 593.25 Td (For) Tj ET Q q 0 0 0 rg BT 220.72 593.25 Td ( the quarterly period ended ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 340.43 593.25 Td (Mar) Tj ET Q q 0 0 0 rg BT 359.13 593.25 Td (ch 31, 2015) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 406.63 593.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 298.50 576.25 Td (OR) Tj ET Q /GS0 gs q 10.69 0 0 11.71 39.00 551.54 cm /I2 Do Q BT /F2 12.00 Tf ET q 0 0 0 rg BT 69.00 555.12 Td (TRANSITION REPORT PURSUANT TO SECTION 13 OR 15\(d\) OF THE SECURITIES) Tj ET Q BT /F2 12.00 Tf ET q 0 0 0 rg BT 69.00 543.12 Td (EXCHANGE ACT OF 1934) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 219.80 521.25 Td (For) Tj ET Q q 0 0 0 rg BT 235.17 521.25 Td ( the transition period fr) Tj ET Q q 0 0 0 rg BT 335.53 521.25 Td (om ) Tj ET Q BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 351.3625 519.68505859375 m 381.3625 519.68505859375 l s q 0 0 0 rg BT 351.36 521.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 381.36 521.25 Td ( to ) Tj ET Q BT /F2 10.00 Tf ET 0 0 0 RG /GS0 gs 0.95 w 0 i [] 0 d 1 J 1 j 3 M 394.692578125 519.68505859375 m 424.692578125 519.68505859375 l s q 0 0 0 rg BT 394.69 521.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 230.65 504.25 Td (Commission file number) Tj ET Q q 0 0 0 rg BT 335.47 504.25 Td ( 000-52606) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 488.25 Td ( ) Tj ET Q BT /F2 18.00 Tf ET q 0 0 0 rg BT 107.50 461.65 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 197.03 461.65 Td ( EST) Tj ET Q q 0 0 0 rg BT 234.22 461.65 Td (A) Tj ET Q q 0 0 0 rg BT 245.88 461.65 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 395.10 461.65 Td ( ) Tj ET Q q 0 0 0 rg BT 399.27 461.65 Td (TRUST) Tj ET Q q 0 0 0 rg BT 457.96 461.65 Td (, INC.) Tj ET Q BT /F2 18.00 Tf ET q 0 0 0 rg BT 504.46 461.65 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 190.45 449.65 Td (\(Exact Name of Registrant as Specified in Its Charter\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.00 433.65 Td ( ) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 36.00 422.85 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 144.60 403.08 Td (Maryland) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 299.00 403.60 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 421.80 403.08 Td (20-2985918) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 114.35 391.43 Td (\(State or) Tj ET Q q 0 0 0 rg BT 143.75 391.43 Td ( Other) Tj ET Q q 0 0 0 rg BT 166.04 391.43 Td ( Jurisdiction of) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 112.25 383.43 Td (Incorporation or) Tj ET Q q 0 0 0 rg BT 169.66 383.43 Td ( Organization\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 299.00 383.60 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 417.15 391.43 Td (\(I.R.S. Employer) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 414.65 383.43 Td (Identification No.\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 87.45 366.08 Td (800 Newport Center) Tj ET Q q 0 0 0 rg BT 173.91 366.08 Td ( Drive, Suite 700) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 108.60 356.08 Td (Newport Beach, California) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 299.00 356.60 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 433.50 357.03 Td (92660) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 97.60 344.43 Td (\(Address of Principal Executive Offices\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 299.00 344.30 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 427.40 344.43 Td (\(Zip Code\)) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 274.75 319.85 Td (\(949\) 417-6500) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 211.90 310.25 Td (\(Registrant’) Tj ET Q q 0 0 0 rg BT 252.92 310.25 Td (s ) Tj ET Q q 0 0 0 rg BT 257.89 310.25 Td (T) Tj ET Q q 0 0 0 rg BT 262.49 310.25 Td (elephone Number) Tj ET Q q 0 0 0 rg BT 322.42 310.25 Td (, Including ) Tj ET Q q 0 0 0 rg BT 360.89 310.25 Td (Ar) Tj ET Q q 0 0 0 rg BT 370.07 310.25 Td (ea Code\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 131.00 298.25 Td (______________________________________________________________________ ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 281.25 Td (Indicate by check mark whether the registrant: \(1\) has filed all reports required to be filed by Section 13 or 15\(d\) of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 36.00 269.25 Td (Securities Exchange ) Tj ET Q q 0 0 0 rg BT 119.31 269.25 Td (Act of 1934 during the preceding 12 months \(or for such shorter period that the registrant was required to file ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 36.00 257.25 Td (such reports\), and \(2\) has been subject to such filing requirements for the past 90 days. ) Tj ET Q q 0 0 0 rg BT 392.48 257.25 Td (Y) Tj ET Q q 0 0 0 rg BT 398.70 257.25 Td (es ) Tj ET Q /GS0 gs q 10.60 0 0 10.09 412.03 255.09 cm /I3 Do Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 422.63 257.25 Td ( No ) Tj ET Q /GS0 gs q 8.91 0 0 10.09 449.85 255.09 cm /I4 Do Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 236.25 Td (Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any) Tj ET Q q 0 0 0 rg BT 528.63 236.25 Td (, every ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 36.00 224.25 Td (Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T) Tj ET Q q 0 0 0 rg BT 424.34 224.25 Td ( \(§232.405 of this chapter\) during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 36.00 212.25 Td (preceding 12 months \(or for such shorter period that the registrant was required to submit and post such files\). ) Tj ET Q q 0 0 0 rg BT 485.80 212.25 Td (Y) Tj ET Q q 0 0 0 rg BT 492.02 212.25 Td (es ) Tj ET Q /GS0 gs q 10.60 0 0 10.09 505.35 210.09 cm /I5 Do Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.95 212.25 Td ( No ) Tj ET Q /GS0 gs q 8.91 0 0 10.09 540.67 210.09 cm /I6 Do Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.00 191.25 Td (Indicate by check mark whether the registrant is a lar) Tj ET Q q 0 0 0 rg BT 272.23 191.25 Td (ge accelerated filer) Tj ET Q q 0 0 0 rg BT 347.88 191.25 Td (, an accelerated filer) Tj ET Q q 0 0 0 rg BT 428.53 191.25 Td (, a non-accelerated filer or a smaller ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 36.00 179.25 Td (reporting company) Tj ET Q q 0 0 0 rg BT 111.16 179.25 Td (. See the definitions of “lar) Tj ET Q q 0 0 0 rg BT 218.72 179.25 Td (ge accelerated filer) Tj ET Q q 0 0 0 rg BT 294.37 179.25 Td (,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 36.00 167.25 Td (of the Exchange ) Tj ET Q q 0 0 0 rg BT 102.92 167.25 Td (Act. \(Check one\):) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 36.00 156.45 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 39.00 136.52 Td (Large Accelerated Filer) Tj ET Q /GS0 gs q 8.91 0 0 9.76 162.00 133.69 cm /I7 Do Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 387.00 136.20 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 439.00 136.52 Td (Accelerated Filer) Tj ET Q /GS0 gs q 8.91 0 0 9.76 562.00 133.69 cm /I8 Do Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 39.00 104.62 Td (Non-Accelerated Filer) Tj ET Q /GS0 gs q 10.60 0 0 9.76 162.00 102.49 cm /I9 Do Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 179.00 104.62 Td (\(Do not check if a smaller reporting company\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 387.00 104.20 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 439.00 104.62 Td (Smaller reporting company) Tj ET Q /GS0 gs q 8.91 0 0 9.76 562.00 102.49 cm /I10 Do Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 36.00 79.45 Td (Indicate by check mark whether the registrant is a shell company \(as defined in Rule 12b-2 of the Exchange ) Tj ET Q q 0 0 0 rg BT 469.46 79.45 Td (Act\). ) Tj ET Q q 0 0 0 rg BT 499.36 79.45 Td (Y) Tj ET Q q 0 0 0 rg BT 505.58 79.45 Td (es ) Tj ET Q /GS0 gs q 8.91 0 0 10.09 518.91 77.29 cm /I11 Do Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.82 79.45 Td ( No ) Tj ET Q /GS0 gs q 10.60 0 0 10.09 555.04 77.29 cm /I12 Do Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 36.00 58.45 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.44 58.45 Td (May 1) Tj ET Q q 0 0 0 rg BT 85.90 58.45 Td (1, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 115.90 58.45 Td (, there were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 165.32 58.45 Td (187,385,260) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 215.32 58.45 Td ( outstanding shares of common stock of KBS Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 493.70 58.45 Td (T) Tj ET Q q 0 0 0 rg BT 499.46 58.45 Td (rust, Inc.) Tj ET Q endstream endobj 5 0 obj <><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><><>] /Rotate 0 /Contents 6 0 R>> endobj 6 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 31.60 Td (1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 742.25 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 742.25 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 742.25 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 742.25 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 742.25 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 742.25 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 742.25 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 278.90 724.25 Td (FORM 10-Q) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 272.90 706.25 Td (Mar) Tj ET Q q 0 0 0 rg BT 291.60 706.25 Td (ch 31, 2015) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 339.10 706.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 289.85 688.25 Td (INDEX) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 50.00 671.45 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 56.40 651.52 Td (PART I.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 98 650.1833984375 m 222.9072265625 650.1833984375 l s q 0 0 1 rg BT 98.00 651.52 Td (FINANCIAL) Tj ET Q q 0 0 1 rg BT 151.52 651.52 Td ( INFORMA) Tj ET Q q 0 0 1 rg BT 199.03 651.52 Td (TION) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 636.52 Td (Item 1.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 635.1833984375 m 226.59375 635.1833984375 l s q 0 0 1 rg BT 143.00 636.52 Td (Financial Statements) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 620.1833984375 m 493.458984375 620.1833984375 l s q 0 0 1 rg BT 143.00 621.52 Td (Consolidated Balance Sheets as of March 31, 2015 \(unaudited\) and December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 605.1833984375 m 509.6748046875 605.1833984375 l s q 0 0 1 rg BT 143.00 606.52 Td (Consolidated Statements of Operations \(unaudited\) for the ) Tj ET Q q 0 0 1 rg BT 379.15 606.52 Td (Three Months Ended March 31, ) Tj ET Q BT /F1 10.00 Tf ET 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 595.1833984375 m 202.4384765625 595.1833984375 l s q 0 0 1 rg BT 143.00 596.52 Td (2015 and 2014) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 580.1833984375 m 517.453125 580.1833984375 l s q 0 0 1 rg BT 143.00 581.52 Td (Consolidated Statements of Comprehensive Income \(Loss\) \(unaudited\) for the ) Tj ET Q q 0 0 1 rg BT 458.58 581.52 Td (Three Months ) Tj ET Q BT /F1 10.00 Tf ET 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 570.1833984375 m 274.083984375 570.1833984375 l s q 0 0 1 rg BT 143.00 571.52 Td (Ended March 31, 2015 and 2014) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 555.1833984375 m 517.4580078125 555.1833984375 l s q 0 0 1 rg BT 143.00 556.52 Td (Consolidated Statements of Stockholders’) Tj ET Q q 0 0 1 rg BT 310.29 556.52 Td ( Equity for the ) Tj ET Q q 0 0 1 rg BT 370.46 556.52 Td (Y) Tj ET Q q 0 0 1 rg BT 376.68 556.52 Td (ear Ended December 31, 2014 and ) Tj ET Q BT /F1 10.00 Tf ET 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 545.1833984375 m 356.65234375 545.1833984375 l s q 0 0 1 rg BT 143.00 546.52 Td (the ) Tj ET Q q 0 0 1 rg BT 157.54 546.52 Td (Three Months Ended March 31, 2015 \(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 530.1833984375 m 512.7509765625 530.1833984375 l s q 0 0 1 rg BT 143.00 531.52 Td (Consolidated Statements of Cash Flows \(unaudited\) for the ) Tj ET Q q 0 0 1 rg BT 382.23 531.52 Td (Three Months Ended March 31, ) Tj ET Q BT /F1 10.00 Tf ET 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 520.1833984375 m 202.4384765625 520.1833984375 l s q 0 0 1 rg BT 143.00 521.52 Td (2015 and 2014) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 505.1833984375 m 501.2666015625 505.1833984375 l s q 0 0 1 rg BT 143.00 506.52 Td (Condensed Notes to Consolidated Financial Statements as of March 31, 2015 \(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 491.52 Td (Item 2.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 490.1833984375 m 501.291015625 490.1833984375 l s q 0 0 1 rg BT 143.00 491.52 Td (Management’) Tj ET Q q 0 0 1 rg BT 197.98 491.52 Td (s Discussion and ) Tj ET Q q 0 0 1 rg BT 267.15 491.52 Td (Analysis of Financial Condition and Results of Operations) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 476.52 Td (Item 3.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 475.1833984375 m 382.3896484375 475.1833984375 l s q 0 0 1 rg BT 143.00 476.52 Td (Quantitative and Qualitative Disclosures about Market Risk) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 461.52 Td (Item 4.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 460.1833984375 m 241.3154296875 460.1833984375 l s q 0 0 1 rg BT 143.00 461.52 Td (Controls and Procedures) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 54.70 446.52 Td (PART II.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 98 445.1833984375 m 202.7216796875 445.1833984375 l s q 0 0 1 rg BT 98.00 446.52 Td (OTHER INFORMA) Tj ET Q q 0 0 1 rg BT 178.84 446.52 Td (TION) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 431.52 Td (Item 1.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 430.1833984375 m 217.140625 430.1833984375 l s q 0 0 1 rg BT 143.00 431.52 Td (Legal Proceedings) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 416.52 Td (Item 1A.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 415.1833984375 m 193.2783203125 415.1833984375 l s q 0 0 1 rg BT 143.00 416.52 Td (Risk Factors) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 401.52 Td (Item 2.) 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Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 370.1833984375 m 241.3154296875 370.1833984375 l s q 0 0 1 rg BT 143.00 371.52 Td (Mine Safety Disclosures) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 356.52 Td (Item 5.) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 143 355.1833984375 m 216.0322265625 355.1833984375 l s q 0 0 1 rg BT 143.00 356.52 Td (Other Information) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.00 341.52 Td (Item 6.) 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gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 557.75 m 562.5 557.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 531.75 m 478.5 531.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 531.75 m 562.5 531.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 492.75 m 478.5 492.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 492.75 m 562.5 492.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 466.75 m 478.5 466.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 466.75 m 562.5 466.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 375.75 m 478.5 375.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 375.75 m 562.5 375.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 363.75 m 478.5 363.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 361.75 m 478.5 361.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 363.75 m 562.5 363.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 361.75 m 562.5 361.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 310.75 m 478.5 310.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 310.75 m 562.5 310.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 219.75 m 478.5 219.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 219.75 m 562.5 219.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 206.75 m 478.5 206.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 206.75 m 562.5 206.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 109.75 m 478.5 109.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 109.75 m 562.5 109.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 96.75 m 478.5 96.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 96.75 m 562.5 96.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 84.75 m 478.5 84.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 398.5 82.75 m 478.5 82.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 84.75 m 562.5 84.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 82.75 m 562.5 82.75 l s BT /F2 7.00 Tf ET q 0 0 0 rg BT 414.80 639.81 Td (March 31, 2015) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 493.75 639.81 Td (December 31, 2014) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 626.80 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 420.45 626.81 Td (\(unaudited\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.00 626.80 Td ( ) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 613.80 Td (Assets) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 600.80 Td (Real estate held for investment:) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 89.00 587.80 Td (Land) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 401.00 587.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.90 587.80 Td (271,566) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.00 587.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 536.90 587.80 Td (271,566) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 89.00 574.80 Td (Buildings and improvements) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.90 574.80 Td (873,237) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 536.90 574.80 Td (867,156) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 89.00 561.80 Td (Tenant origination and absorption costs) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 561.80 Td (87,181) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 561.80 Td (88,350) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 548.80 Td (Total real estate held for investment, at cost and net of impairment charges) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 447.65 548.80 Td (1,231,984) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 531.65 548.80 Td (1,227,072) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 89.00 535.80 Td (Less accumulated depreciation and amortization) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 450.55 535.85 Td (\(199,352) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 475.65 535.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 534.55 535.85 Td (\(187,461) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 535.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 522.80 Td (Total real estate held for investment, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 447.65 522.80 Td (1,032,632) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 531.65 522.80 Td (1,039,611) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 509.80 Td (Real estate held for sale, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 468.65 509.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 509.80 Td (78,900) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 496.80 Td (Foreclosed real estate held for sale) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 468.65 496.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 496.80 Td (12,045) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 483.80 Td (Total real estate, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 447.65 483.80 Td (1,032,632) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 531.65 483.80 Td (1,130,556) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 470.80 Td (Real estate loans receivable, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 470.80 Td (29,135) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 470.80 Td (28,922) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 457.80 Td (Total real estate and real estate-related investments, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 447.65 457.80 Td (1,061,767) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 531.65 457.80 Td (1,159,478) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 444.80 Td (Cash and cash equivalents) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.90 444.80 Td (141,855) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 444.80 Td (58,675) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 431.80 Td (Restricted cash) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 431.80 Td (55,419) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 431.80 Td (62,755) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 418.80 Td (Rents and other receivables, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 418.80 Td (41,208) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 418.80 Td (39,462) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 405.80 Td (Above-market leases, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 405.80 Td (21,912) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 405.80 Td (22,767) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 392.80 Td (Assets related to real estate held for sale) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 468.65 392.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 543.90 392.80 Td (6,918) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 379.80 Td (Deferred financing costs, prepaid expenses and other assets, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 379.80 Td (29,154) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 379.80 Td (26,112) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 366.80 Td (Total assets) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 401.00 366.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 447.65 366.80 Td (1,351,315) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.00 366.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 531.65 366.80 Td (1,376,167) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 353.80 Td (Liabilities and equity) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 340.80 Td (Notes payable:) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 89.00 327.80 Td (Notes payable) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 401.00 327.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.90 327.80 Td (639,346) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.00 327.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 536.90 327.80 Td (641,523) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 89.00 314.80 Td (Notes payable related to real estate held for sale) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 468.65 314.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 314.80 Td (16,575) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 301.80 Td (Total notes payable) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.90 301.80 Td (639,346) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 536.90 301.80 Td (658,098) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 288.80 Td (Accounts payable and accrued liabilities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 288.80 Td (23,059) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 288.80 Td (22,579) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 275.80 Td (Due to affiliates) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 465.15 275.80 Td (696) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.15 275.80 Td (444) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 262.80 Td (Distributions payable) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 468.65 262.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 543.90 262.80 Td (4,699) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 249.80 Td (Below-market leases, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 249.80 Td (38,217) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 249.80 Td (40,854) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 236.80 Td (Liabilities related to real estate held for sale) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 468.65 236.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.15 236.80 Td (308) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 223.80 Td (Other liabilities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 456.40 223.80 Td (34,883) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 223.80 Td (36,412) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 210.80 Td (Total liabilities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.90 210.80 Td (736,201) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 536.90 210.80 Td (763,394) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 197.80 Td (Commitments and contingencies \(Note 13\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 184.80 Td (Redeemable common stock) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 459.90 184.80 Td (8,442) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 184.80 Td (10,000) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 171.80 Td (Stockholders’ equity) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 158.80 Td (Preferred stock, $.01 par value; 10,000,000 shares authorized, no shares issued and outstanding) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 468.65 158.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 552.65 158.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 146.80 Td (Common stock, $.01 par value; 1,000,000,000 shares authorized, 187,500,775 and 187,845,515 shares issued and) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 80.00 139.80 Td (outstanding as of March 31, 2015 and December 31, 2014, respectively) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 459.90 139.80 Td (1,875) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 543.90 139.80 Td (1,879) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 126.80 Td (Additional paid-in capital) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 447.65 126.80 Td (1,662,487) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 531.65 126.80 Td (1,662,483) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 113.80 Td (Cumulative distributions and net losses) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 445.30 113.85 Td (\(1,057,690) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 475.65 113.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 529.30 113.85 Td (\(1,061,589) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 113.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 100.80 Td (Total stockholders’ equity) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.90 100.80 Td (606,672) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 536.90 100.80 Td (602,773) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 87.80 Td (Total liabilities and stockholders’ equity) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 401.00 87.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 447.65 87.80 Td (1,351,315) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.00 87.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 531.65 87.80 Td (1,376,167) Tj ET Q BT /F1 10.00 Tf ET BT /F3 10.00 Tf ET q 0 0 0 rg BT 159.90 66.25 Td (See accompanying condensed notes to consolidated financial statements.) Tj ET Q endstream endobj 9 0 obj <>] /Rotate 0 /Contents 10 0 R>> endobj 10 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 31.60 Td (3) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 713.25 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 713.25 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 713.25 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 713.25 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 713.25 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 713.25 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 713.25 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 416.23 713.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 189.15 695.25 Td (CONSOLIDA) Tj ET Q q 0 0 0 rg BT 248.97 695.25 Td (TED ST) Tj ET Q q 0 0 0 rg BT 283.52 695.25 Td (A) Tj ET Q q 0 0 0 rg BT 290.00 695.25 Td (TEMENTS OF) Tj ET Q q 0 0 0 rg BT 354.92 695.25 Td ( OPERA) Tj ET Q q 0 0 0 rg BT 391.68 695.25 Td (TIONS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 677.25 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 204.05 662.25 Td (\(in thousands, except share and per share amounts\)) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 617.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 617.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 617.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 617.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 589.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 589.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 589.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 589.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 561.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 561.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 561.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 561.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 533.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 533.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 533.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 533.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 505.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 505.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 505.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 505.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 477.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 477.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 477.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 477.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 449.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 449.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 449.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 449.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 421.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 421.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 421.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 421.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 393.75 382.00 -21.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 393.75 63.00 -21.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 393.75 4.00 -21.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 393.75 63.00 -21.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 358.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 358.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 358.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 358.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 330.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 330.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 330.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 330.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 302.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 302.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 302.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 302.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 274.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 274.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 274.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 274.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 246.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 246.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 246.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 246.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 218.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 218.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 218.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 218.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 190.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 190.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 190.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 190.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 162.75 382.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 432.50 162.75 63.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.50 162.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.50 162.75 63.00 -14.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 631.75 m 495.5 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 495.5 631.75 m 499.5 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 631.75 m 562.5 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 631.75 m 495.5 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 617.75 m 495.5 617.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 495.5 631.75 m 499.5 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 631.75 m 562.5 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 617.75 m 562.5 617.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 547.75 m 495.5 547.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 547.75 m 562.5 547.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 547.75 m 495.5 547.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 533.75 m 495.5 533.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 547.75 m 562.5 547.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 533.75 m 562.5 533.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 421.75 m 495.5 421.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 407.75 m 495.5 407.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 421.75 m 562.5 421.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 407.75 m 562.5 407.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 302.75 m 495.5 302.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 302.75 m 562.5 302.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 302.75 m 495.5 302.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 288.75 m 495.5 288.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 302.75 m 562.5 302.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 288.75 m 562.5 288.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 288.75 m 495.5 288.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 288.75 m 562.5 288.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 232.75 m 495.5 232.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 232.75 m 562.5 232.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 218.75 m 495.5 218.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 205.75 m 495.5 205.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 203.75 m 495.5 203.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 218.75 m 562.5 218.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 205.75 m 562.5 205.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 203.75 m 562.5 203.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 162.75 m 495.5 162.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 162.75 m 562.5 162.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 149.75 m 495.5 149.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 147.75 m 495.5 147.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 149.75 m 562.5 149.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 147.75 m 562.5 147.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 147.75 m 495.5 147.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 149.75 m 495.5 149.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 128.75 m 495.5 128.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 432.5 126.75 m 495.5 126.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 147.75 m 562.5 147.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 149.75 m 562.5 149.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 128.75 m 562.5 128.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499.5 126.75 m 562.5 126.75 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 636.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 442.10 635.98 Td (Three Months Ended March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 622.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 455.50 621.98 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 522.50 621.98 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 608.00 Td (Revenues:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 594.00 Td (Rental income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 435.00 594.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 470.30 594.00 Td (35,365) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 502.00 594.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.30 594.00 Td (39,143) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 580.00 Td (Tenant reimbursements) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 470.30 580.00 Td (12,554) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.30 580.00 Td (13,058) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 566.00 Td (Interest income from real estate loans receivable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 480.30 566.00 Td (726) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.30 566.00 Td (801) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 552.00 Td (Parking revenues and other operating income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 480.30 552.00 Td (932) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 552.00 Td (1,004) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 538.00 Td (Total revenues) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 470.30 538.00 Td (49,577) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.30 538.00 Td (54,006) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 524.00 Td (Expenses:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 510.00 Td (Operating, maintenance, and management) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 470.30 510.00 Td (21,989) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.30 510.00 Td (21,400) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 496.00 Td (Real estate taxes, property-related taxes, and insurance) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 474.30 496.00 Td (6,781) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 496.00 Td (7,440) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 482.00 Td (Asset management fees to affiliate) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 474.30 482.00 Td (2,420) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 482.00 Td (2,499) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 468.00 Td (General and administrative expenses) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 474.30 468.00 Td (2,220) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 468.00 Td (3,644) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 454.00 Td (Depreciation and amortization) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 470.30 454.00 Td (15,605) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.30 454.00 Td (17,923) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 440.00 Td (Interest expense) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 474.30 440.00 Td (8,733) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.30 440.00 Td (13,545) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 426.00 Td (Impairment charge on real estate held for investment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 484.30 426.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 426.00 Td (1,257) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 412.00 Td (Total expenses) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 470.30 412.00 Td (57,748) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.30 412.00 Td (67,708) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 398.00 Td (Other income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 385.00 Td (Gain on sales of real estate securities \(includes $3.8 million of unrealized gains reclassified from accumulated) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 377.00 Td (other comprehensive income during the three months ended March 31, 2014\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 484.30 377.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 377.00 Td (3,748) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 363.00 Td (Gain on sales of real estate, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 470.30 363.00 Td (13,967) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.30 363.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 349.00 Td (Gain on sales of foreclosed real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 474.30 349.00 Td (2,509) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.30 349.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 335.00 Td (Gain from extinguishment of debt) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 484.30 335.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 335.00 Td (1,815) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 321.00 Td (Other interest income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 480.30 321.00 Td (116) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.30 321.00 Td (168) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 307.00 Td (Other income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 484.30 307.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.30 307.00 Td (304) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 293.00 Td (Total other income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 470.30 293.00 Td (16,592) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 293.00 Td (6,035) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 279.00 Td (Income \(loss\) from continuing operations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 474.30 279.00 Td (8,421) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.60 279.00 Td (\(7,667) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.30 279.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 265.00 Td (Discontinued operations:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 251.00 Td (Gain on sales of real estate, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 480.30 251.00 Td (124) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 251.00 Td (2,916) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 237.00 Td (Income from discontinued operations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 484.30 237.00 Td (44) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.30 237.00 Td (236) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 223.00 Td (Total income from discontinued operations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 480.30 223.00 Td (168) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 223.00 Td (3,152) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 209.00 Td (Net income \(loss\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 435.00 209.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 474.30 209.00 Td (8,589) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 502.00 209.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.60 209.00 Td (\(4,515) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.30 209.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 195.00 Td (Basic and diluted income \(loss\) per common share:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 181.00 Td (Continuing operations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 435.00 181.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 478.30 181.00 Td (0.05) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 502.00 181.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 542.60 181.00 Td (\(0.04) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.30 181.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 167.00 Td (Discontinued operations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 484.30 167.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 545.30 167.00 Td (0.02) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 153.00 Td (Net income \(loss\) per common share) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 435.00 153.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 478.30 153.00 Td (0.05) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 502.00 153.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 542.60 153.00 Td (\(0.02) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.30 153.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 140.00 Td (W) Tj ET Q q 0 0 0 rg BT 59.91 140.00 Td (eighted-average number of common shares outstanding, ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 71.00 132.00 Td (basic and diluted) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 452.25 132.00 Td (187,718,362) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 519.25 132.00 Td (189,481,669) Tj ET Q BT /F1 10.00 Tf ET BT /F3 10.00 Tf ET q 0 0 0 rg BT 159.90 110.25 Td (See accompanying condensed notes to consolidated financial statements.) Tj ET Q endstream endobj 11 0 obj <>] /Rotate 0 /Contents 12 0 R>> endobj 12 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 33.60 Td (4) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 713.25 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 713.25 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 713.25 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 713.25 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 713.25 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 713.25 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 713.25 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 137.40 695.25 Td (CONSOLIDA) Tj ET Q q 0 0 0 rg BT 197.22 695.25 Td (TED ST) Tj ET Q q 0 0 0 rg BT 231.78 695.25 Td (A) Tj ET Q q 0 0 0 rg BT 238.25 695.25 Td (TEMENTS OF) Tj ET Q q 0 0 0 rg BT 303.17 695.25 Td ( COMPREHENSIVE INCOME \(LOSS\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 677.25 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 277.50 662.25 Td (\(in thousands\)) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 617.75 383.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 617.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 437.00 617.75 61.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.00 617.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 617.75 61.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 589.75 383.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 589.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 437.00 589.75 61.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.00 589.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 589.75 61.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 561.75 383.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 561.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 437.00 561.75 61.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.00 561.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 561.75 61.00 -14.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 631.75 m 498 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498 631.75 m 502 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 631.75 m 563 631.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 617.75 m 498 617.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 617.75 m 563 617.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 561.75 m 498 561.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 561.75 m 563 561.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 547.75 m 498 547.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 534.75 m 498 534.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 532.75 m 498 532.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 547.75 m 563 547.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 534.75 m 563 534.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 532.75 m 563 532.75 l s BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 635.80 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 444.60 635.98 Td (Three Months Ended March 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.00 621.98 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 524.00 621.98 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 608.00 Td (Net income \(loss\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 439.50 608.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 476.80 608.00 Td (8,589) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 504.50 608.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 608.00 Td (\(4,515) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 608.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 594.00 Td (Other comprehensive \(loss\) income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 580.00 Td (Reclassification of realized gain on real estate securities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 486.80 580.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 580.00 Td (\(3,783) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 580.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 566.00 Td (Unrealized change in market value of real estate securities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 486.80 566.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 545.10 566.00 Td (\(136) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 566.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 552.00 Td (Total other comprehensive \(loss\) income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 486.80 552.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 552.00 Td (\(3,919) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 552.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 538.00 Td (Total comprehensive income \(loss\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 439.50 538.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 476.80 538.00 Td (8,589) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 504.50 538.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 538.00 Td (\(8,434) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 538.00 Td (\)) Tj ET Q BT /F1 10.00 Tf ET BT /F3 10.00 Tf ET q 0 0 0 rg BT 159.90 516.25 Td (See accompanying condensed notes to consolidated financial statements.) Tj ET Q endstream endobj 13 0 obj <>] /Rotate 0 /Contents 14 0 R>> endobj 14 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 33.60 Td (5) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 713.25 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 713.25 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 713.25 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 713.25 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 713.25 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 713.25 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 713.25 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 416.23 713.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 157.90 695.25 Td (CONSOLIDA) Tj ET Q q 0 0 0 rg BT 217.72 695.25 Td (TED ST) Tj ET Q q 0 0 0 rg BT 252.28 695.25 Td (A) Tj ET Q q 0 0 0 rg BT 258.75 695.25 Td (TEMENTS OF) Tj ET Q q 0 0 0 rg BT 323.67 695.25 Td ( ST) Tj ET Q q 0 0 0 rg BT 338.22 695.25 Td (OCKHOLDERS’) Tj ET Q q 0 0 0 rg BT 412.49 695.25 Td ( EQUITY) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 110.30 677.25 Td (For the ) Tj ET Q q 0 0 0 rg BT 141.04 677.25 Td (Y) Tj ET Q q 0 0 0 rg BT 147.26 677.25 Td (ear Ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 190.01 677.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 268.60 677.25 Td ( and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 302.57 677.25 Td (Three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 325.89 677.25 Td ( Months Ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.49 677.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 453.09 677.25 Td ( \(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 262.65 659.25 Td (\(dollars in thousands\)) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 597.75 163.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 213.00 597.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 268.00 597.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 272.00 597.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 597.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 597.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.00 597.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.00 597.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 445.00 597.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 597.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 597.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 597.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 569.75 163.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 213.00 569.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 268.00 569.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 272.00 569.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 569.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 569.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.00 569.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.00 569.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 445.00 569.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 569.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 569.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 569.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 541.75 163.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 213.00 541.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 268.00 541.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 272.00 541.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 541.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 541.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.00 541.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.00 541.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 445.00 541.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 541.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 541.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 541.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 513.75 163.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 213.00 513.75 55.00 -14.00 re f /GS0 gs 0.8 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327.00 457.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 457.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.00 457.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.00 457.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 445.00 457.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 457.75 55.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 457.75 4.00 -14.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 457.75 55.00 -14.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 617.75 m 268 617.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268 617.75 m 272 617.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 617.75 m 327 617.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 597.75 m 268 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 597.75 m 327 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 597.75 m 386 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 597.75 m 445 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 597.75 m 504 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 597.75 m 563 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 597.75 m 268 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 597.75 m 327 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 597.75 m 386 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 597.75 m 445 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 597.75 m 504 597.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 527.75 m 268 527.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 527.75 m 327 527.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 527.75 m 386 527.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 527.75 m 445 527.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 527.75 m 504 527.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 527.75 m 563 527.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 457.75 m 268 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 457.75 m 327 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 457.75 m 386 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 457.75 m 445 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 457.75 m 504 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 457.75 m 268 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 444.75 m 268 444.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 442.75 m 268 442.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 457.75 m 327 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 444.75 m 327 444.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 442.75 m 327 442.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 457.75 m 386 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 444.75 m 386 444.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 442.75 m 386 442.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 457.75 m 445 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 444.75 m 445 444.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 442.75 m 445 442.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 457.75 m 504 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 444.75 m 504 444.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 442.75 m 504 442.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 457.75 m 563 457.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 444.75 m 563 444.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 442.75 m 563 442.75 l s BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 621.80 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 246.45 621.81 Td (Common Stock) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 342.05 617.81 Td (Additional) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 347.10 609.81 Td (Paid-in) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 346.90 601.81 Td (Capital) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 399.50 630.81 Td (Cumulative) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 397.35 623.81 Td (Distributions) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 411.35 616.81 Td (and) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 399.75 609.81 Td (Net Income) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 407.85 601.81 Td (\(Loss\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 456.15 625.81 Td (Accumulated) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 467.10 617.81 Td (Other) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 452.70 609.81 Td (Compr) Tj ET Q q 0 0 0 rg BT 473.96 609.81 Td (ehensive) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 454.90 601.81 Td (Income \(Loss\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 527.30 617.81 Td (T) Tj ET Q q 0 0 0 rg BT 531.33 617.81 Td (otal) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 514.60 609.81 Td (Stockholders’) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 524.85 601.81 Td (Equity) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 601.80 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 229.95 601.81 Td (Shares) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 285.35 601.81 Td (Amounts) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 587.80 Td (Balance, December 31, 2013) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 230.15 587.80 Td (189,616,701) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 274.50 587.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 308.40 587.80 Td (1,896) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 333.50 587.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 355.15 587.80 Td (1,670,356) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 392.50 587.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 411.80 587.85 Td (\(1,030,911) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 442.15 587.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 451.50 587.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.40 587.80 Td (4,552) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 510.50 587.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 537.40 587.80 Td (645,893) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 573.80 Td (Net loss) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 258.15 573.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.15 573.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 376.15 573.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 420.55 573.85 Td (\(21,266) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 442.15 573.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 573.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 538.55 573.85 Td (\(21,266) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 573.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 559.80 Td (Other comprehensive income) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 258.15 559.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.15 559.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 376.15 559.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.15 559.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 483.05 559.85 Td (\(4,552) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 501.15 559.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 542.05 559.85 Td (\(4,552) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 559.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 545.80 Td (Redemptions of common stock) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 234.80 545.80 Td (\(1,771,186) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 265.15 545.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 314.80 545.85 Td (\(17) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 324.15 545.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 365.05 545.85 Td (\(7,873) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 383.15 545.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.15 545.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 545.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 542.05 545.85 Td (\(7,890) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 545.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 531.80 Td (Distributions declared) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 258.15 531.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.15 531.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 376.15 531.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 424.05 531.85 Td (\(9,412) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 442.15 531.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 531.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 542.05 531.85 Td (\(9,412) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 531.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 517.80 Td (Balance, December 31, 2014) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 230.15 517.80 Td (187,845,515) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 274.50 517.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 308.40 517.80 Td (1,879) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 333.50 517.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 355.15 517.80 Td (1,662,483) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 392.50 517.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 411.80 517.85 Td (\(1,061,589) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 442.15 517.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 451.50 517.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 517.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 510.50 517.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 537.40 517.80 Td (602,773) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 503.80 Td (Net income) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 258.15 503.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.15 503.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 376.15 503.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 426.40 503.80 Td (8,589) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 503.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 544.40 503.80 Td (8,589) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 489.80 Td (Redemptions of common stock) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 240.05 489.80 Td (\(344,740) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 265.15 489.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 318.30 489.85 Td (\(4) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 324.15 489.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 365.05 489.85 Td (\(1,554) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 383.15 489.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.15 489.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 489.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 542.05 489.85 Td (\(1,558) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 489.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 475.80 Td (Transfers from redeemable common stock) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 258.15 475.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.15 475.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 367.40 475.80 Td (1,558) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.15 475.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 475.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 544.40 475.80 Td (1,558) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 461.80 Td (Distribution declared) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 258.15 461.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.15 461.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 376.15 461.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 424.05 461.85 Td (\(4,690) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 442.15 461.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 461.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 542.05 461.85 Td (\(4,690) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 461.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 447.80 Td (Balance, March 31, 2015) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 230.15 447.80 Td (187,500,775) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 274.50 447.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 308.40 447.80 Td (1,875) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 333.50 447.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 355.15 447.80 Td (1,662,487) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 392.50 447.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 411.80 447.85 Td (\(1,057,690) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 442.15 447.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 451.50 447.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 494.15 447.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 510.50 447.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 537.40 447.80 Td (606,672) Tj ET Q BT /F1 10.00 Tf ET BT /F3 10.00 Tf ET q 0 0 0 rg BT 159.90 426.25 Td (See accompanying condensed notes to consolidated financial statements.) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 49.50 404.65 Td ( ) Tj ET Q endstream endobj 15 0 obj <>] /Rotate 0 /Contents 16 0 R>> endobj 16 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 24.60 Td (6) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 713.25 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 713.25 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 713.25 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 713.25 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 713.25 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 713.25 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 713.25 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 416.23 713.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 188.65 695.25 Td (CONSOLIDA) Tj ET Q q 0 0 0 rg BT 248.47 695.25 Td (TED ST) Tj ET Q q 0 0 0 rg BT 283.02 695.25 Td (A) Tj ET Q q 0 0 0 rg BT 289.50 695.25 Td (TEMENTS OF) Tj ET Q q 0 0 0 rg BT 354.42 695.25 Td ( CASH FLOWS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 677.25 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 277.50 662.25 Td (\(in thousands\)) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 619.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 619.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 619.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 619.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 593.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 593.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 593.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 593.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 567.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 567.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 567.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 567.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 541.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 541.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 541.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 541.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 515.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 515.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 515.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 515.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 489.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 489.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 489.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 489.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 463.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 463.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 463.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 463.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 437.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 437.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 437.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 437.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 411.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 411.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 411.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 411.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 385.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 385.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 385.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 385.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 359.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 359.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 359.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 359.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 333.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 333.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 333.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 333.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 307.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 307.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 307.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 307.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 281.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 281.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 281.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 281.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 255.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 255.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 255.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 255.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 229.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 229.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 229.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 229.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 203.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 203.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 203.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 203.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 177.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 177.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 177.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 177.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 151.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 151.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 151.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 151.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 125.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 125.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 125.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 125.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 99.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 99.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 99.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 99.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 73.75 368.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 418.50 73.75 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.50 73.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 492.50 73.75 70.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 632.75 m 488.5 632.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488.5 632.75 m 492.5 632.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 632.75 m 562.5 632.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 632.75 m 488.5 632.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 619.75 m 488.5 619.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 632.75 m 562.5 632.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 619.75 m 562.5 619.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 320.75 m 488.5 320.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 320.75 m 562.5 320.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 307.75 m 488.5 307.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 307.75 m 562.5 307.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 216.75 m 488.5 216.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 216.75 m 562.5 216.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 203.75 m 488.5 203.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 203.75 m 562.5 203.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 112.75 m 488.5 112.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 112.75 m 562.5 112.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 99.75 m 488.5 99.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 99.75 m 562.5 99.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 99.75 m 488.5 99.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 99.75 m 562.5 99.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 73.75 m 488.5 73.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 73.75 m 562.5 73.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 61.75 m 488.5 61.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 418.5 59.75 m 488.5 59.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 61.75 m 562.5 61.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 492.5 59.75 m 562.5 59.75 l s BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 636.80 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 442.00 636.81 Td (Three Months Ended March 31,) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 623.80 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 446.00 623.81 Td (2015) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 520.00 623.81 Td (2014) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 610.80 Td (Cash Flows from Operating Activities:) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 597.80 Td (Net income \(loss\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 421.00 597.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 469.90 597.80 Td (8,589) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 495.00 597.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 597.85 Td (\(4,515) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 597.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 584.80 Td (Adjustments to reconcile net income \(loss\) to net cash provided by operating activities:) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 571.80 Td (Depreciation and amortization) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 466.40 571.80 Td (15,605) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 571.80 Td (17,923) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 558.80 Td (Impairment charge on real estate) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 478.65 558.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 543.90 558.80 Td (1,257) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 545.80 Td (Noncash interest income on real estate-related investments) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 472.80 545.85 Td (\(240) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 545.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 546.80 545.85 Td (\(248) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 545.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 532.80 Td (Deferred rent) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 472.80 532.85 Td (\(495) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 532.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 546.80 532.85 Td (\(574) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 532.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 519.80 Td (Bad debt expense) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 475.15 519.80 Td (334) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.15 519.80 Td (482) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 506.80 Td (Amortization of deferred financing costs) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 475.15 506.80 Td (476) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.15 506.80 Td (377) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 493.80 Td (Deferred interest payable) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 478.65 493.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.15 493.80 Td (480) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 480.80 Td (Amortization of above- and below-market leases, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 467.55 480.85 Td (\(1,790) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 480.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 480.85 Td (\(2,094) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 480.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 467.80 Td (Gain on sales of foreclosed real estate held for sale) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 467.55 467.85 Td (\(2,509) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 467.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 552.65 467.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 454.80 Td (Gain on sales of real estate, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 464.05 454.85 Td (\(14,191) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 454.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 454.85 Td (\(2,916) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 454.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 441.80 Td (Gain on sales of real estate securities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 478.65 441.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 441.85 Td (\(3,748) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 441.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 428.80 Td (Gain on extinguishment of debt) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 478.65 428.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 428.85 Td (\(1,815) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 428.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 415.80 Td (Amortization of discounts and premiums on notes payable, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 475.15 415.80 Td (511) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.15 415.80 Td (639) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 89.00 402.80 Td (Changes in operating assets and liabilities:) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 389.80 Td (Restricted cash for operational expenditures) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 469.90 389.80 Td (2,949) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.15 389.80 Td (814) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 376.80 Td (Rents and other receivables) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 467.55 376.85 Td (\(1,880) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 376.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 376.85 Td (\(2,877) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 376.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 363.80 Td (Prepaid expenses and other assets) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 467.55 363.85 Td (\(3,615) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 363.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 363.85 Td (\(3,188) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 363.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 350.80 Td (Accounts payable and accrued liabilities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 469.90 350.80 Td (3,894) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 543.90 350.80 Td (1,834) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 337.80 Td (Due to affiliates) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 475.15 337.80 Td (651) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 552.65 337.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 101.00 324.80 Td (Other liabilities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 467.55 324.85 Td (\(1,480) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 324.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 546.80 324.85 Td (\(834) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 324.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 119.00 311.80 Td (Net cash provided by operating activities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 469.90 311.80 Td (6,809) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.15 311.80 Td (997) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 298.80 Td (Cash Flows from Investing Activities:) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 285.80 Td (Improvements to real estate) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 464.05 285.85 Td (\(11,903) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 285.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 285.85 Td (\(5,025) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 285.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 272.80 Td (Proceeds from sales of real estate, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 466.40 272.80 Td (99,915) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 272.80 Td (47,324) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 259.80 Td (Proceeds from sales of foreclosed real estate held for sale) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 466.40 259.80 Td (14,155) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 552.65 259.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 246.80 Td (Principal repayments on real estate loans receivable) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 478.65 246.80 Td (27) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 552.65 246.80 Td (20) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 233.80 Td (Proceeds from sale of real estate securities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 478.65 233.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 543.90 233.80 Td (6,588) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 220.80 Td (Net change in restricted cash for capital expenditures) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 469.90 220.80 Td (4,111) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 546.80 220.85 Td (\(175) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 220.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 119.00 207.80 Td (Net cash provided by investing activities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 462.90 207.80 Td (106,305) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 540.40 207.80 Td (48,732) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 194.80 Td (Cash Flows from Financing Activities:) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 181.80 Td (Proceeds from notes payable) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 478.65 181.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 543.90 181.80 Td (2,500) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 168.80 Td (Principal payments on notes payable) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 464.05 168.85 Td (\(19,263) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 168.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 534.55 168.85 Td (\(104,747) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 168.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 155.80 Td (Net change in restricted cash for debt service obligations) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 475.15 155.80 Td (276) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 546.80 155.85 Td (\(346) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 155.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 142.80 Td (Payments of deferred financing costs) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 478.65 142.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 546.80 142.85 Td (\(727) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 142.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 129.80 Td (Payments to redeem common stock) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 467.55 129.85 Td (\(1,558) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 129.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 541.55 129.85 Td (\(1,628) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 129.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 71.00 116.80 Td (Distributions paid to common stockholders) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 467.55 116.85 Td (\(9,389) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 116.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 552.65 116.80 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 119.00 103.80 Td (Net cash used in financing activities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 464.05 103.85 Td (\(29,934) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 485.65 103.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 534.55 103.85 Td (\(104,948) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 103.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 90.80 Td (Net increase \(decrease\) in cash and cash equivalents) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 466.40 90.80 Td (83,180) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 538.05 90.85 Td (\(55,219) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 559.65 90.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 77.80 Td (Cash and cash equivalents, beginning of period) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 466.40 77.80 Td (58,675) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 536.90 77.80 Td (211,391) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 53.00 64.80 Td (Cash and cash equivalents, end of period) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 421.00 64.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 462.90 64.80 Td (141,855) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 495.00 64.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 536.90 64.80 Td (156,172) Tj ET Q BT /F1 10.00 Tf ET BT /F3 10.00 Tf ET q 0 0 0 rg BT 159.90 43.25 Td (See accompanying condensed notes to consolidated financial statements.) Tj ET Q endstream endobj 17 0 obj <>] /Rotate 0 /Contents 18 0 R>> endobj 18 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 142.65 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 244.16 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 250.65 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 320.75 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 399.93 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 413.92 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 420.40 694.60 Td (TEMENTS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 33.60 Td (7) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 629.10 Td (1. ) Tj ET Q q 0 0 0 rg BT 67.50 629.10 Td (ORGANIZA) Tj ET Q q 0 0 0 rg BT 121.76 629.10 Td (TION) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 611.10 Td (KBS Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 189.96 611.10 Td (T) Tj ET Q q 0 0 0 rg BT 195.72 611.10 Td (rust, Inc. \(the “Company”\) was formed on June 13, 2005 as a Maryland corporation and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 599.10 Td (has elected to be taxed as a real estate investment trust \(“REIT”\). Substantially all of the Company’) Tj ET Q q 0 0 0 rg BT 449.37 599.10 Td (s assets are held by) Tj ET Q q 0 0 0 rg BT 525.37 599.10 Td (, and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 587.10 Td (Company conducts substantially all of its operations through, KBS Limited Partnership, a Delaware limited partnership ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 575.10 Td (\(the “Operating Partnership”\), and its subsidiaries. ) Tj ET Q q 0 0 0 rg BT 256.21 575.10 Td (The Company is the sole general partner of and directly owns a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 512.24 575.10 Td (99%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.57 575.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 563.10 Td (partnership interest in the Operating Partnership. ) Tj ET Q q 0 0 0 rg BT 249.27 563.10 Td (The Company’) Tj ET Q q 0 0 0 rg BT 308.98 563.10 Td (s wholly owned subsidiary) Tj ET Q q 0 0 0 rg BT 415.27 563.10 Td (, KBS REIT) Tj ET Q q 0 0 0 rg BT 464.26 563.10 Td ( Holdings LLC, a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 551.10 Td (Delaware limited liability company \(“KBS REIT) Tj ET Q q 0 0 0 rg BT 245.66 551.10 Td ( Holdings”\), owns the remaining ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.97 551.10 Td (1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 392.30 551.10 Td ( partnership interest in the Operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 539.10 Td (Partnership and is its sole limited partner) Tj ET Q q 0 0 0 rg BT 212.81 539.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 521.10 Td (The Company owns a diverse portfolio of real estate and real estate-related investments. ) Tj ET Q q 0 0 0 rg BT 430.88 521.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 455.32 521.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 518.92 521.10 Td (, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 509.10 Td (Company owned or) Tj ET Q q 0 0 0 rg BT 127.98 509.10 Td (, with respect to a limited number of properties, held a leasehold interest in, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 432.61 509.10 Td (397) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 447.61 509.10 Td ( real estate properties, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 497.10 Td (including the GKK Properties \(defined below\). In addition, as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 313.05 497.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.65 497.10 Td (, the Company owned ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 466.91 497.10 Td (four) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 483.57 497.10 Td ( real estate loans ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 485.10 Td (receivable and a participation interest with respect to a real estate joint venture.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 467.10 Td (On September 1, 201) Tj ET Q q 0 0 0 rg BT 158.11 467.10 Td (1, the Company) Tj ET Q q 0 0 0 rg BT 221.07 467.10 Td (, through indirect wholly owned subsidiaries \(collectively) Tj ET Q q 0 0 0 rg BT 451.20 467.10 Td (, “KBS”\), entered into a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 455.10 Td (Collateral ) Tj ET Q q 0 0 0 rg BT 91.25 455.10 Td (T) Tj ET Q q 0 0 0 rg BT 97.00 455.10 Td (ransfer and Settlement ) Tj ET Q q 0 0 0 rg BT 188.92 455.10 Td (Agreement \(the “Settlement ) Tj ET Q q 0 0 0 rg BT 303.04 455.10 Td (Agreement”\) with, among other parties, GKK Stars ) Tj ET Q q 0 0 0 rg BT 511.05 455.10 Td (Acquisition ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 443.10 Td (LLC \(“GKK Stars”\), the wholly owned subsidiary of Gramercy Property ) Tj ET Q q 0 0 0 rg BT 343.42 443.10 Td (T) Tj ET Q q 0 0 0 rg BT 349.17 443.10 Td (rust, Inc. \(“Gramercy”\) that indirectly owned the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 431.10 Td (Gramercy real estate portfolio, to ef) Tj ET Q q 0 0 0 rg BT 192.59 431.10 Td (fect the orderly transfer of certain assets and liabilities of the Gramercy real estate portfolio ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 419.10 Td (to KBS in satisfaction of certain debt obligations under a mezzanine loan owed by wholly owned subsidiaries of Gramercy to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 407.10 Td (KBS \(the “GKK Mezzanine Loan”\). ) Tj ET Q q 0 0 0 rg BT 200.10 407.10 Td (The Settlement ) Tj ET Q q 0 0 0 rg BT 262.86 407.10 Td (Agreement resulted in the transfer of the equity interests in certain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 395.10 Td (subsidiaries of Gramercy \(the “Equity Interests”\) that indirectly owned or) Tj ET Q q 0 0 0 rg BT 343.72 395.10 Td (, with respect to a limited number of properties, held a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 383.10 Td (leasehold interest in, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 134.48 383.10 Td (867) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 149.48 383.10 Td ( properties \(the “GKK Properties”\), consisting of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 348.31 383.10 Td (576) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 363.31 383.10 Td ( bank branch properties and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.88 383.10 Td (291) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.88 383.10 Td ( of) Tj ET Q q 0 0 0 rg BT 502.53 383.10 Td (fice buildings, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 371.10 Td (operations centers and other properties. ) Tj ET Q q 0 0 0 rg BT 211.39 371.10 Td (As of December 15, 201) Tj ET Q q 0 0 0 rg BT 309.05 371.10 Td (1, GKK Stars had transferred all of the Equity Interests to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 359.10 Td (Company) Tj ET Q q 0 0 0 rg BT 87.74 359.10 Td (, giving the Company title to or) Tj ET Q q 0 0 0 rg BT 213.16 359.10 Td (, with respect to a limited number of GKK Properties, a leasehold interest in, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.80 359.10 Td (867) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 537.80 359.10 Td ( GKK ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 347.10 Td (Properties as of that date. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 329.10 Td (Subject to certain restrictions and limitations, the business of the Company is managed by KBS Capital ) Tj ET Q q 0 0 0 rg BT 488.71 329.10 Td (Advisors LLC ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 317.10 Td (\(the “Advisor”\), an af) Tj ET Q q 0 0 0 rg BT 136.50 317.10 Td (filiate of the Company) Tj ET Q q 0 0 0 rg BT 226.11 317.10 Td (, pursuant to an advisory agreement with the Company \(as amended, the “Advisory ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 305.10 Td (Agreement”\) in ef) Tj ET Q q 0 0 0 rg BT 122.06 305.10 Td (fect through November 8, 2015. ) Tj ET Q q 0 0 0 rg BT 255.18 305.10 Td (The ) Tj ET Q q 0 0 0 rg BT 272.67 305.10 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 311.84 305.10 Td (Agreement may be renewed for an unlimited number of one-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 293.10 Td (year periods upon the mutual consent of the ) Tj ET Q q 0 0 0 rg BT 226.68 293.10 Td (Advisor and the Company) Tj ET Q q 0 0 0 rg BT 331.29 293.10 Td (. Either party may terminate the ) Tj ET Q q 0 0 0 rg BT 462.91 293.10 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 502.08 293.10 Td (Agreement ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 281.10 Td (upon ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 281.10 Td (60) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 82.00 281.10 Td ( days written notice. ) Tj ET Q q 0 0 0 rg BT 167.91 281.10 Td (The ) Tj ET Q q 0 0 0 rg BT 185.40 281.10 Td (Advisor owns ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 243.74 281.10 Td (20,000) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 271.24 281.10 Td ( shares of the Company’) Tj ET Q q 0 0 0 rg BT 368.44 281.10 Td (s common stock.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 263.10 Td (Upon commencing its initial public of) Tj ET Q q 0 0 0 rg BT 225.79 263.10 Td (fering \(the “Of) Tj ET Q q 0 0 0 rg BT 285.03 263.10 Td (fering”\), the Company retained KBS Capital Markets Group LLC ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 251.10 Td (\(the “Dealer Manager”\), an af) Tj ET Q q 0 0 0 rg BT 168.96 251.10 Td (filiate of the ) Tj ET Q q 0 0 0 rg BT 219.78 251.10 Td (Advisor) Tj ET Q q 0 0 0 rg BT 251.60 251.10 Td (, to serve as the dealer manager of the Of) Tj ET Q q 0 0 0 rg BT 415.79 251.10 Td (fering pursuant to a dealer manager ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 239.10 Td (agreement dated January 27, 2006 \(the “Dealer Manager ) Tj ET Q q 0 0 0 rg BT 278.01 239.10 Td (Agreement”\). ) Tj ET Q q 0 0 0 rg BT 337.52 239.10 Td (The Company ceased of) Tj ET Q q 0 0 0 rg BT 434.25 239.10 Td (fering shares of common stock ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 227.10 Td (in its primary of) Tj ET Q q 0 0 0 rg BT 114.03 227.10 Td (fering on May 30, 2008. ) Tj ET Q q 0 0 0 rg BT 216.06 227.10 Td (The Company terminated its dividend reinvestment plan ef) Tj ET Q q 0 0 0 rg BT 451.65 227.10 Td (fective ) Tj ET Q q 0 0 0 rg BT 480.80 227.10 Td (April 10, 2012.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 209.10 Td (The Company sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 152.10 209.10 Td (171,109,494) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 202.10 209.10 Td ( shares of common stock in its primary of) Tj ET Q q 0 0 0 rg BT 368.56 209.10 Td (fering for gross of) Tj ET Q q 0 0 0 rg BT 440.86 209.10 Td (fering proceeds of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 516.10 209.10 Td ($1.7 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 197.10 Td (billion) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 75.61 197.10 Td (. ) Tj ET Q q 0 0 0 rg BT 82.93 197.10 Td (The Company sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 197.10 Td (28,306,086) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 206.54 197.10 Td ( shares of common stock under its dividend reinvestment plan for gross of) Tj ET Q q 0 0 0 rg BT 502.96 197.10 Td (fering ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 185.10 Td (proceeds of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.37 185.10 Td ($233.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 157.26 185.10 Td (. ) Tj ET Q q 0 0 0 rg BT 164.21 185.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 188.65 185.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 252.25 185.10 Td (, the Company had redeemed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 371.65 185.10 Td (1) Tj ET Q q 0 0 0 rg BT 376.28 185.10 Td (1,934,805) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 416.28 185.10 Td ( of the shares sold in the Of) Tj ET Q q 0 0 0 rg BT 526.36 185.10 Td (fering ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 173.10 Td (for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 63.66 173.10 Td ($87.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.55 173.10 Td (.) Tj ET Q endstream endobj 19 0 obj <>] /Rotate 0 /Contents 20 0 R>> endobj 20 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 33.60 Td (8) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (Asset Management Services ) Tj ET Q q 0 0 0 rg BT 170.31 632.25 Td (Agr) Tj ET Q q 0 0 0 rg BT 186.79 632.25 Td (eement Related to the GKK Pr) Tj ET Q q 0 0 0 rg BT 317.95 632.25 Td (operties) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (On December 19, 2013, the Company) Tj ET Q q 0 0 0 rg BT 224.76 614.25 Td (, through an indirect wholly owned subsidiary \(“KBS ) Tj ET Q q 0 0 0 rg BT 440.57 614.25 Td (Acquisition Sub”\), entered ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (into an amended and restated asset management services agreement \(the “Amended Services ) Tj ET Q q 0 0 0 rg BT 422.68 602.25 Td (Agreement”\) with GKK Realty ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (Advisors LLC \(the “Property Manager”\), an af) Tj ET Q q 0 0 0 rg BT 236.76 590.25 Td (filiate of Gramercy) Tj ET Q q 0 0 0 rg BT 312.73 590.25 Td (, with respect to the GKK Properties. ) Tj ET Q q 0 0 0 rg BT 465.85 590.25 Td (The ef) Tj ET Q q 0 0 0 rg BT 491.49 590.25 Td (fective date of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (the ) Tj ET Q q 0 0 0 rg BT 63.67 578.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 140.87 578.25 Td (Agreement was December 1, 2013. Pursuant to the ) Tj ET Q q 0 0 0 rg BT 348.87 578.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 426.07 578.25 Td (Agreement, the Property ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.25 Td (Manager agreed to provide, among other services: standard asset management services, assistance related to dispositions, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.25 Td (accounting services and budgeting and business plans for the GKK Properties \(the “Services”\). ) Tj ET Q q 0 0 0 rg BT 434.49 554.25 Td (The Property Manager is not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.25 Td (af) Tj ET Q q 0 0 0 rg BT 57.09 542.25 Td (filiated with the Company or KBS ) Tj ET Q q 0 0 0 rg BT 196.52 542.25 Td (Acquisition Sub. ) Tj ET Q q 0 0 0 rg BT 268.20 542.25 Td (As compensation for the Services, the Company agreed to pay the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.25 Td (Property Manager: \(i\) an annual fee of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 205.82 530.25 Td ($7.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 254.71 530.25 Td ( plus all GKK Property-related expenses incurred by the Property Manager) Tj ET Q q 0 0 0 rg BT 554.22 530.25 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.25 Td (\(ii\) subject to certain terms and conditions in the ) Tj ET Q q 0 0 0 rg BT 245.29 518.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 322.49 518.25 Td (Agreement, a profit participation interest based on a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.25 Td (percentage \(ranging from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 153.62 506.25 Td (10%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 171.95 506.25 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 184.72 506.25 Td (30%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 203.05 506.25 Td (\) of the amount by which the gross fair market value or gross sales price of certain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.25 Td (identified portfolios of GKK Properties exceeds the sum of \(a\) an agreed-upon baseline value for such GKK Property portfolios ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.25 Td (plus \(b\) new capital expended to increase the value of GKK Properties within the portfolios and expenditures made to pay for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.25 Td (tenant improvements and leasing commissions related to these GKK Properties as of the measurement date, and \(iii\) a monthly ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.25 Td (construction oversight fee equal to a percentage of construction costs for certain construction projects at the GKK Properties ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.25 Td (overseen by the Property Manager) Tj ET Q q 0 0 0 rg BT 186.68 446.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 428.25 Td (The ) Tj ET Q q 0 0 0 rg BT 91.00 428.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 168.20 428.25 Td (Agreement will terminate on December 31, 2016, with a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 396.74 428.25 Td (one) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 411.18 428.25 Td (-year extension option at the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 416.25 Td (Company’) Tj ET Q q 0 0 0 rg BT 91.17 416.25 Td (s option, subject to certain terms and conditions contained in the ) Tj ET Q q 0 0 0 rg BT 350.55 416.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 427.76 416.25 Td (Agreement. ) Tj ET Q q 0 0 0 rg BT 479.50 416.25 Td (The ) Tj ET Q q 0 0 0 rg BT 497.00 416.25 Td (Amended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.25 Td (Services ) Tj ET Q q 0 0 0 rg BT 85.33 404.25 Td (Agreement supersedes and replaces all prior agreements related to the Services among the Company and its af) Tj ET Q q 0 0 0 rg BT 526.10 404.25 Td (filiates ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.25 Td (and the Property Manager and its af) Tj ET Q q 0 0 0 rg BT 192.61 392.25 Td (filiates.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 368.25 Td (2. ) Tj ET Q q 0 0 0 rg BT 67.50 368.25 Td (SUMMAR) Tj ET Q q 0 0 0 rg BT 113.25 368.25 Td (Y) Tj ET Q q 0 0 0 rg BT 120.10 368.25 Td ( OF) Tj ET Q q 0 0 0 rg BT 136.12 368.25 Td ( SIGNIFICANT) Tj ET Q q 0 0 0 rg BT 205.12 368.25 Td ( ) Tj ET Q q 0 0 0 rg BT 207.07 368.25 Td (ACCOUNTING POLICIES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 350.25 Td (There have been no significant changes to the Company’) Tj ET Q q 0 0 0 rg BT 300.65 350.25 Td (s accounting policies since it filed its audited financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 338.25 Td (statements in its ) Tj ET Q q 0 0 0 rg BT 115.89 338.25 Td (Annual Report on Form 10-K for the year ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 312.22 338.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 390.81 338.25 Td (. For further information about the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 326.25 Td (Company’) Tj ET Q q 0 0 0 rg BT 91.17 326.25 Td (s accounting policies, refer to the Company’) Tj ET Q q 0 0 0 rg BT 268.06 326.25 Td (s consolidated financial statements and notes thereto for the year ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 314.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 128.08 314.25 Td ( included in the Company’) Tj ET Q q 0 0 0 rg BT 234.18 314.25 Td (s ) Tj ET Q q 0 0 0 rg BT 240.02 314.25 Td (Annual Report on Form 10-K filed with the SEC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 296.25 Td (Principles of Consolidation and Basis of Pr) Tj ET Q q 0 0 0 rg BT 232.12 296.25 Td (esentation) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 278.25 Td (The accompanying unaudited consolidated financial statements and condensed notes thereto have been prepared in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 266.25 Td (accordance with U.S. generally accepted accounting principles \(“GAAP”\) for interim financial information as contained within ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 254.25 Td (the Financial ) Tj ET Q q 0 0 0 rg BT 103.38 254.25 Td (Accounting Standards Board \(“F) Tj ET Q q 0 0 0 rg BT 234.00 254.25 Td (ASB”\) ) Tj ET Q q 0 0 0 rg BT 263.17 254.25 Td (Accounting Standards Codification \(“ASC”\) and the rules and regulations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 242.25 Td (of the SEC, including the instructions to Form 10-Q and ) Tj ET Q q 0 0 0 rg BT 276.43 242.25 Td (Article 10 of Regulation S-X. ) Tj ET Q q 0 0 0 rg BT 399.47 242.25 Td (Accordingly) Tj ET Q q 0 0 0 rg BT 448.80 242.25 Td (, the unaudited consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 230.25 Td (financial statements do not include all of the information and footnotes required by GAAP) Tj ET Q q 0 0 0 rg BT 410.98 230.25 Td ( for audited financial statements. In ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 218.25 Td (the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments, which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 206.25 Td (are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. Operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 194.25 Td (results for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 106.99 194.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 126.97 194.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 187.80 194.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 251.39 194.25 Td ( are not necessarily indicative of the results that may be expected for the year ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 182.25 Td (ending ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 79.22 182.25 Td (December 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 157.80 182.25 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 164.25 Td (The consolidated financial statements include the accounts of the Company) Tj ET Q q 0 0 0 rg BT 374.70 164.25 Td (, KBS REIT) Tj ET Q q 0 0 0 rg BT 423.69 164.25 Td ( Holdings, the Operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 152.25 Td (Partnership and their direct and indirect wholly owned subsidiaries. ) Tj ET Q q 0 0 0 rg BT 324.16 152.25 Td (All significant intercompany balances and transactions are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 140.25 Td (eliminated in consolidation.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 122.25 Td (Use of Estimates) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 104.25 Td (The preparation of the consolidated financial statements and condensed notes thereto in conformity with GAAP) Tj ET Q q 0 0 0 rg BT 520.22 104.25 Td ( requires ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 92.25 Td (management to make estimates and assumptions that af) Tj ET Q q 0 0 0 rg BT 271.20 92.25 Td (fect the amounts reported in the consolidated financial statements and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 80.25 Td (accompanying notes. ) Tj ET Q q 0 0 0 rg BT 138.37 80.25 Td (Actual results could materially dif) Tj ET Q q 0 0 0 rg BT 274.81 80.25 Td (fer from those estimates.) Tj ET Q endstream endobj 21 0 obj <>] /Rotate 0 /Contents 22 0 R>> endobj 22 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 303.50 33.60 Td (9) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (Reclassifications) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (Certain amounts in the Company’) Tj ET Q q 0 0 0 rg BT 208.48 614.25 Td (s prior period consolidated financial statements have been reclassified to conform to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (current period presentation. ) Tj ET Q q 0 0 0 rg BT 164.55 602.25 Td (These reclassifications have not changed the results of operations of prior periods. During the three ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (months ended March 31, 2015, the Company sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 251.70 590.25 Td (four) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 268.36 590.25 Td ( properties \(of which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 354.44 590.25 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 369.44 590.25 Td ( were GKK Properties\), ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 466.91 590.25 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.91 590.25 Td ( of which were held ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (for sale as of December 31, 2014. ) Tj ET Q q 0 0 0 rg BT 188.90 578.25 Td (As a result, certain assets and liabilities were reclassified to held for sale on the consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.25 Td (balance sheets for all periods presented. Operating results of properties that were classified as held for sale in financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.25 Td (statements prior to January 1, 2014 will remain in discontinued operations on the Company’) Tj ET Q q 0 0 0 rg BT 417.77 554.25 Td (s consolidated statements of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.25 Td (operations. Operating results of properties that were disposed of or classified as held for sale in the ordinary course of business ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.25 Td (subsequent to January 1, 2014 that had not been classified as held for sale in financial statements issued for the reporting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.25 Td (periods prior to January 1, 2014 are included in continuing operations on the Company’) Tj ET Q q 0 0 0 rg BT 399.98 518.25 Td (s consolidated statements of operations. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 500.25 Td (Per) Tj ET Q q 0 0 0 rg BT 64.30 500.25 Td ( Shar) Tj ET Q q 0 0 0 rg BT 87.19 500.25 Td (e Data) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 482.25 Td (Basic net income \(loss\) per share of common stock is calculated by dividing net income \(loss\) by the weighted-average ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.25 Td (number of shares of common stock issued and outstanding during such period. Diluted net income \(loss\) per share of common ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.25 Td (stock equals basic net income \(loss\) per share of common stock as there were no potentially dilutive securities outstanding ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.25 Td (during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 92.83 446.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 112.81 446.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 173.64 446.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 237.23 446.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 256.67 446.25 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 276.67 446.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 329.33 446.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 428.25 Td (Distributions declared per share of common stock were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 297.32 428.25 Td ($0.025) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 324.82 428.25 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.20 428.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.18 428.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 437.01 428.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 500.60 428.25 Td (. On March 6, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 416.25 Td (2015, the Company’) Tj ET Q q 0 0 0 rg BT 130.88 416.25 Td (s board of directors declared a distribution in the amount of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 371.09 416.25 Td ($0.025) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.59 416.25 Td ( per share of common stock to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.25 Td (stockholders of record as of the close of business on March 20, 2015. No distributions were declared during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 500.50 404.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 520.49 404.25 Td ( months ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.25 Td (ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 75.88 392.25 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.48 392.25 Td (. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 374.25 Td (Segments) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 356.25 Td (The Company’) Tj ET Q q 0 0 0 rg BT 133.21 356.25 Td (s segments are based on the Company’) Tj ET Q q 0 0 0 rg BT 288.18 356.25 Td (s method of internal reporting, which classifies its operations by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 344.25 Td (investment type: \(i\) real estate, \(ii\) real estate-related and \(iii\) commercial properties primarily leased to financial institutions ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 332.25 Td (received under the Settlement ) Tj ET Q q 0 0 0 rg BT 170.56 332.25 Td (Agreement, the GKK Properties. For financial data by segment, see Note 12, “Segment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 320.25 Td (Information.”) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 302.25 Td (Recently Issued ) Tj ET Q q 0 0 0 rg BT 118.39 302.25 Td (Accounting Standards Update) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 284.25 Td (In May 2014, the F) Tj ET Q q 0 0 0 rg BT 149.70 284.25 Td (ASB issued ) Tj ET Q q 0 0 0 rg BT 198.60 284.25 Td (ASU No. 2014-09, ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 276.65 284.25 Td (Revenue fr) Tj ET Q q 0 0 0 rg BT 319.32 284.25 Td (om Contracts with Customers \(T) Tj ET Q q 0 0 0 rg BT 448.97 284.25 Td (opic 606\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 487.02 284.25 Td ( \(“ASU No. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 272.25 Td (2014-09”\). ) Tj ET Q q 0 0 0 rg BT 97.55 272.25 Td (ASU No. 2014-09 requires an entity to recognize the revenue to depict the transfer of promised goods or services to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 260.25 Td (customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 248.25 Td (services. ) Tj ET Q q 0 0 0 rg BT 88.66 248.25 Td (ASU No. 2014-09 supersedes the revenue requirements in ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 323.88 248.25 Td (Revenue Recognition \(T) Tj ET Q q 0 0 0 rg BT 419.03 248.25 Td (opic 605\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.08 248.25 Td ( and most industry-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 236.25 Td (specific guidance throughout the Industry ) Tj ET Q q 0 0 0 rg BT 218.44 236.25 Td (T) Tj ET Q q 0 0 0 rg BT 223.85 236.25 Td (opics of the Codification. ) Tj ET Q q 0 0 0 rg BT 329.94 236.25 Td (ASU No. 2014-09 does not apply to lease contracts ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 224.25 Td (within the scope of) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 125.87 224.25 Td ( Leases \(T) Tj ET Q q 0 0 0 rg BT 166.07 224.25 Td (opic 840\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 204.11 224.25 Td (. ) Tj ET Q q 0 0 0 rg BT 211.06 224.25 Td (ASU No. 2014-09 is ef) Tj ET Q q 0 0 0 rg BT 303.38 224.25 Td (fective for fiscal years, and interim periods within those years, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 212.25 Td (beginning after December 15, 2016, and is to be applied retrospectively) Tj ET Q q 0 0 0 rg BT 335.42 212.25 Td (, with early application not permitted. ) Tj ET Q q 0 0 0 rg BT 491.03 212.25 Td (The Company is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 200.25 Td (still evaluating the impact of adopting ) Tj ET Q q 0 0 0 rg BT 203.36 200.25 Td (ASU No. 2014-09 on its financial statements, but does not expect the adoption of ) Tj ET Q q 0 0 0 rg BT 530.53 200.25 Td (ASU ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 188.25 Td (No. 2014-09 to have a material impact on its financial statements. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 170.25 Td (In ) Tj ET Q q 0 0 0 rg BT 83.78 170.25 Td (August 2014, the F) Tj ET Q q 0 0 0 rg BT 159.71 170.25 Td (ASB issued ) Tj ET Q q 0 0 0 rg BT 208.61 170.25 Td (ASU No. 2014-15, ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 286.66 170.25 Td (Pr) Tj ET Q q 0 0 0 rg BT 296.29 170.25 Td (esentation of Financial Statements \(Subtopic 205-40\), Disclosur) Tj ET Q q 0 0 0 rg BT 553.39 170.25 Td (e ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 158.25 Td (of Uncertainties about an Entity’) Tj ET Q q 0 0 0 rg BT 180.41 158.25 Td (s ) Tj ET Q q 0 0 0 rg BT 186.62 158.25 Td (Ability to Continue as a Going Concern ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 348.56 158.25 Td (\(“ASU No. 2014-15”\). ) Tj ET Q q 0 0 0 rg BT 441.97 158.25 Td (The amendments in ) Tj ET Q q 0 0 0 rg BT 522.79 158.25 Td (ASU No. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 146.25 Td (2014-15 require management to evaluate, for each annual and interim reporting period, whether there are conditions or events, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 134.25 Td (considered in the aggregate, that raise substantial doubt about an entity’) Tj ET Q q 0 0 0 rg BT 335.80 134.25 Td (s ability to continue as a going concern within one year ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 122.25 Td (after the date that the financial statements are issued \(or are available to be issued when applicable\) and, if so, provide related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 110.25 Td (disclosures. ) Tj ET Q q 0 0 0 rg BT 98.39 110.25 Td (ASU No. 2014-15 is ef) Tj ET Q q 0 0 0 rg BT 190.70 110.25 Td (fective for annual periods ending after December 15, 2016, and interim periods within ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 98.25 Td (annual periods beginning after December 15, 2016. Early adoption is permitted for annual or interim reporting periods for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 86.25 Td (which the financial statements have not previously been issued. ) Tj ET Q q 0 0 0 rg BT 305.92 86.25 Td (The Company does not expect the adoption of ) Tj ET Q q 0 0 0 rg BT 492.54 86.25 Td (ASU No. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 74.25 Td (2014-15 to have a significant impact on its financial statements.) Tj ET Q endstream endobj 23 0 obj <>] /Rotate 0 /Contents 24 0 R>> endobj 24 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (10) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (In January 2015, the F) Tj ET Q q 0 0 0 rg BT 162.46 632.10 Td (ASB issued ) Tj ET Q q 0 0 0 rg BT 211.37 632.10 Td (ASU No. 2015-01, ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 289.42 632.10 Td (Income Statement - Extraor) Tj ET Q q 0 0 0 rg BT 399.85 632.10 Td (dinary and Unusual Items \(Subtopic) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 544.84 632.10 Td ( ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (225-20\), Simplifying Income Statement Pr) Tj ET Q q 0 0 0 rg BT 217.70 620.10 Td (esentation by Eliminating the Concept of Extraor) Tj ET Q q 0 0 0 rg BT 414.52 620.10 Td (dinary Items ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 467.29 620.10 Td (\(“ASU No. 2015-01”\). ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (The amendments in ) Tj ET Q q 0 0 0 rg BT 130.32 608.10 Td (ASU No. 2015-01 eliminate from GAAP) Tj ET Q q 0 0 0 rg BT 294.37 608.10 Td ( the concept of extraordinary items. ) Tj ET Q q 0 0 0 rg BT 438.49 608.10 Td (Although the amendments will ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (eliminate the requirements in Subtopic 225-20 for reporting entities to consider whether an underlying event or transaction is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 584.10 Td (extraordinary) Tj ET Q q 0 0 0 rg BT 102.71 584.10 Td (, the presentation and disclosure guidance for items that are unusual in nature or occur infrequently will be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 572.10 Td (retained and will be expanded to include items that are both unusual in nature and infrequently occurring. ) Tj ET Q q 0 0 0 rg BT 473.25 572.10 Td (ASU No. 2015-01 is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 560.10 Td (ef) Tj ET Q q 0 0 0 rg BT 57.09 560.10 Td (fective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 548.10 Td (permitted provided that the guidance is applied from the beginning of the fiscal year of adoption. ) Tj ET Q q 0 0 0 rg BT 439.48 548.10 Td (The Company does not expect ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 536.10 Td (the adoption of ) Tj ET Q q 0 0 0 rg BT 111.99 536.10 Td (ASU No. 2015-01 to have a significant impact on its financial statements.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 70.50 518.10 Td (In ) Tj ET Q q 0 0 0 rg BT 80.78 518.10 Td (April 2015, the F) Tj ET Q q 0 0 0 rg BT 148.92 518.10 Td (ASB issued ) Tj ET Q q 0 0 0 rg BT 197.82 518.10 Td (ASU No. 2015-03, ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 275.88 518.10 Td (Inter) Tj ET Q q 0 0 0 rg BT 294.95 518.10 Td (est - Imputation of Inter) Tj ET Q q 0 0 0 rg BT 390.12 518.10 Td (est \(Subtopic 835-30\), Simplifying the ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 506.10 Td (Pr) Tj ET Q q 0 0 0 rg BT 59.13 506.10 Td (esentation of Debt Issuance Costs) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 194.67 506.10 Td ( \(“ASU No. 2015-03”\). ) Tj ET Q q 0 0 0 rg BT 293.08 506.10 Td (The amendments in ) Tj ET Q q 0 0 0 rg BT 373.90 506.10 Td (ASU No. 2015-03 require debt issuance costs ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.10 Td (to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability) Tj ET Q q 0 0 0 rg BT 494.51 494.10 Td (, consistent with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.10 Td (the presentation of a debt discount. ) Tj ET Q q 0 0 0 rg BT 193.91 482.10 Td (ASU No. 2015-03 is limited to the presentation of debt issuance costs and does not af) Tj ET Q q 0 0 0 rg BT 535.89 482.10 Td (fect ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.10 Td (the recognition and measurement of debt issuance costs. ) Tj ET Q q 0 0 0 rg BT 278.88 470.10 Td (ASU No. 2015-03 is ef) Tj ET Q q 0 0 0 rg BT 371.19 470.10 Td (fective for fiscal years, and interim periods ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.10 Td (within those years, beginning after December 15, 2015 and is to be applied retrospectively) Tj ET Q q 0 0 0 rg BT 410.69 458.10 Td (. Early adoption is permitted for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.10 Td (financial statements that have not been previously issued. ) Tj ET Q q 0 0 0 rg BT 284.26 446.10 Td (The adoption of ) Tj ET Q q 0 0 0 rg BT 350.08 446.10 Td (ASU No. 2015-03 would change the presentation of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 434.10 Td (debt issuance costs as the Company presents debt issuance costs as deferred financing costs, prepaid expenses and other assets, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 422.10 Td (net on the accompanying consolidated balance sheets. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 401.10 Td (3. ) Tj ET Q q 0 0 0 rg BT 67.50 401.10 Td (REAL) Tj ET Q q 0 0 0 rg BT 94.73 401.10 Td ( EST) Tj ET Q q 0 0 0 rg BT 115.39 401.10 Td (A) Tj ET Q q 0 0 0 rg BT 121.87 401.10 Td (TE HELD FOR INVESTMENT) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 383.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 383.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 383.10 Td (, the Company’) Tj ET Q q 0 0 0 rg BT 222.92 383.10 Td (s portfolio of real estate held for investment, including the GKK Properties, was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 371.10 Td (composed of approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 163.64 371.10 Td (9.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 207.53 371.10 Td ( rentable square feet and was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 325.80 371.10 Td (79%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 344.13 371.10 Td ( occupied. ) Tj ET Q q 0 0 0 rg BT 390.05 371.10 Td (These properties are located in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.27 371.10 Td (31) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.27 371.10 Td ( states ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 359.10 Td (and include of) Tj ET Q q 0 0 0 rg BT 106.52 359.10 Td (fice properties, industrial properties and bank branch properties. Included in the Company’) Tj ET Q q 0 0 0 rg BT 471.97 359.10 Td (s portfolio of real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 347.10 Td (estate held for investment was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 173.07 347.10 Td (6.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 216.97 347.10 Td ( rentable square feet related to the GKK Properties held for investment, which were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 335.10 Td (80%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.83 335.10 Td ( occupied as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 130.58 335.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 194.18 335.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 317.10 Td (The following table summarizes the Company’) Tj ET Q q 0 0 0 rg BT 261.51 317.10 Td (s investments in real estate as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 392.87 317.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.46 317.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 475.90 317.10 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 554.49 317.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 305.10 Td (\(in thousands\): ) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 246.60 254.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 304.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 308.00 246.60 50.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 358.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 362.00 246.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 423.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 427.00 246.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 246.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 220.60 254.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 304.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 308.00 220.60 50.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 358.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 362.00 220.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 423.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 427.00 220.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 220.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 194.60 254.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 304.00 194.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 308.00 194.60 50.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 358.00 194.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 362.00 194.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 423.00 194.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 427.00 194.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 194.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 194.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 168.60 254.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 304.00 168.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 308.00 168.60 50.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 358.00 168.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 362.00 168.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 423.00 168.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 427.00 168.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 168.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 168.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 142.60 254.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 304.00 142.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 308.00 142.60 50.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 358.00 142.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 362.00 142.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 423.00 142.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 427.00 142.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 142.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 142.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 116.60 254.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 304.00 116.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 308.00 116.60 50.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 358.00 116.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 362.00 116.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 423.00 116.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 427.00 116.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 116.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 116.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 90.60 254.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 304.00 90.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 308.00 90.60 50.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 358.00 90.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 362.00 90.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 423.00 90.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 427.00 90.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 90.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 90.60 66.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 259.6 m 358 259.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 259.6 m 423 259.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 259.6 m 493 259.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 259.6 m 563 259.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 207.60000000000002 m 358 207.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 207.60000000000002 m 423 207.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 207.60000000000002 m 493 207.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 207.60000000000002 m 563 207.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 181.60000000000002 m 358 181.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 181.60000000000002 m 423 181.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 181.60000000000002 m 493 181.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 181.60000000000002 m 563 181.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 169.60000000000002 m 358 169.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 167.60000000000002 m 358 167.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 169.60000000000002 m 423 169.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 167.60000000000002 m 423 167.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 169.60000000000002 m 493 169.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 167.60000000000002 m 493 167.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 169.60000000000002 m 563 169.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 167.60000000000002 m 563 167.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 116.60000000000002 m 358 116.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 116.60000000000002 m 423 116.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 116.60000000000002 m 493 116.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 116.60000000000002 m 563 116.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 90.60000000000002 m 358 90.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 90.60000000000002 m 423 90.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 90.60000000000002 m 493 90.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 90.60000000000002 m 563 90.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 78.60000000000002 m 358 78.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308 76.60000000000002 m 358 76.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 78.60000000000002 m 423 78.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 362 76.60000000000002 m 423 76.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 78.60000000000002 m 493 78.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 427 76.60000000000002 m 493 76.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 78.60000000000002 m 563 78.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 76.60000000000002 m 563 76.60000000000002 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 323.35 263.83 Td (Land) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 368.30 271.83 Td (Buildings and) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 367.15 263.83 Td (Impr) Tj ET Q q 0 0 0 rg BT 384.78 263.83 Td (ovements) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 447.60 279.83 Td (T) Tj ET Q q 0 0 0 rg BT 452.20 279.83 Td (enant ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 432.00 271.83 Td (Origination and ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 429.80 263.83 Td (Absorption Costs) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 500.30 279.83 Td (T) Tj ET Q q 0 0 0 rg BT 504.90 279.83 Td (otal Real Estate) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 515.20 271.83 Td (Held for) Tj ET Q q 0 0 0 rg BT 543.72 271.83 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 510.35 263.83 Td (Investment) Tj ET Q BT /F3 8.00 Tf ET q 0 0 0 rg BT 52.50 250.85 Td (As of March 31, 2015:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 237.85 Td (Office) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 310.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 332.75 237.85 Td (68,178) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 364.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 393.80 237.85 Td (404,910) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 429.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 471.80 237.85 Td (1,661) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 499.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 237.85 Td (474,749) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 224.85 Td (Industrial) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 332.75 224.85 Td (16,787) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 397.80 224.85 Td (82,486) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 471.80 224.85 Td (2,244) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 224.85 Td (101,517) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 211.85 Td (GKK Properties) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 328.75 211.85 Td (186,601) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 393.80 211.85 Td (385,841) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 467.80 211.85 Td (83,276) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 211.85 Td (655,718) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 198.85 Td (Real estate held for investment, at cost and net of impairment charges) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 328.75 198.85 Td (271,566) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 393.80 198.85 Td (873,237) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 467.80 198.85 Td (87,181) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 527.80 198.85 Td (1,231,984) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 185.85 Td (Accumulated depreciation/amortization) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 346.80 185.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 391.10 185.85 Td (\(160,670) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 419.80 185.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 465.10 185.85 Td (\(38,682) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 489.80 185.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 531.10 185.85 Td (\(199,352) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 185.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 172.85 Td (Real estate held for investment, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 310.50 172.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 328.75 172.85 Td (271,566) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 364.50 172.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 393.80 172.85 Td (712,567) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 429.50 172.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 467.80 172.85 Td (48,499) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 499.50 172.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 527.80 172.85 Td (1,032,632) Tj ET Q BT /F3 8.00 Tf ET q 0 0 0 rg BT 52.50 159.85 Td (As of December 31, 2014:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 146.85 Td (Office) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 310.50 146.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 332.75 146.85 Td (68,178) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 364.50 146.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 393.80 146.85 Td (401,083) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 429.50 146.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 471.80 146.85 Td (1,825) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 499.50 146.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 146.85 Td (471,086) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 133.85 Td (Industrial) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 332.75 133.85 Td (16,787) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 397.80 133.85 Td (80,565) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 471.80 133.85 Td (3,137) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 133.85 Td (100,489) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 120.85 Td (GKK Properties) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 328.75 120.85 Td (186,601) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 393.80 120.85 Td (385,508) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 467.80 120.85 Td (83,388) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 120.85 Td (655,497) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 107.85 Td (Real estate held for investment, at cost and net of impairment charges) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 328.75 107.85 Td (271,566) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 393.80 107.85 Td (867,156) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 467.80 107.85 Td (88,350) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 527.80 107.85 Td (1,227,072) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 94.85 Td (Accumulated depreciation/amortization) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 346.80 94.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 391.10 94.85 Td (\(150,434) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 419.80 94.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 465.10 94.85 Td (\(37,027) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 489.80 94.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 531.10 94.85 Td (\(187,461) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 94.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 81.85 Td (Real estate held for investment, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 310.50 81.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 328.75 81.85 Td (271,566) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 364.50 81.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 393.80 81.85 Td (716,722) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 429.50 81.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 467.80 81.85 Td (51,323) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 499.50 81.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 527.80 81.85 Td (1,039,611) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 25 0 obj <>] /Rotate 0 /Contents 26 0 R>> endobj 26 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.15 33.60 Td (1) Tj ET Q q 0 0 0 rg BT 305.78 33.60 Td (1) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (Operating Leases) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (The Company’) Tj ET Q q 0 0 0 rg BT 133.21 614.25 Td (s real estate assets are leased to tenants under operating leases for which the terms and expirations vary) Tj ET Q q 0 0 0 rg BT 544.91 614.25 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.94 602.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 137.54 602.25 Td (, the Company’) Tj ET Q q 0 0 0 rg BT 198.92 602.25 Td (s leases, including the GKK Properties held for investment and excluding options to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (extend, had remaining terms of up to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.46 590.25 Td (1) Tj ET Q q 0 0 0 rg BT 204.09 590.25 Td (1.9) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 216.59 590.25 Td ( years with a weighted-average remaining term of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 418.17 590.25 Td (4.9) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 430.67 590.25 Td ( years. ) Tj ET Q q 0 0 0 rg BT 461.22 590.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 485.66 590.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 549.26 590.25 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (leases related to the GKK Properties, excluding options to extend, had remaining terms of up to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 434.41 578.25 Td (1) Tj ET Q q 0 0 0 rg BT 439.04 578.25 Td (1.9) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.54 578.25 Td ( years with a weighted-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.25 Td (average remaining term of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 157.78 566.25 Td (5.0) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 170.28 566.25 Td ( years. Some of the Company’) Tj ET Q q 0 0 0 rg BT 293.87 566.25 Td (s leases have provisions to extend the term of the leases, options ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.25 Td (for early termination for all or a part of the leased premises after paying a specified penalty) Tj ET Q q 0 0 0 rg BT 413.14 554.25 Td (, rights of first refusal to purchase ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.25 Td (the property at competitive market rates, and other terms and conditions as negotiated. ) Tj ET Q q 0 0 0 rg BT 399.39 542.25 Td (Additionally) Tj ET Q q 0 0 0 rg BT 449.29 542.25 Td (, the Company assumed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.25 Td (several leases related to the GKK Properties which contain shedding rights provisions. ) Tj ET Q q 0 0 0 rg BT 399.98 530.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.42 530.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.02 530.25 Td (, these shedding ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.25 Td (rights totaled approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 164.75 518.25 Td (0.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 208.64 518.25 Td ( square feet and can be exercised at various dates during the remainder of 2015 through ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.25 Td (2016. ) Tj ET Q q 0 0 0 rg BT 76.82 506.25 Td (The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.25 Td (Generally) Tj ET Q q 0 0 0 rg BT 88.27 494.25 Td (, upon the execution of a lease, the Company requires a security deposit from the tenant in the form of a cash deposit ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.25 Td (and/or a letter of credit. ) Tj ET Q q 0 0 0 rg BT 148.44 482.25 Td (The amount required as a security deposit varies depending upon the terms of the respective lease and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.25 Td (the creditworthiness of the tenant, but generally is not a significant amount. ) Tj ET Q q 0 0 0 rg BT 356.18 470.25 Td (Therefore, exposure to credit risk exists to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.25 Td (extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash related to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.25 Td (tenant leases are included in other liabilities in the accompanying consolidated balance sheets and totaled ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.96 446.25 Td ($2.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 521.85 446.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.29 446.25 Td ($3.0 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 434.25 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.39 434.25 Td ( as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 102.55 434.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 166.15 434.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 185.59 434.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 264.17 434.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 316.83 434.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 416.25 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.05 416.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.03 416.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.86 416.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.46 416.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.89 416.25 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 302.89 416.25 Td (, the Company recognized deferred rent from tenants of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.25 Td ($0.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.39 404.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 117.83 404.25 Td ($0.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 166.72 404.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 219.38 404.25 Td (. ) Tj ET Q q 0 0 0 rg BT 226.70 404.25 Td (These excess amounts for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.94 404.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.93 404.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 427.75 404.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.35 404.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 510.79 404.25 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 530.79 404.25 Td ( were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.25 Td (net of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 75.05 392.25 Td ($0.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.94 392.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 143.38 392.25 Td ($0.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 192.27 392.25 Td ( of lease incentive amortization, respectively) Tj ET Q q 0 0 0 rg BT 370.43 392.25 Td (. ) Tj ET Q q 0 0 0 rg BT 377.38 392.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 401.82 392.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 465.42 392.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 484.86 392.25 Td (December 31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 380.25 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.50 380.25 Td (, the cumulative deferred rent balance was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 241.08 380.25 Td ($30.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 294.97 380.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 314.41 380.25 Td ($29.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 368.30 380.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 420.96 380.25 Td (, and is included in rents and other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 368.25 Td (receivables on the accompanying balance sheets. ) Tj ET Q q 0 0 0 rg BT 247.29 368.25 Td (The cumulative deferred rent balance included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 436.08 368.25 Td ($6.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 484.97 368.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 504.41 368.25 Td ($5.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.30 368.25 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 356.25 Td (of unamortized lease incentives as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 200.00 356.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.60 356.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 283.04 356.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 361.62 356.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 414.28 356.25 Td (. ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.43137254901960786 0.7490196078431373 rg BT 419.28 356.25 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 421.60 356.25 Td (The Company records property ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 344.25 Td (operating expense reimbursements due from tenants for common area maintenance, real estate taxes and other recoverable costs ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 332.25 Td (in the period the related expenses are incurred.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 314.25 Td (The future minimum rental income from the Company’) Tj ET Q q 0 0 0 rg BT 294.83 314.25 Td (s properties under non-cancelable operating leases, including ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 302.25 Td (leases subject to shedding rights and excluding options to extend, as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 335.28 302.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.88 302.25 Td ( for the years ending December 31 is as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 290.25 Td (follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 273.75 397.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 447.00 273.75 115.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 247.75 397.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 447.00 247.75 115.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 221.75 397.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 447.00 221.75 115.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 195.75 397.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 447.00 195.75 115.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 447 195.75 m 562 195.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 447 183.75 m 562 183.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 447 181.75 m 562 181.75 l s BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 265.01 Td (April 1, 2015 through December 31, 2015) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 449.50 265.01 Td ($) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 533.75 265.01 Td (90,848) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 252.01 Td (2016) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 529.25 252.01 Td (119,917) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 239.01 Td (2017) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 529.25 239.01 Td (110,491) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 226.01 Td (2018) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 533.75 226.01 Td (97,651) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 213.01 Td (2019) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 533.75 213.01 Td (82,967) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 200.01 Td (Thereafter) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 529.25 200.01 Td (208,183) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 449.50 187.01 Td ($) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 529.25 187.01 Td (710,057) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 159.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 159.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 159.25 Td (, the Company’) Tj ET Q q 0 0 0 rg BT 222.92 159.25 Td (s highest tenant industry concentration \(greater than 10% of annualized base rent\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 147.25 Td (was as follows:) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 104.75 238.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 288.00 104.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 292.00 104.75 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 349.00 104.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 353.00 104.75 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 453.00 104.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 457.00 104.75 106.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 104.75 m 288 104.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 292 104.75 m 349 104.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 353 104.75 m 453 104.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 457 104.75 m 563 104.75 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.50 108.98 Td (Industry) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 301.50 116.98 Td (Number) Tj ET Q q 0 0 0 rg BT 329.80 116.98 Td ( of) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 306.55 108.98 Td (T) Tj ET Q q 0 0 0 rg BT 311.15 108.98 Td (enants) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 382.90 122.83 Td (Annualized) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 381.20 114.83 Td (Base Rent ) Tj ET Q BT /F2 8.00 Tf ET BT /F2 5.20 Tf ET q 0 0 0 rg BT 417.64 118.46 Td (\(1\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 378.15 106.88 Td (\(in thousands\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 486.35 116.98 Td (Per) Tj ET Q q 0 0 0 rg BT 498.19 116.98 Td (centage of) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 471.70 108.98 Td (Annualized Base Rent) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 96.00 Td (Finance) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 316.00 96.00 Td (69) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 355.50 96.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 427.80 96.00 Td (61,552) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 96.00 Td (49.3) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 555.80 96.00 Td (%) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 80.25 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 71.65 Td (\(1\) ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 57.62 68.25 Td (Annualized base rent represents annualized contractual base rental income as of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 298.98 68.25 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 346.68 68.25 Td (, adjusted to straight-line any contractual tenant concessions \(including ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 59.25 Td (free rent\), rent increases and rent decreases from the lease's inception through the balance of the lease term. ) Tj ET Q endstream endobj 27 0 obj <>] /Rotate 0 /Contents 28 0 R>> endobj 28 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (12) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 632.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 632.10 Td (, no other tenant industries accounted for more than 10% of the Company’) Tj ET Q q 0 0 0 rg BT 458.41 632.10 Td (s annualized base rent. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (The Company currently has approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 223.62 620.10 Td (360) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 238.62 620.10 Td ( tenants over a diverse range of industries and geographical regions. ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.43137254901960786 0.7490196078431373 rg BT 512.97 620.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 514.92 620.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 608.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 132.54 608.10 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 211.12 608.10 Td (, the Company had a bad debt expense reserve of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 409.66 608.10 Td ($1.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.55 608.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.99 608.10 Td ($1.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 526.88 608.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (respectively) Tj ET Q q 0 0 0 rg BT 97.16 596.10 Td (. ) Tj ET Q q 0 0 0 rg BT 104.48 596.10 Td (The Company’) Tj ET Q q 0 0 0 rg BT 164.19 596.10 Td (s bad debt expense reserve as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 294.97 596.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 358.57 596.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.01 596.10 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.59 596.10 Td ( included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 496.03 596.10 Td ($1.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 544.92 596.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 584.10 Td ($0.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.39 584.10 Td ( related to the GKK Properties, respectively) Tj ET Q q 0 0 0 rg BT 272.96 584.10 Td (. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.01 584.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 345.99 584.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 406.82 584.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 470.42 584.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 489.86 584.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 509.86 584.10 Td (, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 572.10 Td (Company recorded bad debt expense related to its tenant receivables of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 336.89 572.10 Td ($0.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 385.78 572.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 405.22 572.10 Td ($0.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 454.11 572.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 506.77 572.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 554.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 554.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 554.10 Td (, the Company had a concentration of credit risk related to leases with the following tenant that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.10 Td (represented more than 10% of the Company’) Tj ET Q q 0 0 0 rg BT 228.89 542.10 Td (s annualized base rent:) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 475.60 82.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 132.00 475.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 136.00 475.60 37.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 173.00 475.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 177.00 475.60 46.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 223.00 475.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 227.00 475.60 47.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 274.00 475.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 278.00 475.60 56.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 334.00 475.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 338.00 475.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 475.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 397.00 475.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 452.00 475.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 456.00 475.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 511.00 475.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 515.00 475.60 48.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 338 512.6 m 393 512.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 512.6 m 397 512.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397 512.6 m 452 512.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 452 512.6 m 456 512.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 456 512.6 m 511 512.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 475.6 m 132 475.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 136 475.6 m 173 475.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 177 475.6 m 223 475.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 227 475.6 m 274 475.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 278 475.6 m 334 475.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 338 475.6 m 393 475.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 397 475.6 m 452 475.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 456 475.6 m 511 475.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 515 475.6 m 563 475.6 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 516.85 Td ( ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 138.50 516.85 Td ( ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 179.50 516.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 369.85 516.83 Td (Annualized Base Rent Statistics) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 517.50 516.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 78.60 479.83 Td (Tenant) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 138.70 479.83 Td (Property) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 187.60 487.83 Td (T) Tj ET Q q 0 0 0 rg BT 192.20 487.83 Td (enant) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 184.60 479.83 Td (Industry) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 234.65 487.83 Td (Rentable) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 229.50 479.83 Td (Square Feet) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 297.15 503.83 Td (% of) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 290.35 495.83 Td (Portfolio ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 290.15 487.83 Td (Rentable ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 285.00 479.83 Td (Squar) Tj ET Q q 0 0 0 rg BT 305.75 479.83 Td (e Feet) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 345.40 495.83 Td (Annualized ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 343.70 487.83 Td (Base Rent ) Tj ET Q BT /F2 8.00 Tf ET BT /F2 5.20 Tf ET q 0 0 0 rg BT 380.14 491.46 Td (\(1\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 340.65 479.83 Td (\(in thousands\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 399.55 495.83 Td (% of Portfolio) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 404.40 487.83 Td (Annualized) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 406.75 479.83 Td (Base Rent) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 463.40 495.83 Td (Annualized) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.05 487.83 Td (Base Rent per) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 462.05 479.83 Td (Square Foot) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 528.70 487.83 Td (Lease) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 518.45 479.83 Td (Expirations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 466.85 Td (Bank of America, N.A.) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 141.75 466.85 Td (Various) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 186.80 466.85 Td (Finance) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 234.00 466.85 Td (3,085,003) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 312.80 466.85 Td (31.7) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 326.80 466.85 Td (%) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 340.50 466.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 367.80 466.85 Td (27,406) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 430.80 466.85 Td (22.0) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 444.80 466.85 Td (%) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 458.50 466.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 493.80 466.85 Td (8.88) Tj ET Q BT /F1 5.20 Tf ET q 0 0 0 rg BT 535.45 470.96 Td (\(2\)) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 451.10 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 442.50 Td (\(1\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 439.10 Td ( ) Tj ET Q q 0 0 0 rg BT 56.65 439.10 Td (Annualized base rent represents annualized contractual base rental income as of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 298.01 439.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 345.71 439.10 Td (, adjusted to straight-line any contractual tenant concessions \(including ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (free rent\), rent increases and rent decreases from the lease’) Tj ET Q q 0 0 0 rg BT 225.25 430.10 Td (s inception through the balance of the lease term. ) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 421.50 Td (\(2\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 418.10 Td ( ) Tj ET Q q 0 0 0 rg BT 56.65 418.10 Td (As of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 74.98 418.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 122.68 418.10 Td (, lease expiration dates ranged from the remainder of 2015 through 2026 with a weighted-average remaining term of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 473.61 418.10 Td (5.0) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 482.98 418.10 Td ( years. ) Tj ET Q q 0 0 0 rg BT 505.89 418.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 543.32 418.10 Td (, as of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 409.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 97.20 409.10 Td (, certain of Bank of ) Tj ET Q q 0 0 0 rg BT 156.77 409.10 Td (America’) Tj ET Q q 0 0 0 rg BT 184.67 409.10 Td (s leases contained shedding right provisions. ) Tj ET Q q 0 0 0 rg BT 322.02 409.10 Td (These shedding rights totaled approximately ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 457.20 409.10 Td (0.3 million) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 490.12 409.10 Td ( square feet and can be ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 400.10 Td (exercised at various dates during the remainder of 2015 through 2016. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 376.10 Td (Bank of ) Tj ET Q q 0 0 0 rg BT 107.39 376.10 Td (America Corporation is the guarantor of various leases that its subsidiary) Tj ET Q q 0 0 0 rg BT 398.89 376.10 Td (, Bank of ) Tj ET Q q 0 0 0 rg BT 437.77 376.10 Td (America, N.A., has with the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 364.10 Td (Company) Tj ET Q q 0 0 0 rg BT 87.74 364.10 Td (. ) Tj ET Q q 0 0 0 rg BT 95.06 364.10 Td (The condensed consolidated financial information of Bank of ) Tj ET Q q 0 0 0 rg BT 342.76 364.10 Td (America Corporation has been included herein ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 352.10 Td (because of the significant credit concentration the Company has with this guarantor) Tj ET Q q 0 0 0 rg BT 383.01 352.10 Td (. Bank of ) Tj ET Q q 0 0 0 rg BT 424.40 352.10 Td (America Corporation currently ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 340.10 Td (files its financial statements in reports filed with the SEC, and the following unaudited summary financial data regarding Bank ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 328.10 Td (of ) Tj ET Q q 0 0 0 rg BT 59.78 328.10 Td (America Corporation is taken from its previously filed public reports. For more detailed financial information regarding ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 316.10 Td (Bank of ) Tj ET Q q 0 0 0 rg BT 83.39 316.10 Td (America Corporation, please refer to its financial statements, which are publicly available with the SEC at ) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 510.466796875 314.7669921875 m 537.41015625 314.7669921875 l s q 0 0 0 rg BT 510.47 316.10 Td (http:// ) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 49.5 302.7669921875 m 102.732421875 302.7669921875 l s q 0 0 0 rg BT 49.50 304.10 Td (www) Tj ET Q q 0 0 0 rg BT 68.77 304.10 Td (.sec.gov) Tj ET Q q 0 0 0 rg BT 100.23 304.10 Td (.) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 261.60 345.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 395.00 261.60 82.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 477.00 261.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.00 261.60 82.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 235.60 345.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 395.00 235.60 82.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 477.00 235.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.00 235.60 82.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 176.60 345.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 395.00 176.60 82.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 477.00 176.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.00 176.60 82.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 150.60 345.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 395.00 150.60 82.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 477.00 150.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.00 150.60 82.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 274.6 m 477 274.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 261.6 m 477 261.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 477 274.6 m 481 274.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 481 274.6 m 563 274.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 481 261.6 m 563 261.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 261.6 m 477 261.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 189.60000000000002 m 477 189.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 477 189.60000000000002 m 481 189.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 481 189.60000000000002 m 563 189.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 176.60000000000002 m 477 176.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 481 176.60000000000002 m 563 176.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 395 176.60000000000002 m 477 176.60000000000002 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 278.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 423.60 278.83 Td (Three Months Ended March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 265.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 427.50 265.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 513.50 265.83 Td (2014) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.50 252.83 Td (Consolidated Statements of Income \(in millions\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 239.85 Td (Total revenue, net of interest expense) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 397.50 239.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 451.80 239.85 Td (21,202) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 483.50 239.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 239.85 Td (22,566) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 226.85 Td (Income before income taxes) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 455.80 226.85 Td (4,742) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 545.10 226.85 Td (\(681) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 226.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 213.85 Td (Net income \(loss\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 455.80 213.85 Td (3,357) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 545.10 213.85 Td (\(276) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 213.85 Td (\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 469.70 193.83 Td (As of) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 409.00 180.83 Td (March 31, 2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 489.25 180.83 Td (December 31, 2014) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.50 167.83 Td (Consolidated Balance Sheets \(in millions\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 154.85 Td (Total assets) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 397.50 154.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 441.80 154.85 Td (2,143,545) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 483.50 154.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 527.80 154.85 Td (2,104,534) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 141.85 Td (Total liabilities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 441.80 141.85 Td (1,893,357) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 527.80 141.85 Td (1,861,063) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 128.85 Td (Total stockholders’ equity) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 128.85 Td (250,188) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 128.85 Td (243,471) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 101.10 Td (No) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.72 101.10 Td ( other tenant represented more than 10% of the Company’) Tj ET Q q 0 0 0 rg BT 317.59 101.10 Td (s annualized base rent.) Tj ET Q endstream endobj 29 0 obj <>] /Rotate 0 /Contents 30 0 R>> endobj 30 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (13) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (Geographic Concentration Risk) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 614.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 614.25 Td (, the Company’) Tj ET Q q 0 0 0 rg BT 222.92 614.25 Td (s net investments in real estate in North Carolina represented ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 468.96 614.25 Td (12.0%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 494.79 614.25 Td ( of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (Company’) Tj ET Q q 0 0 0 rg BT 91.17 602.25 Td (s total assets. ) Tj ET Q q 0 0 0 rg BT 148.11 602.25 Td (As a result, the geographic concentration of the Company’) Tj ET Q q 0 0 0 rg BT 381.65 602.25 Td (s portfolio makes it particularly susceptible ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (to adverse economic developments in North Carolina’) Tj ET Q q 0 0 0 rg BT 265.55 590.25 Td (s real estate market. ) Tj ET Q q 0 0 0 rg BT 349.40 590.25 Td (Any adverse economic or real estate developments ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (in this market, such as business layof) Tj ET Q q 0 0 0 rg BT 197.91 578.25 Td (fs or downsizing, industry slowdowns, relocations of businesses, changing demographics ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.25 Td (and other factors, or any decrease in demand for of) Tj ET Q q 0 0 0 rg BT 253.12 566.25 Td (fice or bank branch space resulting from the local business climate, could ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.25 Td (adversely af) Tj ET Q q 0 0 0 rg BT 97.90 554.25 Td (fect the Company’) Tj ET Q q 0 0 0 rg BT 171.77 554.25 Td (s operating results.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 536.25 Td (4. ) Tj ET Q q 0 0 0 rg BT 67.50 536.25 Td (TENANT) Tj ET Q q 0 0 0 rg BT 108.99 536.25 Td ( ORIGINA) Tj ET Q q 0 0 0 rg BT 155.76 536.25 Td (TION ) Tj ET Q q 0 0 0 rg BT 183.27 536.25 Td (AND ) Tj ET Q q 0 0 0 rg BT 206.88 536.25 Td (ABSORPTION COSTS, ) Tj ET Q q 0 0 0 rg BT 312.74 536.25 Td (ABOVE-MARKET) Tj ET Q q 0 0 0 rg BT 396.46 536.25 Td ( LEASE ) Tj ET Q q 0 0 0 rg BT 433.70 536.25 Td (ASSETS ) Tj ET Q q 0 0 0 rg BT 472.89 536.25 Td (AND BELOW) Tj ET Q q 0 0 0 rg BT 534.47 536.25 Td (-) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 67.50 524.25 Td (MARKET) Tj ET Q q 0 0 0 rg BT 112.32 524.25 Td ( LEASE LIABILITIES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 506.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 506.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 506.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 180.98 506.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.56 506.25 Td (, the Company’) Tj ET Q q 0 0 0 rg BT 320.95 506.25 Td (s tenant origination and absorption costs, above-market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.25 Td (lease assets, and below-market lease liabilities \(excluding fully amortized assets and liabilities and accumulated amortization\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.25 Td (were as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 425.75 162.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 212.00 425.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 267.00 425.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 271.00 425.75 56.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 425.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 425.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.00 425.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.00 425.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 445.00 425.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 425.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 425.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 425.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 399.75 162.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 212.00 399.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 267.00 399.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 271.00 399.75 56.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 399.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 399.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.00 399.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.00 399.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 445.00 399.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 399.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 399.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 399.75 55.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 212 445.75 m 267 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 267 445.75 m 271 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 445.75 m 327 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 445.75 m 386 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386 445.75 m 390 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 445.75 m 445 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 445.75 m 504 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 504 445.75 m 508 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 445.75 m 563 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 212 445.75 m 267 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 212 425.75 m 267 425.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 445.75 m 327 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 425.75 m 327 425.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 445.75 m 386 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 425.75 m 386 425.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 445.75 m 445 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 425.75 m 445 425.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 445.75 m 504 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 425.75 m 504 425.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 445.75 m 563 445.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 425.75 m 563 425.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 212 399.75 m 267 399.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 399.75 m 327 399.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 399.75 m 386 399.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 399.75 m 445 399.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 399.75 m 504 399.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 399.75 m 563 399.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 212 387.75 m 267 387.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 212 385.75 m 267 385.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 387.75 m 327 387.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 385.75 m 327 385.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 387.75 m 386 387.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 385.75 m 386 385.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 387.75 m 445 387.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 385.75 m 445 385.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 387.75 m 504 387.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 385.75 m 504 385.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 387.75 m 563 387.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 385.75 m 563 385.75 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 450.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 228.65 457.83 Td (T) Tj ET Q q 0 0 0 rg BT 233.25 457.83 Td (enant Origination and) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 239.30 449.83 Td (Absorption Costs) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 362.35 457.83 Td (Above-Market) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 366.25 449.83 Td (Lease ) Tj ET Q q 0 0 0 rg BT 387.36 449.83 Td (Assets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 480.80 457.83 Td (Below-Market) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 477.60 449.83 Td (Lease Liabilities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 430.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 221.50 437.83 Td (March 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 231.00 429.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 275.25 437.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 290.50 429.83 Td (2014) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 340.50 437.83 Td (March 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 350.00 429.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 393.75 437.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 409.00 429.83 Td (2014) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 458.50 437.83 Td (March 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 468.00 429.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 511.75 437.83 Td (December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 527.00 429.83 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 417.00 Td (Cost, net of impairments) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 214.50 417.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 241.80 417.00 Td (87,181) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 273.50 417.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 301.80 417.00 Td (88,350) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 333.50 417.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 360.80 417.00 Td (34,329) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 392.50 417.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 419.80 417.00 Td (34,329) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 451.50 417.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 476.10 417.00 Td (\(75,946) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 500.80 417.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 510.50 417.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 535.10 417.00 Td (\(76,128) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 417.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 404.00 Td (Accumulated amortization) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 239.10 404.00 Td (\(38,682) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 263.80 404.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 299.10 404.00 Td (\(37,027) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 323.80 404.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 358.10 404.00 Td (\(12,417) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 382.80 404.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 417.10 404.00 Td (\(11,562) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 441.80 404.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 478.80 404.00 Td (37,729) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 404.00 Td (35,274) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 391.00 Td (Net Amount) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 214.50 391.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 241.80 391.00 Td (48,499) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 273.50 391.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 301.80 391.00 Td (51,323) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 333.50 391.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 360.80 391.00 Td (21,912) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 392.50 391.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 419.80 391.00 Td (22,767) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 451.50 391.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 476.10 391.00 Td (\(38,217) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 500.80 391.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 510.50 391.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 535.10 391.00 Td (\(40,854) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 391.00 Td (\)) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 366.25 Td (Increases \(decreases\) in net income as a result of amortization of the Company’) Tj ET Q q 0 0 0 rg BT 391.16 366.25 Td (s tenant origination and absorption costs, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 354.25 Td (above-market lease assets and below-market lease liabilities for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 321.34 354.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 341.32 354.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 402.15 354.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 465.75 354.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 485.18 354.25 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 505.18 354.25 Td ( were as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 342.25 Td (follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 272.75 163.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 213.00 272.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 268.00 272.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 272.00 272.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 327.00 272.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 331.00 272.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 386.00 272.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 390.00 272.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 445.00 272.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 272.75 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 272.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 272.75 55.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 305.75 m 268 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268 305.75 m 272 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 305.75 m 327 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 305.75 m 386 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386 305.75 m 390 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 305.75 m 445 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 305.75 m 504 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 504 305.75 m 508 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 305.75 m 563 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 305.75 m 268 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 285.75 m 268 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268 305.75 m 272 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 268 285.75 m 272 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 305.75 m 327 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 285.75 m 327 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 305.75 m 386 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 285.75 m 386 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386 305.75 m 390 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 386 285.75 m 390 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 305.75 m 445 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 285.75 m 445 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 305.75 m 504 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 285.75 m 504 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 504 305.75 m 508 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 504 285.75 m 508 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 305.75 m 563 305.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 285.75 m 563 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 285.75 m 268 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 272.75 m 268 272.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 285.75 m 327 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 272.75 m 327 272.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 285.75 m 386 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 272.75 m 386 272.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 285.75 m 445 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 272.75 m 445 272.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 285.75 m 504 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 272.75 m 504 272.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 285.75 m 563 285.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 272.75 m 563 272.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 260.75 m 268 260.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 213 258.75 m 268 258.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 260.75 m 327 260.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 272 258.75 m 327 258.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 260.75 m 386 260.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 331 258.75 m 386 258.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 260.75 m 445 260.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 390 258.75 m 445 258.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 260.75 m 504 260.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 258.75 m 504 258.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 260.75 m 563 260.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 258.75 m 563 258.75 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 310.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 228.15 317.83 Td (T) Tj ET Q q 0 0 0 rg BT 232.75 317.83 Td (enant Origination and) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 239.80 309.83 Td (Absorption Costs) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 362.35 317.83 Td (Above-Market) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 366.25 309.83 Td (Lease ) Tj ET Q q 0 0 0 rg BT 387.36 309.83 Td (Assets) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 480.80 317.83 Td (Below-Market) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 477.60 309.83 Td (Lease Liabilities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 290.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 219.70 297.83 Td (For the Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 252.00 289.83 Td (March 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 337.70 297.83 Td (For the Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 370.00 289.83 Td (March 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 455.70 297.83 Td (For the Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 488.00 289.83 Td (March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 277.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 232.00 276.98 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 291.00 276.98 Td (2014) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 350.00 276.98 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 409.00 276.98 Td (2014) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 468.00 276.98 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 527.00 276.98 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 264.00 Td (Amortization) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 215.50 264.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 244.10 264.00 Td (\(2,824) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 264.80 264.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 274.50 264.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 303.10 264.00 Td (\(3,834) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 323.80 264.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 333.50 264.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 368.10 264.00 Td (\(855) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 382.80 264.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 392.50 264.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 421.10 264.00 Td (\(1,008) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 441.80 264.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 451.50 264.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 482.80 264.00 Td (2,645) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 510.50 264.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 264.00 Td (3,021) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 31 0 obj <>] /Rotate 0 /Contents 32 0 R>> endobj 32 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (14) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (5. ) Tj ET Q q 0 0 0 rg BT 67.50 632.25 Td (REAL) Tj ET Q q 0 0 0 rg BT 94.73 632.25 Td ( EST) Tj ET Q q 0 0 0 rg BT 115.39 632.25 Td (A) Tj ET Q q 0 0 0 rg BT 121.87 632.25 Td (TE LOANS RECEIV) Tj ET Q q 0 0 0 rg BT 212.27 632.25 Td (ABLE) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 614.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 614.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 180.98 614.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.56 614.25 Td (, the Company) Tj ET Q q 0 0 0 rg BT 317.52 614.25 Td (, through indirect wholly owned subsidiaries, had invested in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (or originated real estate loans receivable as follows \(dollars in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 548.75 127.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 177.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 181.00 548.75 34.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 215.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 219.00 548.75 29.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 248.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 252.00 548.75 35.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 287.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 291.00 548.75 48.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 548.75 46.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 548.75 46.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 439.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 443.00 548.75 38.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 548.75 36.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 521.00 548.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 525.00 548.75 34.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 512.75 127.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 177.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 181.00 512.75 34.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 215.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 219.00 512.75 29.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 248.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 252.00 512.75 35.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 287.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 291.00 512.75 48.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 512.75 46.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 512.75 46.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 439.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 443.00 512.75 38.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 512.75 36.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 521.00 512.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 525.00 512.75 34.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 476.75 127.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 177.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 181.00 476.75 34.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 215.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 219.00 476.75 29.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 248.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 252.00 476.75 35.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 287.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 291.00 476.75 48.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 476.75 46.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 476.75 46.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 439.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 443.00 476.75 38.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 476.75 36.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 521.00 476.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 525.00 476.75 34.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 440.75 127.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 177.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 181.00 440.75 34.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 215.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 219.00 440.75 29.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 248.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 252.00 440.75 35.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 287.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 291.00 440.75 48.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 339.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 440.75 46.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 393.00 440.75 46.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 439.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 443.00 440.75 38.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 481.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 440.75 36.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 521.00 440.75 4.00 -18.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 525.00 440.75 34.00 -18.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 548.75 m 177 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 181 548.75 m 215 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 219 548.75 m 248 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 252 548.75 m 287 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 291 548.75 m 339 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343 548.75 m 389 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 548.75 m 439 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 443 548.75 m 481 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485 548.75 m 521 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 525 548.75 m 559 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 548.75 m 177 548.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 291 476.75 m 339 476.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343 476.75 m 389 476.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 476.75 m 439 476.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 291 440.75 m 339 440.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343 440.75 m 389 440.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 440.75 m 439 440.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 291 423.75 m 339 423.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 291 421.75 m 339 421.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343 423.75 m 389 423.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 343 421.75 m 389 421.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 423.75 m 439 423.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 393 421.75 m 439 421.75 l s BT /F2 6.00 Tf ET q 0 0 0 rg BT 52.50 558.59 Td (Loan Name) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 61.50 552.59 Td (Location of Related Pr) Tj ET Q q 0 0 0 rg BT 119.55 552.59 Td (operty or) Tj ET Q q 0 0 0 rg BT 143.26 552.59 Td ( Collateral) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 191.50 564.59 Td (Date) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 184.70 558.59 Td (Acquir) Tj ET Q q 0 0 0 rg BT 202.59 558.59 Td (ed/) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 183.50 552.59 Td (Originated) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 221.55 558.59 Td (Pr) Tj ET Q q 0 0 0 rg BT 227.77 558.59 Td (operty) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 226.70 552.59 Td (T) Tj ET Q q 0 0 0 rg BT 230.26 552.59 Td (ype) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 262.30 558.59 Td (Loan) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 262.70 552.59 Td (T) Tj ET Q q 0 0 0 rg BT 266.26 552.59 Td (ype) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 298.45 576.59 Td (Outstanding) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 302.65 570.59 Td (Principal) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 297.65 564.59 Td (Balance as of ) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 301.35 558.59 Td (Mar) Tj ET Q q 0 0 0 rg BT 312.57 558.59 Td (ch 31, ) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 306.20 552.59 Td (2015) Tj ET Q BT /F2 6.00 Tf ET BT /F2 3.90 Tf ET q 0 0 0 rg BT 318.20 555.31 Td (\(1\)) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 350.90 570.59 Td (Book ) Tj ET Q q 0 0 0 rg BT 365.63 570.59 Td (V) Tj ET Q q 0 0 0 rg BT 369.41 570.59 Td (alue) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 359.55 564.59 Td (as of) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 352.35 558.59 Td (Mar) Tj ET Q q 0 0 0 rg BT 363.57 558.59 Td (ch 31,) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 355.70 552.59 Td ( 2015 ) Tj ET Q BT /F2 6.00 Tf ET BT /F2 3.90 Tf ET q 0 0 0 rg BT 370.70 555.31 Td (\(2\)) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 400.90 570.59 Td (Book ) Tj ET Q q 0 0 0 rg BT 415.63 570.59 Td (V) Tj ET Q q 0 0 0 rg BT 419.41 570.59 Td (alue) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 409.55 564.59 Td (as of) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 398.05 558.59 Td (December) Tj ET Q q 0 0 0 rg BT 423.93 558.59 Td ( 31,) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 406.45 552.59 Td (2014 ) Tj ET Q BT /F2 6.00 Tf ET BT /F2 3.90 Tf ET q 0 0 0 rg BT 419.95 555.31 Td (\(2\)) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 446.00 564.59 Td (Contractual) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 451.55 558.59 Td (Inter) Tj ET Q q 0 0 0 rg BT 464.44 558.59 Td (est) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 452.45 552.59 Td (Rate ) Tj ET Q BT /F2 6.00 Tf ET BT /F2 3.90 Tf ET q 0 0 0 rg BT 465.94 555.31 Td (\(3\)) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 487.80 570.59 Td (Annualized) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 491.15 564.59 Td (Effective) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 492.55 558.59 Td (Inter) Tj ET Q q 0 0 0 rg BT 505.44 558.59 Td (est) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 493.45 552.59 Td (Rate ) Tj ET Q BT /F2 6.00 Tf ET BT /F2 3.90 Tf ET q 0 0 0 rg BT 506.94 555.31 Td (\(3\)) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 529.80 558.59 Td (Maturity) Tj ET Q BT /F2 6.00 Tf ET q 0 0 0 rg BT 535.50 552.59 Td (Date) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 52.50 542.09 Td (Sandmar Mezzanine Loan) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 61.50 534.09 Td (Southeast U.S. ) Tj ET Q BT /F1 6.00 Tf ET BT /F1 3.90 Tf ET q 0 0 0 rg BT 98.50 536.81 Td (\(4\)) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 183.80 534.59 Td (01/09/2007) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 225.80 534.59 Td (Retail) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 255.80 534.59 Td (Mezzanine) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 293.50 534.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 323.00 534.59 Td (5,150) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 345.50 534.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 373.00 534.59 Td (5,172) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 395.50 534.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 423.00 534.59 Td (5,181) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 455.25 534.59 Td (5.4%) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 509.50 534.59 Td (—) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 515.50 534.59 Td (%) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 528.15 534.59 Td (01/01/2017) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 52.50 524.09 Td (Lawrence ) Tj ET Q q 0 0 0 rg BT 77.54 524.09 Td (V) Tj ET Q q 0 0 0 rg BT 81.51 524.09 Td (illage Plaza Loan Origination) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 61.50 516.09 Td (New Castle, Pennsylvania) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 183.80 516.59 Td (08/06/2007) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 225.80 516.59 Td (Retail) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 257.30 516.59 Td (Mortgage) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 323.00 516.59 Td (6,915) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 373.00 516.59 Td (6,915) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 423.00 516.59 Td (6,920) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 455.25 516.59 Td (8.0%) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 508.00 516.59 Td (8.1) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 515.50 516.59 Td (%) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 528.15 516.59 Td (09/01/2015) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 52.50 506.09 Td (San Diego Of) Tj ET Q q 0 0 0 rg BT 85.39 506.09 Td (fice Portfolio B-Note) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 61.50 498.09 Td (San Diego, California ) Tj ET Q BT /F1 6.00 Tf ET BT /F1 3.90 Tf ET q 0 0 0 rg BT 115.49 500.81 Td (\(5\)) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 183.80 498.59 Td (10/26/2007) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 225.35 498.59 Td (Office) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 260.15 498.59 Td (B-Note) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 320.00 498.59 Td (20,000) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 370.00 498.59 Td (17,645) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 420.00 498.59 Td (17,450) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 455.25 498.59 Td (5.8%) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 505.00 498.59 Td (11.2) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 515.50 498.59 Td (%) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 528.35 498.59 Td (10/11/2017) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 52.50 488.09 Td (4929 ) Tj ET Q q 0 0 0 rg BT 65.89 488.09 Td (W) Tj ET Q q 0 0 0 rg BT 71.31 488.09 Td (ilshire B-Note) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 61.50 480.09 Td (Los ) Tj ET Q q 0 0 0 rg BT 71.67 480.09 Td (Angeles, California) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 183.90 480.59 Td (11/19/2007) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 225.35 480.59 Td (Office) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 260.15 480.59 Td (B-Note) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 323.00 480.59 Td (3,873) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 373.00 480.59 Td (3,397) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 423.00 480.59 Td (3,365) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 455.25 480.59 Td (6.1%) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 505.00 480.59 Td (12.4) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 515.50 480.59 Td (%) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 528.35 480.59 Td (07/11/2017) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 293.50 462.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 320.00 462.59 Td (35,938) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 345.50 462.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 370.00 462.59 Td (33,129) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 395.50 462.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 420.00 462.59 Td (32,916) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 52.50 444.59 Td (Reserve for Loan Losses ) Tj ET Q BT /F1 6.00 Tf ET BT /F1 3.90 Tf ET q 0 0 0 rg BT 113.48 447.31 Td (\(6\)) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 330.50 444.59 Td (—) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 371.00 444.59 Td (\(3,994) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 386.50 444.59 Td (\)) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 421.00 444.59 Td (\(3,994) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 436.50 444.59 Td (\)) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 293.50 426.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 320.00 426.59 Td (35,938) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 345.50 426.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 370.00 426.59 Td (29,135) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 395.50 426.59 Td ($) Tj ET Q BT /F1 6.00 Tf ET q 0 0 0 rg BT 420.00 426.59 Td (28,922) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 411.25 Td (_____________________) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 403.40 Td (\(1\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 400.45 Td ( Outstanding principal balance as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 149.73 400.45 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 191.07 400.45 Td ( represents original principal balance outstanding under the loan, increased for any subsequent fundings and reduced for any principal ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 49.50 392.65 Td (paydowns.) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 384.80 Td (\(2\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 381.85 Td ( Book value represents outstanding principal balance, adjusted for unamortized acquisition discounts, origination fees and direct origination and acquisition costs. Loan balances are presented ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 49.50 374.05 Td (gross of any asset-specific reserves.) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 366.20 Td (\(3\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 363.25 Td ( Contractual interest rate is the stated interest rate on the face of the loan. ) Tj ET Q q 0 0 0 rg BT 247.01 363.25 Td (Annualized ef) Tj ET Q q 0 0 0 rg BT 283.53 363.25 Td (fective interest rate is calculated as the actual interest income recognized in 2015, using the interest ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 49.50 355.45 Td (method, annualized and divided by the average amortized cost basis of the investment during 2015. ) Tj ET Q q 0 0 0 rg BT 311.13 355.45 Td (The contractual interest rates and annualized ef) Tj ET Q q 0 0 0 rg BT 433.73 355.45 Td (fective interest rates presented are as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 49.50 347.65 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 90.84 347.65 Td (. ) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 339.80 Td (\(4\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 336.85 Td ( ) Tj ET Q q 0 0 0 rg BT 55.93 336.85 Td (The Company had recorded an asset-specific loan loss reserve against this investment as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 294.57 336.85 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 335.91 336.85 Td (. See “—Reserve for Loan Losses.”) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 329.00 Td (\(5\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 326.05 Td ( ) Tj ET Q q 0 0 0 rg BT 55.93 326.05 Td (The borrower under this note is a wholly owned subsidiary of the Irvine Company) Tj ET Q q 0 0 0 rg BT 269.43 326.05 Td (. Donald Bren, who is the brother of Peter Bren \(one of the Company’) Tj ET Q q 0 0 0 rg BT 452.84 326.05 Td (s executive of) Tj ET Q q 0 0 0 rg BT 488.82 326.05 Td (ficers and sponsors\), is the ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 49.50 318.25 Td (chairman of the Irvine Company) Tj ET Q q 0 0 0 rg BT 133.91 318.25 Td (. During the ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 168.40 318.25 Td (three) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 181.39 318.25 Td ( months ended ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 220.92 318.25 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 262.26 318.25 Td (, the Company recognized ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 332.12 318.25 Td ($0.5 million) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 363.90 318.25 Td ( of interest income related to its investment in this loan.) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 310.40 Td (\(6\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 307.45 Td ( See “—Reserve for Loan Losses.”) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 283.45 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 283.45 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 283.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 180.98 283.45 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.56 283.45 Td (, interest receivable from real estate loans receivable was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.00 283.45 Td ($0.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 538.90 283.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 271.45 Td ($0.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.39 271.45 Td (, respectively) Tj ET Q q 0 0 0 rg BT 151.05 271.45 Td (, and is included in rents and other receivables.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 253.45 Td (The following summarizes the activity related to real estate loans receivable for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 409.20 253.45 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 429.18 253.45 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 490.01 253.45 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.61 253.45 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 241.45 Td (\(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 224.95 426.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.00 224.95 87.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 198.95 426.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.00 198.95 87.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 172.95 426.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 476.00 172.95 87.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 172.95000000000005 m 563 172.95000000000005 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 160.95000000000005 m 563 160.95000000000005 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 476 158.95000000000005 m 563 158.95000000000005 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 216.20 Td (Real estate loans receivable, net - December 31, 2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 478.50 216.20 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 216.20 Td (28,922) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 203.20 Td (Principal repayments received on real estate loans receivable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 549.10 203.20 Td (\(27) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 203.20 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 190.20 Td (Accretion of discounts on purchased real estate loans receivable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 190.20 Td (248) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 177.20 Td (Amortization of origination fees and costs on purchased and originated real estate loans receivable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 553.10 177.20 Td (\(8) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 177.20 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 164.20 Td (Real estate loans receivable, net - March 31, 2015) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 478.50 164.20 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 164.20 Td (29,135) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 33 0 obj <>] /Rotate 0 /Contents 34 0 R>> endobj 34 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (15) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (For the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 104.61 632.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.59 632.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 185.42 632.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 249.02 632.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 268.46 632.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 288.46 632.10 Td (, interest income from real estate loans receivable consisted of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (following \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 577.60 370.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 420.00 577.60 69.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 577.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 577.60 70.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 551.60 370.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 420.00 551.60 69.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 551.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 493.00 551.60 70.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 420 590.6 m 489 590.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 590.6 m 493 590.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493 590.6 m 563 590.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 420 590.6 m 489 590.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 420 577.6 m 489 577.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 590.6 m 493 590.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493 590.6 m 563 590.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493 577.6 m 563 577.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 420 577.6 m 489 577.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493 577.6 m 563 577.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 420 538.6 m 489 538.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493 538.6 m 563 538.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 420 526.6 m 489 526.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 420 524.6 m 489 524.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493 526.6 m 563 526.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 493 524.6 m 563 524.6 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 594.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 436.10 594.83 Td (Three Months Ended March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 581.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 446.00 581.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 519.50 581.83 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 568.85 Td (Contractual interest income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 422.50 568.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 568.85 Td (486) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 495.50 568.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 568.85 Td (553) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 555.85 Td (Interest accretion) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 555.85 Td (248) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 555.85 Td (257) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 542.85 Td (Amortization of origination fees and costs) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 479.10 542.85 Td (\(8) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 485.80 542.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 553.10 542.85 Td (\(9) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 542.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 529.85 Td (Interest income from real estate loans receivable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 422.50 529.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 529.85 Td (726) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 495.50 529.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 529.85 Td (801) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 502.10 Td (The Company generally recognizes income on impaired loans on either a cash basis, where interest income is only ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 490.10 Td (recorded when received in cash, or on a cost-recovery basis, where all cash receipts are applied against the carrying value of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 478.10 Td (loan. ) Tj ET Q q 0 0 0 rg BT 74.04 478.10 Td (The Company will resume the accrual of interest if it determines the collection of interest according to the contractual ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 466.10 Td (terms of the loan is probable. ) Tj ET Q q 0 0 0 rg BT 170.96 466.10 Td (The Company considers the collectibility of the loan’) Tj ET Q q 0 0 0 rg BT 383.96 466.10 Td (s principal balance in determining whether ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 454.10 Td (to recognize income on impaired loans on a cash basis or a cost-recovery basis. Beginning in July 2014, interest income ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 442.10 Td (received on the Sandmar Mezzanine Loan was recorded on a cost-recovery basis. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.46 442.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.45 442.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 506.27 442.10 Td (March 31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 430.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.50 430.10 Td (, the Company recognized ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 176.97 430.10 Td ($0.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 225.86 430.10 Td ( of interest income related to the Sandmar Mezzanine Loan, which has an asset-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 418.10 Td (specific reserve. ) Tj ET Q q 0 0 0 rg BT 119.28 418.10 Td (The Company did not recognize any interest income related to the Sandmar Mezzanine Loan during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 536.92 418.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 556.90 418.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 406.10 Td (months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 107.83 406.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 171.42 406.10 Td (.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 388.10 Td (Reserve for) Tj ET Q q 0 0 0 rg BT 98.46 388.10 Td ( Loan Losses) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 370.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 370.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 370.10 Td (, the total reserve for loan losses consisted of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 343.71 370.10 Td ($4.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 392.61 370.10 Td ( of asset-specific reserves related to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 358.10 Td (Sandmar Mezzanine Loan, which had an amortized cost basis of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.69 358.10 Td ($5.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 358.58 358.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 340.10 Td (The Company did not record a provision for loan loss reserves during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 369.27 340.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 389.25 340.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 450.08 340.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 513.68 340.10 Td ( or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.01 340.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.01 340.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 328.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.94 328.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 137.54 328.10 Td (, the borrower under the Sandmar Mezzanine Loan was delinquent and the Company will recognize ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 316.10 Td (income on this loan on a cost-recovery basis.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 292.10 Td (6. ) Tj ET Q q 0 0 0 rg BT 67.50 292.10 Td (REAL) Tj ET Q q 0 0 0 rg BT 94.73 292.10 Td ( EST) Tj ET Q q 0 0 0 rg BT 115.39 292.10 Td (A) Tj ET Q q 0 0 0 rg BT 121.87 292.10 Td (TE HELD FOR SALE ) Tj ET Q q 0 0 0 rg BT 220.23 292.10 Td (AND DISCONTINUED OPERA) Tj ET Q q 0 0 0 rg BT 358.95 292.10 Td (TIONS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 274.10 Td (In accordance with ) Tj ET Q q 0 0 0 rg BT 151.52 274.10 Td (ASU No. 2014-08, ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 229.57 274.10 Td (Pr) Tj ET Q q 0 0 0 rg BT 239.20 274.10 Td (esentation of Financial Statements \(T) Tj ET Q q 0 0 0 rg BT 388.27 274.10 Td (opic 205\) and Pr) Tj ET Q q 0 0 0 rg BT 455.94 274.10 Td (operty) Tj ET Q q 0 0 0 rg BT 480.94 274.10 Td (, Plant, and ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 262.10 Td (Equipment \(T) Tj ET Q q 0 0 0 rg BT 103.30 262.10 Td (opic 360\): Reporting Discontinued Operations and Disclosur) Tj ET Q q 0 0 0 rg BT 349.02 262.10 Td (es of Disposals of Components of an Entity) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 521.52 262.10 Td ( \(“ASU ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 250.10 Td (No. 2014-08”\), operating results of properties that are classified as held for sale in the ordinary course of business on or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 238.10 Td (subsequent to January 1, 2014 would generally be included in continuing operations on the Company’) Tj ET Q q 0 0 0 rg BT 457.48 238.10 Td (s consolidated statements ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (of operations. Operating results of properties that were classified as held for sale in financial statements issued for the reporting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 214.10 Td (periods prior to January 1, 2014 will remain in discontinued operations on the Company’) Tj ET Q q 0 0 0 rg BT 404.99 214.10 Td (s consolidated statement of operations. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 202.10 Td (Prior to the adoption of ) Tj ET Q q 0 0 0 rg BT 144.77 202.10 Td (ASU No. 2014-08, the operations of properties held for sale or to be disposed of and the aggregate net ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 190.10 Td (gains recognized upon their disposition were presented as discontinued operations in the accompanying consolidated statements ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 178.10 Td (of operations for all periods presented. During the year ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 300.53 178.10 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.11 178.10 Td (, the Company disposed of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.54 178.10 Td (16) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 498.54 178.10 Td ( properties \(of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 166.10 Td (which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 76.44 166.10 Td (1) Tj ET Q q 0 0 0 rg BT 81.07 166.10 Td (1) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.07 166.10 Td ( were GKK Properties\), transferred a portfolio of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 284.61 166.10 Td (five) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 300.15 166.10 Td ( GKK Properties to the lender in satisfaction of the debt and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (other obligations due under the BOA) Tj ET Q q 0 0 0 rg BT 196.98 154.10 Td ( ) Tj ET Q q 0 0 0 rg BT 199.29 154.10 Td (W) Tj ET Q q 0 0 0 rg BT 208.33 154.10 Td (indsor Mortgage Portfolio, terminated its leasehold interest in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 457.45 154.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.43 154.10 Td ( GKK Properties and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 142.10 Td (transferred ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 95.31 142.10 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 110.31 142.10 Td ( GKK Properties to the lenders in connection with foreclosure proceedings. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 462.16 142.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 482.14 142.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 130.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 130.10 Td (, the Company disposed of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 222.53 130.10 Td (four) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 239.19 130.10 Td ( properties \(of which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 325.28 130.10 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 340.28 130.10 Td ( were GKK Properties\). ) Tj ET Q q 0 0 0 rg BT 439.70 130.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 464.14 130.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.74 130.10 Td (, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (Company did not own any properties that were classified as held for sale.) Tj ET Q endstream endobj 35 0 obj <>] /Rotate 0 /Contents 36 0 R>> endobj 36 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (16) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (The following summary presents the major components of assets and liabilities related to real estate held for sale as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 620.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 132.54 620.10 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 211.12 620.10 Td ( \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 590.60 309.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 359.00 590.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 459.00 590.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 463.00 590.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 564.60 309.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 359.00 564.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 459.00 564.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 463.00 564.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 538.60 309.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 359.00 538.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 459.00 538.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 463.00 538.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 512.60 309.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 359.00 512.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 459.00 512.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 463.00 512.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 486.60 309.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 359.00 486.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 459.00 486.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 463.00 486.60 100.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 590.6 m 459 590.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 463 590.6 m 563 590.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 551.6 m 459 551.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 463 551.6 m 563 551.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 525.6 m 459 525.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 463 525.6 m 563 525.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 513.6 m 459 513.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 511.6 m 459 511.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 463 513.6 m 563 513.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 463 511.6 m 563 511.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 473.6 m 459 473.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 463 473.6 m 563 473.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 461.6 m 459 461.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 359 459.6 m 459 459.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 463 461.6 m 563 461.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 463 459.6 m 563 459.6 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 594.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 382.00 594.83 Td (March 31, 2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 480.25 594.83 Td (December 31, 2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 581.85 Td (Assets related to real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 568.85 Td (Total real estate, at cost and net of impairment charges) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 361.50 568.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 568.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 465.50 568.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 568.85 Td (84,847) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 555.85 Td (Accumulated depreciation and amortization) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 555.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 555.85 Td (\(5,947) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 555.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 542.85 Td (Real estate held for sale, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 542.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 542.85 Td (78,900) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 529.85 Td (Other assets) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 529.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 529.85 Td (6,918) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 516.85 Td (Total assets related to real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 361.50 516.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 516.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 465.50 516.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 516.85 Td (85,818) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 503.85 Td (Liabilities related to real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 490.85 Td (Notes payable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 490.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 490.85 Td (16,575) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 477.85 Td (Other liabilities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 477.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 477.85 Td (308) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 464.85 Td (Total liabilities related to real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 361.50 464.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 447.80 464.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 465.50 464.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 464.85 Td (16,883) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 437.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.05 437.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.03 437.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.86 437.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.46 437.10 Td (, the Company sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 343.73 437.10 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 358.73 437.10 Td ( historical real estate properties and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.11 437.10 Td (one) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 517.55 437.10 Td ( GKK ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 425.10 Td (Property) Tj ET Q q 0 0 0 rg BT 83.29 425.10 Td (, which properties were not classified as held for sale in financial statements issued for the reporting periods prior to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 413.10 Td (January 1, 2014. During the year ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 212.23 413.10 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 290.81 413.10 Td (, the Company sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 371.09 413.10 Td (four) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 387.75 413.10 Td ( historical real estate properties and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 532.13 413.10 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.13 413.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 401.10 Td (GKK Properties, disposed of a portfolio of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 222.81 401.10 Td (five) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 238.35 401.10 Td ( properties in connection with a deed-in-lieu of foreclosure, and transferred ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.57 401.10 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 556.57 401.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 389.10 Td (GKK Properties to the lenders in connection with foreclosure proceedings, which properties were not classified as held for sale ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 377.10 Td (in financial statements issued for the reporting periods prior to January 1, 2014. In accordance with ) Tj ET Q q 0 0 0 rg BT 450.77 377.10 Td (ASU No. 2014-08, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 365.10 Td (operations of these properties are included in continuing operations on the Company’) Tj ET Q q 0 0 0 rg BT 390.25 365.10 Td (s consolidated statements of operations. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 353.10 Td (The following table summarizes certain revenues and expenses related to all of these properties, which were included in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 341.10 Td (continuing operations \(in thousands\): ) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 298.60 380.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 430.00 298.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 434.00 298.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 298.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 298.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 272.60 380.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 430.00 272.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 434.00 272.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 272.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 272.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 246.60 380.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 430.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 434.00 246.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 246.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 220.60 380.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 430.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 434.00 220.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 220.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 194.60 380.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 430.00 194.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 434.00 194.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 194.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 194.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 168.60 380.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 430.00 168.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 434.00 168.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 168.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 168.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 142.60 380.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 430.00 142.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 434.00 142.60 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 142.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 142.60 61.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 434 311.6 m 495 311.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 495 311.6 m 499 311.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 311.6 m 560 311.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 434 311.6 m 495 311.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 434 298.6 m 495 298.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 495 311.6 m 499 311.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 311.6 m 560 311.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 298.6 m 560 298.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 434 259.6 m 495 259.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 434 246.60000000000002 m 495 246.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 259.6 m 560 259.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 246.60000000000002 m 560 246.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 434 142.60000000000002 m 495 142.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 434 129.60000000000002 m 495 129.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 142.60000000000002 m 560 142.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 129.60000000000002 m 560 129.60000000000002 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 315.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 441.60 315.83 Td (Three Months Ended March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 302.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 456.00 302.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 521.00 302.83 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 289.85 Td (Revenues) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 276.85 Td (Rental income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 436.50 276.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 276.85 Td (2,196) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 501.50 276.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.80 276.85 Td (5,379) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 263.85 Td (Tenant reimbursements and other operating income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 479.80 263.85 Td (668) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.80 263.85 Td (1,057) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 250.85 Td (Total Revenues) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 250.85 Td (2,864) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.80 250.85 Td (6,436) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 237.85 Td (Expenses) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 224.85 Td (Operating, maintenance, and management) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 224.85 Td (1,125) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.80 224.85 Td (1,377) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 211.85 Td (Real estate taxes and insurance) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 479.80 211.85 Td (260) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 544.80 211.85 Td (831) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 198.85 Td (Asset management fees to affiliate) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 483.80 198.85 Td (98) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 544.80 198.85 Td (195) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 185.85 Td (General and administrative expenses) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 483.80 185.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 552.80 185.85 Td (7) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 172.85 Td (Depreciation and amortization) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 479.80 172.85 Td (220) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.80 172.85 Td (2,394) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 159.85 Td (Interest expense) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 479.80 159.85 Td (194) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.80 159.85 Td (2,493) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 146.85 Td (Impairment of real estate) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 483.80 146.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.80 146.85 Td (1,257) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 133.85 Td (Total expenses) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 133.85 Td (1,897) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 538.80 133.85 Td (8,554) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 37 0 obj <>] /Rotate 0 /Contents 38 0 R>> endobj 38 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (17) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (Discontinued Operations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 617.25 Td (The following table summarizes operating income from discontinued operations for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.90 617.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.89 617.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 506.71 617.25 Td (March 31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 605.25 Td (2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.50 605.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.94 605.25 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 108.94 605.25 Td ( \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 562.75 387.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 437.00 562.75 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.00 562.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 562.75 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 536.75 387.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 437.00 536.75 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.00 536.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 536.75 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 510.75 387.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 437.00 510.75 61.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 498.00 510.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 510.75 61.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 575.75 m 498 575.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498 575.75 m 502 575.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 575.75 m 563 575.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 575.75 m 498 575.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 562.75 m 498 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498 575.75 m 502 575.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 575.75 m 563 575.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 562.75 m 563 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 562.75 m 498 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 498 562.75 m 502 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 562.75 m 563 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 536.75 m 498 536.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 536.75 m 563 536.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 510.75 m 498 510.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 498.75 m 498 498.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 437 496.75 m 498 496.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 510.75 m 563 510.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 498.75 m 563 498.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 502 496.75 m 563 496.75 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 580.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 444.60 579.98 Td (Three Months Ended March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 567.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.00 566.98 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 524.00 566.98 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 554.00 Td (Total revenues and other income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 439.50 554.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 486.80 554.00 Td (33) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 504.50 554.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 554.00 Td (692) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 541.00 Td (Total expenses) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 484.10 541.00 Td (\(11) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 494.80 541.00 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 541.00 Td (456) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 528.00 Td (Income from discontinued operations before gain on sales of real estate, net and impairment charge) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 486.80 528.00 Td (44) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 528.00 Td (236) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 515.00 Td (Gain on sales of real estate, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 482.80 515.00 Td (124) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 515.00 Td (2,916) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 58.50 502.00 Td (Income from discontinued operations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 439.50 502.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 482.80 502.00 Td (168) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 504.50 502.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 502.00 Td (3,152) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 474.25 Td (7. ) Tj ET Q q 0 0 0 rg BT 67.50 474.25 Td (FORECLOSED REAL) Tj ET Q q 0 0 0 rg BT 166.13 474.25 Td ( EST) Tj ET Q q 0 0 0 rg BT 186.79 474.25 Td (A) Tj ET Q q 0 0 0 rg BT 193.27 474.25 Td (TE HELD FOR SALE) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 456.25 Td (In 2006 and 2007, the Company originally made ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 270.41 456.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 290.39 456.25 Td ( debt investments \(collectively) Tj ET Q q 0 0 0 rg BT 412.21 456.25 Td (, the “T) Tj ET Q q 0 0 0 rg BT 442.12 456.25 Td (ribeca Loans”\) related to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 444.25 Td (conversion of an eight-story loft building into a 10-story condominium building with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 391.68 444.25 Td (62) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 401.68 444.25 Td ( units \(the “T) Tj ET Q q 0 0 0 rg BT 454.37 444.25 Td (ribeca Building”\) located ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 432.25 Td (at 415 Greenwich Street in New ) Tj ET Q q 0 0 0 rg BT 180.20 432.25 Td (Y) Tj ET Q q 0 0 0 rg BT 186.42 432.25 Td (ork, New ) Tj ET Q q 0 0 0 rg BT 225.76 432.25 Td (Y) Tj ET Q q 0 0 0 rg BT 231.98 432.25 Td (ork. On February 19, 2010, the borrowers under the ) Tj ET Q q 0 0 0 rg BT 443.69 432.25 Td (T) Tj ET Q q 0 0 0 rg BT 449.45 432.25 Td (ribeca Loans defaulted and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 420.25 Td (the Company foreclosed on the ) Tj ET Q q 0 0 0 rg BT 176.79 420.25 Td (T) Tj ET Q q 0 0 0 rg BT 182.54 420.25 Td (ribeca Building by exercising its right to accept ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 374.71 420.25 Td (100%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.04 420.25 Td ( of the ownership interest of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 408.25 Td (borrowers. ) Tj ET Q q 0 0 0 rg BT 97.36 408.25 Td (The Company acquired the remaining unsold condominium units of the ) Tj ET Q q 0 0 0 rg BT 386.01 408.25 Td (T) Tj ET Q q 0 0 0 rg BT 391.77 408.25 Td (ribeca Building \(the residential, retail and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 396.25 Td (parking space condominium units transferred to the Company are, collectively) Tj ET Q q 0 0 0 rg BT 362.64 396.25 Td (, the “Units” and, individually) Tj ET Q q 0 0 0 rg BT 482.53 396.25 Td (, each is a “Unit”\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 384.25 Td (and assumed the project liabilities. ) Tj ET Q q 0 0 0 rg BT 192.89 384.25 Td (The Company recorded the ) Tj ET Q q 0 0 0 rg BT 304.34 384.25 Td (T) Tj ET Q q 0 0 0 rg BT 310.10 384.25 Td (ribeca Building at fair value using a discounted cash flow ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 372.25 Td (valuation model based on the net realizable value \(expected sales price less estimated costs to sell the unsold Units\) of the real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 360.25 Td (estate.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 342.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 342.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 176.53 342.25 Td (, the Company’) Tj ET Q q 0 0 0 rg BT 237.91 342.25 Td (s investment in the ) Tj ET Q q 0 0 0 rg BT 315.50 342.25 Td (T) Tj ET Q q 0 0 0 rg BT 321.25 342.25 Td (ribeca Building consisted of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 436.23 342.25 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.23 342.25 Td ( Units with a carrying ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 330.25 Td (value of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 84.49 330.25 Td ($12.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 138.38 330.25 Td ( and is presented as foreclosed real estate held for sale on the consolidated balance sheet. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 318.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.49 318.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 130.31 318.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 193.91 318.25 Td (, the Company sold the remaining ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 331.94 318.25 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.94 318.25 Td ( Units and recognized a gain on sale of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 504.94 318.25 Td ($2.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.84 318.25 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 306.25 Td (\(which gain on sale has been reduced by disposition fees to the ) Tj ET Q q 0 0 0 rg BT 303.32 306.25 Td (Advisor of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 348.88 306.25 Td ($0.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 397.77 306.25 Td ( related to these two Units\) and recorded ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 294.25 Td (expenses of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.93 294.25 Td ($0.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 147.82 294.25 Td ( related to foreclosed real estate held for sale. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 379.67 294.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 399.65 294.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.48 294.25 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 524.08 294.25 Td (, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 282.25 Td (Company did not sell any Units of the ) Tj ET Q q 0 0 0 rg BT 204.30 282.25 Td (T) Tj ET Q q 0 0 0 rg BT 210.06 282.25 Td (ribeca Building and recorded expenses of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.33 282.25 Td ($0.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 427.22 282.25 Td ( related to foreclosed real estate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 270.25 Td (held for sale.) Tj ET Q endstream endobj 39 0 obj <>] /Rotate 0 /Contents 40 0 R>> endobj 40 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (18) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (8. ) Tj ET Q q 0 0 0 rg BT 67.50 632.25 Td (NOTES P) Tj ET Q q 0 0 0 rg BT 109.27 632.25 Td (A) Tj ET Q q 0 0 0 rg BT 115.57 632.25 Td (Y) Tj ET Q q 0 0 0 rg BT 121.88 632.25 Td (ABLE) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 614.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 614.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 180.98 614.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.56 614.25 Td (, the Company’) Tj ET Q q 0 0 0 rg BT 320.95 614.25 Td (s notes payable, including notes payable related to real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (estate held for sale, consisted of the following \(dollars in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 562.75 156.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 206.00 562.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 210.00 562.75 65.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 275.00 562.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 279.00 562.75 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 562.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 347.00 562.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 420.00 562.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 424.00 562.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 562.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 562.75 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 536.75 156.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 206.00 536.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 210.00 536.75 65.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 275.00 536.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 279.00 536.75 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 536.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 347.00 536.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 420.00 536.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 424.00 536.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 536.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 536.75 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 510.75 156.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 206.00 510.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 210.00 510.75 65.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 275.00 510.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 279.00 510.75 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 510.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 347.00 510.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 420.00 510.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 424.00 510.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 510.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 510.75 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 478.75 156.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 206.00 478.75 4.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 210.00 478.75 65.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 275.00 478.75 4.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 279.00 478.75 64.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 478.75 4.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 347.00 478.75 73.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 420.00 478.75 4.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 424.00 478.75 73.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 478.75 4.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 478.75 62.00 -19.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 446.75 156.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 206.00 446.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 210.00 446.75 65.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 275.00 446.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 279.00 446.75 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 446.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 347.00 446.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 420.00 446.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 424.00 446.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 446.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 446.75 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 420.75 156.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 206.00 420.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 210.00 420.75 65.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 275.00 420.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 279.00 420.75 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 343.00 420.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 347.00 420.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 420.00 420.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 424.00 420.75 73.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 420.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 420.75 62.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 562.75 m 206 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 210 562.75 m 275 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 562.75 m 343 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 347 562.75 m 420 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 424 562.75 m 497 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 501 562.75 m 563 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 562.75 m 206 562.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 210 523.75 m 275 523.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 523.75 m 343 523.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 210 510.75 m 275 510.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 510.75 m 343 510.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 210 459.75 m 275 459.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 459.75 m 343 459.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 210 446.75 m 275 446.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 459.75 m 343 459.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 446.75 m 343 446.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 446.75 m 343 446.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 210 420.75 m 275 420.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 420.75 m 343 420.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 210 408.75 m 275 408.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 210 406.75 m 275 406.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 408.75 m 343 408.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 279 406.75 m 343 406.75 l s BT /F2 7.00 Tf ET q 0 0 0 rg BT 52.50 566.81 Td (Loan Type) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 217.20 573.81 Td (Book ) Tj ET Q q 0 0 0 rg BT 234.39 573.81 Td (V) Tj ET Q q 0 0 0 rg BT 238.80 573.81 Td (alue as of) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 218.80 566.81 Td (Mar) Tj ET Q q 0 0 0 rg BT 231.89 566.81 Td (ch 31, 2015) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 285.70 573.81 Td (Book ) Tj ET Q q 0 0 0 rg BT 302.89 573.81 Td (V) Tj ET Q q 0 0 0 rg BT 307.30 573.81 Td (alue as of) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 282.25 566.81 Td (December) Tj ET Q q 0 0 0 rg BT 312.44 566.81 Td ( 31, 2014) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 364.90 580.81 Td (Contractual) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 354.35 573.81 Td (Inter) Tj ET Q q 0 0 0 rg BT 369.39 573.81 Td (est Rates as of) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 356.30 566.81 Td (Mar) Tj ET Q q 0 0 0 rg BT 369.39 566.81 Td (ch 31, 2015 ) Tj ET Q BT /F2 7.00 Tf ET BT /F2 4.55 Tf ET q 0 0 0 rg BT 404.39 569.98 Td (\(1\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 432.45 580.81 Td (W) Tj ET Q q 0 0 0 rg BT 439.06 580.81 Td (eighted-A) Tj ET Q q 0 0 0 rg BT 467.71 580.81 Td (verage) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 431.35 573.81 Td (Inter) Tj ET Q q 0 0 0 rg BT 446.39 573.81 Td (est Rates as of) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 433.30 566.81 Td (Mar) Tj ET Q q 0 0 0 rg BT 446.39 566.81 Td (ch 31, 2015 ) Tj ET Q BT /F2 7.00 Tf ET BT /F2 4.55 Tf ET q 0 0 0 rg BT 481.39 569.98 Td (\(1\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 503.95 580.81 Td (W) Tj ET Q q 0 0 0 rg BT 510.56 580.81 Td (eighted-A) Tj ET Q q 0 0 0 rg BT 539.21 580.81 Td (verage) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 506.30 573.81 Td (Remaining ) Tj ET Q q 0 0 0 rg BT 540.59 573.81 Td (T) Tj ET Q q 0 0 0 rg BT 544.62 573.81 Td (erm) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 515.90 566.81 Td (in ) Tj ET Q q 0 0 0 rg BT 523.23 566.81 Td (Y) Tj ET Q q 0 0 0 rg BT 527.51 566.81 Td (ears ) Tj ET Q BT /F2 7.00 Tf ET BT /F2 4.55 Tf ET q 0 0 0 rg BT 541.70 569.98 Td (\(2\)) Tj ET Q BT /F3 7.00 Tf ET q 0 0 0 rg BT 52.50 553.79 Td (Fixed Rate) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 540.80 Td (Mortgage loans) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 212.50 540.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 252.90 540.80 Td (62,200) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 281.50 540.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 320.90 540.80 Td (62,200) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 375.70 540.80 Td (5.9%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.70 540.80 Td (5.9%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 527.10 540.80 Td (1.5) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 527.80 Td (GKK Properties mortgage loans) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 249.40 527.80 Td (379,035) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.40 527.80 Td (381,179) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 365.50 527.80 Td (5.3% - 6.8%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.70 527.80 Td (5.9%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 527.10 527.80 Td (3.7) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 249.40 514.80 Td (441,235) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.40 514.80 Td (443,379) Tj ET Q BT /F3 7.00 Tf ET q 0 0 0 rg BT 52.50 501.79 Td (Variable Rate) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 482.80 Td (Mortgage loans) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 249.40 482.80 Td (164,131) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.40 482.80 Td (181,249) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 352.80 489.80 Td (One-month LIBOR +) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 373.95 482.80 Td (1.80%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.70 482.80 Td (2.0%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 527.10 482.80 Td (0.8) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 463.80 Td (GKK Properties mortgage loans) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 252.90 463.80 Td (40,000) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 320.90 463.80 Td (40,000) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 352.80 470.80 Td (One-month LIBOR +) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 373.95 463.80 Td (3.00%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 452.70 463.80 Td (3.2%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 527.10 463.80 Td (2.2) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 249.40 450.80 Td (204,131) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.40 450.80 Td (221,249) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 58.50 437.80 Td (Total notes payable principal outstanding) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 249.40 437.80 Td (645,366) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.40 437.80 Td (664,628) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 70.50 424.80 Td (Discount on notes payable, net) Tj ET Q BT /F1 7.00 Tf ET BT /F1 4.55 Tf ET q 0 0 0 rg BT 156.62 427.97 Td ( \(3\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 254.05 424.80 Td (\(6,020) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 272.15 424.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 322.05 424.85 Td (\(6,530) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 340.15 424.80 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 58.50 411.80 Td (Total notes payable, net ) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 212.50 411.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 249.40 411.80 Td (639,346) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 281.50 411.80 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 317.40 411.80 Td (658,098) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 396.25 Td (_____________________) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 388.40 Td (\(1\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 385.45 Td ( Contractual interest rates as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 136.73 385.45 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 178.07 385.45 Td ( represent the range of interest rates in ef) Tj ET Q q 0 0 0 rg BT 284.08 385.45 Td (fect under these loans as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 356.28 385.45 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 397.62 385.45 Td (. ) Tj ET Q q 0 0 0 rg BT 402.37 385.45 Td (W) Tj ET Q q 0 0 0 rg BT 407.99 385.45 Td (eighted-average interest rates as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 499.85 385.45 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 541.19 385.45 Td ( are ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 49.50 377.65 Td (calculated as the actual interest rates in ef) Tj ET Q q 0 0 0 rg BT 157.49 377.65 Td (fect under these loans as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 229.69 377.65 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 271.03 377.65 Td ( \(consisting of the contractual interest rates\), using interest rate indices as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 470.30 377.65 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 511.64 377.65 Td (, where applicable.) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 369.80 Td (\(2\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 366.85 Td ( ) Tj ET Q q 0 0 0 rg BT 55.93 366.85 Td (W) Tj ET Q q 0 0 0 rg BT 61.55 366.85 Td (eighted-average remaining term in years represents the initial maturity dates or the maturity dates as extended as of ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 362.62 366.85 Td (March 31, 2015) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 403.96 366.85 Td (; subject to certain conditions, the maturity dates of certain ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 49.50 359.05 Td (loans may be further extended.) Tj ET Q BT /F1 6.50 Tf ET BT /F1 4.22 Tf ET q 0 0 0 rg BT 49.50 351.20 Td (\(3\)) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 54.43 348.25 Td ( Represents the unamortized discounts and premiums on notes payable due to the above- and below-market interest rates when the loans were assumed. ) Tj ET Q q 0 0 0 rg BT 451.97 348.25 Td (The discounts and premiums are ) Tj ET Q BT /F1 6.50 Tf ET q 0 0 0 rg BT 49.50 340.45 Td (amortized over the remaining life of the respective loan.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 316.45 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 316.45 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 316.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 180.98 316.45 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 259.56 316.45 Td (, the Company’) Tj ET Q q 0 0 0 rg BT 320.95 316.45 Td (s deferred financing costs were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 447.84 316.45 Td ($1.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 496.73 316.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 304.45 Td ($1.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.39 304.45 Td (, respectively) Tj ET Q q 0 0 0 rg BT 151.05 304.45 Td (, net of amortization. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 285.18 304.45 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 305.17 304.45 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 365.99 304.45 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 429.59 304.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 449.03 304.45 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 469.03 304.45 Td (, the Company ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 292.45 Td (incurred interest expense, net of discontinued operations, of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 291.09 292.45 Td ($8.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 339.98 292.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 359.42 292.45 Td ($13.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 413.31 292.45 Td (, respectively) Tj ET Q q 0 0 0 rg BT 465.97 292.45 Td (. ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0.43137254901960786 0.7490196078431373 rg BT 470.97 292.45 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 473.47 292.45 Td (Included in interest ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 280.45 Td (expense was: \(i\) the amortization of deferred financing costs of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 304.96 280.45 Td ($0.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 353.85 280.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 375.79 280.45 Td ($0.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.68 280.45 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 456.06 280.45 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.04 280.45 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 268.45 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 268.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 132.54 268.45 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 152.54 268.45 Td (, respectively) Tj ET Q q 0 0 0 rg BT 205.20 268.45 Td (, and \(ii\) the amortization of discounts and premiums on notes payable, which increased ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 256.45 Td (interest expense by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 128.64 256.45 Td ($0.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.53 256.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.47 256.45 Td ($0.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 248.36 256.45 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 279.74 256.45 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 299.72 256.45 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 360.55 256.45 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.15 256.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 443.59 256.45 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.59 256.45 Td (, respectively) Tj ET Q q 0 0 0 rg BT 516.25 256.45 Td (. ) Tj ET Q q 0 0 0 rg BT 523.20 256.45 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 244.45 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 244.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 132.54 244.45 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 211.12 244.45 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 216.12 244.45 Td ($2.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 265.01 244.45 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 284.45 244.45 Td ($1.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 333.34 244.45 Td ( of interest was payable, respectively) Tj ET Q q 0 0 0 rg BT 480.41 244.45 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 226.45 Td (The following is a schedule of maturities, including principal amortization payments, for all notes payable outstanding as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 214.45 Td (of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 60.33 214.45 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.93 214.45 Td ( \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 49.00 197.95 447.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 496.00 197.95 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 49.00 171.95 447.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 496.00 171.95 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 49.00 145.95 447.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 496.00 145.95 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 49.00 119.95 447.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 496.00 119.95 66.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 496 119.95000000000005 m 562 119.95000000000005 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 496 107.95000000000005 m 562 107.95000000000005 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 496 105.95000000000005 m 562 105.95000000000005 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 51.50 189.20 Td (April 1, 2015 through December 31, 2015) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 498.50 189.20 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.80 189.20 Td (13,346) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 51.50 176.20 Td (2016) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 532.80 176.20 Td (304,640) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 51.50 163.20 Td (2017) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 532.80 163.20 Td (159,175) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 51.50 150.20 Td (2018) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 540.80 150.20 Td (8,651) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 51.50 137.20 Td (2019) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 532.80 137.20 Td (126,044) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 51.50 124.20 Td (Thereafter) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.80 124.20 Td (33,510) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 498.50 111.20 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 532.80 111.20 Td (645,366) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 41 0 obj <>] /Rotate 0 /Contents 42 0 R>> endobj 42 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (19) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (The following summarizes the activity related to notes payable for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 356.46 632.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.45 632.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 437.27 632.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 500.87 632.10 Td ( \(in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 603.60 447.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 603.60 66.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 577.60 447.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 497.00 577.60 66.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 564.6 m 563 564.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 552.6 m 563 552.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 497 550.6 m 563 550.6 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 594.85 Td (Total notes payable, net - December 31, 2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 499.50 594.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 594.85 Td (658,098) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 581.85 Td (Principal repayments) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 535.10 581.85 Td (\(19,263) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 581.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 568.85 Td (Amortization of discounts and premiums on notes payable, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 568.85 Td (511) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 555.85 Td (Total notes payable, net - March 31, 2015) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 499.50 555.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 555.85 Td (639,346) Tj ET Q BT /F1 10.00 Tf ET BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 528.10 Td (Debt Covenants ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 510.10 Td (The documents evidencing the Company’) Tj ET Q q 0 0 0 rg BT 240.13 510.10 Td (s outstanding debt obligations typically require that specified loan-to-value and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 498.10 Td (debt service coverage ratios be maintained with respect to the financed properties. ) Tj ET Q q 0 0 0 rg BT 382.15 498.10 Td (A) Tj ET Q q 0 0 0 rg BT 388.82 498.10 Td ( breach of the financial covenants in these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 486.10 Td (documents may result in the lender imposing additional restrictions on the Company’) Tj ET Q q 0 0 0 rg BT 390.27 486.10 Td (s operations, such as restrictions on the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 474.10 Td (Company’) Tj ET Q q 0 0 0 rg BT 91.17 474.10 Td (s ability to incur additional debt, or may allow the lender to impose “cash traps” with respect to cash flow from the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 462.10 Td (property securing the loan. In addition, such a breach may constitute an event of default and the lender could require the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 450.10 Td (Company to repay the debt immediately) Tj ET Q q 0 0 0 rg BT 209.64 450.10 Td (. If the Company fails to make such repayment in a timely manner) Tj ET Q q 0 0 0 rg BT 476.94 450.10 Td (, the lender may be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 438.10 Td (entitled to take possession of any property securing the loan. Except as described below) Tj ET Q q 0 0 0 rg BT 402.36 438.10 Td (, as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 429.02 438.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 492.62 438.10 Td (, the Company ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 426.10 Td (was in compliance with these debt covenants. ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 408.10 Td (BBD2 Loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 390.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 100.44 390.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 164.04 390.10 Td (, the borrower under the BBD2 Loan was out of debt service coverage compliance. ) Tj ET Q q 0 0 0 rg BT 500.32 390.10 Td (As a result of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 378.10 Td (such non-compliance, the loan servicer will impose a “cash trap,” which restricts distributions to the Company to the budgeted ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 366.10 Td (property operating expenses. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 342.10 Td (9. ) Tj ET Q q 0 0 0 rg BT 67.50 342.10 Td (F) Tj ET Q q 0 0 0 rg BT 72.87 342.10 Td (AIR ) Tj ET Q q 0 0 0 rg BT 93.52 342.10 Td (V) Tj ET Q q 0 0 0 rg BT 99.45 342.10 Td (ALUE DISCLOSURES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 324.10 Td (Under GAAP) Tj ET Q q 0 0 0 rg BT 127.11 324.10 Td (, the Company is required to measure certain financial instruments at fair value on a recurring basis. In ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 312.10 Td (addition, the Company is required to measure other financial instruments and balances at fair value on a non-recurring basis ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 300.10 Td (\(e.g., carrying value of impaired real estate loans receivable and long-lived assets\). Fair value is defined as the price that would ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 288.10 Td (be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 276.10 Td (measurement date. ) Tj ET Q q 0 0 0 rg BT 129.29 276.10 Td (The GAAP) Tj ET Q q 0 0 0 rg BT 174.19 276.10 Td ( fair value framework uses a three-tiered approach. Fair value measurements are classified and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 264.10 Td (disclosed in one of the following three categories:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 246.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 246.10 Td (Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 234.10 Td (liabilities;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 219.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 219.10 Td (Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 207.10 Td (markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 195.10 Td (observable in active markets; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 180.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 180.10 Td (Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 168.10 Td (significant to the fair value measurement and unobservable.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 147.10 Td (The fair value for certain financial instruments is derived using a combination of market quotes, pricing models and other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 135.10 Td (valuation techniques that involve significant management judgment. ) Tj ET Q q 0 0 0 rg BT 327.86 135.10 Td (The price transparency of financial instruments is a key ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 123.10 Td (determinant of the degree of judgment involved in determining the fair value of the Company’) Tj ET Q q 0 0 0 rg BT 426.61 123.10 Td (s financial instruments. Financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 111.10 Td (instruments for which actively quoted prices or pricing parameters are available and for which markets contain orderly ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 99.10 Td (transactions will generally have a higher degree of price transparency than financial instruments for which markets are inactive ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 87.10 Td (or consist of non-orderly trades. ) Tj ET Q q 0 0 0 rg BT 182.34 87.10 Td (The Company evaluates several factors when determining if a market is inactive or when ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 75.10 Td (market transactions are not orderly) Tj ET Q q 0 0 0 rg BT 188.24 75.10 Td (. ) Tj ET Q q 0 0 0 rg BT 195.56 75.10 Td (The following is a summary of the methods and assumptions used by management in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 63.10 Td (estimating the fair value of each class of assets and liabilities for which it is practicable to estimate the fair value:) Tj ET Q endstream endobj 43 0 obj <>] /Rotate 0 /Contents 44 0 R>> endobj 44 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (20) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (Cash and cash equivalents, r) Tj ET Q q 0 0 0 rg BT 188.95 632.10 Td (estricted cash, r) Tj ET Q q 0 0 0 rg BT 252.74 632.10 Td (ent and other r) Tj ET Q q 0 0 0 rg BT 312.08 632.10 Td (eceivables, and accounts payable and accrued liabilities:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 541.74 632.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (These balances approximate their fair values due to the short maturities of these items.) Tj ET Q endstream endobj 45 0 obj <>] /Rotate 0 /Contents 46 0 R>> endobj 46 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (21) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (Real estate loans r) Tj ET Q q 0 0 0 rg BT 147.84 632.10 Td (eceivable:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 188.92 632.10 Td ( ) Tj ET Q q 0 0 0 rg BT 191.24 632.10 Td (These instruments are presented in the accompanying consolidated balance sheets at their ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (amortized cost net of recorded loan loss reserves and not at fair value. ) Tj ET Q q 0 0 0 rg BT 333.93 620.10 Td (The fair values of real estate loans receivable were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (estimated using an internal valuation model that considered the expected cash flows for the loans, underlying collateral values ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (\(for collateral-dependent loans\) and estimated yield requirements of institutional investors for loans with similar characteristics, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 584.10 Td (including remaining loan term, loan-to-value, type of collateral and other credit enhancements. ) Tj ET Q q 0 0 0 rg BT 433.62 584.10 Td (The Company classifies these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 572.10 Td (inputs as Level 3 inputs.) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 73.50 554.10 Td (Notes payable:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 133.76 554.10 Td ( ) Tj ET Q q 0 0 0 rg BT 136.08 554.10 Td (The fair values of the Company’) Tj ET Q q 0 0 0 rg BT 265.77 554.10 Td (s notes payable are estimated using a discounted cash flow analysis based ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.10 Td (on management’) Tj ET Q q 0 0 0 rg BT 115.87 542.10 Td (s estimates of current market interest rates for instruments with similar characteristics, including remaining ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.10 Td (loan term, loan-to-value ratio, type of collateral and other credit enhancements. ) Tj ET Q q 0 0 0 rg BT 370.76 530.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 420.66 530.10 Td (, when determining the fair value ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.10 Td (of a liability in circumstances in which a quoted price in an active market for an identical liability is not available, the Company ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.10 Td (measures fair value using \(i\) a valuation technique that uses the quoted price of the identical liability when traded as an asset or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.10 Td (quoted prices for similar liabilities when traded as assets or \(ii\) another valuation technique that is consistent with the principles ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.10 Td (of fair value measurement, such as the income approach or the market approach. ) Tj ET Q q 0 0 0 rg BT 376.40 482.10 Td (The Company classifies these inputs as Level ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.10 Td (3 inputs.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 452.10 Td (The following were the face values, carrying amounts and fair values of the Company’) Tj ET Q q 0 0 0 rg BT 420.05 452.10 Td (s real estate loans receivable and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 440.10 Td (notes payable as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 128.36 440.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 191.96 440.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 211.40 440.10 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 289.98 440.10 Td (, which carrying amounts generally do not approximate the fair ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 428.10 Td (values \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 378.60 162.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 212.00 378.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 267.00 378.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 271.00 378.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.00 378.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 330.00 378.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 385.00 378.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 378.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 378.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 378.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 503.00 378.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 507.00 378.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 352.60 162.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 212.00 352.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 267.00 352.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 271.00 352.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 326.00 352.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 330.00 352.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 385.00 352.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 352.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 352.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 352.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 503.00 352.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 507.00 352.60 55.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 212 398.6 m 267 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 267 398.6 m 271 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 398.6 m 326 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 326 398.6 m 330 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 398.6 m 385 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 398.6 m 444 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 444 398.6 m 448 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448 398.6 m 503 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 503 398.6 m 507 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 507 398.6 m 562 398.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 212 378.6 m 267 378.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 271 378.6 m 326 378.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 378.6 m 385 378.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 378.6 m 444 378.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448 378.6 m 503 378.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 507 378.6 m 562 378.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 330 378.6 m 385 378.6 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 402.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 271.50 402.83 Td (March 31, 2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 442.75 402.83 Td (December 31, 2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 382.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 220.40 382.83 Td (Face Value ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 282.20 390.68 Td (Carrying) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 283.95 382.68 Td (Amount ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 339.15 382.83 Td (Fair Value ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 397.40 382.83 Td (Face Value ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 459.20 390.68 Td (Carrying) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 460.95 382.68 Td (Amount ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 516.15 382.83 Td (Fair Value ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 369.85 Td (Financial assets:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 356.85 Td (Real estate loans receivable ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 155.12 360.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 214.50 356.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 241.80 356.85 Td (35,938) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 273.50 356.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 300.80 356.85 Td (29,135) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 332.50 356.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 359.80 356.85 Td (26,314) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 391.50 356.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 418.80 356.85 Td (35,966) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 450.50 356.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 477.80 356.85 Td (28,922) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 509.50 356.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 536.80 356.85 Td (25,818) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 343.85 Td (Financial liabilities:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 330.85 Td (Notes payable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 214.50 330.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 237.75 330.85 Td (645,366) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 273.50 330.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 296.75 330.85 Td (639,346) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 332.50 330.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 355.75 330.85 Td (669,642) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 391.50 330.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 414.75 330.85 Td (664,628) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 450.50 330.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.75 330.85 Td (658,098) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 509.50 330.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 532.75 330.85 Td (688,374) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 315.10 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 306.50 Td (\(1\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 303.10 Td ( Carrying amount of real estate loans receivable includes loan loss reserves.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 279.10 Td (Disclosure of the fair values of financial instruments is based on pertinent information available to the Company as of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 267.10 Td (period end and requires a significant amount of judgment. ) Tj ET Q q 0 0 0 rg BT 286.20 267.10 Td (The actual value of these investments could be materially dif) Tj ET Q q 0 0 0 rg BT 529.54 267.10 Td (ferent ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 255.10 Td (from the Company’) Tj ET Q q 0 0 0 rg BT 127.82 255.10 Td (s estimate of value.) Tj ET Q endstream endobj 47 0 obj <>] /Rotate 0 /Contents 48 0 R>> endobj 48 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (22) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (10. ) Tj ET Q q 0 0 0 rg BT 67.50 632.25 Td (RELA) Tj ET Q q 0 0 0 rg BT 94.54 632.25 Td (TED P) Tj ET Q q 0 0 0 rg BT 122.97 632.25 Td (AR) Tj ET Q q 0 0 0 rg BT 137.06 632.25 Td (TY) Tj ET Q q 0 0 0 rg BT 150.58 632.25 Td ( ) Tj ET Q q 0 0 0 rg BT 152.90 632.25 Td (TRANSACTIONS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (The Company has entered into an ) Tj ET Q q 0 0 0 rg BT 210.13 614.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 249.30 614.25 Td (Agreement with the ) Tj ET Q q 0 0 0 rg BT 330.67 614.25 Td (Advisor) Tj ET Q q 0 0 0 rg BT 362.49 614.25 Td (, which entitles the ) Tj ET Q q 0 0 0 rg BT 439.97 614.25 Td (Advisor to specified fees for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (the management and disposition of investments, among other services, as well as to reimbursement for certain costs incurred by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (the ) Tj ET Q q 0 0 0 rg BT 63.67 590.25 Td (Advisor in providing services to the Company) Tj ET Q q 0 0 0 rg BT 247.99 590.25 Td (. In addition, the ) Tj ET Q q 0 0 0 rg BT 318.26 590.25 Td (Advisor is entitled to certain other fees, including an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (incentive fee upon achieving certain performance goals, as detailed in the ) Tj ET Q q 0 0 0 rg BT 345.49 578.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 384.66 578.25 Td (Agreement. ) Tj ET Q q 0 0 0 rg BT 436.40 578.25 Td (The Company has also entered ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.25 Td (into a fee reimbursement agreement \(the “AIP) Tj ET Q q 0 0 0 rg BT 234.05 566.25 Td ( Reimbursement ) Tj ET Q q 0 0 0 rg BT 301.82 566.25 Td (Agreement”\) with the Dealer Manager pursuant to which the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.25 Td (Company agreed to reimburse the Dealer Manager for certain fees and expenses it incurs for administering the Company’) Tj ET Q q 0 0 0 rg BT 535.72 554.25 Td (s ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.25 Td (participation in the DTCC ) Tj ET Q q 0 0 0 rg BT 156.15 542.25 Td (Alternative Investment Product Platform with respect to certain accounts of the Company’) Tj ET Q q 0 0 0 rg BT 517.44 542.25 Td (s investors ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.25 Td (serviced through the platform. ) Tj ET Q q 0 0 0 rg BT 175.39 530.25 Td (The ) Tj ET Q q 0 0 0 rg BT 192.89 530.25 Td (Advisor also serves, and the Dealer Manager also serves or served, as the advisor and dealer ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.25 Td (manager) Tj ET Q q 0 0 0 rg BT 83.52 518.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 136.18 518.25 Td (, for KBS Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 271.81 518.25 Td (T) Tj ET Q q 0 0 0 rg BT 277.57 518.25 Td (rust II, Inc., KBS Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 443.46 518.25 Td (T) Tj ET Q q 0 0 0 rg BT 449.22 518.25 Td (rust III, Inc., KBS Strategic ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.25 Td (Opportunity REIT) Tj ET Q q 0 0 0 rg BT 122.36 506.25 Td (, Inc., KBS Legacy Partners ) Tj ET Q q 0 0 0 rg BT 236.22 506.25 Td (Apartment REIT) Tj ET Q q 0 0 0 rg BT 302.96 506.25 Td (, Inc. and KBS Strategic Opportunity REIT) Tj ET Q q 0 0 0 rg BT 476.09 506.25 Td ( II, Inc. and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.25 Td (anticipate that they will serve as the advisor and dealer manager) Tj ET Q q 0 0 0 rg BT 305.11 494.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 357.77 494.25 Td (, to KBS Growth & Income REIT) Tj ET Q q 0 0 0 rg BT 492.29 494.25 Td (, Inc.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 476.25 Td (On January 6, 2014, the Company) Tj ET Q q 0 0 0 rg BT 209.77 476.25 Td (, together with KBS Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 386.78 476.25 Td (T) Tj ET Q q 0 0 0 rg BT 392.54 476.25 Td (rust II, Inc., KBS Real Estate Investment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 464.25 Td (T) Tj ET Q q 0 0 0 rg BT 55.26 464.25 Td (rust III, Inc., KBS Strategic Opportunity REIT) Tj ET Q q 0 0 0 rg BT 240.87 464.25 Td (, Inc., KBS Legacy Partners ) Tj ET Q q 0 0 0 rg BT 354.73 464.25 Td (Apartment REIT) Tj ET Q q 0 0 0 rg BT 421.47 464.25 Td (, Inc., KBS Strategic Opportunity ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 452.25 Td (REIT) Tj ET Q q 0 0 0 rg BT 71.54 452.25 Td ( II, Inc., the Dealer Manager) Tj ET Q q 0 0 0 rg BT 184.96 452.25 Td (, the ) Tj ET Q q 0 0 0 rg BT 204.13 452.25 Td (Advisor and other KBS-af) Tj ET Q q 0 0 0 rg BT 309.21 452.25 Td (filiated entities, entered into an errors and omissions and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 440.25 Td (directors and of) Tj ET Q q 0 0 0 rg BT 112.07 440.25 Td (ficers liability insurance program where the lower tiers of such insurance coverage are shared. ) Tj ET Q q 0 0 0 rg BT 493.40 440.25 Td (The cost of these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 428.25 Td (lower tiers is allocated by the ) Tj ET Q q 0 0 0 rg BT 168.91 428.25 Td (Advisor and its insurance broker among each of the various entities covered by the program, and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 416.25 Td (is billed directly to each entity) Tj ET Q q 0 0 0 rg BT 170.20 416.25 Td (. ) Tj ET Q q 0 0 0 rg BT 177.52 416.25 Td (The allocation of these shared coverage costs is proportionate to the pricing by the insurance ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.25 Td (marketplace for the first tiers of directors and of) Tj ET Q q 0 0 0 rg BT 241.46 404.25 Td (ficers liability coverage purchased individually by each REIT) Tj ET Q q 0 0 0 rg BT 487.02 404.25 Td (. ) Tj ET Q q 0 0 0 rg BT 494.34 404.25 Td (The ) Tj ET Q q 0 0 0 rg BT 511.83 404.25 Td (Advisor) Tj ET Q q 0 0 0 rg BT 544.43 404.25 Td (’) Tj ET Q q 0 0 0 rg BT 547.21 404.25 Td (s ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.25 Td (and the Dealer Manager) Tj ET Q q 0 0 0 rg BT 146.21 392.25 Td (’) Tj ET Q q 0 0 0 rg BT 148.99 392.25 Td (s portion of the shared lower tiers’) Tj ET Q q 0 0 0 rg BT 285.98 392.25 Td ( cost is proportionate to the respective entities’) Tj ET Q q 0 0 0 rg BT 472.13 392.25 Td ( prior cost for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 380.25 Td (errors and omissions insurance. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 362.25 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.05 362.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.03 362.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.86 362.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.46 362.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.89 362.25 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 302.89 362.25 Td (, no other business transactions occurred between the Company ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 350.25 Td (and the other KBS-sponsored programs. On May 18, 2012, KBS Strategic Opportunity REIT) Tj ET Q q 0 0 0 rg BT 423.71 350.25 Td (, Inc. made an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 482.58 350.25 Td ($8.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 531.47 350.25 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 338.25 Td (investment in a joint venture in which the Company indirectly owns a participation interest through another joint venture ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 326.25 Td (investment. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 308.25 Td (Pursuant to the terms of the ) Tj ET Q q 0 0 0 rg BT 185.71 308.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 224.88 308.25 Td (Agreement and the ) Tj ET Q q 0 0 0 rg BT 302.90 308.25 Td (AIP) Tj ET Q q 0 0 0 rg BT 318.65 308.25 Td ( Reimbursement ) Tj ET Q q 0 0 0 rg BT 386.42 308.25 Td (Agreement, summarized below are the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 296.25 Td (related-party costs incurred by the Company for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 258.88 296.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 278.86 296.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 339.69 296.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 403.28 296.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 422.72 296.25 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 442.72 296.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 495.38 296.25 Td (, and any related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 284.25 Td (amounts payable as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 141.14 284.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 204.74 284.25 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 224.18 284.25 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 302.76 284.25 Td ( \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 228.75 279.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 329.00 228.75 56.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 385.00 228.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 228.75 58.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 447.00 228.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 451.00 228.75 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 505.00 228.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 509.00 228.75 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 202.75 279.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 329.00 202.75 56.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 385.00 202.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 202.75 58.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 447.00 202.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 451.00 202.75 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 505.00 202.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 509.00 202.75 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 176.75 279.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 329.00 176.75 56.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 385.00 176.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 389.00 176.75 58.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 447.00 176.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 451.00 176.75 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 505.00 176.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 509.00 176.75 54.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 254.75 m 385 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 385 254.75 m 389 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 254.75 m 447 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 254.75 m 505 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 505 254.75 m 509 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 509 254.75 m 563 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 254.75 m 385 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 385 254.75 m 389 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 254.75 m 447 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 254.75 m 505 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 509 254.75 m 563 254.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 228.75 m 385 228.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 228.75 m 447 228.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 228.75 m 505 228.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 509 228.75 m 563 228.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 176.75 m 385 176.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 176.75 m 447 176.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 176.75 m 505 176.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 509 176.75 m 563 176.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 176.75 m 385 176.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 164.75 m 385 164.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 329 162.75 m 385 162.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 176.75 m 447 176.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 164.75 m 447 164.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 389 162.75 m 447 162.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 164.75 m 505 164.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 451 162.75 m 505 162.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 509 164.75 m 563 164.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 509 162.75 m 563 162.75 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 259.00 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 374.10 258.81 Td (Incurred) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 494.60 258.81 Td (Payable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 246.00 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 339.50 245.81 Td (Three Months Ended March 31,) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 462.20 245.81 Td (March 31,) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 515.15 245.81 Td (December 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 233.00 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 349.50 232.81 Td (2015) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 410.50 232.81 Td (2014) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 470.50 232.81 Td (2015) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 528.50 232.81 Td (2014) Tj ET Q BT /F4 8.00 Tf ET q 0 0 0 rg BT 52.50 219.98 Td (Expensed) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 207.00 Td (Asset management fees) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 128.03 210.63 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 331.50 207.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 363.80 207.00 Td (2,420) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 391.50 207.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 425.80 207.00 Td (2,516) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 453.50 207.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 493.80 207.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 511.50 207.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 207.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 194.00 Td (Reimbursement of operating expenses) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 174.91 197.63 Td (\(2\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 373.80 194.00 Td (49) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 435.80 194.00 Td (49) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 493.80 194.00 Td (80) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 194.00 Td (45) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 181.00 Td (Disposition fees) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 104.27 184.63 Td (\(3\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 363.80 181.00 Td (1,185) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 431.80 181.00 Td (376) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 489.80 181.00 Td (616) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 181.00 Td (399) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 331.50 168.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 363.80 168.00 Td (3,654) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 391.50 168.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 425.80 168.00 Td (2,941) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 453.50 168.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 489.80 168.00 Td (696) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 511.50 168.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 168.00 Td (444) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 152.25 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 143.65 Td (\(1\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 140.25 Td ( ) Tj ET Q q 0 0 0 rg BT 56.65 140.25 Td (Amounts include asset management fees from discontinued operations totaling ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 295.14 140.25 Td ($0.1 million) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 331.81 140.25 Td ( for the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 355.34 140.25 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 370.33 140.25 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 415.95 140.25 Td (March 31, 2014) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 463.65 140.25 Td (. ) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 131.65 Td (\(2\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 128.25 Td ( ) Tj ET Q q 0 0 0 rg BT 56.92 128.25 Td (The ) Tj ET Q q 0 0 0 rg BT 70.05 128.25 Td (Advisor may seek reimbursement for certain employee costs under the ) Tj ET Q q 0 0 0 rg BT 283.32 128.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 312.70 128.25 Td (Agreement. ) Tj ET Q q 0 0 0 rg BT 351.51 128.25 Td (The Company reimburses the ) Tj ET Q q 0 0 0 rg BT 441.49 128.25 Td (Advisor for the Company’) Tj ET Q q 0 0 0 rg BT 520.44 128.25 Td (s allocable ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 119.25 Td (portion of the salaries, benefits and overhead of internal audit department personnel providing services to the Company) Tj ET Q q 0 0 0 rg BT 407.04 119.25 Td (. ) Tj ET Q q 0 0 0 rg BT 412.53 119.25 Td (These amounts totaled ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 481.89 119.25 Td ($45,000) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 506.27 119.25 Td ( and ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 520.85 119.25 Td ($49,000) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 545.22 119.25 Td ( for ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 110.25 Td (the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 60.54 110.25 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 75.53 110.25 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 121.15 110.25 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 168.85 110.25 Td ( and ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 183.43 110.25 Td (2014) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 198.43 110.25 Td (, respectively) Tj ET Q q 0 0 0 rg BT 237.92 110.25 Td (. ) Tj ET Q q 0 0 0 rg BT 243.41 110.25 Td (These were the only type of employee costs reimbursed under the ) Tj ET Q q 0 0 0 rg BT 441.90 110.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 471.28 110.25 Td (Agreement for the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 528.13 110.25 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 543.12 110.25 Td ( ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 101.25 Td (months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 93.25 101.25 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 140.94 101.25 Td ( and ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 157.40 101.25 Td (2014) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 172.40 101.25 Td (. ) Tj ET Q q 0 0 0 rg BT 177.89 101.25 Td (The Company will not reimburse for employee costs in connection with services for which the ) Tj ET Q q 0 0 0 rg BT 463.04 101.25 Td (Advisor earns disposition fees ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 92.25 Td (\(other than reimbursement of travel and communication expenses\) or for the salaries or benefits the ) Tj ET Q q 0 0 0 rg BT 349.20 92.25 Td (Advisor or its af) Tj ET Q q 0 0 0 rg BT 398.02 92.25 Td (filiates may pay to the Company’) Tj ET Q q 0 0 0 rg BT 497.79 92.25 Td (s executive of) Tj ET Q q 0 0 0 rg BT 539.31 92.25 Td (ficers.) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 83.65 Td (\(3\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 80.25 Td ( Disposition fees with respect to real estate sold are included in the gain \(loss\) on sales of real estate in the accompanying consolidated statements of operations. ) Tj ET Q endstream endobj 49 0 obj <>] /Rotate 0 /Contents 50 0 R>> endobj 50 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (23) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 90.34 632.25 Td (Agr) Tj ET Q q 0 0 0 rg BT 106.82 632.25 Td (eement ) Tj ET Q q 0 0 0 rg BT 139.30 632.25 Td (Amendment) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (On January 15, 2015, the Company and the ) Tj ET Q q 0 0 0 rg BT 249.03 614.25 Td (Advisor entered into an amendment to the ) Tj ET Q q 0 0 0 rg BT 419.26 614.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 458.43 614.25 Td (Agreement to amend ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (certain terms related to the disposition fee payable to the ) Tj ET Q q 0 0 0 rg BT 277.76 602.25 Td (Advisor by the Company) Tj ET Q q 0 0 0 rg BT 377.93 602.25 Td (. In accordance with the ) Tj ET Q q 0 0 0 rg BT 475.67 602.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 514.84 602.25 Td (Agreement, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (for substantial assistance in connection with the sale of properties, loans or other investments as determined by the conflicts ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (committee of the Company’) Tj ET Q q 0 0 0 rg BT 161.42 578.25 Td (s board of directors, the Company pays the ) Tj ET Q q 0 0 0 rg BT 334.99 578.25 Td (Advisor or its af) Tj ET Q q 0 0 0 rg BT 400.08 578.25 Td (filiates a disposition fee of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 508.67 578.25 Td (1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.00 578.25 Td ( of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.25 Td (contract sales price of the properties, loans or other investments sold. However) Tj ET Q q 0 0 0 rg BT 364.84 566.25 Td (, in no event may the total commissions ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.25 Td (\(including such disposition fees\) paid to the ) Tj ET Q q 0 0 0 rg BT 226.42 554.25 Td (Advisor) Tj ET Q q 0 0 0 rg BT 258.24 554.25 Td (, its af) Tj ET Q q 0 0 0 rg BT 282.78 554.25 Td (filiates and unaf) Tj ET Q q 0 0 0 rg BT 347.01 554.25 Td (filiated third parties exceed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.63 554.25 Td (6%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.96 554.25 Td ( of the contract sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.25 Td (price of the property) Tj ET Q q 0 0 0 rg BT 130.76 542.25 Td (, loan or other investment sold or exceed a competitive real estate commission. Pursuant to the amendment, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.25 Td (the disposition fee related to the sales of GKK Properties has been modified to provide that the conflicts committee will ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.25 Td (determine in its sole discretion the amount of the disposition fee related to the sale of GKK Properties upon the terms set forth ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.25 Td (below) Tj ET Q q 0 0 0 rg BT 73.29 506.25 Td (, which disposition fee may be an amount not to exceed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 298.23 506.25 Td (1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 311.56 506.25 Td ( of the contract sales price, which maximum amount is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.25 Td (consistent with the fixed percentage applicable to the sales of other properties, loans and other investments under the ) Tj ET Q q 0 0 0 rg BT 518.52 494.25 Td (Advisory ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.25 Td (Agreement.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 464.25 Td (The amendment provides that with respect to sales of the GKK Properties, and provided that the conflicts committee ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 452.25 Td (determines that the ) Tj ET Q q 0 0 0 rg BT 127.53 452.25 Td (Advisor has provided a substantial amount of services in connection with the sale of each GKK Property for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 440.25 Td (which the payment of a disposition fee is requested by the ) Tj ET Q q 0 0 0 rg BT 283.61 440.25 Td (Advisor) Tj ET Q q 0 0 0 rg BT 315.43 440.25 Td (, then:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 422.25 Td (\(a\) ) Tj ET Q q 0 0 0 rg BT 85.50 422.25 Td (W) Tj ET Q q 0 0 0 rg BT 94.54 422.25 Td (ith respect to portfolio or single asset sales of GKK Properties designated by the conflicts committee in its sole ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 410.25 Td (discretion at or about the time of the sale, the Company will pay the ) Tj ET Q q 0 0 0 rg BT 359.04 410.25 Td (Advisor a fee in an amount not to exceed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.93 410.25 Td (1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 539.26 410.25 Td ( of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 398.25 Td (the contract sales price and subject to other limitations and conditions set forth in the ) Tj ET Q q 0 0 0 rg BT 426.80 398.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 465.97 398.25 Td (Agreement, as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 386.25 Td (determined by the conflicts committee in its sole discretion, which fee will be payable upon the respective closing; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 371.25 Td (\(b\) ) Tj ET Q q 0 0 0 rg BT 85.50 371.25 Td (W) Tj ET Q q 0 0 0 rg BT 94.54 371.25 Td (ith respect to sales of all other GKK Properties for which a disposition fee has not yet been paid, if, upon the sale of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 359.25 Td (the final GKK Property) Tj ET Q q 0 0 0 rg BT 179.00 359.25 Td (, the conflicts committee determines in its sole discretion that the Company has recovered its ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 347.25 Td (entire investment related to the GKK Mezzanine Loan and the GKK Properties subsequent to the Settlement ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 335.25 Td (Agreement, after taking into consideration the net cash flow received by the Company from the investment, whether in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 323.25 Td (the form of \(i\) net proceeds from the sales or other dispositions or transfers of the GKK Properties, \(ii\) the net cash ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 311.25 Td (flow related to the GKK Mezzanine Loan, \(iii\) the net cash flow related to the GKK Properties subsequent to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 299.25 Td (Settlement ) Tj ET Q q 0 0 0 rg BT 130.22 299.25 Td (Agreement and/or \(iv\) other proceeds related to the assets and liabilities received under the Settlement ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 287.25 Td (Agreement, then the Company will pay the ) Tj ET Q q 0 0 0 rg BT 259.90 287.25 Td (Advisor a fee in an amount not to exceed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 426.79 287.25 Td (1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 440.12 287.25 Td ( of the contract sales price and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 275.25 Td (subject to other conditions set forth in the ) Tj ET Q q 0 0 0 rg BT 253.81 275.25 Td (Advisory ) Tj ET Q q 0 0 0 rg BT 292.98 275.25 Td (Agreement, as determined by the conflicts committee in its sole ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 263.25 Td (discretion, which fee will be payable promptly upon such determination by the conflicts committee.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 242.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 242.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 242.25 Td (, the Company had sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 258.75 242.25 Td (159) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 273.75 242.25 Td ( GKK Properties for an aggregate contract sales price of $) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 505.88 242.25 Td (212.3) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 528.38 242.25 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 230.25 Td (million for which the Company had not paid or accrued a disposition fee. If the conflicts committee determines the Company ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 218.25 Td (has recovered its entire investment related to the GKK Mezzanine Loan and the GKK Properties upon the sale of the final GKK ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 206.25 Td (Property) Tj ET Q q 0 0 0 rg BT 83.29 206.25 Td (, the conflicts committee may authorize the Company to pay the ) Tj ET Q q 0 0 0 rg BT 341.55 206.25 Td (Advisor a disposition fee of up to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.92 206.25 Td (1%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.25 206.25 Td ( of the aggregate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 194.25 Td (contract sales price of these GKK Properties sold as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 270.54 194.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 334.14 194.25 Td (, which amount would be determined by the conflicts ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 182.25 Td (committee in its sole discretion.) Tj ET Q endstream endobj 51 0 obj <>] /Rotate 0 /Contents 52 0 R>> endobj 52 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (24) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (1) Tj ET Q q 0 0 0 rg BT 53.95 632.25 Td (1. ) Tj ET Q q 0 0 0 rg BT 67.50 632.25 Td (SUPPLEMENT) Tj ET Q q 0 0 0 rg BT 135.10 632.25 Td (AL) Tj ET Q q 0 0 0 rg BT 148.44 632.25 Td ( CASH FLOW) Tj ET Q q 0 0 0 rg BT 211.60 632.25 Td ( ) Tj ET Q q 0 0 0 rg BT 213.54 632.25 Td (AND SIGNIFICANT) Tj ET Q q 0 0 0 rg BT 304.21 632.25 Td ( NONCASH ) Tj ET Q q 0 0 0 rg BT 359.03 632.25 Td (TRANSACTION DISCLOSURES) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (Supplemental cash flow and significant noncash transaction disclosures were as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 571.75 359.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 409.00 571.75 75.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 484.00 571.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.00 571.75 75.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 545.75 359.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 409.00 545.75 75.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 484.00 545.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.00 545.75 75.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 519.75 359.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 409.00 519.75 75.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 484.00 519.75 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 488.00 519.75 75.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 584.75 m 484 584.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 484 584.75 m 488 584.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 584.75 m 563 584.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 584.75 m 484 584.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 571.75 m 484 571.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 584.75 m 563 584.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 571.75 m 563 571.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 546.75 m 484 546.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 544.75 m 484 544.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 546.75 m 563 546.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 544.75 m 563 544.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 520.75 m 484 520.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 518.75 m 484 518.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 520.75 m 563 520.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 518.75 m 563 518.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 507.75 m 484 507.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 409 505.75 m 484 505.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 507.75 m 563 507.75 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 488 505.75 m 563 505.75 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 589.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 417.20 588.98 Td (For the Three Months Ended March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 576.00 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 438.00 575.98 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 517.00 575.98 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 563.00 Td (Supplemental Disclosure of Cash Flow Information:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 550.00 Td (Interest paid) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 411.50 550.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 462.80 550.00 Td (7,086) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 490.50 550.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 550.00 Td (11,857) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 537.00 Td (Supplemental Disclosure of Significant Noncash Transactions:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 524.00 Td (Mortgage loans extinguished in connection with foreclosures and deed in lieu of foreclosure) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 411.50 524.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 472.80 524.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 490.50 524.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 524.00 Td (6,134) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 511.00 Td (Increase in lease incentives payable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 411.50 511.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 472.80 511.00 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 490.50 511.00 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 511.00 Td (143) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 564.50 507.25 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 566.50 507.25 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 483.25 Td (12. ) Tj ET Q q 0 0 0 rg BT 67.50 483.25 Td (SEGMENT) Tj ET Q q 0 0 0 rg BT 117.33 483.25 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 167.97 483.25 Td (TION) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 465.25 Td (The Company presently operates in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 218.18 465.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 238.17 465.25 Td ( business segments based on its investment types: real estate, real estate-related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 453.25 Td (and commercial properties primarily leased to financial institutions received under the Settlement ) Tj ET Q q 0 0 0 rg BT 441.59 453.25 Td (Agreement, or the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 441.25 Td (GKK Properties. Under the real estate segment, the Company has invested primarily in of) Tj ET Q q 0 0 0 rg BT 410.89 441.25 Td (fice and industrial properties located ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 429.25 Td (throughout the United States. ) Tj ET Q q 0 0 0 rg BT 171.53 429.25 Td (The real estate segment excludes all real estate properties that were classified as discontinued ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 417.25 Td (operations. Under the real estate-related segment, the Company has invested in or originated mortgage loans, mezzanine loans ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 405.25 Td (and other real estate-related assets, including real estate securities. ) Tj ET Q q 0 0 0 rg BT 319.20 405.25 Td (The GKK Properties segment consists of primarily of) Tj ET Q q 0 0 0 rg BT 533.15 405.25 Td (fice ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 393.25 Td (properties, bank branch properties, operations centers and other properties located in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 390.21 393.25 Td (30) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.21 393.25 Td ( states but excludes GKK Properties that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 381.25 Td (were classified as discontinued operations. ) Tj ET Q q 0 0 0 rg BT 224.73 381.25 Td (All revenues earned from the Company’) Tj ET Q q 0 0 0 rg BT 385.51 381.25 Td (s three reporting segments were from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 369.25 Td (external customers and there were no intersegment sales or transfers. ) Tj ET Q q 0 0 0 rg BT 329.77 369.25 Td (The Company does not allocate corporate-level accounts ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 357.25 Td (to its reporting segments. Corporate-level accounts include corporate general and administrative expenses, asset management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 345.25 Td (fees, non-operating interest income and other corporate-level expenses. ) Tj ET Q q 0 0 0 rg BT 339.48 345.25 Td (The accounting policies of the reporting segments are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 333.25 Td (consistent with those described in Note 2, “Summary of Significant ) Tj ET Q q 0 0 0 rg BT 321.40 333.25 Td (Accounting Policies.”) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 315.25 Td (The Company evaluates the performance of its segments based upon net operating income from continuing operations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 303.25 Td (\(“NOI”\), which is a non-GAAP) Tj ET Q q 0 0 0 rg BT 176.04 303.25 Td ( supplemental financial measure. ) Tj ET Q q 0 0 0 rg BT 312.48 303.25 Td (The Company defines NOI for its real estate segment and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 291.25 Td (GKK Properties segment as operating revenues \(rental income, tenant reimbursements and other operating income\) less ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 279.25 Td (property and related expenses \(property operating expenses, real estate taxes, insurance and provision for bad debt\) less interest ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 267.25 Td (expense. ) Tj ET Q q 0 0 0 rg BT 89.03 267.25 Td (The Company defines NOI for its real estate-related segment as interest income and income from its unconsolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 255.25 Td (joint venture investment less loan servicing costs \(if applicable\) and interest expense \(if applicable\). NOI excludes certain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 243.25 Td (items that are not considered to be controllable in connection with the management of an asset such as non-property income and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 231.25 Td (expenses, depreciation and amortization, asset management fees and corporate general and administrative expenses. ) Tj ET Q q 0 0 0 rg BT 518.30 231.25 Td (The ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 219.25 Td (Company uses NOI to evaluate the operating performance of the Company’) Tj ET Q q 0 0 0 rg BT 352.19 219.25 Td (s real estate investments, real estate-related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 207.25 Td (investments and the GKK Properties and to make decisions about resource allocations. ) Tj ET Q q 0 0 0 rg BT 401.45 207.25 Td (The Company believes that net income ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 195.25 Td (is the GAAP) Tj ET Q q 0 0 0 rg BT 100.24 195.25 Td ( measure that is most directly comparable to NOI; however) Tj ET Q q 0 0 0 rg BT 336.71 195.25 Td (, NOI should not be considered as an alternative to net ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 183.25 Td (income as the primary indicator of operating performance as it excludes the items described above. ) Tj ET Q q 0 0 0 rg BT 450.19 183.25 Td (Additionally) Tj ET Q q 0 0 0 rg BT 500.09 183.25 Td (, NOI as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 171.25 Td (defined above may not be comparable to other REIT) Tj ET Q q 0 0 0 rg BT 259.28 171.25 Td (s or companies as their definitions of NOI may dif) Tj ET Q q 0 0 0 rg BT 460.44 171.25 Td (fer from the Company’) Tj ET Q q 0 0 0 rg BT 552.36 171.25 Td (s ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 159.25 Td (definition. During the year ended December 31, 2014, the Company revised its definition of NOI to exclude asset management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 147.25 Td (fees, which the Company does not consider to be controllable in connection with the management of each property or real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 135.25 Td (estate-related asset and is viewed by the chief operating decision makers as a corporate-level administrative expense. NOI for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 123.25 Td (all prior periods presented has been adjusted to conform to the current period definition.) Tj ET Q endstream endobj 53 0 obj <>] /Rotate 0 /Contents 54 0 R>> endobj 54 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (25) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 632.10 Td (The following tables summarize total revenues, interest expense and NOI for each reportable segment for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 488.50 632.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 508.49 632.10 Td ( months ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 75.88 620.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.48 620.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 158.91 620.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 178.91 620.10 Td (, and total assets and total liabilities for each reportable segment as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 459.38 620.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.98 620.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (December 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 128.08 608.10 Td ( \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 571.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 571.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 571.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 571.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 545.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 545.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 545.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 545.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 519.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 519.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 519.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 519.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 493.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 493.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 493.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 493.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 467.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 467.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 467.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 467.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 441.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 441.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 441.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 441.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 415.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 415.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 415.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 415.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 389.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 389.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 389.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 389.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 342.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 342.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 342.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 342.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 316.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 316.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 316.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 316.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 290.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 290.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 290.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 290.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 264.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 264.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 264.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 264.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 238.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 238.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 238.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 238.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 212.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 212.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 212.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 212.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 186.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 186.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 186.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 186.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 160.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 160.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 160.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 160.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 134.60 361.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 411.00 134.60 74.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 485.00 134.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 489.00 134.60 74.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 584.6 m 485 584.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 485 584.6 m 489 584.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 584.6 m 563 584.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 584.6 m 485 584.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 571.6 m 485 571.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 584.6 m 563 584.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 571.6 m 563 571.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 519.6 m 485 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 519.6 m 563 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 519.6 m 485 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 507.6 m 485 507.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 505.6 m 485 505.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 519.6 m 563 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 507.6 m 563 507.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 505.6 m 563 505.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 454.6 m 485 454.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 454.6 m 563 454.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 454.6 m 485 454.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 442.6 m 485 442.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 440.6 m 485 440.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 454.6 m 563 454.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 442.6 m 563 442.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 440.6 m 563 440.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 389.6 m 485 389.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 389.6 m 563 389.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 389.6 m 485 389.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 377.6 m 485 377.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 375.6 m 485 375.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 389.6 m 563 389.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 377.6 m 563 377.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 375.6 m 563 375.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 342.6 m 485 342.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 342.6 m 563 342.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 290.6 m 485 290.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 290.6 m 563 290.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 238.60000000000002 m 485 238.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 238.60000000000002 m 563 238.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 226.60000000000002 m 485 226.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 224.60000000000002 m 485 224.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 226.60000000000002 m 563 226.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 224.60000000000002 m 563 224.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 173.60000000000002 m 485 173.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 173.60000000000002 m 563 173.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 134.60000000000002 m 485 134.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 134.60000000000002 m 563 134.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 122.60000000000002 m 485 122.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 411 120.60000000000002 m 485 120.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 122.60000000000002 m 563 122.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 489 120.60000000000002 m 563 120.60000000000002 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 588.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 418.20 588.83 Td (For the Three Months Ended March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 575.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 439.50 575.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 517.50 575.83 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 562.85 Td (Revenues:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 549.85 Td (Real estate segment ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 136.03 553.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 549.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 459.80 549.85 Td (17,841) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 549.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 549.85 Td (18,919) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 536.85 Td (Real estate-related segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 469.80 536.85 Td (726) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 536.85 Td (801) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 523.85 Td (GKK Properties segment ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 152.93 527.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 459.80 523.85 Td (31,010) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 523.85 Td (34,286) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 510.85 Td (Total revenues) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 510.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 459.80 510.85 Td (49,577) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 510.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 510.85 Td (54,006) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 497.85 Td (Interest expense:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 484.85 Td (Real estate segment ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 136.03 488.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 484.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 463.80 484.85 Td (2,209) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 484.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 484.85 Td (2,966) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 471.85 Td (Real estate-related segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 471.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 471.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 458.85 Td (GKK Properties segment ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 152.93 462.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 463.80 458.85 Td (6,524) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 458.85 Td (10,579) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 445.85 Td (Total interest expense) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 445.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 463.80 445.85 Td (8,733) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 445.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 445.85 Td (13,545) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 432.85 Td (NOI:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 419.85 Td (Real estate segment ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 136.03 423.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 419.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 463.80 419.85 Td (6,394) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 419.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 419.85 Td (7,563) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 406.85 Td (Real estate-related segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 469.80 406.85 Td (725) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 406.85 Td (800) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 393.85 Td (GKK Properties segment ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 152.93 397.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 463.80 393.85 Td (4,955) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 393.85 Td (3,258) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 380.85 Td (Total NOI) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 380.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 459.80 380.85 Td (12,074) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 380.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 380.85 Td (11,621) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 359.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 420.20 359.83 Td (As of March 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 492.45 359.83 Td (As of December 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 346.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 439.50 346.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 517.50 346.83 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 333.85 Td (Assets:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 320.85 Td (Real estate segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 320.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 455.80 320.85 Td (546,677) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 320.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 320.85 Td (542,512) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 307.85 Td (Real estate-related segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 459.80 307.85 Td (29,291) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 307.85 Td (29,096) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 294.85 Td (GKK Properties segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 455.80 294.85 Td (718,214) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 294.85 Td (671,905) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 88.50 281.85 Td (Total segment assets) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 449.80 281.85 Td (1,294,182) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 527.80 281.85 Td (1,243,513) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 268.85 Td (Real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 268.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 268.85 Td (85,818) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 255.85 Td (Foreclosed real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 255.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 255.85 Td (12,045) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 242.85 Td (Corporate-level ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 122.70 246.48 Td (\(2\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 459.80 242.85 Td (57,133) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 242.85 Td (34,791) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 229.85 Td (Total assets) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 229.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 449.80 229.85 Td (1,351,315) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 229.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 527.80 229.85 Td (1,376,167) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 216.85 Td (Liabilities:) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 203.85 Td (Real estate segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 203.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 455.80 203.85 Td (243,523) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 203.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 203.85 Td (240,965) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 190.85 Td (Real estate-related segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 477.80 190.85 Td (5) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 190.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 177.85 Td (GKK Properties segment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 455.80 177.85 Td (491,732) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 177.85 Td (499,908) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 88.50 164.85 Td (Total segment liabilities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 455.80 164.85 Td (735,260) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 164.85 Td (740,873) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 151.85 Td (Real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 151.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 151.85 Td (16,883) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 70.50 138.85 Td (Corporate-level ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 122.70 142.48 Td (\(3\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 469.80 138.85 Td (941) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 138.85 Td (5,638) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 125.85 Td (Total liabilities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.50 125.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 455.80 125.85 Td (736,201) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.50 125.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 533.80 125.85 Td (763,394) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 110.10 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 101.50 Td (\(1\) ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 56.40 98.10 Td (Amounts include certain properties in continuing operations that were sold as of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 298.85 98.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 346.55 98.10 Td (. See Note 6, “Real Estate Held for Sale and Discontinued Operations” ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 89.10 Td (for more information.) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 80.50 Td (\(2\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 77.10 Td ( ) Tj ET Q q 0 0 0 rg BT 56.92 77.10 Td (T) Tj ET Q q 0 0 0 rg BT 60.98 77.10 Td (otal corporate-level assets consisted primarily of cash and cash equivalents of approximately ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 340.90 77.10 Td ($56.7 million) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 381.32 77.10 Td ( and ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 395.90 77.10 Td ($34.2 million) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 436.32 77.10 Td ( as of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 454.44 77.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 502.14 77.10 Td ( and ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 516.72 77.10 Td (December 31, ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 68.10 Td (2014) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 64.50 68.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 104.00 68.10 Td (.) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 59.50 Td (\(3\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 56.10 Td ( ) Tj ET Q q 0 0 0 rg BT 56.65 56.10 Td (As of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 74.98 56.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 122.68 56.10 Td (, corporate-level liabilities consisted primarily of accounts payable and accrued liabilities for general and administrative expenses. ) Tj ET Q q 0 0 0 rg BT 516.51 56.10 Td (As of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 47.10 Td (December 31, 2014) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 108.44 47.10 Td (, corporate-level liabilities consisted primarily of distributions payable.) Tj ET Q endstream endobj 55 0 obj <>] /Rotate 0 /Contents 56 0 R>> endobj 56 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (26) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (The following table reconciles the Company’) Tj ET Q q 0 0 0 rg BT 254.28 632.10 Td (s net income \(loss\) to its NOI for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 403.42 632.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 423.41 632.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 484.23 632.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 547.83 632.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 66.44 620.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.44 620.10 Td ( \(amounts in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 569.60 383.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 569.60 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 569.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 569.60 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 543.60 383.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 543.60 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 543.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 543.60 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 517.60 383.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 517.60 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 517.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 517.60 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 491.60 383.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 491.60 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 491.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 491.60 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 465.60 383.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 465.60 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 465.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 465.60 64.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 439.60 383.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 433.00 439.60 62.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 495.00 439.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 499.00 439.60 64.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 433 582.6 m 495 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 495 582.6 m 499 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 582.6 m 563 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 433 582.6 m 495 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 433 569.6 m 495 569.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 582.6 m 563 582.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 569.6 m 563 569.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 433 569.6 m 495 569.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 569.6 m 563 569.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 433 426.6 m 495 426.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 426.6 m 563 426.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 433 426.6 m 495 426.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 433 414.6 m 495 414.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 433 412.6 m 495 412.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 426.6 m 563 426.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 414.6 m 563 414.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 499 412.6 m 563 412.6 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 586.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 447.70 594.83 Td (For the Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 480.00 586.83 Td (March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 573.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 455.50 573.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 522.50 573.83 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 560.85 Td (Net income \(loss\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 435.50 560.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 560.85 Td (8,589) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 501.50 560.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 560.85 Td (\(4,515) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 560.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 547.85 Td (Gain on sales of real estate) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 467.10 547.85 Td (\(13,967) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.80 547.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 547.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 534.85 Td (Gain on sales of real estate securities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 483.80 534.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 534.85 Td (\(3,748) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 534.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 521.85 Td (Gain from extinguishment of debt) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 483.80 521.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 521.85 Td (\(1,815) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 521.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 508.85 Td (Gain on sale of foreclosed real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 471.10 508.85 Td (\(2,509) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.80 508.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 508.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 495.85 Td (Other income and interest income) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 477.10 495.85 Td (\(116) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.80 495.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 545.10 495.85 Td (\(472) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 495.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 482.85 Td (Asset management fees to affiliate) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 482.85 Td (2,420) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 482.85 Td (2,499) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 469.85 Td (General and administrative expenses) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 473.80 469.85 Td (2,220) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 469.85 Td (3,644) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 456.85 Td (Depreciation and amortization) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 469.80 456.85 Td (15,605) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 456.85 Td (17,923) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 443.85 Td (Impairment charge on real estate held for investment) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 483.80 443.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 443.85 Td (1,257) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 430.85 Td (Total income from discontinued operations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 477.10 430.85 Td (\(168) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 491.80 430.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 430.85 Td (\(3,152) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 430.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 417.85 Td (NOI ) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 68.72 421.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 435.50 417.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 469.80 417.85 Td (12,074) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 501.50 417.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 417.85 Td (11,621) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 399.10 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 390.50 Td (\(1\) ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 56.40 387.10 Td (Amounts include certain properties in continuing operations that were sold as of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 298.85 387.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 346.55 387.10 Td (. See Note 6, “Real Estate Held for Sale and Discontinued Operations” ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 378.10 Td (for more information.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 354.10 Td (13. ) Tj ET Q q 0 0 0 rg BT 67.50 354.10 Td (COMMITMENTS ) Tj ET Q q 0 0 0 rg BT 149.45 354.10 Td (AND CONTINGENCIES) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 336.10 Td (Lease Obligations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 318.10 Td (Pursuant to the Settlement ) Tj ET Q q 0 0 0 rg BT 180.71 318.10 Td (Agreement, the Company indirectly received leasehold interests in certain commercial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 306.10 Td (properties, pursuant to leases between the owner of the property) Tj ET Q q 0 0 0 rg BT 304.88 306.10 Td (, as landlord, and the Company) Tj ET Q q 0 0 0 rg BT 428.92 306.10 Td (, as tenant. ) Tj ET Q q 0 0 0 rg BT 476.51 306.10 Td (The ground leases ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 294.10 Td (have expiration dates between 2017 and 2101 and the building leases have expiration dates during the remainder of 2015 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 282.10 Td (through 2085. ) Tj ET Q q 0 0 0 rg BT 110.43 282.10 Td (These lease obligations generally contain rent increases and renewal options. In certain instances, the rent owed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 270.10 Td (by the Company to the owner of the property under the lease is greater than the revenue received by the Company from the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 258.10 Td (tenants occupying the property) Tj ET Q q 0 0 0 rg BT 172.42 258.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 240.10 Td (Future minimum lease payments owed by the Company under non-cancelable operating building and ground leases as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 228.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 228.10 Td ( were as follows \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 211.60 412.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 462.00 211.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 185.60 412.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 462.00 185.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 159.60 412.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 462.00 159.60 100.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 133.60 412.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 462.00 133.60 100.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 462 133.60000000000002 m 562 133.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 462 133.60000000000002 m 562 133.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 462 121.60000000000002 m 562 121.60000000000002 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 462 119.60000000000002 m 562 119.60000000000002 l s BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 202.86 Td (April 1, 2015 through December 31, 2015) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 464.50 202.86 Td ($) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 533.75 202.86 Td (13,060) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 189.86 Td (2016) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 533.75 189.86 Td (16,923) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 176.86 Td (2017) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 533.75 176.86 Td (12,981) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 163.86 Td (2018) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 538.25 163.86 Td (2,782) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 150.86 Td (2019) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 538.25 150.86 Td (2,338) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 52.50 137.86 Td (Thereafter) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 533.75 137.86 Td (36,079) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 464.50 124.86 Td ($) Tj ET Q BT /F1 9.00 Tf ET q 0 0 0 rg BT 533.75 124.86 Td (84,163) Tj ET Q BT /F1 10.00 Tf ET endstream endobj 57 0 obj <>] /Rotate 0 /Contents 58 0 R>> endobj 58 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 1. Financial Statements \(continued\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 195.70 712.60 Td (KBS REAL) Tj ET Q q 0 0 0 rg BT 245.44 712.60 Td ( EST) Tj ET Q q 0 0 0 rg BT 266.10 712.60 Td (A) Tj ET Q q 0 0 0 rg BT 272.58 712.60 Td (TE INVESTMENT) Tj ET Q q 0 0 0 rg BT 355.48 712.60 Td ( ) Tj ET Q q 0 0 0 rg BT 357.79 712.60 Td (TRUST) Tj ET Q q 0 0 0 rg BT 390.40 712.60 Td (, INC.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 107.50 694.60 Td (CONDENSED NOTES ) Tj ET Q q 0 0 0 rg BT 209.01 694.60 Td (T) Tj ET Q q 0 0 0 rg BT 215.50 694.60 Td (O CONSOLIDA) Tj ET Q q 0 0 0 rg BT 285.60 694.60 Td (TED FINANCIAL) Tj ET Q q 0 0 0 rg BT 364.78 694.60 Td ( ST) Tj ET Q q 0 0 0 rg BT 378.77 694.60 Td (A) Tj ET Q q 0 0 0 rg BT 385.25 694.60 Td (TEMENTS \(CONTINUED\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.20 676.60 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.95 661.60 Td (\(unaudited\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (27) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 632.25 Td (Economic Dependency) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 614.25 Td (The Company is dependent on the ) Tj ET Q q 0 0 0 rg BT 212.36 614.25 Td (Advisor for certain services that are essential to the Company) Tj ET Q q 0 0 0 rg BT 458.02 614.25 Td (, including the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (management of the Company’) Tj ET Q q 0 0 0 rg BT 170.30 602.25 Td (s real estate and real estate-related investment portfolio; the disposition of real estate and real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (estate-related investments; and other general and administrative responsibilities. In the event that the ) Tj ET Q q 0 0 0 rg BT 456.32 590.25 Td (Advisor is unable to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (provide any of these services, the Company will be required to obtain such services from other sources. ) Tj ET Q q 0 0 0 rg BT 468.09 578.25 Td (The Company is also ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.25 Td (dependent on the Property Manager for the Services under the ) Tj ET Q q 0 0 0 rg BT 299.97 566.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 377.18 566.25 Td (Agreement, including the operations, leasing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.25 Td (and eventual dispositions of the GKK Properties.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 536.25 Td (Envir) Tj ET Q q 0 0 0 rg BT 73.77 536.25 Td (onmental) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 518.25 Td (As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.25 Td (Although there can be no assurance, the Company is not aware of any environmental liability that could have a material adverse ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.25 Td (ef) Tj ET Q q 0 0 0 rg BT 57.09 494.25 Td (fect on its financial condition or results of operations. However) Tj ET Q q 0 0 0 rg BT 312.45 494.25 Td (, changes in applicable environmental laws and regulations, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.25 Td (the uses and conditions of properties in the vicinity of the Company’) Tj ET Q q 0 0 0 rg BT 323.62 482.25 Td (s properties, the activities of its tenants and other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.25 Td (environmental conditions of which the Company is unaware with respect to the properties could result in future environmental ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.25 Td (liabilities.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 440.25 Td (Under the Settlement ) Tj ET Q q 0 0 0 rg BT 160.42 440.25 Td (Agreement, the Company indirectly took title to or) Tj ET Q q 0 0 0 rg BT 363.31 440.25 Td (, with respect to a limited number of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 428.25 Td (GKK Properties, indirectly took a leasehold interest in, the GKK Properties on an “as is” basis. ) Tj ET Q q 0 0 0 rg BT 434.42 428.25 Td (As such, the Company was not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 416.25 Td (able to inspect the GKK Properties or conduct standard due diligence on certain of the GKK Properties before the transfers of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.25 Td (the properties. ) Tj ET Q q 0 0 0 rg BT 111.15 404.25 Td (Additionally) Tj ET Q q 0 0 0 rg BT 161.05 404.25 Td (, the Company did not receive representations, warranties and indemnities relating to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.25 Td (GKK Properties from Gramercy and/or its af) Tj ET Q q 0 0 0 rg BT 228.71 392.25 Td (filiates. ) Tj ET Q q 0 0 0 rg BT 263.24 392.25 Td (Thus, the value of the GKK Properties may decline if the Company ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 380.25 Td (subsequently discovers environmental problems with the GKK Properties.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 362.25 Td (Legal Matters) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 344.25 Td (From time to time, the Company is party to legal proceedings that arise in the ordinary course of its business. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 332.25 Td (Management is not aware of any legal proceedings the outcome of which is probable or reasonably possible to have a material ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 320.25 Td (adverse ef) Tj ET Q q 0 0 0 rg BT 90.13 320.25 Td (fect on the Company’) Tj ET Q q 0 0 0 rg BT 176.49 320.25 Td (s results of operations or financial condition, which would require accrual or disclosure of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 308.25 Td (contingency and possible range of loss. ) Tj ET Q q 0 0 0 rg BT 211.14 308.25 Td (Additionally) Tj ET Q q 0 0 0 rg BT 261.04 308.25 Td (, the Company has not recorded any loss contingencies related to legal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 296.25 Td (proceedings in which the potential loss is deemed to be remote.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 272.25 Td (14. ) Tj ET Q q 0 0 0 rg BT 68.00 272.25 Td (SUBSEQUENT) Tj ET Q q 0 0 0 rg BT 135.07 272.25 Td ( EVENTS) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 74.00 254.25 Td (The Company evaluates subsequent events up until the date the consolidated financial statements are issued.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 236.25 Td (Distribution Declar) Tj ET Q q 0 0 0 rg BT 132.87 236.25 Td (ed) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 218.25 Td (On May 13, 2015, the Company’) Tj ET Q q 0 0 0 rg BT 204.43 218.25 Td (s board of directors declared a distribution in the amount of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 444.64 218.25 Td ($0.025) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.14 218.25 Td ( per share of common ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 206.25 Td (stock to stockholders of record as of the close of business on June 19, 2015. ) Tj ET Q q 0 0 0 rg BT 358.10 206.25 Td (The Company expects to pay this distribution on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 194.25 Td (or about June 26, 2015.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 176.25 Td (Disposition of Pr) Tj ET Q q 0 0 0 rg BT 121.49 176.25 Td (operties Subsequent to Mar) Tj ET Q q 0 0 0 rg BT 239.36 176.25 Td (ch 31, 2015) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 50.00 158.25 Td (101 Independence) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 74.00 140.25 Td (On May 1, 2015, the Company) Tj ET Q q 0 0 0 rg BT 197.51 140.25 Td (, through an indirect wholly owned subsidiary) Tj ET Q q 0 0 0 rg BT 380.99 140.25 Td (, sold an of) Tj ET Q q 0 0 0 rg BT 425.25 140.25 Td (fice building containing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 523.28 140.25 Td (565,694) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 555.78 140.25 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 128.25 Td (rentable square feet located in Charlotte, North Carolina \(“101 Independence”\) for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.63 128.25 Td ($107.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 441.52 128.25 Td ( or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 454.85 128.25 Td ($106.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 513.75 128.25 Td ( net of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 116.25 Td (concessions and credits. ) Tj ET Q q 0 0 0 rg BT 151.18 116.25 Td (The carrying value of 101 Independence as of the date of sale was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 418.01 116.25 Td ($69.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.90 116.25 Td (. ) Tj ET Q q 0 0 0 rg BT 479.22 116.25 Td (The purchaser is not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 104.25 Td (af) Tj ET Q q 0 0 0 rg BT 57.59 104.25 Td (filiated with the Company or the ) Tj ET Q q 0 0 0 rg BT 189.79 104.25 Td (Advisor) Tj ET Q q 0 0 0 rg BT 221.46 104.25 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 74.00 86.25 Td (In connection with the disposition of 101 Independence, the Company repaid the entire ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 425.02 86.25 Td ($65.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.91 86.25 Td ( principal balance ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 74.25 Td (and all other sums due under a mortgage loan secured by 101 Independence, including a prepayment premium of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 504.58 74.25 Td ($4.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 553.47 74.25 Td (. ) Tj ET Q endstream endobj 59 0 obj <>] /Rotate 0 /Contents 60 0 R>> endobj 60 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (28) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (The following discussion and analysis should be read in conjunction with the accompanying financial statements of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (KBS Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 165.96 692.10 Td (T) Tj ET Q q 0 0 0 rg BT 171.72 692.10 Td (rust, Inc. and the notes thereto. ) Tj ET Q q 0 0 0 rg BT 299.47 692.10 Td (As used herein, the terms “we,” “our” and “us” refer to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (KBS Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 165.96 680.10 Td (T) Tj ET Q q 0 0 0 rg BT 171.72 680.10 Td (rust, Inc., a Maryland corporation, and, as required by context, KBS Limited Partnership, a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (Delaware limited partnership, which we refer to as the “Operating Partnership,” and to their subsidiaries.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 650.10 Td (Forward-Looking Statements) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 632.10 Td (Certain statements included in this Quarterly Report on Form 10-Q are forward-looking statements. ) Tj ET Q q 0 0 0 rg BT 476.83 632.10 Td (Those statements ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (include statements regarding the intent, belief or current expectations of KBS Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 456.14 620.10 Td (T) Tj ET Q q 0 0 0 rg BT 461.89 620.10 Td (rust, Inc. and members ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (of our management team, as well as the assumptions on which such statements are based, and generally are identified by the use ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (of words such as “may) Tj ET Q q 0 0 0 rg BT 139.94 596.10 Td (,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “should” or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 584.10 Td (similar expressions. ) Tj ET Q q 0 0 0 rg BT 133.38 584.10 Td (Actual results may dif) Tj ET Q q 0 0 0 rg BT 221.79 584.10 Td (fer materially from those contemplated by such forward-looking statements. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 572.10 Td (Further) Tj ET Q q 0 0 0 rg BT 78.54 572.10 Td (, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 560.10 Td (forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 548.10 Td (operating results over time, unless required by law) Tj ET Q q 0 0 0 rg BT 251.02 548.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 530.10 Td (The following are some of the risks and uncertainties, although not all of the risks and uncertainties, that could cause our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.10 Td (actual results to dif) Tj ET Q q 0 0 0 rg BT 125.69 518.10 Td (fer materially from those presented in our forward-looking statements:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 500.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 500.10 Td (W) Tj ET Q q 0 0 0 rg BT 98.64 500.10 Td (e are the first publicly of) Tj ET Q q 0 0 0 rg BT 197.03 500.10 Td (fered investment program sponsored by the af) Tj ET Q q 0 0 0 rg BT 380.68 500.10 Td (filiates of our external advisor) Tj ET Q q 0 0 0 rg BT 500.80 500.10 Td (, KBS Capital ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 488.10 Td (Advisors LLC, which makes our future performance dif) Tj ET Q q 0 0 0 rg BT 313.64 488.10 Td (ficult to predict. Our stockholders should not assume that our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 476.10 Td (performance will be similar to the past performance of other real estate investment programs sponsored by af) Tj ET Q q 0 0 0 rg BT 526.33 476.10 Td (filiates ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 464.10 Td (of our advisor) Tj ET Q q 0 0 0 rg BT 145.55 464.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 449.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 449.10 Td (All of our executive of) Tj ET Q q 0 0 0 rg BT 180.90 449.10 Td (ficers and some of our directors and other key real estate and debt finance professionals are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 437.10 Td (also of) Tj ET Q q 0 0 0 rg BT 116.76 437.10 Td (ficers, directors, managers, key professionals and/or holders of a direct or indirect controlling interest in our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 425.10 Td (advisor) Tj ET Q q 0 0 0 rg BT 119.04 425.10 Td (, the entity that acted as our dealer manager and/or other KBS-af) Tj ET Q q 0 0 0 rg BT 377.09 425.10 Td (filiated entities. ) Tj ET Q q 0 0 0 rg BT 443.74 425.10 Td (As a result, they face ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 413.10 Td (conflicts of interest, including significant conflicts created by our advisor) Tj ET Q q 0 0 0 rg BT 383.62 413.10 Td (’) Tj ET Q q 0 0 0 rg BT 386.40 413.10 Td (s compensation arrangements with us and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 401.10 Td (other KBS-sponsored programs and KBS-advised investors and conflicts in allocating time among us and these other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 389.10 Td (programs and investors. ) Tj ET Q q 0 0 0 rg BT 190.63 389.10 Td (These conflicts could result in unanticipated actions.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 374.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 374.10 Td (W) Tj ET Q q 0 0 0 rg BT 98.64 374.10 Td (e pay substantial fees to and expenses of our advisor and its af) Tj ET Q q 0 0 0 rg BT 347.28 374.10 Td (filiates. ) Tj ET Q q 0 0 0 rg BT 381.81 374.10 Td (These payments increase the risk that our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 362.10 Td (stockholders will not earn a profit on their investment in us and increase the risk of loss to our stockholders.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 347.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 347.10 Td (W) Tj ET Q q 0 0 0 rg BT 98.64 347.10 Td (e depend on tenants for the revenue generated by our real estate investments and, accordingly) Tj ET Q q 0 0 0 rg BT 472.01 347.10 Td (, the revenue ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 335.10 Td (generated by our real estate investments is dependent upon the success and economic viability of our tenants. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 323.10 Td (Revenues from our properties could decrease due to a reduction in occupancy \(caused by factors including, but not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 311.10 Td (limited to, tenant defaults, tenant insolvency) Tj ET Q q 0 0 0 rg BT 266.81 311.10 Td (, early termination of tenant leases and non-renewal of existing tenant ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 299.10 Td (leases\) and/or lower rental rates, making it more dif) Tj ET Q q 0 0 0 rg BT 296.69 299.10 Td (ficult for us to meet our debt service obligations and reducing our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 287.10 Td (stockholders’) Tj ET Q q 0 0 0 rg BT 143.13 287.10 Td ( returns.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 272.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 272.10 Td (W) Tj ET Q q 0 0 0 rg BT 98.64 272.10 Td (e may not be able to refinance some or all of our existing indebtedness or to obtain additional debt financing on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 260.10 Td (attractive terms. If we are not able to refinance existing indebtedness on attractive terms at or prior to its maturity) Tj ET Q q 0 0 0 rg BT 545.02 260.10 Td (, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 248.10 Td (may be forced to dispose of our assets sooner than we otherwise would and/or our lenders may take action against us. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 233.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 233.10 Td (Our investments in real estate and real estate loans may be af) Tj ET Q q 0 0 0 rg BT 333.89 233.10 Td (fected by unfavorable real estate market and general ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 221.10 Td (economic conditions, which could decrease the value of those assets and reduce the investment return to our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 209.10 Td (stockholders. Revenues from our real property investments could decrease, making it more dif) Tj ET Q q 0 0 0 rg BT 469.99 209.10 Td (ficult for us to meet ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 197.10 Td (our debt service obligations. Revenues from the properties and other assets directly or indirectly securing our loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 185.10 Td (investments could decrease, making it more dif) Tj ET Q q 0 0 0 rg BT 278.93 185.10 Td (ficult for the borrowers under those loans to meet their payment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 173.10 Td (obligations to us. In addition, decreases in revenues from the properties directly or indirectly securing our loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 161.10 Td (investments could result in decreased valuations for those properties, which could make it dif) Tj ET Q q 0 0 0 rg BT 463.05 161.10 Td (ficult for our borrowers ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 149.10 Td (to repay or refinance their obligations to us. ) Tj ET Q q 0 0 0 rg BT 269.77 149.10 Td (These factors could make it more dif) Tj ET Q q 0 0 0 rg BT 416.75 149.10 Td (ficult for us to meet our debt service ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 137.10 Td (obligations and could reduce our stockholders’) Tj ET Q q 0 0 0 rg BT 276.71 137.10 Td ( return.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 122.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 122.10 Td (Disruptions in the financial markets and uncertain economic conditions could adversely af) Tj ET Q q 0 0 0 rg BT 451.10 122.10 Td (fect our ability to meet our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 110.10 Td (debt service obligations and cash needs, reducing the value of our stockholders’) Tj ET Q q 0 0 0 rg BT 408.60 110.10 Td ( investment in us.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 95.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 95.10 Td (Certain of our debt obligations have variable interest rates and related payments that vary with the movement of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 83.10 Td (LIBOR or other indexes. Increases in these indexes could increase the amount of our debt payments and reduce our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 71.10 Td (stockholders’) Tj ET Q q 0 0 0 rg BT 143.13 71.10 Td ( return.) Tj ET Q endstream endobj 61 0 obj <>] /Rotate 0 /Contents 62 0 R>> endobj 62 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (29) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 704.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 704.10 Td (Our share redemption program provides only for redemptions sought upon a stockholder) Tj ET Q q 0 0 0 rg BT 445.01 704.10 Td (’) Tj ET Q q 0 0 0 rg BT 447.79 704.10 Td (s death, “qualifying ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 692.10 Td (disability” or “determination of incompetence” \(each as defined in the share redemption program and, together with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 680.10 Td (redemptions in connection with a stockholder) Tj ET Q q 0 0 0 rg BT 272.83 680.10 Td (’) Tj ET Q q 0 0 0 rg BT 275.61 680.10 Td (s death, “special redemptions”\). ) Tj ET Q q 0 0 0 rg BT 407.88 680.10 Td (The dollar amounts available for such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 668.10 Td (redemptions are determined by our board of directors and may be reviewed and adjusted from time to time. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 656.10 Td (Additionally) Tj ET Q q 0 0 0 rg BT 139.90 656.10 Td (, redemptions are further subject to limitations described in our share redemption program. ) Tj ET Q q 0 0 0 rg BT 507.39 656.10 Td (W) Tj ET Q q 0 0 0 rg BT 516.03 656.10 Td (e currently ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 644.10 Td (do not expect to have funds available for ordinary redemptions in the future. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 629.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 629.10 Td (W) Tj ET Q q 0 0 0 rg BT 98.64 629.10 Td (e may not be able to successfully operate and/or sell the GKK Properties \(defined below\) given current economic ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 617.10 Td (conditions and the concentration of the GKK Properties in the financial services sector) Tj ET Q q 0 0 0 rg BT 436.16 617.10 Td (, the significant debt ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 605.10 Td (obligations we have assumed with respect to such GKK Properties, and our advisor) Tj ET Q q 0 0 0 rg BT 423.91 605.10 Td (’) Tj ET Q q 0 0 0 rg BT 426.69 605.10 Td (s limited experience operating, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 593.10 Td (managing and selling bank branch properties. Moreover) Tj ET Q q 0 0 0 rg BT 316.20 593.10 Td (, we depend upon GKK Realty ) Tj ET Q q 0 0 0 rg BT 441.45 593.10 Td (Advisors LLC \(the “Property ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 581.10 Td (Manager”\), an af) Tj ET Q q 0 0 0 rg BT 157.83 581.10 Td (filiate of Gramercy \(defined below\), to manage and conduct the operations of the GKK Properties ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 569.10 Td (and any adverse changes in or the termination of our relationship with the Property Manager could hinder the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 557.10 Td (performance of the GKK Properties and the return on our stockholders’) Tj ET Q q 0 0 0 rg BT 375.28 557.10 Td ( investment.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 542.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 542.10 Td (As a result of the transfer of the GKK Properties to us, a significant portion of our properties are leased to financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 530.10 Td (institutions, making us more economically vulnerable in the event of a downturn in the banking industry) Tj ET Q q 0 0 0 rg BT 507.05 530.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 512.10 Td (All forward-looking statements should be read in light of the risks identified in Part I, Item 1A) Tj ET Q q 0 0 0 rg BT 450.93 512.10 Td ( of our ) Tj ET Q q 0 0 0 rg BT 479.54 512.10 Td (Annual Report on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 500.10 Td (Form 10-K for the year ended December 31, 2014 filed with the Securities and Exchange Commission \(the “SEC”\).) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 482.10 Td (Overview) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 464.10 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 464.10 Td (e are a Maryland corporation that was formed on June 13, 2005 to invest in a diverse portfolio of real estate properties ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 452.10 Td (and real estate-related investments. ) Tj ET Q q 0 0 0 rg BT 194.81 452.10 Td (W) Tj ET Q q 0 0 0 rg BT 203.45 452.10 Td (e elected to be taxed as a real estate investment trust \(“REIT”\) beginning with the taxable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 440.10 Td (year ended December 31, 2006 and we intend to continue to operate in such a manner) Tj ET Q q 0 0 0 rg BT 392.16 440.10 Td (. ) Tj ET Q q 0 0 0 rg BT 399.48 440.10 Td (W) Tj ET Q q 0 0 0 rg BT 408.11 440.10 Td (e own substantially all of our assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 428.10 Td (and conduct our operations through our Operating Partnership, of which we are the sole general partner) Tj ET Q q 0 0 0 rg BT 462.70 428.10 Td (. Subject to certain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 416.10 Td (restrictions and limitations, our business is managed by KBS Capital ) Tj ET Q q 0 0 0 rg BT 326.42 416.10 Td (Advisors pursuant to an advisory agreement. Our advisor ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.10 Td (owns 20,000 shares of our common stock. ) Tj ET Q q 0 0 0 rg BT 223.19 404.10 Td (W) Tj ET Q q 0 0 0 rg BT 231.82 404.10 Td (e have no paid employees.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 386.10 Td (On January 27, 2006, we launched our initial public of) Tj ET Q q 0 0 0 rg BT 291.88 386.10 Td (fering of up to 200,000,000 shares of common stock in our primary ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 374.10 Td (of) Tj ET Q q 0 0 0 rg BT 57.65 374.10 Td (fering and 80,000,000 shares of common stock under our dividend reinvestment plan. ) Tj ET Q q 0 0 0 rg BT 405.17 374.10 Td (W) Tj ET Q q 0 0 0 rg BT 413.81 374.10 Td (e ceased of) Tj ET Q q 0 0 0 rg BT 458.04 374.10 Td (fering shares of common ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 362.10 Td (stock in our primary of) Tj ET Q q 0 0 0 rg BT 141.52 362.10 Td (fering on May 30, 2008. ) Tj ET Q q 0 0 0 rg BT 243.55 362.10 Td (W) Tj ET Q q 0 0 0 rg BT 252.19 362.10 Td (e terminated our dividend reinvestment plan ef) Tj ET Q q 0 0 0 rg BT 439.16 362.10 Td (fective ) Tj ET Q q 0 0 0 rg BT 468.31 362.10 Td (April 10, 2012. ) Tj ET Q q 0 0 0 rg BT 534.24 362.10 Td (W) Tj ET Q q 0 0 0 rg BT 542.88 362.10 Td (e ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 350.10 Td (sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 68.67 350.10 Td (171,109,494) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 118.67 350.10 Td ( shares in our primary of) Tj ET Q q 0 0 0 rg BT 217.07 350.10 Td (fering for gross of) Tj ET Q q 0 0 0 rg BT 289.37 350.10 Td (fering proceeds of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 364.62 350.10 Td ($1.7 billion) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.73 350.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 430.17 350.10 Td (28,306,086) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 475.17 350.10 Td ( shares under our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 338.10 Td (dividend reinvestment plan for gross of) Tj ET Q q 0 0 0 rg BT 206.79 338.10 Td (fering proceeds of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 282.03 338.10 Td ($233.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 340.92 338.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 320.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 320.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 320.10 Td (, we owned or) Tj ET Q q 0 0 0 rg BT 217.79 320.10 Td (, with respect to a limited number of properties, held a leasehold interest in, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.43 320.10 Td (397) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 537.43 320.10 Td ( real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 308.10 Td (estate properties, including the GKK Properties. In addition, as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 317.21 308.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 380.81 308.10 Td (, we owned ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 429.13 308.10 Td (four) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.79 308.10 Td ( real estate loans receivable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 296.10 Td (and a participation interest with respect to a real estate joint venture.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 278.10 Td (On September 1, 201) Tj ET Q q 0 0 0 rg BT 158.11 278.10 Td (1, we, through indirect wholly owned subsidiaries \(collectively) Tj ET Q q 0 0 0 rg BT 409.91 278.10 Td (, “KBS”\), entered into a Collateral ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 266.10 Td (T) Tj ET Q q 0 0 0 rg BT 55.26 266.10 Td (ransfer and Settlement ) Tj ET Q q 0 0 0 rg BT 147.17 266.10 Td (Agreement \(the “Settlement ) Tj ET Q q 0 0 0 rg BT 261.30 266.10 Td (Agreement”\) with, among other parties, GKK Stars ) Tj ET Q q 0 0 0 rg BT 469.30 266.10 Td (Acquisition LLC ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 254.10 Td (\(“GKK Stars”\), the wholly owned subsidiary of Gramercy Property ) Tj ET Q q 0 0 0 rg BT 322.03 254.10 Td (T) Tj ET Q q 0 0 0 rg BT 327.79 254.10 Td (rust, Inc. \(“Gramercy”\) that indirectly owned the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 242.10 Td (Gramercy real estate portfolio, to ef) Tj ET Q q 0 0 0 rg BT 192.59 242.10 Td (fect the orderly transfer of certain assets and liabilities of the Gramercy real estate portfolio ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 230.10 Td (to KBS in satisfaction of certain debt obligations under a mezzanine loan owed by wholly owned subsidiaries of Gramercy to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 218.10 Td (KBS \(the “GKK Mezzanine Loan”\). ) Tj ET Q q 0 0 0 rg BT 200.10 218.10 Td (The Settlement ) Tj ET Q q 0 0 0 rg BT 262.86 218.10 Td (Agreement resulted in the transfer of the equity interests in certain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 206.10 Td (subsidiaries of Gramercy \(the “Equity Interests”\) that indirectly owned or) Tj ET Q q 0 0 0 rg BT 343.72 206.10 Td (, with respect to a limited number of properties, held a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 194.10 Td (leasehold interest in, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 134.48 194.10 Td (867) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 149.48 194.10 Td ( properties \(the “GKK Properties”\), consisting of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 348.31 194.10 Td (576) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 363.31 194.10 Td ( bank branch properties and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 476.88 194.10 Td (291) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.88 194.10 Td ( of) Tj ET Q q 0 0 0 rg BT 502.53 194.10 Td (fice buildings, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 182.10 Td (operations centers and other properties. For a further discussion of the Settlement ) Tj ET Q q 0 0 0 rg BT 379.41 182.10 Td (Agreement, the transfers of the GKK ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 170.10 Td (Properties and the debt related to these properties, see our ) Tj ET Q q 0 0 0 rg BT 282.48 170.10 Td (Annual Report on Form 10-K for the year ended December 31, 201) Tj ET Q q 0 0 0 rg BT 552.03 170.10 Td (1 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 158.10 Td (filed with the SEC.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 140.10 Td (Our focus in 2015 is to manage our existing investment portfolio, which includes strategically selling assets and exploring ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 128.10 Td (value-add opportunities for existing assets \(primarily certain of the GKK Properties\), refinancing upcoming maturities and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 116.10 Td (paying down debt, and distributing available cash to stockholders.) Tj ET Q endstream endobj 63 0 obj <>] /Rotate 0 /Contents 64 0 R>> endobj 64 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (30) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (Our charter requires that we seek stockholder approval of our liquidation if our shares of common stock are not listed on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (a national securities exchange by November 2012, unless a majority of our independent directors determines that liquidation is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (not then in the best interest of our stockholders. Pursuant to our charter requirement, the conflicts committee assessed our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (portfolio of investments and related debt financings, including the assets and liabilities transferred to us under the Settlement ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 656.10 Td (Agreement in satisfaction of certain debt obligations owed to us by wholly owned subsidiaries of Gramercy) Tj ET Q q 0 0 0 rg BT 479.58 656.10 Td (. ) Tj ET Q q 0 0 0 rg BT 486.90 656.10 Td (The conflicts ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 644.10 Td (committee also considered the prepayment penalties associated with certain debt obligations assumed by us under the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 632.10 Td (Settlement ) Tj ET Q q 0 0 0 rg BT 94.22 632.10 Td (Agreement. ) Tj ET Q q 0 0 0 rg BT 145.96 632.10 Td (T) Tj ET Q q 0 0 0 rg BT 151.37 632.10 Td (aking into consideration our portfolio and current market conditions, in November 2012, November ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (2013 and November 2014, the conflicts committee unanimously determined that liquidation is not now in the best interests of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (our stockholders. Our charter requires that the conflicts committee revisit the issue of liquidation at least annually) Tj ET Q q 0 0 0 rg BT 505.94 608.10 Td (. Given the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (factors noted above, the conflicts committee believes it is likely it may reach the same conclusion next year) Tj ET Q q 0 0 0 rg BT 478.80 596.10 Td (.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 578.10 Td (Market Outlook – Real Estate and Real Estate Finance Markets) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 560.10 Td (The following discussion is based on management’) Tj ET Q q 0 0 0 rg BT 252.09 560.10 Td (s beliefs, observations and expectations with r) Tj ET Q q 0 0 0 rg BT 436.42 560.10 Td (espect to the r) Tj ET Q q 0 0 0 rg BT 492.42 560.10 Td (eal estate and ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 548.10 Td (r) Tj ET Q q 0 0 0 rg BT 53.02 548.10 Td (eal estate finance markets.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 530.10 Td (Current conditions in the global capital markets remain volatile as the world’) Tj ET Q q 0 0 0 rg BT 380.92 530.10 Td (s economic growth has been af) Tj ET Q q 0 0 0 rg BT 504.31 530.10 Td (fected by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.10 Td (geopolitical and economic events. Geopolitical events in Europe and the Middle East escalated throughout 2014, and into ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.10 Td (2015. ) Tj ET Q q 0 0 0 rg BT 76.82 506.10 Td (The rise of the Islamic State and the struggle between the Ukrainian government and pro-Russian rebels have kept the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.10 Td (U.S. and its allies engaged in international military conflicts. ) Tj ET Q q 0 0 0 rg BT 297.32 494.10 Td (The slowdown in global economic growth, and in particular the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.10 Td (slowing of the Chinese economy) Tj ET Q q 0 0 0 rg BT 179.94 482.10 Td (, has had a ripple ef) Tj ET Q q 0 0 0 rg BT 258.06 482.10 Td (fect through the ener) Tj ET Q q 0 0 0 rg BT 340.90 482.10 Td (gy and commodity markets. Decreasing demand for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.10 Td (commodities, in particular oil, has led to a steep price decline in most commodity market prices. In this type of economic ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.10 Td (environment, deflation is a real risk. ) Tj ET Q q 0 0 0 rg BT 199.00 458.10 Td (While the U.S. economy has rebounded from the recent recession, the remainder of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.10 Td (world’) Tj ET Q q 0 0 0 rg BT 75.61 446.10 Td (s industrialized and emer) Tj ET Q q 0 0 0 rg BT 175.67 446.10 Td (ging economies have struggled to maintain even low levels of economic growth.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 428.10 Td (Central bank interventions and the use of monetary policy to combat the lingering ef) Tj ET Q q 0 0 0 rg BT 411.28 428.10 Td (fects of the recent recession continue ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 416.10 Td (to dominate the performance of the global economy) Tj ET Q q 0 0 0 rg BT 256.28 416.10 Td (. In 2012, Japan embarked on a massive quantitative easing \(“QE”\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.10 Td (program designed to kick start the country’) Tj ET Q q 0 0 0 rg BT 221.68 404.10 Td (s economy) Tj ET Q q 0 0 0 rg BT 264.08 404.10 Td (. ) Tj ET Q q 0 0 0 rg BT 271.39 404.10 Td (T) Tj ET Q q 0 0 0 rg BT 276.80 404.10 Td (o date the program has led to lower Japanese interest rates, a run up in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.10 Td (the Japanese stock markets and a devaluation of the yen. In Europe, the European Central Bank \(ECB\) announced its own QE ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 380.10 Td (program in January 2015. ) Tj ET Q q 0 0 0 rg BT 157.07 380.10 Td (The long awaited announcement has led to lower European interest rates and a weakening of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 368.10 Td (Euro against other currencies.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 350.10 Td (The Federal Reserve has maintained an accommodative monetary policy since the beginning of the financial crisis. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 338.10 Td (Through a variety of monetary tools and programs, the Federal Reserve injected trillions of U.S. dollars into the global financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 326.10 Td (markets. ) Tj ET Q q 0 0 0 rg BT 88.47 326.10 Td (The U.S. QE program focused on the purchase of U.S. treasury bonds and mortgage backed securities. In October of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 314.10 Td (2014, the Federal Reserve concluded the most recent phase of QE. ) Tj ET Q q 0 0 0 rg BT 320.34 314.10 Td (The end of this program has shifted investor focus to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 302.10 Td (timing of an eventual interest rate increase by the Federal Reserve.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 284.10 Td (In the United States, recent economic data has been improving. Slow and steady growth in the labor markets drove ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 272.10 Td (unemployment below 6%. Consumer spending in the United States has increased, and is being driven by lower debt service ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 260.10 Td (burdens, record high stock market valuations, rebounding home prices and a dramatic decrease in the cost of gasoline. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 248.10 Td (Consumer confidence levels are starting to reach levels last seen in the 1990s. U.S. gross domestic product \(“U.S. GDP”\) has ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 236.10 Td (continued to grow at a moderate annualized rate. On an annual basis, U.S. GDP) Tj ET Q q 0 0 0 rg BT 367.65 236.10 Td ( growth in 2014 was 2.4%, which was a slight ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 224.10 Td (improvement over 2013’) Tj ET Q q 0 0 0 rg BT 148.37 224.10 Td (s growth rate of 2.2%. In the second half of 2014, the U.S. dollar began to appreciate against the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 212.10 Td (currencies of other nations. However) Tj ET Q q 0 0 0 rg BT 199.60 212.10 Td (, the ef) Tj ET Q q 0 0 0 rg BT 226.90 212.10 Td (fects of a strong dollar and weak international economic growth began to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 200.10 Td (materialize in the form of reduced corporate earnings in the fourth quarter of 2014. ) Tj ET Q q 0 0 0 rg BT 385.85 200.10 Td (The labor force participation rate continues ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 188.10 Td (to be low and personal income growth has remained muted. During the first quarter of 2015, U.S. GDP) Tj ET Q q 0 0 0 rg BT 464.04 188.10 Td ( increased at an annual ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 176.10 Td (rate of 0.2%.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 158.10 Td (The U.S. dollar has remained a safe haven currency and the U.S. commercial real estate market has benefited from an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 146.10 Td (inflow of foreign capital. Initially) Tj ET Q q 0 0 0 rg BT 182.98 146.10 Td (, gateway markets such as New ) Tj ET Q q 0 0 0 rg BT 310.62 146.10 Td (Y) Tj ET Q q 0 0 0 rg BT 316.84 146.10 Td (ork City and San Francisco benefited from a high demand ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 134.10 Td (for commercial properties. In 2014, the commercial real estate market recovery spread to secondary and tertiary markets, and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 122.10 Td (most asset classes. ) Tj ET Q q 0 0 0 rg BT 128.47 122.10 Td (The U.S. commercial real estate market has gained favor as an alternative investment class and capital flows ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 110.10 Td (continue to improve. Looking forward, however) Tj ET Q q 0 0 0 rg BT 244.60 110.10 Td (, the recovery in commercial real estate is expected to remain uneven across ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 98.10 Td (geographies and among property types.) Tj ET Q endstream endobj 65 0 obj <>] /Rotate 0 /Contents 66 0 R>> endobj 66 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (31) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (As the dollar strengthens, the flow of capital into the United States could be curtailed. International demand for U.S. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (assets has been driven, in part, by the perception that U.S. real assets and the U.S. dollar are safe havens from some market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (risks. ) Tj ET Q q 0 0 0 rg BT 75.34 680.10 Td (A) Tj ET Q q 0 0 0 rg BT 82.01 680.10 Td ( decrease in flow of capital into the United States could lead to a decrease in the demand for U.S. commercial real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (estate assets, and result in a decline in commercial real estate valuations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 650.10 Td (After several years of improving market conditions, the recovery in the U.S. residential real estate market recently began ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 638.10 Td (to slow) Tj ET Q q 0 0 0 rg BT 78.02 638.10 Td (. ) Tj ET Q q 0 0 0 rg BT 85.34 638.10 Td (The initial recovery was driven by low interest rates, pent-up demand from the consumer sector and institutional ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 626.10 Td (investors in the form of buy-to-rent portfolios. In 2014, investor demand for homes slowed and stringent mortgage lending ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 614.10 Td (standards reduced demand in the residential markets. In addition, as referenced above, the Federal Reserve’) Tj ET Q q 0 0 0 rg BT 481.55 614.10 Td (s QE program, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.10 Td (which peaked at $85 billion a month in purchases of long-term treasury bonds and mortgage backed securities, ended on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.10 Td (October 31, 2014. ) Tj ET Q q 0 0 0 rg BT 129.03 590.10 Td (This reduction in market support could cause the demand for residential real estate to decrease further) Tj ET Q q 0 0 0 rg BT 535.81 590.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 572.10 Td (Overall, despite indications of recovery in the United States, uncertainties abound. China’) Tj ET Q q 0 0 0 rg BT 434.79 572.10 Td (s export-based economy has ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 560.10 Td (slowed and the Japanese government continues to experiment with QE. ) Tj ET Q q 0 0 0 rg BT 339.80 560.10 Td (The EU is faced with the economic collapse of Greece, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 548.10 Td (another recession and an escalating military conflict in the Ukraine. In the United States, the Federal Reserve is faced with the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 536.10 Td (impact of a strong dollar and record low interest rates. In the short-term, we anticipate that market conditions will continue to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 524.10 Td (remain volatile and, combined with a challenging global macro-economic environment, may interfere with the implementation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 512.10 Td (of our business strategy and/or force us to modify it.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 494.10 Td (Impact on Our Real Estate Investments) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 479.10 Td (The economic events that have occurred since the onset of the recession in 2008 have no precedent. ) Tj ET Q q 0 0 0 rg BT 476.78 479.10 Td (While current ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 467.10 Td (forecasts for the U.S. economy are positive, there is a level of uncertainty inherent to this outlook. Currently) Tj ET Q q 0 0 0 rg BT 484.29 467.10 Td (, both the investing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 455.10 Td (and leasing environments are highly competitive. ) Tj ET Q q 0 0 0 rg BT 251.49 455.10 Td (While there has been an increase in the amount of capital flowing into U.S. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 443.10 Td (real estate markets, which has resulted in an increase in real estate values in certain markets, the uncertainty regarding the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 431.10 Td (economic environment has made businesses reluctant to make long-term commitments or changes in their business plans. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 419.10 Td (Possible future declines in rental rates, slower or potentially negative net absorption of leased space and expectations of future ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 407.10 Td (rental concessions, including free rent to renew tenants early) Tj ET Q q 0 0 0 rg BT 291.26 407.10 Td (, to retain tenants who are up for renewal or to attract new tenants, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 395.10 Td (may result in decreases in cash flows. Historically low interest rates could help of) Tj ET Q q 0 0 0 rg BT 378.39 395.10 Td (fset some of the impact of these potential ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 383.10 Td (decreases in operating cash flow for properties financed with variable rate mortgages; however) Tj ET Q q 0 0 0 rg BT 428.94 383.10 Td (, interest rates likely will not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 371.10 Td (remain at these historically low levels for the remaining life of many of our investments. Interest rates have become more ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 359.10 Td (volatile as the global capital markets react to increasing economic and geopolitical risks.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 341.10 Td (Impact on Our Real Estate-Related Investments) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 326.10 Td (All of our real estate-related investments are directly or indirectly secured by commercial real estate. ) Tj ET Q q 0 0 0 rg BT 480.82 326.10 Td (As a result, our real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 314.10 Td (estate-related investments, in general, have been and likely will continue to be impacted by the same factors impacting our real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 302.10 Td (estate investments. ) Tj ET Q q 0 0 0 rg BT 129.86 302.10 Td (The higher yields and the improving credit position of many U.S. tenants and borrowers have attracted ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 290.10 Td (global capital. However) Tj ET Q q 0 0 0 rg BT 147.40 290.10 Td (, the real estate and capital markets are fluid, and the positive trends can reverse quickly) Tj ET Q q 0 0 0 rg BT 498.55 290.10 Td (. Economic ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 278.10 Td (conditions remain relatively unstable and can have a negative impact on the performance of collateral securing our loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 266.10 Td (investments, and therefore may impact the ability of some borrowers under our loans to make contractual interest payments to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 254.10 Td (us.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 236.10 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 236.10 Td (e have fixed rate real estate-related loan investments with a total book value \(excluding asset-specific loan loss ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 224.10 Td (reserves\) of $33.1 million. ) Tj ET Q q 0 0 0 rg BT 159.76 224.10 Td (Assuming our real estate-related loans are fully extended under the terms of the respective loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 212.10 Td (agreements and excluding our loan investment with an asset-specific loan loss reserve, we have a real estate-related loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 200.10 Td (investment with a book value of $6.9 million maturing within one year from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 357.22 200.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 420.82 200.10 Td (. ) Tj ET Q q 0 0 0 rg BT 427.77 200.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 452.21 200.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 515.81 200.10 Td (, we had ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 188.10 Td (recorded ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.98 188.10 Td ($4.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 135.87 188.10 Td ( of reserves for loan losses related to one of our real estate-related investments. ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 170.10 Td (Impact on Our Financing ) Tj ET Q q 0 0 0 rg BT 158.60 170.10 Td (Activities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 155.10 Td (In light of the risks associated with potentially volatile operating cash flows from some of our real estate properties, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 143.10 Td (may have dif) Tj ET Q q 0 0 0 rg BT 101.52 143.10 Td (ficulty refinancing some of our debt obligations prior to or at maturity or we may not be able to refinance these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 131.10 Td (obligations at terms as favorable as the terms of our existing indebtedness. Recent financial market conditions have improved ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 119.10 Td (from the bottom of the economic cycle, but material risks are still present. Market conditions can change quickly) Tj ET Q q 0 0 0 rg BT 502.60 119.10 Td (, potentially ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 107.10 Td (negatively impacting the value of our investments.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 89.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 89.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 89.10 Td (, we had a total of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 235.68 89.10 Td ($441.2 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 294.57 89.10 Td ( of fixed rate notes payable and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 422.58 89.10 Td ($204.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.47 89.10 Td ( of variable rate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 77.10 Td (notes payable. ) Tj ET Q q 0 0 0 rg BT 111.52 77.10 Td (W) Tj ET Q q 0 0 0 rg BT 120.16 77.10 Td (e have $179.7 million of debt maturing \(including principal amortization payments\) during the 12 months ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 65.10 Td (ending March 31, 2016. ) Tj ET Q endstream endobj 67 0 obj <>] /Rotate 0 /Contents 68 0 R>> endobj 68 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (32) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 704.25 Td (Liquidity and Capital Resour) Tj ET Q q 0 0 0 rg BT 175.18 704.25 Td (ces) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 686.25 Td (Our principal demands for funds during the short- and long-term are for: the payment of operating expenses, capital ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 674.25 Td (expenditures and general and administrative expenses; refinancing upcoming maturities and paying down debt obligations; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 662.25 Td (special redemptions of common stock pursuant to our share redemption program; and the payment of distributions to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 650.25 Td (stockholders. ) Tj ET Q q 0 0 0 rg BT 107.37 650.25 Td (T) Tj ET Q q 0 0 0 rg BT 112.78 650.25 Td (o date, we have had six primary sources of capital for meeting our cash requirements:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 632.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 632.25 Td (Proceeds from our primary of) Tj ET Q q 0 0 0 rg BT 208.67 632.25 Td (fering, which closed in 2008;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 617.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 617.25 Td (Debt financings, including mortgage loans, repurchase agreements and credit facilities;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 602.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 602.25 Td (Proceeds from common stock issued under our dividend reinvestment plan \(which terminated ef) Tj ET Q q 0 0 0 rg BT 474.72 602.25 Td (fective ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 590.25 Td (April 10, 2012\);) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 575.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 575.25 Td (Cash flow generated by our real estate and real estate-related investments;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 560.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 560.25 Td (Proceeds from the sales of real estate, real estate loans receivable and real estate securities; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 545.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 545.25 Td (Principal repayments on our real estate loans receivable.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 524.25 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 524.25 Td (e ceased of) Tj ET Q q 0 0 0 rg BT 126.37 524.25 Td (fering shares of common stock in our primary of) Tj ET Q q 0 0 0 rg BT 320.58 524.25 Td (fering on May 30, 2008. ) Tj ET Q q 0 0 0 rg BT 422.61 524.25 Td (W) Tj ET Q q 0 0 0 rg BT 431.25 524.25 Td (e do not currently plan to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 512.25 Td (acquire or originate additional real estate or real estate-related investments. ) Tj ET Q q 0 0 0 rg BT 354.74 512.25 Td (W) Tj ET Q q 0 0 0 rg BT 363.38 512.25 Td (e intend to use our cash on hand, proceeds from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 500.25 Td (asset sales and principal repayments on our real estate loans receivable as our primary sources of immediate and long-term ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 488.25 Td (liquidity) Tj ET Q q 0 0 0 rg BT 82.74 488.25 Td (. ) Tj ET Q q 0 0 0 rg BT 90.06 488.25 Td (T) Tj ET Q q 0 0 0 rg BT 95.47 488.25 Td (o the extent available, we also intend to use cash flow generated by our real estate and real estate-related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 476.25 Td (investments and funds available under our credit facilities. However) Tj ET Q q 0 0 0 rg BT 324.56 476.25 Td (, we have suf) Tj ET Q q 0 0 0 rg BT 377.14 476.25 Td (fered and/or expect to suf) Tj ET Q q 0 0 0 rg BT 479.14 476.25 Td (fer declines in cash ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 464.25 Td (flows from these sources. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 446.25 Td (On March 20, 2012, our board of directors approved the suspension of monthly distribution payments in order to manage ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 434.25 Td (our reduced cash flow from operations and to redirect available funds to reduce our debt. Our primary focus in approving this ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 422.25 Td (suspension of monthly distribution payments was the repayment of certain maturing debt obligations. Our board of directors ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 410.25 Td (currently expects to authorize and declare distributions on a quarterly basis based on cash flow generated by our real estate and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 398.25 Td (real estate-related investments. On March 6, 2015, our board of directors declared a distribution in the amount of $0.025 per ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 386.25 Td (share of common stock to stockholders of record as of the close of business on March 20, 2015. ) Tj ET Q q 0 0 0 rg BT 437.29 386.25 Td (W) Tj ET Q q 0 0 0 rg BT 445.93 386.25 Td (e paid this distribution on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 374.25 Td (March 25, 2015. ) Tj ET Q q 0 0 0 rg BT 120.42 374.25 Td (W) Tj ET Q q 0 0 0 rg BT 129.06 374.25 Td (e funded this distribution with cash flow from operations from the current period and prior periods.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 356.25 Td (Our share redemption program provides only for special redemptions. Such redemptions are subject to an annual dollar ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 344.25 Td (limitation. On December 9, 2014, our board of directors approved an annual dollar limitation for redemptions of $10.0 million ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 332.25 Td (in the aggregate for the calendar year 2015 \(subject to review and adjustment during the year by our board of directors\), and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 320.25 Td (further subject to the limitations described in the share redemption program document. Based on historical redemption activity) Tj ET Q q 0 0 0 rg BT 557.60 320.25 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 308.25 Td (we believe the $10.0 million redemption limitation for the calendar year 2015 will be suf) Tj ET Q q 0 0 0 rg BT 405.05 308.25 Td (ficient for these special redemptions. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 296.25 Td (During each calendar year) Tj ET Q q 0 0 0 rg BT 154.31 296.25 Td (, the annual dollar limitation for our share redemption program will be reviewed and adjusted from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 284.25 Td (time to time, if necessary) Tj ET Q q 0 0 0 rg BT 149.65 284.25 Td (. ) Tj ET Q q 0 0 0 rg BT 156.97 284.25 Td (W) Tj ET Q q 0 0 0 rg BT 165.61 284.25 Td (e currently do not expect to have funds available for ordinary redemptions in the future.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 266.25 Td (Our focus in 2015 is: to manage our existing investment portfolio, which includes strategically selling assets and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 254.25 Td (exploring value-add opportunities for existing assets, primarily the GKK Properties; refinancing upcoming maturities and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 242.25 Td (paying down debt; and distributing available cash to stockholders. Reducing our debt will allow us to hold certain assets in our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 230.25 Td (portfolio to improve their value and the returns to our stockholders. ) Tj ET Q q 0 0 0 rg BT 323.98 230.25 Td (W) Tj ET Q q 0 0 0 rg BT 332.62 230.25 Td (e plan to make certain strategic asset sales and, from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 218.25 Td (time to time, may declare special distributions to our stockholders that would be funded with the net proceeds from those asset ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 206.25 Td (sales or from cash flow from other sources. ) Tj ET Q q 0 0 0 rg BT 227.60 206.25 Td (W) Tj ET Q q 0 0 0 rg BT 236.24 206.25 Td (e will continue our existing strategy of selling assets when we believe the assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 194.25 Td (have reached the stage that disposition will assist in improving returns to our stockholders. In addition, as noted above, our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 182.25 Td (board of directors currently expects to authorize and declare distributions on a quarterly basis based on cash flow generated by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 170.25 Td (our real estate and real estate-related investments. ) Tj ET Q q 0 0 0 rg BT 253.39 170.25 Td (W) Tj ET Q q 0 0 0 rg BT 262.03 170.25 Td (e intend to maintain adequate cash reserves for liquidity) Tj ET Q q 0 0 0 rg BT 485.19 170.25 Td (, capital ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 158.25 Td (expenditures, debt repayments, future share redemptions and other future capital needs.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 140.25 Td (Our investments in real estate generate cash flow in the form of rental revenues and tenant reimbursements, which are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 128.25 Td (reduced by operating expenditures, debt service payments, the payment of asset management fees and corporate general and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 116.25 Td (administrative expenses. Cash flow from operations from our real estate investments is primarily dependent upon the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 104.25 Td (occupancy level of our portfolio, the net ef) Tj ET Q q 0 0 0 rg BT 220.36 104.25 Td (fective rental rates on our leases, the collectibility of rent and operating recoveries ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 92.25 Td (from our tenants and how well we manage our expenditures. ) Tj ET Q q 0 0 0 rg BT 296.10 92.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 320.54 92.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 384.14 92.25 Td (, our real estate held for investment was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 80.25 Td (79%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.83 80.25 Td ( occupied.) Tj ET Q endstream endobj 69 0 obj <>] /Rotate 0 /Contents 70 0 R>> endobj 70 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (33) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (Our real estate-related investments generate cash flow in the form of interest income, which is reduced by the payment of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (asset management fees and corporate general and administrative expenses. Cash flow from operations from our real estate-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (related investments is primarily dependent on the operating performance of the underlying collateral and the borrowers’) Tj ET Q q 0 0 0 rg BT 528.31 680.10 Td ( ability ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (to make debt service payments. ) Tj ET Q q 0 0 0 rg BT 179.74 668.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 204.18 668.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 267.78 668.10 Td (, the borrower under the Sandmar Mezzanine Loan was delinquent.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 650.10 Td (As a result of the factors described above, we may experience declines in future cash flow from our real estate and real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 638.10 Td (estate-related investments and we expect an increased need for capital to cover leasing costs and capital improvements needed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 626.10 Td (to improve the performance of our real estate assets. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 608.10 Td (For the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 104.61 608.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 124.59 608.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 185.42 608.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 249.02 608.10 Td (, we met our cash needs for capital expenditures and the payment of debt ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (obligations with cash on hand and proceeds from asset sales. ) Tj ET Q q 0 0 0 rg BT 297.04 596.10 Td (W) Tj ET Q q 0 0 0 rg BT 305.68 596.10 Td (e met our operating cash needs during the same period through ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 584.10 Td (cash flow generated by our real estate and real estate-related investments. ) Tj ET Q q 0 0 0 rg BT 348.35 584.10 Td (W) Tj ET Q q 0 0 0 rg BT 356.99 584.10 Td (e believe that potential proceeds from the sale of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 572.10 Td (real estate, cash flow from operations, potential proceeds from the sale or payof) Tj ET Q q 0 0 0 rg BT 368.09 572.10 Td (f of real estate loans receivable and cash on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 560.10 Td (hand will be suf) Tj ET Q q 0 0 0 rg BT 113.47 560.10 Td (ficient to meet our liquidity needs for the remainder of 2015. ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 542.10 Td (Cash Flows from Operating ) Tj ET Q q 0 0 0 rg BT 166.93 542.10 Td (Activities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 527.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 527.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 527.10 Td (, we owned or) Tj ET Q q 0 0 0 rg BT 217.79 527.10 Td (, with respect to a limited number of properties, held a leasehold interest in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 519.93 527.10 Td (397) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 534.93 527.10 Td ( real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 515.10 Td (estate properties. In addition, as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 192.51 515.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 256.11 515.10 Td (, we owned ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 304.43 515.10 Td (four) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 321.09 515.10 Td ( real estate loans receivable and a participation interest with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 503.10 Td (respect to a real estate joint venture.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 485.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.05 485.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.03 485.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.86 485.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.46 485.10 Td (, net cash provided by operating activities was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 450.90 485.10 Td ($6.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 499.79 485.10 Td (, compared to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 473.10 Td ($1.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 98.39 473.10 Td ( of net cash provided by operating activities during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 319.44 473.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 339.43 473.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 400.25 473.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.85 473.10 Td (. Net cash from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 461.10 Td (operations increased in 2015 primarily due to the timing of payments for operating expenses, and a decrease in interest paid as a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 449.10 Td (result of debt refinancing and restructuring, which resulted in an overall decrease in ef) Tj ET Q q 0 0 0 rg BT 394.18 449.10 Td (fective interest rates and a decrease in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 437.10 Td (principal outstanding. ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 419.10 Td (Cash Flows from Investing ) Tj ET Q q 0 0 0 rg BT 163.60 419.10 Td (Activities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 404.10 Td (Net cash provided by investing activities was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 257.07 404.10 Td ($106.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 315.96 404.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.34 404.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.32 404.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 428.15 404.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.75 404.10 Td (. ) Tj ET Q q 0 0 0 rg BT 499.07 404.10 Td (The significant ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.10 Td (sources and uses of net cash provided by investing activities were as follows:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 374.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 374.10 Td ($99.9 million of cash provided from the sale of real estate; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 359.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 359.10 Td ($1) Tj ET Q q 0 0 0 rg BT 99.63 359.10 Td (1.9 million of cash used for improvements to real estate; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 344.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 344.10 Td ($14.2 million of cash provided from the sale of foreclosed real estate held for sale; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 329.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 329.10 Td (a $4.1 million decrease in restricted cash for capital expenditures.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 308.10 Td (Cash Flows from Financing ) Tj ET Q q 0 0 0 rg BT 168.61 308.10 Td (Activities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 293.10 Td (Net cash used in financing activities was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 238.73 293.10 Td ($29.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 292.62 293.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 324.00 293.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 343.98 293.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 404.81 293.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 468.41 293.10 Td (. ) Tj ET Q q 0 0 0 rg BT 475.73 293.10 Td (The significant ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 281.10 Td (sources and uses of cash for financing activities were as follows:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 263.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 263.10 Td ($19.3 million of principal payments on notes payable; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 248.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 248.10 Td ($9.4 million of cash used for distributions;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 233.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 233.10 Td ($1.5 million of cash used for redemptions of common stock; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 218.10 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 218.10 Td (a $0.3 million decrease in restricted cash for debt service obligations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 197.10 Td (In addition to using our capital resources to meet our debt service obligations, for capital expenditures, for operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 185.10 Td (costs, to fund special redemptions pursuant to our share redemption program and to pay distributions to our stockholders, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 173.10 Td (use our capital resources to make certain payments to our advisor) Tj ET Q q 0 0 0 rg BT 310.53 173.10 Td (. ) Tj ET Q q 0 0 0 rg BT 317.84 173.10 Td (W) Tj ET Q q 0 0 0 rg BT 326.48 173.10 Td (e also reimburse our advisor and dealer manager for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 161.10 Td (certain costs they incur on our behalf. ) Tj ET Q q 0 0 0 rg BT 205.10 161.10 Td (W) Tj ET Q q 0 0 0 rg BT 213.74 161.10 Td (e pay our advisor fees in connection with the management and disposition of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 149.10 Td (assets.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 131.10 Td (Among the fees payable to our advisor is an asset management fee. ) Tj ET Q q 0 0 0 rg BT 347.12 131.10 Td (W) Tj ET Q q 0 0 0 rg BT 356.16 131.10 Td (ith respect to investments in real estate, we pay our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 119.10 Td (advisor a monthly asset management fee equal to one-twelfth of 0.75% of the amount actually paid or allocated to acquire the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 107.10 Td (investment, plus the cost of any subsequent development, construction or improvements to the property) Tj ET Q q 0 0 0 rg BT 462.93 107.10 Td (. ) Tj ET Q q 0 0 0 rg BT 470.25 107.10 Td (This amount includes ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 95.10 Td (any portion of the investment that was debt financed and is inclusive of acquisition fees and expenses related thereto. In the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 83.10 Td (case of investments made through joint ventures, the asset management fee is determined based on our proportionate share of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 71.10 Td (the underlying investment. ) Tj ET Q endstream endobj 71 0 obj <>] /Rotate 0 /Contents 72 0 R>> endobj 72 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (34) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (W) Tj ET Q q 0 0 0 rg BT 82.54 704.10 Td (ith respect to investments in loans and any investments other than real estate, we pay our advisor a monthly asset ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (management fee calculated, each month, as one-twelfth of 0.75% of the lesser of \(i\) the amount actually paid or allocated to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (acquire or fund the loan or other investment \(which amount includes any portion of the investment that was debt financed and is ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (inclusive of acquisition or origination fees and expenses related thereto\) and \(ii\) the outstanding principal amount of such loan ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 656.10 Td (or other investment, plus the acquisition or origination fees and expenses related to the acquisition or funding of such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 644.10 Td (investment, as of the time of calculation. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 626.10 Td (W) Tj ET Q q 0 0 0 rg BT 82.54 626.10 Td (ith respect to an investment that has suf) Tj ET Q q 0 0 0 rg BT 240.38 626.10 Td (fered an impairment in value, reduction in cash flow or other negative ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 614.10 Td (circumstances, such investment may either be excluded from the calculation of the asset management fee described above or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.10 Td (included in such calculation at a reduced value that is recommended by our advisor and our management and then approved by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.10 Td (a majority of our independent directors, and this change in the fee shall be applicable to an investment upon the earlier to occur ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.10 Td (of the date on which \(i\) such investment is sold, \(ii\) such investment is surrendered to a person other than the company) Tj ET Q q 0 0 0 rg BT 524.29 578.10 Td (, our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.10 Td (direct or indirect wholly owned subsidiary or a joint venture or partnership in which we have an interest, \(iii\) our advisor ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.10 Td (determines that it will no longer pursue collection or other remedies related to such investment, or \(iv\) our advisor recommends ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.10 Td (a revised fee arrangement with respect to such investment. ) Tj ET Q q 0 0 0 rg BT 288.03 542.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 312.47 542.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 376.07 542.10 Td (, we excluded our interest in an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.10 Td (unconsolidated joint venture from the calculation of asset management fees. ) Tj ET Q q 0 0 0 rg BT 358.66 530.10 Td (W) Tj ET Q q 0 0 0 rg BT 367.30 530.10 Td (e also calculate the asset management fee for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.10 Td (GKK Properties based on the original cost of our investment in the GKK Mezzanine Loan, rather than on the gross value of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.10 Td (GKK Properties we own or in which we hold a leasehold interest. However) Tj ET Q q 0 0 0 rg BT 353.46 506.10 Td (, once the gross value of the GKK properties falls ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.10 Td (below the original cost of our investment in the GKK Mezzanine Loan, we will calculate the asset management fee based on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.10 Td (the gross value of the GKK Properties. ) Tj ET Q q 0 0 0 rg BT 209.19 482.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 233.64 482.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 297.23 482.10 Td (, we had not determined to calculate the asset management fee at ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.10 Td (an adjusted value for any other investments or to exclude any other investments from the calculation of the asset management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.10 Td (fee.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 440.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 440.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 440.10 Td (, we had ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 197.64 440.10 Td ($141.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 256.53 440.10 Td ( of cash and cash equivalents. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 422.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 422.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 422.10 Td (, our borrowings and other liabilities were approximately ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 392.31 422.10 Td (45%) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.64 422.10 Td ( of both the cost \(before deducting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 410.10 Td (depreciation or other noncash reserves\) and book value \(before deducting depreciation\) of our tangible assets. ) Tj ET Q q 0 0 0 rg BT 493.32 410.10 Td (W) Tj ET Q q 0 0 0 rg BT 501.96 410.10 Td (e limit our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 398.10 Td (total liabilities to 75% of the cost \(before deducting depreciation or other non-cash reserves\) of our tangible assets; however) Tj ET Q q 0 0 0 rg BT 545.05 398.10 Td (, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 386.10 Td (may exceed that limit if a majority of the conflicts committee approves each borrowing in excess of that limitation and we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 374.10 Td (disclose such borrowing to our stockholders in our next quarterly report with an explanation from the conflicts committee of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 362.10 Td (justification for exceeding the total liabilities limitation. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 344.10 Td (Contractual Commitments and Contingencies) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 326.10 Td (The following is a summary of our contractual obligations as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 330.94 326.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 394.54 326.10 Td ( \(in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 281.60 186.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 236.00 281.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 240.00 281.60 62.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 302.00 281.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 306.00 281.60 71.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 377.00 281.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 381.00 281.60 58.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 439.00 281.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 443.00 281.60 58.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 281.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 505.00 281.60 58.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 233.60 186.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 236.00 233.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 240.00 233.60 62.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 302.00 233.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 306.00 233.60 71.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 377.00 233.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 381.00 233.60 58.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 439.00 233.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 443.00 233.60 58.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 233.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 505.00 233.60 58.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 185.60 186.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 236.00 185.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 240.00 185.60 62.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 302.00 185.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 306.00 185.60 71.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 377.00 185.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 381.00 185.60 58.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 439.00 185.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 443.00 185.60 58.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 501.00 185.60 4.00 -24.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 505.00 185.60 58.00 -24.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 295.6 m 302 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 302 295.6 m 306 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 306 295.6 m 377 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 377 295.6 m 381 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 381 295.6 m 439 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 439 295.6 m 443 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 443 295.6 m 501 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 501 295.6 m 505 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 505 295.6 m 563 295.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 281.6 m 236 281.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 240 281.6 m 302 281.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 306 281.6 m 377 281.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 381 281.6 m 439 281.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 443 281.6 m 501 281.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 505 281.6 m 563 281.6 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 299.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 308.75 299.83 Td (Payments Due During the Years Ending December 31,) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 52.50 285.83 Td (Contractual Obligations) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 261.75 285.83 Td (Total ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 308.60 285.83 Td (Remainder of 2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 392.15 285.83 Td (2016-2017 ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 454.15 285.83 Td (2018-2019 ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 515.20 285.83 Td (Thereafter ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 269.85 Td (Outstanding debt obligations related to historical ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 61.50 261.85 Td (portfolio) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 89.50 265.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 242.50 261.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 272.80 261.85 Td (226,331) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 308.50 261.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 365.80 261.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 383.50 261.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 409.75 261.85 Td (226,331) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 445.50 261.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 489.80 261.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 507.50 261.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 261.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 245.85 Td (Outstanding debt obligations related to the GKK ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 61.50 237.85 Td (Properties) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 93.94 241.48 Td (\(1\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 242.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 272.80 237.85 Td (419,035) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 308.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 351.80 237.85 Td (13,346) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 383.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 409.75 237.85 Td (237,484) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 445.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 471.75 237.85 Td (134,695) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 507.50 237.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 237.85 Td (33,510) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 221.85 Td (Interest payments on outstanding debt obligations ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 61.50 213.85 Td (related to historical portfolio) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 153.25 217.48 Td (\(2\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 242.50 213.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 280.80 213.85 Td (8,001) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 308.50 213.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 355.80 213.85 Td (5,177) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 383.50 213.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 417.80 213.85 Td (2,824) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 445.50 213.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 489.80 213.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 507.50 213.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 213.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 197.85 Td (Interest payments on outstanding debt obligations ) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 61.50 189.85 Td (related to the GKK Properties) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 157.03 193.48 Td (\(2\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 242.50 189.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 276.80 189.85 Td (77,619) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 308.50 189.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 351.80 189.85 Td (18,198) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 383.50 189.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.80 189.85 Td (37,602) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 445.50 189.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 475.80 189.85 Td (17,233) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 507.50 189.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 189.85 Td (4,586) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 165.85 Td (Operating leases) Tj ET Q BT /F1 8.00 Tf ET BT /F1 5.20 Tf ET q 0 0 0 rg BT 105.59 169.48 Td (\(3\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 242.50 165.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 276.80 165.85 Td (84,163) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 308.50 165.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 351.80 165.85 Td (13,060) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 383.50 165.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 413.80 165.85 Td (29,904) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 445.50 165.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 479.80 165.85 Td (5,120) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 507.50 165.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 165.85 Td (36,079) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 150.10 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 141.50 Td (\(1\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 138.10 Td ( ) Tj ET Q q 0 0 0 rg BT 56.65 138.10 Td (Amounts include principal payments under notes payable based on maturity dates of debt obligations as of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 378.25 138.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 425.95 138.10 Td (. ) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 129.50 Td (\(2\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 126.10 Td ( Projected interest payments are based on the outstanding principal amounts and weighted-average interest rates as of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 409.04 126.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 456.74 126.10 Td (. ) Tj ET Q q 0 0 0 rg BT 462.23 126.10 Td (W) Tj ET Q q 0 0 0 rg BT 468.71 126.10 Td (e incurred interest expense of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 117.10 Td ($7.7 million, excluding amortization of deferred financing costs and the amortization of debt discount and premium totaling $1.0 million, during the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 496.29 117.10 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 511.28 117.10 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 108.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 97.20 108.10 Td (. ) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 99.50 Td (\(3\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 96.10 Td ( ) Tj ET Q q 0 0 0 rg BT 56.65 96.10 Td (Amounts relate to future minimum lease payments under non-cancelable building and ground leases.) Tj ET Q endstream endobj 73 0 obj <>] /Rotate 0 /Contents 74 0 R>> endobj 74 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (35) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 704.25 Td (Debt Covenants ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 689.25 Td (The documents evidencing our outstanding debt obligations typically require that specified loan-to-value and debt service ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 677.25 Td (coverage ratios be maintained with respect to the financed properties. ) Tj ET Q q 0 0 0 rg BT 331.61 677.25 Td (A) Tj ET Q q 0 0 0 rg BT 338.28 677.25 Td ( breach of the financial covenants in these documents ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 665.25 Td (may result in the lender imposing additional restrictions on our operations, such as restrictions on our ability to incur additional ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 653.25 Td (debt, or may allow the lender to impose “cash traps” with respect to cash flow from the property securing the loan. In addition, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 641.25 Td (such a breach may constitute an event of default and the lender could require us to repay the debt immediately) Tj ET Q q 0 0 0 rg BT 489.52 641.25 Td (. If we fail to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 629.25 Td (make such repayment in a timely manner) Tj ET Q q 0 0 0 rg BT 214.04 629.25 Td (, the lender may be entitled to take possession of any property securing the loan. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 617.25 Td (Except as described below) Tj ET Q q 0 0 0 rg BT 155.20 617.25 Td (, as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 181.86 617.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 245.46 617.25 Td (, we were in compliance with these debt covenants. ) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 49.5 597.9169921875 m 97 597.9169921875 l s q 0 0 0 rg BT 49.50 599.25 Td (BBD2 Loan) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 97.00 599.25 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 581.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 100.44 581.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 164.04 581.25 Td (, the borrower under the BBD2 Loan was out of debt service coverage compliance. ) Tj ET Q q 0 0 0 rg BT 500.32 581.25 Td (As a result of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 569.25 Td (such non-compliance, the loan servicer will impose a “cash trap,” which restricts distributions to us to the budgeted property ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 557.25 Td (operating expenses. ) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 533.25 Td (Asset Management Services ) Tj ET Q q 0 0 0 rg BT 166.62 533.25 Td (Agreement Related to the GKK Properties) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 518.25 Td (On December 19, 2013, we, through an indirect wholly owned subsidiary \(“KBS ) Tj ET Q q 0 0 0 rg BT 399.27 518.25 Td (Acquisition Sub”\), entered into an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.25 Td (amended and restated asset management services agreement \(the “Amended Services ) Tj ET Q q 0 0 0 rg BT 392.69 506.25 Td (Agreement”\) with the Property Manager ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.25 Td (with respect to the GKK Properties. ) Tj ET Q q 0 0 0 rg BT 195.12 494.25 Td (The ef) Tj ET Q q 0 0 0 rg BT 220.75 494.25 Td (fective date of the ) Tj ET Q q 0 0 0 rg BT 294.61 494.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 371.81 494.25 Td (Agreement was December 1, 2013. Pursuant to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.25 Td (the ) Tj ET Q q 0 0 0 rg BT 63.67 482.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 140.87 482.25 Td (Agreement, the Property Manager agreed to provide, among other services: standard asset management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.25 Td (services, assistance related to dispositions, accounting services and budgeting and business plans for the GKK Properties \(the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.25 Td (“Services”\). ) Tj ET Q q 0 0 0 rg BT 100.40 458.25 Td (The Property Manager is not af) Tj ET Q q 0 0 0 rg BT 225.46 458.25 Td (filiated with us or KBS ) Tj ET Q q 0 0 0 rg BT 320.18 458.25 Td (Acquisition Sub. ) Tj ET Q q 0 0 0 rg BT 389.36 458.25 Td (As compensation for the Services, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.25 Td (agreed to pay the Property Manager: \(i\) an annual fee of $7.5 million plus all GKK Property-related expenses incurred by the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 434.25 Td (Property Manager) Tj ET Q q 0 0 0 rg BT 121.58 434.25 Td (, \(ii\) subject to certain terms and conditions in the ) Tj ET Q q 0 0 0 rg BT 322.36 434.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 399.56 434.25 Td (Agreement, a profit participation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 422.25 Td (interest based on a percentage \(ranging from 10% to 30%\) of the amount by which the gross fair market value or gross sales ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 410.25 Td (price of certain identified portfolios of GKK Properties exceeds the sum of \(a\) an agreed-upon baseline value for such GKK ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 398.25 Td (Property portfolios plus \(b\) new capital expended to increase the value of GKK Properties within the portfolios and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 386.25 Td (expenditures made to pay for tenant improvements and leasing commissions related to these GKK Properties as of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 374.25 Td (measurement date, and \(iii\) a monthly construction oversight fee equal to a percentage of construction costs for certain ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 362.25 Td (construction projects at the GKK Properties overseen by the Property Manager) Tj ET Q q 0 0 0 rg BT 364.41 362.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 67.50 344.25 Td (The ) Tj ET Q q 0 0 0 rg BT 85.00 344.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 162.20 344.25 Td (Agreement will terminate on December 31, 2016, with a one-year extension option at our option, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 332.25 Td (subject to certain terms and conditions contained in the ) Tj ET Q q 0 0 0 rg BT 271.94 332.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 349.14 332.25 Td (Agreement. ) Tj ET Q q 0 0 0 rg BT 400.89 332.25 Td (The ) Tj ET Q q 0 0 0 rg BT 418.38 332.25 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 495.58 332.25 Td (Agreement ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 320.25 Td (supersedes and replaces all prior agreements related to the Services among us and our af) Tj ET Q q 0 0 0 rg BT 402.52 320.25 Td (filiates and the Property Manager and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 308.25 Td (its af) Tj ET Q q 0 0 0 rg BT 69.04 308.25 Td (filiates.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 290.25 Td (Results of Operations) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 272.25 Td (Overview) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 257.25 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 97.94 257.25 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 161.54 257.25 Td (, we owned or) Tj ET Q q 0 0 0 rg BT 217.79 257.25 Td (, with respect to a limited number of properties, held a leasehold interest in, 417 real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 245.25 Td (estate properties, four real estate loans receivable \(one of which was impaired\), a participation interest with respect to a real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 233.25 Td (estate joint venture and the ) Tj ET Q q 0 0 0 rg BT 159.56 233.25 Td (T) Tj ET Q q 0 0 0 rg BT 165.32 233.25 Td (ribeca Building with 62 condominium units acquired through foreclosure, of which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 221.25 Td (three condominium units were owned by us and were held for sale. Subsequent to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 381.64 221.25 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 445.24 221.25 Td (, we sold two historical ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 209.25 Td (of) Tj ET Q q 0 0 0 rg BT 57.65 209.25 Td (fice properties, four historical industrial properties and nine GKK Properties; terminated the lease of three GKK Properties in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 197.25 Td (which we held a leasehold interest; transferred two GKK Properties to the lenders in connection with foreclosure proceedings; ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 185.25 Td (and sold the remaining three condominium units of the ) Tj ET Q q 0 0 0 rg BT 271.22 185.25 Td (T) Tj ET Q q 0 0 0 rg BT 276.98 185.25 Td (ribeca Building. ) Tj ET Q q 0 0 0 rg BT 345.85 185.25 Td (As a result, as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.28 185.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.88 185.25 Td (, we owned or) Tj ET Q q 0 0 0 rg BT 535.13 185.25 Td (, with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 173.25 Td (respect to a limited number of properties, held a leasehold interest in, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 328.86 173.25 Td (397) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 343.86 173.25 Td ( real estate properties, four real estate loans receivable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 161.25 Td (\(one of which was impaired\) and a participation interest with respect to a real estate joint venture.) Tj ET Q endstream endobj 75 0 obj <>] /Rotate 0 /Contents 76 0 R>> endobj 76 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (36) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (In accordance with ) Tj ET Q q 0 0 0 rg BT 151.52 704.10 Td (ASU No. 2014-08, ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 229.57 704.10 Td (Pr) Tj ET Q q 0 0 0 rg BT 239.20 704.10 Td (esentation of Financial Statements \(T) Tj ET Q q 0 0 0 rg BT 388.27 704.10 Td (opic 205\) and Pr) Tj ET Q q 0 0 0 rg BT 455.94 704.10 Td (operty) Tj ET Q q 0 0 0 rg BT 480.94 704.10 Td (, Plant, and ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (Equipment \(T) Tj ET Q q 0 0 0 rg BT 103.30 692.10 Td (opic 360\): Reporting Discontinued Operations and Disclosur) Tj ET Q q 0 0 0 rg BT 349.02 692.10 Td (es of Disposals of Components of an Entity) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 521.52 692.10 Td ( \(“ASU ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (No. 2014-08”\), operating results of properties that are classified as held for sale in the ordinary course of business on or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (subsequent to January 1, 2014 would generally be included in continuing operations on our consolidated statements of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 656.10 Td (operations. Operating results of properties that were classified as held for sale in financial statements issued for the reporting ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 644.10 Td (periods prior to reporting periods beginning January 1, 2014 will remain in discontinued operations on our consolidated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 632.10 Td (statement of operations. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 195.85 632.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 215.84 632.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 276.66 632.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 340.26 632.10 Td (, we sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 378.59 632.10 Td (two) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.59 632.10 Td ( historical real estate properties and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 537.98 632.10 Td (one) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 552.42 632.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (GKK Property) Tj ET Q q 0 0 0 rg BT 107.45 620.10 Td (, which properties were not classified as held for sale in financial statements issued for the reporting periods prior ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (to January 1, 2014. During the year ended December 31, 2014, we sold four historical real estate properties and two GKK ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (Properties, transferred a portfolio of five GKK Properties to the lender in satisfaction of the debt and other obligations due ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 584.10 Td (under the BOA) Tj ET Q q 0 0 0 rg BT 110.05 584.10 Td ( ) Tj ET Q q 0 0 0 rg BT 112.37 584.10 Td (W) Tj ET Q q 0 0 0 rg BT 121.40 584.10 Td (indsor Mortgage Portfolio, and transferred two GKK Properties to the lenders in connection with foreclosure ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 572.10 Td (proceedings, which properties were not classified as held for sale in financial statements issued for the reporting periods prior to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 560.10 Td (January 1, 2014. In accordance with ) Tj ET Q q 0 0 0 rg BT 198.62 560.10 Td (ASU No. 2014-08, the operations of these properties are included in continuing operations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 548.10 Td (on our consolidated statements of operations. Our results of operations for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 366.09 548.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 386.08 548.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 446.90 548.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 510.50 548.10 Td ( are not ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 536.10 Td (indicative of those expected in future periods due to anticipated asset sales. In general, we expect that our revenues and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 524.10 Td (expenses related to our portfolio will decrease in future periods due to disposition activity) Tj ET Q q 0 0 0 rg BT 407.92 524.10 Td (. ) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 72 504.7669921875 m 148.9482421875 504.7669921875 l s q 0 0 0 rg BT 72.00 506.10 Td (Comparison of the ) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 148.9482421875 504.7669921875 m 169.1240234375 504.7669921875 l s q 0 0 0 rg BT 148.95 506.10 Td (thr) Tj ET Q q 0 0 0 rg BT 160.25 506.10 Td (ee) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 169.1240234375 504.7669921875 m 229.392578125 504.7669921875 l s q 0 0 0 rg BT 169.12 506.10 Td ( months ended ) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 229.392578125 504.7669921875 m 293.181640625 504.7669921875 l s q 0 0 0 rg BT 229.39 506.10 Td (Mar) Tj ET Q q 0 0 0 rg BT 246.24 506.10 Td (ch 31, 2015) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 293.181640625 504.7669921875 m 338.4501953125 504.7669921875 l s q 0 0 0 rg BT 293.18 506.10 Td ( versus the ) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 338.4501953125 504.7669921875 m 358.6259765625 504.7669921875 l s q 0 0 0 rg BT 338.45 506.10 Td (thr) Tj ET Q q 0 0 0 rg BT 349.75 506.10 Td (ee) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 358.6259765625 504.7669921875 m 418.89453125 504.7669921875 l s q 0 0 0 rg BT 358.63 506.10 Td ( months ended ) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 418.89453125 504.7669921875 m 482.68359375 504.7669921875 l s q 0 0 0 rg BT 418.89 506.10 Td (Mar) Tj ET Q q 0 0 0 rg BT 435.75 506.10 Td (ch 31, 2014) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 482.68 506.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 491.10 Td (The following table provides summary information about our results of operations for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 410.25 491.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 430.24 491.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 491.06 491.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 554.66 491.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 479.10 Td (and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 66.44 479.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 86.44 479.10 Td ( \(dollar amounts in thousands\):) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 428.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 428.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 428.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 428.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 428.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 428.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 428.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 428.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 428.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 428.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 428.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 428.60 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 402.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 402.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 402.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 402.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 402.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 402.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 402.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 402.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 402.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 402.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 402.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 402.60 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 376.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 376.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 376.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 376.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 376.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 376.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 376.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 376.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 376.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 376.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 376.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 376.60 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 350.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 350.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 350.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 350.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 350.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 350.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 350.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 350.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 350.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 350.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 350.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 350.60 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 324.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 324.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 324.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 324.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 324.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 324.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 324.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 324.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 324.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 324.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 324.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 324.60 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 298.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 298.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 298.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 298.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 298.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 298.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 298.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 298.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 298.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 298.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 298.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 298.60 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 272.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 272.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 272.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 272.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 272.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 272.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 272.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 272.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 272.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 272.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 272.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 272.60 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 246.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 246.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 246.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 246.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 246.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 246.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 246.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 246.60 57.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 220.60 196.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 246.00 220.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 299.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 303.00 220.60 53.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 356.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 360.00 220.60 41.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 401.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 405.00 220.60 39.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 444.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 448.00 220.60 54.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 502.00 220.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 506.00 220.60 57.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 246 456.6 m 299 456.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 299 456.6 m 303 456.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 303 456.6 m 356 456.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 246 456.6 m 299 456.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 246 428.6 m 299 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 303 456.6 m 356 456.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 303 428.6 m 356 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 360 428.6 m 401 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 405 428.6 m 444 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448 428.6 m 502 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 506 428.6 m 563 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 246 428.6 m 299 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 303 428.6 m 356 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 360 428.6 m 401 428.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 448 428.6 m 502 428.6 l s BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 460.65 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 252.50 460.66 Td (Three Months Ended March 31,) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 367.40 439.66 Td (Incr) Tj ET Q q 0 0 0 rg BT 380.10 439.66 Td (ease) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 364.30 432.66 Td (\(Decr) Tj ET Q q 0 0 0 rg BT 380.88 432.66 Td (ease\) ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 407.50 439.66 Td (Per) Tj ET Q q 0 0 0 rg BT 417.86 439.66 Td (centage ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 412.50 432.66 Td (Change) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 460.40 446.66 Td ($ Change ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 464.65 439.66 Td (Due to ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 452.85 432.66 Td (Dispositions ) Tj ET Q BT /F2 7.00 Tf ET BT /F2 4.55 Tf ET q 0 0 0 rg BT 490.78 435.83 Td (\(1\)) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 509.20 460.66 Td ($ Change Due to ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 514.35 453.66 Td (Pr) Tj ET Q q 0 0 0 rg BT 521.61 453.66 Td (operties or) Tj ET Q q 0 0 0 rg BT 553.55 453.66 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 516.75 446.66 Td (Loans Held ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 515.95 439.66 Td (Thr) Tj ET Q q 0 0 0 rg BT 527.49 439.66 Td (oughout ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 511.10 432.66 Td (Both Periods ) Tj ET Q BT /F2 7.00 Tf ET BT /F2 4.55 Tf ET q 0 0 0 rg BT 551.54 435.83 Td (\(2\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 432.65 Td ( ) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 265.00 432.66 Td (2015) Tj ET Q BT /F2 7.00 Tf ET q 0 0 0 rg BT 322.00 432.66 Td (2014) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 419.65 Td (Rental income) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 248.50 419.65 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 276.90 419.65 Td (35,365) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 305.50 419.65 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 333.90 419.65 Td (39,143) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 362.50 419.65 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 380.05 419.70 Td (\(3,778) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 419.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 425.95 419.65 Td (\(10) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 419.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 450.50 419.65 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 481.05 419.70 Td (\(3,182) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 419.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 508.50 419.65 Td ($) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 547.30 419.70 Td (\(596) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 419.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 406.65 Td (Tenant reimbursements) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 276.90 406.65 Td (12,554) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 333.90 406.65 Td (13,058) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 385.30 406.70 Td (\(504) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 406.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 429.45 406.65 Td (\(4) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 406.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 486.30 406.70 Td (\(264) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 406.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 547.30 406.70 Td (\(240) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 406.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 393.65 Td (Interest income from real estate loans receivable) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 285.65 393.65 Td (726) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 342.65 393.65 Td (801) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 388.80 393.70 Td (\(75) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 393.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 429.45 393.65 Td (\(9) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 393.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 492.15 393.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 550.80 393.70 Td (\(75) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 393.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 380.65 Td (Parking revenues and other operating income) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 285.65 380.65 Td (932) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 337.40 380.65 Td (1,004) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 388.80 380.70 Td (\(72) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 380.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 429.45 380.65 Td (\(7) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 380.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 486.30 380.70 Td (\(125) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 380.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 380.65 Td (53) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 367.65 Td (Operating, maintenance and management costs) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 276.90 367.65 Td (21,989) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 333.90 367.65 Td (21,400) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 387.65 367.65 Td (589) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 431.80 367.65 Td (3) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 437.65 367.65 Td (%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 486.30 367.70 Td (\(247) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 367.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 549.65 367.65 Td (836) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 354.65 Td (Real estate taxes, property-related taxes and insurance) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 280.40 354.65 Td (6,781) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 337.40 354.65 Td (7,440) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 385.30 354.70 Td (\(659) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 354.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 429.45 354.65 Td (\(9) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 354.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 486.30 354.70 Td (\(571) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 354.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 550.80 354.70 Td (\(88) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 354.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 341.65 Td (Asset management fees to affiliate) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 280.40 341.65 Td (2,420) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 337.40 341.65 Td (2,499) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 388.80 341.70 Td (\(79) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 341.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 429.45 341.65 Td (\(3) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 341.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 489.80 341.70 Td (\(97) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 341.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 341.65 Td (18) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 328.65 Td (General and administrative expenses) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 280.40 328.65 Td (2,220) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 337.40 328.65 Td (3,644) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 380.05 328.70 Td (\(1,424) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 328.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 425.95 328.65 Td (\(39) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 328.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 486.80 328.65 Td (N/A) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 547.80 328.65 Td (N/A) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 315.65 Td (Depreciation and amortization expense) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 276.90 315.65 Td (15,605) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 333.90 315.65 Td (17,923) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 380.05 315.70 Td (\(2,318) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 315.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 425.95 315.65 Td (\(13) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 315.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 481.05 315.70 Td (\(2,174) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 315.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 547.30 315.70 Td (\(144) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 315.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 302.65 Td (Interest expense) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 280.40 302.65 Td (8,733) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 333.90 302.65 Td (13,545) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 380.05 302.70 Td (\(4,812) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 302.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 425.95 302.65 Td (\(36) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 302.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 481.05 302.70 Td (\(2,298) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 302.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 542.05 302.70 Td (\(2,514) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 560.15 302.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 289.65 Td (Impairment charge on real estate held for investment) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 289.15 289.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 337.40 289.65 Td (1,257) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 380.05 289.70 Td (\(1,257) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 289.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 422.45 289.65 Td (\(100) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 289.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 481.05 289.70 Td (\(1,257) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 289.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 289.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 276.65 Td (Gain on sales of real estate securities) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 289.15 276.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 337.40 276.65 Td (3,748) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 380.05 276.70 Td (\(3,748) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 276.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 422.45 276.65 Td (\(100) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 276.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 481.05 276.70 Td (\(3,748) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 276.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 276.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 263.65 Td (Gain on sales of real estate, net) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 276.90 263.65 Td (13,967) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 346.15 263.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 378.90 263.65 Td (13,967) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 424.80 263.65 Td (100) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 437.65 263.65 Td (%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 479.90 263.65 Td (13,967) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 263.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 250.65 Td (Gain on sale of foreclosed real estate held for sale) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 280.40 250.65 Td (2,509) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 346.15 250.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 382.40 250.65 Td (2,509) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 424.80 250.65 Td (100) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 437.65 250.65 Td (%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 483.40 250.65 Td (2,509) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 250.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 237.65 Td (Gain from extinguishment of debt) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 289.15 237.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 337.40 237.65 Td (1,815) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 380.05 237.70 Td (\(1,815) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 237.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 422.45 237.65 Td (\(100) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 237.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 481.05 237.70 Td (\(1,815) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 237.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 237.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 224.65 Td (Gain on sales of real estate, net \(discontinued operations\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 285.65 224.65 Td (124) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 337.40 224.65 Td (2,916) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 380.05 224.70 Td (\(2,792) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 224.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 425.95 224.65 Td (\(96) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 224.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 481.05 224.70 Td (\(2,792) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 224.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 224.65 Td (—) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 52.50 211.65 Td (Income from discontinued operations) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 289.15 211.65 Td (44) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 342.65 211.65 Td (236) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 385.30 211.70 Td (\(192) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 398.15 211.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 425.95 211.65 Td (\(81) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 435.30 211.65 Td (\)%) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 486.30 211.70 Td (\(192) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 499.15 211.65 Td (\)) Tj ET Q BT /F1 7.00 Tf ET q 0 0 0 rg BT 553.15 211.65 Td (—) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 196.10 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 187.50 Td (\(1\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 184.10 Td ( Represents the dollar amount increase \(decrease\) for the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 227.40 184.10 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 242.39 184.10 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 288.01 184.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 335.71 184.10 Td ( compared to the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 387.78 184.10 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 402.77 184.10 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 448.39 184.10 Td (March 31, 2014) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 496.09 184.10 Td ( related to ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 175.10 Td (investments disposed of on or after January 1, 2014. ) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 49.50 166.50 Td (\(2\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.18 163.10 Td ( Represents the dollar amount increase \(decrease\) for the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 227.40 163.10 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 242.39 163.10 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 288.01 163.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 335.71 163.10 Td ( compared to the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 387.78 163.10 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 402.77 163.10 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 448.39 163.10 Td (March 31, 2014) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 496.09 163.10 Td ( related to real estate ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 49.50 154.10 Td (and real estate-related investments owned by us throughout both periods presented. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 130.10 Td (Rental income from our real estate properties decreased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 309.95 130.10 Td ($3.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 358.85 130.10 Td ( primarily due to properties sold or disposed of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 118.10 Td (other than by sale, the results of which are included in income from continuing operations, and slightly lower occupancy \(as a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 106.10 Td (result of tenants vacating or tenants reducing leased space\) at certain properties. Overall, we expect rental income to decrease ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 94.10 Td (in future periods due to anticipated real estate property sales. Our rental income in future periods will also vary in lar) Tj ET Q q 0 0 0 rg BT 519.16 94.10 Td (ge part ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 82.10 Td (based on the occupancy rates and rental rates of the properties in our portfolio. ) Tj ET Q endstream endobj 77 0 obj <>] /Rotate 0 /Contents 78 0 R>> endobj 78 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (37) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (T) Tj ET Q q 0 0 0 rg BT 78.91 704.10 Td (enant reimbursements from our real estate properties decreased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 346.85 704.10 Td ($0.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 395.75 704.10 Td ( primarily due to properties sold, the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (results of which are included in income from continuing operations, and adjustments to prior year tax recoveries related to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (GKK Properties, partially of) Tj ET Q q 0 0 0 rg BT 163.18 680.10 Td (fset by an increase in recovery of operating expenses related to our historical real estate properties. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (Our tenant reimbursements in future periods will also vary based on several factors, including the occupancy rates of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 656.10 Td (properties in our portfolio, changes in base year terms, and changes in reimbursable operating expenses. Generally) Tj ET Q q 0 0 0 rg BT 509.53 656.10 Td (, as new ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 644.10 Td (leases are negotiated, the base year resets to operating expenses incurred in the year the lease is signed and the tenant generally ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 632.10 Td (only reimburses operating expenses to the extent and by the amount that its allocable share of the building’) Tj ET Q q 0 0 0 rg BT 476.89 632.10 Td (s operating expenses ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (in future years increases from its base year) Tj ET Q q 0 0 0 rg BT 219.71 620.10 Td (. ) Tj ET Q q 0 0 0 rg BT 226.66 620.10 Td (As a result, as new leases are executed, tenant reimbursements would generally ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (decrease. Rental income may or may not change by amounts corresponding to changes in tenant reimbursements due to new ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (leases. Overall, we expect tenant reimbursements to decrease in future periods due to anticipated real estate property sales.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 578.10 Td (Interest income from real estate loans receivable decreased slightly from $0.8 million for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 446.42 578.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 466.41 578.10 Td ( months ended March ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.10 Td (31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 64.50 566.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 84.50 566.10 Td ( to $0.7 million for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 177.55 566.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 197.53 566.10 Td ( months ended March 31, 2015, due to the decrease in interest received from an impaired ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.10 Td (loan, the Sandmar Mezzanine Loan. In general, we expect interest income in future periods to remain fairly constant, but to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.10 Td (decrease to the extent that we receive principal repayments on or make dispositions of real estate loans receivable. Interest ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.10 Td (income from real estate loans receivable in future periods may also be af) Tj ET Q q 0 0 0 rg BT 339.75 530.10 Td (fected by potential loan impairments as a result of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.10 Td (current or future market conditions. ) Tj ET Q q 0 0 0 rg BT 196.40 518.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 220.84 518.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 284.44 518.10 Td (, the borrower under the Sandmar Mezzanine Loan was delinquent.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 500.10 Td (If any of the borrowers under our real estate loans receivable are unable to repay their loans at maturity or default on their ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 488.10 Td (loan, the impact to future interest income and loan recoveries may be significant and will depend on several factors unique to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 476.10 Td (each individual loan. In general, if we have a first priority lien on the collateral securing a loan, we may agree to extend the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 464.10 Td (loan at similar terms, modify the terms of the loan, or foreclose on the collateral. If we foreclose on the collateral, we may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 452.10 Td (either operate the property) Tj ET Q q 0 0 0 rg BT 154.63 452.10 Td (, resulting in our receipt of any cash flows generated by the property or our payment of any cash ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 440.10 Td (shortfalls related to the property) Tj ET Q q 0 0 0 rg BT 177.14 440.10 Td (, or sell the property for whatever amount we are able to obtain, which may or may not be equal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 428.10 Td (to the loan balance prior to foreclosure. In general, if we own a mezzanine loan or a B-Note and the borrower is unable to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 416.10 Td (repay its loan at maturity) Tj ET Q q 0 0 0 rg BT 148.82 416.10 Td (, we may have more restrictions and fewer options regarding the resolution of our investment. In ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.10 Td (certain circumstances, the senior lenders, in conjunction with us, may be willing to grant the borrower extensions or may grant ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.10 Td (extensions in exchange for more favorable terms \(such as higher interest rates, a partial payof) Tj ET Q q 0 0 0 rg BT 423.34 392.10 Td (f, or the entitlement to a portion of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 380.10 Td (a junior lender) Tj ET Q q 0 0 0 rg BT 108.18 380.10 Td (’) Tj ET Q q 0 0 0 rg BT 110.96 380.10 Td (s interest income, etc.\). If the senior lenders will not grant the borrower an extension, we, as the mezzanine ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 368.10 Td (lender) Tj ET Q q 0 0 0 rg BT 74.08 368.10 Td (, may foreclose on the ownership interests of the borrower and indirectly take legal title to the property subject to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 356.10 Td (existing senior loans or we may negotiate a discounted repayment. ) Tj ET Q q 0 0 0 rg BT 320.35 356.10 Td (W) Tj ET Q q 0 0 0 rg BT 328.99 356.10 Td (e could attempt to negotiate an extension or modification ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 344.10 Td (with the senior lenders as the new borrower; however) Tj ET Q q 0 0 0 rg BT 263.47 344.10 Td (, if the senior lenders were not willing to extend or modify the loans and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 332.10 Td (we were not able to repay the senior loans, we would most likely relinquish our interests or rights in the investment to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 320.10 Td (holders of the senior loans. ) Tj ET Q q 0 0 0 rg BT 161.98 320.10 Td (Actual outcomes may dif) Tj ET Q q 0 0 0 rg BT 262.61 320.10 Td (fer significantly from the above based on factors specific to individual ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 308.10 Td (loans and situations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 290.10 Td (Property operating, maintenance and management costs from our real estate properties increased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 475.01 290.10 Td ($0.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 523.91 290.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 278.10 Td (primarily due to snow removal expenses related to our real estate properties located in the midwestern and northeastern regions ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 266.10 Td (of the United States due to record snow fall during the first quarter 2015, partially of) Tj ET Q q 0 0 0 rg BT 387.56 266.10 Td (fset by a decrease due to properties sold or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 254.10 Td (disposed of other than by sale, the results of which are included in income from continuing operations. Overall, we expect ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 242.10 Td (property operating, maintenance and management costs to decrease in future periods due to anticipated real estate property ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 230.10 Td (sales.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 212.10 Td (Real estate taxes, property-related taxes and insurance from our real estate properties decreased from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.70 212.10 Td ($7.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 528.59 212.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 200.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.49 200.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 130.31 200.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 193.91 200.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 206.69 200.10 Td ($6.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 255.58 200.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 286.96 200.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 306.94 200.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.77 200.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 431.37 200.10 Td ( primarily due to properties sold ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 188.10 Td (or disposed of other than by sale, the results of which are included in income from continuing operations and property tax ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 176.10 Td (refunds received related to the GKK Properties. Overall, we expect real estate taxes, property-related taxes and insurance to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 164.10 Td (decrease in future periods due to anticipated real estate property sales. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 146.10 Td (Asset management fees decreased from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 234.26 146.10 Td ($2.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 283.15 146.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 314.53 146.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 334.52 146.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 395.34 146.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 458.94 146.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 471.72 146.10 Td ($2.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 520.61 146.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 134.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.49 134.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 130.31 134.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 193.91 134.10 Td ( primarily due to properties sold or disposed of other than by sale, the results of which are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 122.10 Td (included in income from continuing operations. Overall, we expect asset management fees to decrease in future periods due to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 110.10 Td (anticipated asset sales or payof) Tj ET Q q 0 0 0 rg BT 173.16 110.10 Td (fs. See “Liquidity and Capital Resources.”) Tj ET Q endstream endobj 79 0 obj <>] /Rotate 0 /Contents 80 0 R>> endobj 80 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (38) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (General and administrative expenses decreased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 277.30 704.10 Td ($1.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.20 704.10 Td ( primarily due to a decrease of $1.0 million in the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (estimated profit participation interest related to the GKK Properties under the ) Tj ET Q q 0 0 0 rg BT 361.35 692.10 Td (Amended Services ) Tj ET Q q 0 0 0 rg BT 438.55 692.10 Td (Agreement and a decrease of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td ($0.4 million related to lower legal fees, accounting fees, transfer agent fees and other professional fees. See “— Contractual ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (Commitments and Contingencies — ) Tj ET Q q 0 0 0 rg BT 197.27 668.10 Td (Asset Management Services ) Tj ET Q q 0 0 0 rg BT 312.52 668.10 Td (Agreement Related to the GKK Properties” for more ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 656.10 Td (information. General and administrative expenses consist primarily of management fees related to the ) Tj ET Q q 0 0 0 rg BT 460.75 656.10 Td (Amended Services ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 644.10 Td (Agreement, legal fees, audit fees, transfer agent fees, state and local income taxes and other professional fees.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 626.10 Td (Depreciation and amortization expense from our real estate properties decreased by $2.3 million primarily due to real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 614.10 Td (estate property sales and decreased amortization of tenant origination and absorption costs resulting from lease expirations. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.10 Td (Upon classifying a property as held for sale, we cease depreciation and amortization expense for that property) Tj ET Q q 0 0 0 rg BT 488.41 602.10 Td (. Overall, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.10 Td (expect depreciation and amortization expense to decrease in future periods due to anticipated real estate property sales.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 572.10 Td (Interest expense from the financing of our portfolio decreased by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 336.18 572.10 Td ($4.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 385.07 572.10 Td (, primarily due to a decrease in the average ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 560.10 Td (loan balance as a result of principal repayments and debt extinguishments subsequent to March 31, 2014. Included in interest ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 548.10 Td (expense is the amortization of deferred financing costs of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 281.36 548.10 Td ($0.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 330.25 548.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 349.69 548.10 Td ($0.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.58 548.10 Td ( for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 429.96 548.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 449.94 548.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 510.77 548.10 Td (March 31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 536.10 Td (2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.50 536.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 88.94 536.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 152.54 536.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 205.20 536.10 Td (. Interest expense in future periods will vary based on fluctuations in one-month ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 524.10 Td (LIBOR, our level of future borrowings and our ability to refinance existing indebtedness at similar rates. ) Tj ET Q q 0 0 0 rg BT 472.82 524.10 Td (W) Tj ET Q q 0 0 0 rg BT 481.46 524.10 Td (e do not currently ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 512.10 Td (plan to acquire or originate more real estate or real estate-related assets and, therefore, do not plan to enter into any purchase ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 500.10 Td (financing in the future. However) Tj ET Q q 0 0 0 rg BT 182.39 500.10 Td (, we may need to refinance our existing indebtedness in the future. Overall, we expect interest ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 488.10 Td (expense to decrease in future periods due to anticipated asset sales and principal paydowns.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 470.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.05 470.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.03 470.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.86 470.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.46 470.10 Td (, due to a change in cash flow estimates and the estimated hold period, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.10 Td (recorded a non-cash impairment char) Tj ET Q q 0 0 0 rg BT 198.14 458.10 Td (ge of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 220.91 458.10 Td ($1.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 269.80 458.10 Td ( to write-down the carrying value of one of our historical industrial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.10 Td (properties held for investment to its estimated fair value. ) Tj ET Q q 0 0 0 rg BT 280.64 446.10 Td (W) Tj ET Q q 0 0 0 rg BT 289.28 446.10 Td (e measured this property at estimated fair value, as this property ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 434.10 Td (was impaired and the carrying value of the property was adjusted to estimated fair value. ) Tj ET Q q 0 0 0 rg BT 409.47 434.10 Td (W) Tj ET Q q 0 0 0 rg BT 418.11 434.10 Td (e estimated the fair value for this ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 422.10 Td (impaired real estate property held for investment based on an estimated sales price. ) Tj ET Q q 0 0 0 rg BT 386.70 422.10 Td (W) Tj ET Q q 0 0 0 rg BT 395.33 422.10 Td (e did not record an impairment char) Tj ET Q q 0 0 0 rg BT 538.43 422.10 Td (ge on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 410.10 Td (real estate held for investment during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 215.83 410.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 235.82 410.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 296.64 410.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 360.24 410.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 392.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.05 392.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.03 392.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.86 392.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.46 392.10 Td (, we sold 1,151,343 shares of common stock of Gramercy and recognized ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 380.10 Td (a gain on the sale of real estate securities of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 226.09 380.10 Td ($3.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.98 380.10 Td (. ) Tj ET Q q 0 0 0 rg BT 282.30 380.10 Td (W) Tj ET Q q 0 0 0 rg BT 290.94 380.10 Td (e did not own or sell any shares of common stock of Gramercy ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 368.10 Td (during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 92.83 368.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 112.81 368.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 173.64 368.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 237.23 368.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 350.10 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 350.10 Td (e recognized a gain on sales of real estate of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 260.94 350.10 Td ($14.0 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 314.83 350.10 Td ( related to the disposition of two historical industrial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 338.10 Td (properties and one GKK Property during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 230.29 338.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 250.28 338.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 311.10 338.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 374.70 338.10 Td ( that were included in income from continuing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 326.10 Td (operations. ) Tj ET Q q 0 0 0 rg BT 98.47 326.10 Td (W) Tj ET Q q 0 0 0 rg BT 107.11 326.10 Td (e did not dispose of any real estate properties during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 333.44 326.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 353.42 326.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 414.25 326.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 477.84 326.10 Td ( that were included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 314.10 Td (in income from continuing operations. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 296.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.05 296.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.03 296.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.86 296.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.46 296.10 Td (, we sold the remaining two condominium units of the ) Tj ET Q q 0 0 0 rg BT 482.41 296.10 Td (T) Tj ET Q q 0 0 0 rg BT 488.17 296.10 Td (ribeca Building ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 284.10 Td (and recognized a gain of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 150.29 284.10 Td ($2.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.18 284.10 Td ( on the sales of foreclosed real estate held for sale. ) Tj ET Q q 0 0 0 rg BT 405.30 284.10 Td (W) Tj ET Q q 0 0 0 rg BT 413.94 284.10 Td (e did not sell any condominium units ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 272.10 Td (of the ) Tj ET Q q 0 0 0 rg BT 74.87 272.10 Td (T) Tj ET Q q 0 0 0 rg BT 80.62 272.10 Td (ribeca Building during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 188.38 272.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 208.36 272.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 269.19 272.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 332.79 272.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 254.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 119.05 254.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 139.03 254.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 199.86 254.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 263.46 254.10 Td (, we recognized a gain on extinguishment of debt of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 473.67 254.10 Td ($1.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 522.56 254.10 Td ( related ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 242.10 Td (to the BOA) Tj ET Q q 0 0 0 rg BT 95.06 242.10 Td ( ) Tj ET Q q 0 0 0 rg BT 97.38 242.10 Td (W) Tj ET Q q 0 0 0 rg BT 106.41 242.10 Td (indsor Mortgage Portfolio Loan, which matured on October 31, 2012. On February 21, 2014, we entered into ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 230.10 Td (agreements for deed-in-lieu of foreclosure and transferred the properties securing the BOA) Tj ET Q q 0 0 0 rg BT 412.41 230.10 Td ( ) Tj ET Q q 0 0 0 rg BT 414.73 230.10 Td (W) Tj ET Q q 0 0 0 rg BT 423.77 230.10 Td (indsor Mortgage Portfolio Loan to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 218.10 Td (the lender in full satisfaction of the debt and other obligations due under the loan. ) Tj ET Q q 0 0 0 rg BT 380.06 218.10 Td (The gain on extinguishment of debt ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 206.10 Td (represents the dif) Tj ET Q q 0 0 0 rg BT 118.18 206.10 Td (ference between the carrying amount of the outstanding debt and other liabilities of $7.0 million and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 194.10 Td (carrying value of the real estate properties and other assets which secured the loan of approximately $5.2 million as of the date ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 182.10 Td (the properties were transferred to the lender) Tj ET Q q 0 0 0 rg BT 223.87 182.10 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 164.10 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 164.10 Td (e recognized a gain on sale of real estate of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 257.05 164.10 Td ($0.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 305.94 164.10 Td ( in discontinued operations related to the disposition of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 152.10 Td (one GKK Property during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 170.87 152.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 190.85 152.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 251.68 152.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 315.28 152.10 Td (. During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 368.32 152.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.31 152.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 449.13 152.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 512.73 152.10 Td (, we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 140.10 Td (recognized a gain on sales of real estate of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 221.37 140.10 Td ($2.9 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 270.26 140.10 Td ( related to the disposition of one historical of) Tj ET Q q 0 0 0 rg BT 449.48 140.10 Td (fice property and four GKK ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 128.10 Td (Properties. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 110.10 Td (Income from discontinued operations for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 254.56 110.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 274.54 110.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 335.37 110.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 398.97 110.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 418.41 110.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 438.41 110.10 Td ( was $0.1 million and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 527.29 110.10 Td ($0.2 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 98.10 Td (million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 78.39 98.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 131.05 98.10 Td (. Income from discontinued operations is composed of the results of operations from properties sold and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 86.10 Td (properties designated as held for sale prior to January 1, 2014. ) Tj ET Q q 0 0 0 rg BT 303.14 86.10 Td (T) Tj ET Q q 0 0 0 rg BT 308.55 86.10 Td (otal revenues and other income from discontinued operations ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 74.10 Td (decreased from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.35 74.10 Td ($0.7 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 162.24 74.10 Td ( during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 208.07 74.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 228.05 74.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 288.88 74.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 352.48 74.10 Td ( to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 365.26 74.10 Td ($33,000) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 397.76 74.10 Td ( during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 443.58 74.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 463.57 74.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 62.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 62.10 Td (. ) Tj ET Q q 0 0 0 rg BT 120.42 62.10 Td (T) Tj ET Q q 0 0 0 rg BT 125.83 62.10 Td (otal expenses from discontinued operations decreased from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 365.47 62.10 Td ($0.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 414.36 62.10 Td ( during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 460.19 62.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 480.17 62.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 50.10 Td (March 31, 2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 50.10 Td ( to $0 during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 181.70 50.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 201.69 50.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 262.51 50.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 326.11 50.10 Td (. ) Tj ET Q endstream endobj 81 0 obj <>] /Rotate 0 /Contents 82 0 R>> endobj 82 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (39) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 704.25 Td (Funds fr) Tj ET Q q 0 0 0 rg BT 86.27 704.25 Td (om Operations and Modified Funds fr) Tj ET Q q 0 0 0 rg BT 249.16 704.25 Td (om Operations) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 686.25 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 686.25 Td (e believe that funds from operations \(“FFO”\) is a beneficial indicator of the performance of an equity REIT) Tj ET Q q 0 0 0 rg BT 511.52 686.25 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 674.25 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 674.25 Td (e compute FFO in accordance with the current National ) Tj ET Q q 0 0 0 rg BT 282.79 674.25 Td (Association of Real Estate Investment ) Tj ET Q q 0 0 0 rg BT 437.84 674.25 Td (T) Tj ET Q q 0 0 0 rg BT 443.60 674.25 Td (rusts \(“NAREIT”\) definition. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 662.25 Td (FFO represents net income, excluding gains and losses from sales of operating real estate assets \(which can vary among owners ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 650.25 Td (of identical assets in similar conditions based on historical cost accounting and useful-life estimates\), impairment losses on real ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 638.25 Td (estate assets, depreciation and amortization of real estate assets, and adjustments for unconsolidated partnerships and joint ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 626.25 Td (ventures. In connection with NAREIT’) Tj ET Q q 0 0 0 rg BT 207.80 626.25 Td (s ) Tj ET Q q 0 0 0 rg BT 213.64 626.25 Td (Accounting and Financial Standards Hot ) Tj ET Q q 0 0 0 rg BT 378.70 626.25 Td (T) Tj ET Q q 0 0 0 rg BT 384.11 626.25 Td (opics, we are excluding impairment char) Tj ET Q q 0 0 0 rg BT 546.64 626.25 Td (ges ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 614.25 Td (on real estate assets from our calculation of FFO. ) Tj ET Q q 0 0 0 rg BT 251.21 614.25 Td (W) Tj ET Q q 0 0 0 rg BT 259.85 614.25 Td (e have also restated FFO from prior periods to exclude these impairment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (char) Tj ET Q q 0 0 0 rg BT 66.53 602.25 Td (ges. NAREIT) Tj ET Q q 0 0 0 rg BT 123.84 602.25 Td ( believes that impairment char) Tj ET Q q 0 0 0 rg BT 244.72 602.25 Td (ges on real estate assets are often early recognition of losses on prospective ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (sales of properties, and therefore, the exclusion of these impairments is consistent with the exclusion of gains and losses ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (recognized from the sales of real estate. ) Tj ET Q q 0 0 0 rg BT 212.48 578.25 Td (Although these losses are included in the calculation of net income \(loss\), we have ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 566.25 Td (excluded these impairment char) Tj ET Q q 0 0 0 rg BT 176.77 566.25 Td (ges in our calculation of FFO because impairments do not impact the current operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 554.25 Td (performance of our investments, and may or may not provide an indication of future operating performance. ) Tj ET Q q 0 0 0 rg BT 487.22 554.25 Td (W) Tj ET Q q 0 0 0 rg BT 495.86 554.25 Td (e believe FFO ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.25 Td (facilitates comparisons of operating performance between periods and among other REIT) Tj ET Q q 0 0 0 rg BT 407.00 542.25 Td (s. However) Tj ET Q q 0 0 0 rg BT 454.65 542.25 Td (, our computation of FFO ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.25 Td (may not be comparable to other REIT) Tj ET Q q 0 0 0 rg BT 200.42 530.25 Td (s that do not define FFO in accordance with the current NAREIT) Tj ET Q q 0 0 0 rg BT 460.44 530.25 Td ( definition or that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.25 Td (interpret the current NAREIT) Tj ET Q q 0 0 0 rg BT 167.88 518.25 Td ( definition dif) Tj ET Q q 0 0 0 rg BT 222.69 518.25 Td (ferently than we do. Our management believes that historical cost accounting for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.25 Td (real estate assets in accordance with U.S. generally accepted accounting principles \(“GAAP”\) implicitly assumes that the value ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.25 Td (of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.25 Td (conditions, many industry investors and analysts have considered the presentation of operating results for real estate companies ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.25 Td (that use historical cost accounting to be insuf) Tj ET Q q 0 0 0 rg BT 229.55 470.25 Td (ficient by themselves. ) Tj ET Q q 0 0 0 rg BT 321.48 470.25 Td (As a result, we believe that the use of FFO, together with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.25 Td (the required GAAP) Tj ET Q q 0 0 0 rg BT 126.89 458.25 Td ( presentations, provides a more complete understanding of our performance relative to our competitors and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.25 Td (provides a more informed and appropriate basis on which to make decisions involving operating, financing, and investing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 434.25 Td (activities.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 416.25 Td (Changes in accounting rules have resulted in a substantial increase in the number of non-operating and non-cash items ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 404.25 Td (included in the calculation of FFO. ) Tj ET Q q 0 0 0 rg BT 193.92 404.25 Td (As a result, our management also uses modified funds from operations \(“MFFO”\) as an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 392.25 Td (indicator of our ongoing performance. MFFO excludes from FFO: acquisition fees and expenses; adjustments related to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 380.25 Td (contingent purchase price obligations; amounts relating to straight-line rents and amortization of above and below market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 368.25 Td (intangible lease assets and liabilities; accretion of discounts and amortization of premiums on debt investments; amortization of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 356.25 Td (closing costs relating to debt investments; impairments of real estate-related investments; mark-to-market adjustments included ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 344.25 Td (in net income; and gains or losses included in net income for the extinguishment or sale of debt or hedges. ) Tj ET Q q 0 0 0 rg BT 479.22 344.25 Td (W) Tj ET Q q 0 0 0 rg BT 487.85 344.25 Td (e compute MFFO ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 332.25 Td (in accordance with the definition of MFFO included in the practice guideline issued by the Investment Program ) Tj ET Q q 0 0 0 rg BT 498.00 332.25 Td (Association ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 320.25 Td (\(“IP) Tj ET Q q 0 0 0 rg BT 65.24 320.25 Td (A”\) in November 2010 as interpreted by management. Our computation of MFFO may not be comparable to other REIT) Tj ET Q q 0 0 0 rg BT 549.97 320.25 Td (s ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 308.25 Td (that do not compute MFFO in accordance with the current IP) Tj ET Q q 0 0 0 rg BT 292.97 308.25 Td (A) Tj ET Q q 0 0 0 rg BT 299.64 308.25 Td ( definition or that interpret the current IP) Tj ET Q q 0 0 0 rg BT 461.72 308.25 Td (A) Tj ET Q q 0 0 0 rg BT 468.39 308.25 Td ( definition dif) Tj ET Q q 0 0 0 rg BT 523.20 308.25 Td (ferently ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 296.25 Td (than we do. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 278.25 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 278.25 Td (e believe that MFFO is helpful as a measure of ongoing operating performance because it excludes non-operating items ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 266.25 Td (included in FFO. MFFO also excludes non-cash items such as straight-line rental revenue. ) Tj ET Q q 0 0 0 rg BT 417.49 266.25 Td (Additionally) Tj ET Q q 0 0 0 rg BT 467.39 266.25 Td (, we believe that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 254.25 Td (MFFO provides investors with supplemental performance information that is consistent with the performance indicators and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 242.25 Td (analysis used by management, in addition to net income and cash flows from operating activities as defined by GAAP) Tj ET Q q 0 0 0 rg BT 520.78 242.25 Td (, to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 230.25 Td (evaluate the sustainability of our operating performance. MFFO provides comparability in evaluating the operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 218.25 Td (performance of our portfolio with other non-traded REIT) Tj ET Q q 0 0 0 rg BT 277.34 218.25 Td (s, which typically have limited lives with short and defined acquisition ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 206.25 Td (periods and tar) Tj ET Q q 0 0 0 rg BT 108.74 206.25 Td (geted exit strategies. MFFO, or an equivalent measure, is routinely reported by non-traded REIT) Tj ET Q q 0 0 0 rg BT 496.55 206.25 Td (s, and we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 194.25 Td (believe often used by analysts and investors for comparison purposes.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 176.25 Td (FFO and MFFO are non-GAAP) Tj ET Q q 0 0 0 rg BT 200.91 176.25 Td ( financial measures and do not represent net income as defined by GAAP) Tj ET Q q 0 0 0 rg BT 493.05 176.25 Td (. Net income as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 164.25 Td (defined by GAAP) Tj ET Q q 0 0 0 rg BT 121.34 164.25 Td ( is the most relevant measure in determining our operating performance because FFO and MFFO include ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 152.25 Td (adjustments that investors may deem subjective, such as adding back expenses such as depreciation and amortization and the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 140.25 Td (other items described above. ) Tj ET Q q 0 0 0 rg BT 168.35 140.25 Td (Accordingly) Tj ET Q q 0 0 0 rg BT 217.69 140.25 Td (, FFO and MFFO should not be considered as alternatives to net income as an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 128.25 Td (indicator of our current and historical operating performance. In addition, FFO and MFFO do not represent cash flows from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 116.25 Td (operating activities determined in accordance with GAAP) Tj ET Q q 0 0 0 rg BT 280.72 116.25 Td ( and should not be considered an indication of our liquidity) Tj ET Q q 0 0 0 rg BT 516.69 116.25 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 104.25 Td (W) Tj ET Q q 0 0 0 rg BT 58.14 104.25 Td (e believe FFO and MFFO, in addition to net income and cash flows from operating activities as defined by GAAP) Tj ET Q q 0 0 0 rg BT 513.61 104.25 Td (, are ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 92.25 Td (meaningful supplemental performance measures. During periods of significant disposition activity) Tj ET Q q 0 0 0 rg BT 445.14 92.25 Td (, FFO and MFFO are much ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 80.25 Td (more limited as measures of future performance.) Tj ET Q endstream endobj 83 0 obj <>] /Rotate 0 /Contents 84 0 R>> endobj 84 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (40) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (Although MFFO includes other adjustments, the exclusion of straight-line rent, amortization of above- and below-market ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (leases, gain from extinguishment of debt and the net amortization of discounts and premiums on mortgage loans related to the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (GKK Properties are the most significant adjustments to us at the present time. ) Tj ET Q q 0 0 0 rg BT 365.64 680.10 Td (W) Tj ET Q q 0 0 0 rg BT 374.28 680.10 Td (e have excluded these items based on the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (following economic considerations:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 650.10 Td (• ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 90.00 650.10 Td (Adjustments for straight-line r) Tj ET Q q 0 0 0 rg BT 211.02 650.10 Td (ent) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 223.24 650.10 Td (. ) Tj ET Q q 0 0 0 rg BT 230.56 650.10 Td (These are adjustments to rental revenue as required by GAAP) Tj ET Q q 0 0 0 rg BT 477.60 650.10 Td ( to recognize ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 638.10 Td (contractual lease payments on a straight-line basis over the life of the respective lease. ) Tj ET Q q 0 0 0 rg BT 439.68 638.10 Td (W) Tj ET Q q 0 0 0 rg BT 448.32 638.10 Td (e have excluded these ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 626.10 Td (adjustments in our calculation of MFFO to more appropriately reflect the current economic impact of our in-place ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 614.10 Td (leases, while also providing investors with a useful supplemental metric that addresses core operating performance by ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 602.10 Td (removing rent we expect to receive in a future period or rent that was received in a prior period;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 587.10 Td (• ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 90.00 587.10 Td (Amortization of above- and below-market leases.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 286.64 587.10 Td ( Similar to depreciation and amortization of real estate assets and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 575.10 Td (lease related costs that are excluded from FFO, GAAP) Tj ET Q q 0 0 0 rg BT 307.62 575.10 Td ( implicitly assumes that the value of intangible lease assets and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 563.10 Td (liabilities diminishes predictably over time and requires that these char) Tj ET Q q 0 0 0 rg BT 372.79 563.10 Td (ges be recognized currently in revenue. Since ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 551.10 Td (market lease rates in the aggregate have historically risen or fallen with local market conditions, management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 539.10 Td (believes that by excluding these char) Tj ET Q q 0 0 0 rg BT 237.27 539.10 Td (ges, MFFO provides useful supplemental information on the operating ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 527.10 Td (performance of the real estate;) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 512.10 Td (• ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 90.00 512.10 Td (Gain fr) Tj ET Q q 0 0 0 rg BT 118.80 512.10 Td (om extinguishment of debt) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 224.06 512.10 Td (. ) Tj ET Q q 0 0 0 rg BT 231.01 512.10 Td (A) Tj ET Q q 0 0 0 rg BT 237.68 512.10 Td ( gain from extinguishment of debt represents the dif) Tj ET Q q 0 0 0 rg BT 445.22 512.10 Td (ference between the carrying ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 500.10 Td (value of any consideration transferred to the lender in return for the extinguishment of a debt and the net carrying ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 488.10 Td (value of the debt at the time of settlement. ) Tj ET Q q 0 0 0 rg BT 263.37 488.10 Td (W) Tj ET Q q 0 0 0 rg BT 272.01 488.10 Td (e have excluded the gain from extinguishment of debt in our calculation ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 476.10 Td (of MFFO because these gains do not impact the current operating performance of our investments and do not provide ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 464.10 Td (an indication of future operating performance; and) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 449.10 Td (• ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 90.00 449.10 Td (Net amortization of discounts and pr) Tj ET Q q 0 0 0 rg BT 236.58 449.10 Td (emiums on mortgage loans r) Tj ET Q q 0 0 0 rg BT 350.65 449.10 Td (elated to the GKK Pr) Tj ET Q q 0 0 0 rg BT 435.27 449.10 Td (operties. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 472.49 449.10 Td ( Discounts and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 437.10 Td (premiums on debt are amortized over the term of the loan as an adjustment to interest expense. ) Tj ET Q q 0 0 0 rg BT 473.86 437.10 Td (This application ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 425.10 Td (results in interest expense recognition that is dif) Tj ET Q q 0 0 0 rg BT 281.16 425.10 Td (ferent than the underlying contractual terms of the debt. ) Tj ET Q q 0 0 0 rg BT 508.96 425.10 Td (W) Tj ET Q q 0 0 0 rg BT 517.59 425.10 Td (e have ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 413.10 Td (excluded the amortization of discounts and premiums related to the debt assumed in connection with the Settlement ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 401.10 Td (Agreement in our calculation of MFFO to more appropriately reflect the economic impact of our debt as the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 389.10 Td (amortization of discounts and premiums has no ongoing economic impact on our operations. ) Tj ET Q q 0 0 0 rg BT 465.58 389.10 Td (The debt assumed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 377.10 Td (related to the GKK Properties was marked to market as of the date we entered into Settlement ) Tj ET Q q 0 0 0 rg BT 467.38 377.10 Td (Agreement, which ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 365.10 Td (resulted in discounts and premiums related to the debt assumed. ) Tj ET Q q 0 0 0 rg BT 350.32 365.10 Td (W) Tj ET Q q 0 0 0 rg BT 358.96 365.10 Td (e believe excluding these items provides investors ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 90.00 353.10 Td (with a useful supplemental metric that directly addresses core operating performance.) Tj ET Q endstream endobj 85 0 obj <>] /Rotate 0 /Contents 86 0 R>> endobj 86 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (41) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 704.10 Td (Our calculation of FFO and MFFO is presented in the table below for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 369.00 704.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 388.98 704.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 449.81 704.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 513.41 704.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 532.85 704.10 Td (2014) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 552.85 704.10 Td (, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (respectively \(in thousands\). No conclusions or comparisons should be made from the presentation of these periods. ) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 640.60 399.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 640.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 640.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 640.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 614.60 399.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 614.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 614.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 614.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 588.60 399.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 588.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 588.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 588.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 562.60 399.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 562.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 562.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 562.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 536.60 399.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 536.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 536.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 536.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 510.60 399.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 510.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 510.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 510.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 50.00 484.60 399.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 449.00 484.60 55.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 504.00 484.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 508.00 484.60 55.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 654.6 m 504 654.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 504 654.6 m 508 654.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 654.6 m 563 654.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 654.6 m 504 654.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 640.6 m 504 640.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 654.6 m 563 654.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 640.6 m 563 640.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 640.6 m 504 640.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 640.6 m 563 640.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 536.6 m 504 536.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 536.6 m 563 536.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 471.6 m 504 471.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 471.6 m 563 471.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 459.6 m 504 459.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 449 457.6 m 504 457.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 459.6 m 563 459.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 508 457.6 m 563 457.6 l s BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 658.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 455.70 666.83 Td (For the Three Months Ended) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 488.00 658.83 Td (March 31,) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 644.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 468.00 644.83 Td (2015) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 527.00 644.83 Td (2014) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 631.85 Td (Net income \(loss\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 451.50 631.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 482.80 631.85 Td (8,589) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 510.50 631.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 631.85 Td (\(4,515) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 631.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 618.85 Td (Depreciation of real estate assets) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 478.80 618.85 Td (10,015) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 537.80 618.85 Td (10,617) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 605.85 Td (Amortization of lease-related costs) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 482.80 605.85 Td (5,590) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 605.85 Td (7,306) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 592.85 Td (Impairment charges on real estate) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 492.80 592.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 592.85 Td (1,257) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 579.85 Td (Gain on foreclosed real estate held for sale) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 480.10 579.85 Td (\(2,509) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 500.80 579.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 579.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 566.85 Td (Gain on sales of real estate, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 476.10 566.85 Td (\(13,967) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 500.80 566.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 551.80 566.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 553.85 Td (Gain on sales of real estate, net - discontinued operations) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 486.10 553.85 Td (\(124) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 500.80 553.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 553.85 Td (\(2,916) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 553.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 540.85 Td (Gain on sales of real estate securities) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 492.80 540.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 540.85 Td (\(3,748) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 540.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 527.85 Td (FFO) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 482.80 527.85 Td (7,594) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 527.85 Td (8,001) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 514.85 Td (Straight-line rent and amortization of above- and below-market leases) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 480.10 514.85 Td (\(2,285) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 500.80 514.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 514.85 Td (\(2,668) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 514.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 501.85 Td (Gain from extinguishment of debt) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 492.80 501.85 Td (—) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 539.10 501.85 Td (\(1,815) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 501.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 488.85 Td (Amortization of discounts and closing costs on real estate loans receivable) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 486.10 488.85 Td (\(240) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 500.80 488.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 545.10 488.85 Td (\(248) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 559.80 488.85 Td (\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 64.50 475.85 Td (Amortization of discounts and premiums on GKK notes payable, net) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 488.80 475.85 Td (511) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 547.80 475.85 Td (639) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 52.50 462.85 Td (MFFO) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 451.50 462.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 482.80 462.85 Td (5,580) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 510.50 462.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.80 462.85 Td (3,909) Tj ET Q BT /F1 10.00 Tf ET BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 435.10 Td (FFO and MFFO may be used to fund all or a portion of certain capitalizable items that are excluded from FFO and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 423.10 Td (MFFO, such as tenant improvements, building improvements and deferred leasing costs. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 405.10 Td (Distributions) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 387.10 Td (Distributions declared, distributions paid and cash flow from operations were as follows for the first quarter of 2015 ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 375.10 Td (\(in thousands, except per share amounts\): ) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 50.50 326.60 170.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 220.50 326.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 224.50 326.60 80.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 304.50 326.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 308.50 326.60 80.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 388.50 326.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 392.50 326.60 86.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 478.50 326.60 4.00 -13.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 482.50 326.60 80.00 -13.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50.5 326.6 m 220.5 326.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 224.5 326.6 m 304.5 326.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 308.5 326.6 m 388.5 326.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 392.5 326.6 m 478.5 326.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 482.5 326.6 m 562.5 326.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 123.65 330.83 Td (Period) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 241.55 338.83 Td (Distributions ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 244.70 330.83 Td (Declar) Tj ET Q q 0 0 0 rg BT 267.21 330.83 Td (ed ) Tj ET Q BT /F2 8.00 Tf ET BT /F2 5.20 Tf ET q 0 0 0 rg BT 277.21 334.46 Td (\(1\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 325.55 346.83 Td (Distributions ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 325.80 338.83 Td (Declar) Tj ET Q q 0 0 0 rg BT 348.31 338.83 Td (ed Per) Tj ET Q q 0 0 0 rg BT 370.15 338.83 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 330.35 330.83 Td (Shar) Tj ET Q q 0 0 0 rg BT 346.65 330.83 Td (e ) Tj ET Q BT /F2 8.00 Tf ET BT /F2 5.20 Tf ET q 0 0 0 rg BT 352.21 334.46 Td (\(1\) \(2\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 503.85 338.83 Td (Cash Flow ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 492.40 330.83 Td (Fr) Tj ET Q q 0 0 0 rg BT 500.69 330.83 Td (om Operations) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 396.05 330.83 Td (Distributions Paid ) Tj ET Q BT /F2 8.00 Tf ET BT /F2 5.20 Tf ET q 0 0 0 rg BT 460.51 334.46 Td (\(1\) \(2\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 53.00 317.85 Td (First Quarter 2015) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 227.00 317.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 283.30 317.85 Td (4,690) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 311.00 317.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 367.30 317.85 Td (0.025) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 395.00 317.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 457.30 317.85 Td (9,389) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 485.00 317.85 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 541.30 317.85 Td (6,809) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 302.10 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 50.00 293.50 Td (\(1\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.68 290.10 Td ( “Distributions Declared” and “Distributions Declared Per Share” consist of the following: ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 68.00 278.10 Td (• ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 86.00 278.10 Td (On December 9, 2014, our board of directors declared a distribution in the amount of $0.025 per share of common stock to stockholders of record as of the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 86.00 269.10 Td (close of business on December 29, 2014. ) Tj ET Q q 0 0 0 rg BT 212.51 269.10 Td (This distribution totaled approximately $4.7 million and was paid on January 2, 2015.) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 68.00 257.10 Td (• ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 86.00 257.10 Td (On March 6, 2015, our board of directors declared a distribution in the amount of $0.025 per share of common stock to stockholders of record as of the close ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 86.00 248.10 Td (of business on March 20, 2015. ) Tj ET Q q 0 0 0 rg BT 183.98 248.10 Td (This distribution totaled approximately $4.7 million and was paid on March 25, 2015.) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 50.00 239.50 Td (\(2\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 55.68 236.10 Td ( ) Tj ET Q q 0 0 0 rg BT 57.15 236.10 Td (Assumes share was issued and outstanding each day that was a record date during the period presented. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.50 212.10 Td ( For the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 108.61 212.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 128.59 212.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 189.42 212.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 253.02 212.10 Td (, we paid aggregate cash distributions of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 416.86 212.10 Td ($9.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 465.75 212.10 Td (. FFO and cash flow ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 200.10 Td (from operations for the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 144.97 200.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 164.96 200.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 225.78 200.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 289.38 200.10 Td ( were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 313.81 200.10 Td ($7.6 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 362.70 200.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.14 200.10 Td ($6.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 431.03 200.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 483.69 200.10 Td (. ) Tj ET Q q 0 0 0 rg BT 491.01 200.10 Td (W) Tj ET Q q 0 0 0 rg BT 499.65 200.10 Td (e funded our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 188.10 Td (total distributions paid with ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 162.77 188.10 Td ($6.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 211.67 188.10 Td ( of current period cash flow from operations and $2.6 million of cash flow from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 176.10 Td (operations in excess of distributions paid during the year ended December 31, 2014. For purposes of determining the source of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 164.10 Td (our distributions paid, we assume first that we use cash flow from operations from the relevant periods to fund distribution ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 152.10 Td (payments. See the reconciliation of FFO to net income above. For information on our liquidity and distribution policies, see ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 50.00 140.10 Td (“– Liquidity and Capital Resources.”) Tj ET Q endstream endobj 87 0 obj <>] /Rotate 0 /Contents 88 0 R>> endobj 88 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. Management’) Tj ET Q q 0 0 0 rg BT 144.05 730.60 Td (s Discussion and ) Tj ET Q q 0 0 0 rg BT 216.03 730.60 Td (Analysis of Financial Condition and Results of Operations \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (42) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 704.25 Td (Critical ) Tj ET Q q 0 0 0 rg BT 84.21 704.25 Td (Accounting Policies) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 686.25 Td (Our consolidated interim financial statements have been prepared in accordance with GAAP) Tj ET Q q 0 0 0 rg BT 443.27 686.25 Td ( and in conjunction with the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 674.25 Td (rules and regulations of the SEC. ) Tj ET Q q 0 0 0 rg BT 186.52 674.25 Td (The preparation of our financial statements requires significant management judgments, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 662.25 Td (assumptions and estimates about matters that are inherently uncertain. ) Tj ET Q q 0 0 0 rg BT 334.51 662.25 Td (These judgments af) Tj ET Q q 0 0 0 rg BT 412.64 662.25 Td (fect the reported amounts of assets ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 650.25 Td (and liabilities and our disclosure of contingent assets and liabilities as of the dates of the financial statements and the reported ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 638.25 Td (amounts of revenue and expenses during the reporting periods. ) Tj ET Q q 0 0 0 rg BT 305.64 638.25 Td (W) Tj ET Q q 0 0 0 rg BT 314.68 638.25 Td (ith dif) Tj ET Q q 0 0 0 rg BT 338.66 638.25 Td (ferent estimates or assumptions, materially dif) Tj ET Q q 0 0 0 rg BT 523.43 638.25 Td (ferent ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 626.25 Td (amounts could be reported in our financial statements. ) Tj ET Q q 0 0 0 rg BT 271.11 626.25 Td (Additionally) Tj ET Q q 0 0 0 rg BT 321.01 626.25 Td (, other companies may utilize dif) Tj ET Q q 0 0 0 rg BT 452.45 626.25 Td (ferent estimates that may ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 614.25 Td (impact the comparability of our results of operations to those of companies in similar businesses. ) Tj ET Q q 0 0 0 rg BT 441.92 614.25 Td (A) Tj ET Q q 0 0 0 rg BT 448.59 614.25 Td ( discussion of the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (accounting policies that management considers critical in that they involve significant management judgments, assumptions and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (estimates is included in our ) Tj ET Q q 0 0 0 rg BT 160.87 590.25 Td (Annual Report on Form 10-K for the year ended December 31, 2014 filed with the SEC. ) Tj ET Q q 0 0 0 rg BT 519.77 590.25 Td (There ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 578.25 Td (have been no significant changes to our policies during 2015. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 560.25 Td (Subsequent Events) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 542.25 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 542.25 Td (e evaluate subsequent events up until the date the consolidated financial statements are issued.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 524.25 Td (Distribution Declared) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 509.25 Td (On May 13, 2015, our board of directors declared a distribution in the amount of $0.025 per share of common stock to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 497.25 Td (stockholders of record as of the close of business on June 19, 2015. ) Tj ET Q q 0 0 0 rg BT 323.71 497.25 Td (W) Tj ET Q q 0 0 0 rg BT 332.35 497.25 Td (e expect to pay this distribution on or about June 26, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 485.25 Td (2015.) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 467.25 Td (Disposition of Properties Subsequent to March 31, 2015) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 49.50 452.25 Td (101 Independence) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 434.25 Td (On May 1, 2015, we, through an indirect wholly owned subsidiary) Tj ET Q q 0 0 0 rg BT 339.20 434.25 Td (, sold an of) Tj ET Q q 0 0 0 rg BT 383.46 434.25 Td (fice building containing ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.49 434.25 Td (565,694) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 513.99 434.25 Td ( rentable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 422.25 Td (square feet located in Charlotte, North Carolina \(“101 Independence”\) for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 347.43 422.25 Td ($107.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 406.32 422.25 Td ( or ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 419.65 422.25 Td ($106.8 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 478.54 422.25 Td ( net of concessions ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 410.25 Td (and credits. ) Tj ET Q q 0 0 0 rg BT 100.41 410.25 Td (The carrying value of 101 Independence as of the date of sale was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 367.24 410.25 Td ($69.5 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 421.14 410.25 Td (. ) Tj ET Q q 0 0 0 rg BT 428.46 410.25 Td (The purchaser is not af) Tj ET Q q 0 0 0 rg BT 519.91 410.25 Td (filiated ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 398.25 Td (with us or our advisor) Tj ET Q q 0 0 0 rg BT 136.72 398.25 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 380.25 Td (In connection with the disposition of 101 Independence, we repaid the entire ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 382.57 380.25 Td ($65.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 436.46 380.25 Td ( principal balance and all other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 368.25 Td (sums due under a mortgage loan secured by 101 Independence, including a prepayment premium of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.59 368.25 Td ($4.4 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 500.49 368.25 Td (. ) Tj ET Q endstream endobj 89 0 obj <>] /Rotate 0 /Contents 90 0 R>> endobj 90 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 3. Quantitative and Qualitative Disclosur) Tj ET Q q 0 0 0 rg BT 250.09 730.60 Td (es about Market Risk) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (43) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 72.00 704.10 Td (W) Tj ET Q q 0 0 0 rg BT 80.64 704.10 Td (e are exposed to the ef) Tj ET Q q 0 0 0 rg BT 170.13 704.10 Td (fects of interest rate changes as a result of borrowings used to \(i\) maintain liquidity) Tj ET Q q 0 0 0 rg BT 501.61 704.10 Td (, \(ii\) fund the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 692.10 Td (financing and refinancing of our real estate investment portfolio, and \(iii\) fund operations and payments on the debt assumed in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 680.10 Td (connection with the Settlement ) Tj ET Q q 0 0 0 rg BT 175.58 680.10 Td (Agreement. ) Tj ET Q q 0 0 0 rg BT 227.33 680.10 Td (W) Tj ET Q q 0 0 0 rg BT 235.96 680.10 Td (e are also exposed to the ef) Tj ET Q q 0 0 0 rg BT 344.07 680.10 Td (fects of changes in interest rates as a result of our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 668.10 Td (investments in mortgage, mezzanine and other real estate loans receivable. Our profitability and the value of our investment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 656.10 Td (portfolio may be adversely af) Tj ET Q q 0 0 0 rg BT 167.05 656.10 Td (fected during any period as a result of interest rate changes. Our interest rate risk management ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 644.10 Td (objectives are to limit the impact of interest rate changes on earnings, prepayment penalties and cash flows and to lower overall ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 632.10 Td (borrowing costs. ) Tj ET Q q 0 0 0 rg BT 120.98 632.10 Td (W) Tj ET Q q 0 0 0 rg BT 129.62 632.10 Td (e have managed and will continue to manage interest rate risk by maintaining a ratio of fixed rate, long-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 620.10 Td (term debt such that variable rate exposure is kept at an acceptable level. In addition, we may utilize a variety of financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 608.10 Td (instruments, including interest rate caps, floors, and swap agreements, in order to limit the ef) Tj ET Q q 0 0 0 rg BT 420.33 608.10 Td (fects of changes in interest rates on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 596.10 Td (our operations. ) Tj ET Q q 0 0 0 rg BT 114.30 596.10 Td (When we use these types of derivatives to hedge the risk of interest-earning assets or interest-bearing liabilities, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 584.10 Td (we may be subject to certain risks, including the risk that losses on a hedge position will reduce the overall returns to our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 572.10 Td (stockholders and that the losses may exceed the amount we invested in the instruments.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 554.10 Td (W) Tj ET Q q 0 0 0 rg BT 82.14 554.10 Td (e borrow funds and made investments at a combination of fixed and variable rates. Interest rate fluctuations will ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.10 Td (generally not af) Tj ET Q q 0 0 0 rg BT 112.07 542.10 Td (fect our future earnings or cash flows on our fixed rate debt or fixed rate real estate loans receivable unless such ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.10 Td (instruments mature or are otherwise terminated. However) Tj ET Q q 0 0 0 rg BT 282.35 530.10 Td (, interest rate changes will af) Tj ET Q q 0 0 0 rg BT 397.12 530.10 Td (fect the fair value of our fixed rate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 518.10 Td (instruments. ) Tj ET Q q 0 0 0 rg BT 103.11 518.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 127.56 518.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 191.16 518.10 Td (, the fair value and book value of our fixed rate real estate loans receivable were ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 506.10 Td ($26.3 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.39 506.10 Td ( and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 122.83 506.10 Td ($29.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 176.72 506.10 Td (, respectively) Tj ET Q q 0 0 0 rg BT 229.38 506.10 Td (. ) Tj ET Q q 0 0 0 rg BT 236.70 506.10 Td (The fair value estimate of our real estate loans receivable is calculated using an ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 494.10 Td (internal valuation model that considers the expected cash flows for the loans, underlying collateral values \(for collateral-) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 482.10 Td (dependent loans\) and the estimated yield requirements of institutional investors for loans with similar characteristics, including ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 470.10 Td (remaining loan term, loan-to-value, type of collateral and other credit enhancements. ) Tj ET Q q 0 0 0 rg BT 392.98 470.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 417.42 470.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 481.02 470.10 Td (, the fair value of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 458.10 Td (our fixed rate debt was $465.4 million and the carrying value of our fixed rate debt was $435.2 million. ) Tj ET Q q 0 0 0 rg BT 467.82 458.10 Td (The fair value estimate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 446.10 Td (of our fixed rate debt was calculated using a discounted cash flow analysis utilizing rates we would expect to pay for debt of a ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 434.10 Td (similar type and remaining maturity if the loans were originated as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 329.42 434.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 393.02 434.10 Td (. ) Tj ET Q q 0 0 0 rg BT 399.96 434.10 Td (As we expect to hold our fixed rate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 422.10 Td (instruments to maturity and the amounts due under such instruments would be limited to the outstanding principal balance and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 410.10 Td (any accrued and unpaid interest, we do not expect that fluctuations in interest rates, and the resulting changes in fair value of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 398.10 Td (our fixed rate instruments, would have a significant impact on our operations.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 380.10 Td (Conversely) Tj ET Q q 0 0 0 rg BT 118.40 380.10 Td (, movements in interest rates on variable rate debt would change our future earnings and cash flows, but would ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 368.10 Td (not significantly af) Tj ET Q q 0 0 0 rg BT 124.86 368.10 Td (fect the fair value of those instruments. However) Tj ET Q q 0 0 0 rg BT 322.44 368.10 Td (, changes in required risk premiums would result in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 356.10 Td (changes in the fair value of variable rate instruments. ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 1 rg BT 264.42 356.10 Td ( ) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL q 0 0 0 rg BT 266.37 356.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 290.81 356.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 354.41 356.10 Td (, we were exposed to market risks related to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 344.10 Td (fluctuations in interest rates on our ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 191.13 344.10 Td ($204.1 million) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 250.02 344.10 Td ( of variable rate debt outstanding. Based on interest rates as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 503.83 344.10 Td (March 31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 332.10 Td (2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 69.50 332.10 Td (, if interest rates are 100 basis points higher during the 12 months ending March 31, 2016, interest expense on our variable ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 320.10 Td (rate debt outstanding would increase by approximately $2.0 million. ) Tj ET Q q 0 0 0 rg BT 327.22 320.10 Td (As of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 351.66 320.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 415.26 320.10 Td (, one-month LIBOR was 0.17625% ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 308.10 Td (and if this index was reduced to 0% during the 12 months ending March 31, 2016, interest expense on our variable rate debt ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 296.10 Td (would decrease by $0.4 million. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 278.10 Td (The weighted-average annual ef) Tj ET Q q 0 0 0 rg BT 201.86 278.10 Td (fective interest rate of our fixed rate real estate loans receivable as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 479.77 278.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 543.37 278.10 Td ( was ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 266.10 Td (8.9%. ) Tj ET Q q 0 0 0 rg BT 77.65 266.10 Td (The weighted-average annual ef) Tj ET Q q 0 0 0 rg BT 206.01 266.10 Td (fective interest rate represents the ef) Tj ET Q q 0 0 0 rg BT 350.47 266.10 Td (fective interest rate as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 451.25 266.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 514.85 266.10 Td (, using the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 254.10 Td (interest method, which we use to recognize interest income on our real estate loans receivable without asset-specific loan loss ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 242.10 Td (reserves. ) Tj ET Q q 0 0 0 rg BT 89.58 242.10 Td (The weighted-average interest rates of our fixed rate debt and variable rate debt as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 431.92 242.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 495.52 242.10 Td ( were 5.9% and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 230.10 Td (2.2%, respectively) Tj ET Q q 0 0 0 rg BT 122.99 230.10 Td (. ) Tj ET Q q 0 0 0 rg BT 130.31 230.10 Td (The weighted-average interest rate represents the actual interest rate in ef) Tj ET Q q 0 0 0 rg BT 422.76 230.10 Td (fect as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 461.90 230.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 525.50 230.10 Td (, using ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 218.10 Td (interest rate indices as of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 151.40 218.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 215.00 218.10 Td (, where applicable.) Tj ET Q endstream endobj 91 0 obj <>] /Rotate 0 /Contents 92 0 R>> endobj 92 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( I. FINANCIAL) Tj ET Q q 0 0 0 rg BT 143.46 748.60 Td ( INFORMA) Tj ET Q q 0 0 0 rg BT 194.10 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 4. Contr) Tj ET Q q 0 0 0 rg BT 110.36 730.60 Td (ols and Pr) Tj ET Q q 0 0 0 rg BT 153.52 730.60 Td (ocedur) Tj ET Q q 0 0 0 rg BT 182.78 730.60 Td (es) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (44) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 704.25 Td (Disclosur) Tj ET Q q 0 0 0 rg BT 89.32 704.25 Td (e Contr) Tj ET Q q 0 0 0 rg BT 121.63 704.25 Td (ols and Pr) Tj ET Q q 0 0 0 rg BT 164.79 704.25 Td (ocedur) Tj ET Q q 0 0 0 rg BT 194.05 704.25 Td (es) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 686.25 Td (As of the end of the period covered by this report, management, including our principal executive of) Tj ET Q q 0 0 0 rg BT 474.86 686.25 Td (ficer and principal ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 674.25 Td (financial of) Tj ET Q q 0 0 0 rg BT 95.13 674.25 Td (ficer) Tj ET Q q 0 0 0 rg BT 113.04 674.25 Td (, evaluated the ef) Tj ET Q q 0 0 0 rg BT 181.16 674.25 Td (fectiveness of the design and operation of our disclosure controls and procedures. Based upon, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 662.25 Td (and as of the date of, the evaluation, our principal executive of) Tj ET Q q 0 0 0 rg BT 299.50 662.25 Td (ficer and principal financial of) Tj ET Q q 0 0 0 rg BT 420.93 662.25 Td (ficer concluded that the disclosure ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 650.25 Td (controls and procedures were ef) Tj ET Q q 0 0 0 rg BT 177.04 650.25 Td (fective as of the end of the period covered by this report to ensure that information required to ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 638.25 Td (be disclosed in the reports we file and submit under the Exchange ) Tj ET Q q 0 0 0 rg BT 314.43 638.25 Td (Act is recorded, processed, summarized and reported as and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 626.25 Td (when required. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 614.25 Td (information required to be disclosed by us in the reports we file and submit under the Exchange ) Tj ET Q q 0 0 0 rg BT 434.12 614.25 Td (Act is accumulated and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 602.25 Td (communicated to our management, including our principal executive of) Tj ET Q q 0 0 0 rg BT 336.17 602.25 Td (ficer and our principal financial of) Tj ET Q q 0 0 0 rg BT 473.43 602.25 Td (ficer) Tj ET Q q 0 0 0 rg BT 491.34 602.25 Td (, as appropriate ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 590.25 Td (to allow timely decisions regarding required disclosure. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 572.25 Td (Internal Contr) Tj ET Q q 0 0 0 rg BT 112.37 572.25 Td (ol Over) Tj ET Q q 0 0 0 rg BT 144.12 572.25 Td ( Financial Reporting) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 554.25 Td (There have been no changes in our internal control over financial reporting that occurred during the quarter ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 542.25 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 113.10 542.25 Td ( that have materially af) Tj ET Q q 0 0 0 rg BT 205.10 542.25 Td (fected, or are reasonably likely to materially af) Tj ET Q q 0 0 0 rg BT 392.05 542.25 Td (fect, our internal control over financial ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 530.25 Td (reporting. ) Tj ET Q endstream endobj 93 0 obj <>] /Rotate 0 /Contents 94 0 R>> endobj 94 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( II. OTHER INFORMA) Tj ET Q q 0 0 0 rg BT 177.99 748.60 Td (TION) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (45) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 719.25 Td (Item 1. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 85.50 719.25 Td (Legal Pr) Tj ET Q q 0 0 0 rg BT 122.25 719.25 Td (oceedings) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 701.25 Td (None.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 677.25 Td (Item 1A. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 94.50 677.25 Td (Risk Factors) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 659.25 Td (Please see the risks in Part I, Item 1A) Tj ET Q q 0 0 0 rg BT 222.64 659.25 Td ( of our ) Tj ET Q q 0 0 0 rg BT 251.24 659.25 Td (Annual Report on Form 10-K for the year ended December 31, 2014 filed ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 647.25 Td (with the SEC on March 10, 2015.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 623.25 Td (Item 2. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 85.50 623.25 Td (Unr) Tj ET Q q 0 0 0 rg BT 102.54 623.25 Td (egister) Tj ET Q q 0 0 0 rg BT 130.68 623.25 Td (ed Sales of Equity Securities and Use of Pr) Tj ET Q q 0 0 0 rg BT 311.60 623.25 Td (oceeds) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 605.25 Td (a\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 605.25 Td (During the period covered by this Form 10-Q, we did not sell any equity securities that were not registered under ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 593.25 Td (the Securities ) Tj ET Q q 0 0 0 rg BT 159.60 593.25 Td (Act of 1933.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 575.25 Td (b\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 575.25 Td (Not applicable.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 85.50 557.25 Td (c\) ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 557.25 Td (W) Tj ET Q q 0 0 0 rg BT 112.14 557.25 Td (e have a share redemption program pursuant to which stockholders may only sell their shares to us in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 545.25 Td (connection with a stockholder) Tj ET Q q 0 0 0 rg BT 224.12 545.25 Td (’) Tj ET Q q 0 0 0 rg BT 226.89 545.25 Td (s death, “qualifying disability” or “determination of incompetence” \(each as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 533.25 Td (defined in the share redemption program and together with redemptions sought in connection with a stockholder) Tj ET Q q 0 0 0 rg BT 553.48 533.25 Td (’) Tj ET Q q 0 0 0 rg BT 556.25 533.25 Td (s ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 521.25 Td (death, “special redemptions”\). Such redemptions are subject to an annual dollar limitation and are further subject ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 509.25 Td (to the other limitations described in our share redemption program, including:) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 491.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 491.25 Td (During each calendar year) Tj ET Q q 0 0 0 rg BT 226.31 491.25 Td (, special redemptions are limited to an annual amount determined by our board of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 479.25 Td (directors. ) Tj ET Q q 0 0 0 rg BT 163.80 479.25 Td (The annual dollar limitation for our share redemption program may be reviewed and adjusted from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 467.25 Td (time to time during the year) Tj ET Q q 0 0 0 rg BT 232.31 467.25 Td (. On December 9, 2014, our board of directors approved an annual dollar ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 455.25 Td (limitation of $10.0 million in the aggregate for the calendar year 2015 \(subject to review and adjustment ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 443.25 Td (during the year by our board of directors\), and further subject to the limitations described in our share ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 431.25 Td (redemption program.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 413.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 413.25 Td (During any calendar year) Tj ET Q q 0 0 0 rg BT 222.44 413.25 Td (, we may redeem no more than 5% of the weighted-average number of shares ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 401.25 Td (outstanding during the prior calendar year) Tj ET Q q 0 0 0 rg BT 288.95 401.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 383.25 Td (• ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 383.25 Td (W) Tj ET Q q 0 0 0 rg BT 130.14 383.25 Td (e have no obligation to redeem shares if the redemption would violate the restrictions on distributions under ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 371.25 Td (Maryland law) Tj ET Q q 0 0 0 rg BT 176.67 371.25 Td (, which prohibits distributions that would cause a corporation to fail to meet statutory tests of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 121.50 359.25 Td (solvency) Tj ET Q q 0 0 0 rg BT 156.40 359.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 338.25 Td (W) Tj ET Q q 0 0 0 rg BT 112.14 338.25 Td (e do not currently expect to have funds available for ordinary redemptions in the future.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 320.25 Td (If we cannot repurchase all shares presented for redemption in any month because of the limitations on ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 308.25 Td (redemptions set forth in our share redemption program, then we will honor redemption requests on a pro rata ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 296.25 Td (basis, except that if a pro rata redemption would result in a stockholder owning less than the minimum purchase ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 284.25 Td (requirement described in our most recently ef) Tj ET Q q 0 0 0 rg BT 285.47 284.25 Td (fective registration statement, as amended or supplemented, then we ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 272.25 Td (would redeem all of such stockholder) Tj ET Q q 0 0 0 rg BT 254.11 272.25 Td (’) Tj ET Q q 0 0 0 rg BT 256.88 272.25 Td (s shares. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 254.25 Td (The complete share redemption program document is filed as an exhibit to our ) Tj ET Q q 0 0 0 rg BT 419.24 254.25 Td (Annual Report on Form 10-K for ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 242.25 Td (the year ended December 31, 2012 and is available at the SEC’) Tj ET Q q 0 0 0 rg BT 355.63 242.25 Td (s website at ) Tj ET Q BT /F3 10.00 Tf ET q 0 0 0 rg BT 404.79 242.25 Td (http:) Tj ET Q BT /F3 10.00 Tf ET 0 0 0 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 423.67578125 240.9169921875 m 480.70703125 240.9169921875 l s q 0 0 0 rg BT 423.68 242.25 Td (//www) Tj ET Q q 0 0 0 rg BT 448.50 242.25 Td (.sec.gov) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 480.71 242.25 Td (.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 224.25 Td (The only redemptions we made under our share redemption program during the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 424.52 224.25 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 444.50 224.25 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 505.33 224.25 Td (March 31, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 212.25 Td (2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 123.50 212.25 Td ( were those that qualified as, and met the requirements for) Tj ET Q q 0 0 0 rg BT 355.52 212.25 Td (, special redemptions under our share redemption ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 200.25 Td (program. For the three months ended March 31, 2015, we fulfilled all redemption requests that qualified as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 188.25 Td (special redemptions under our share redemption program with a combination of proceeds from cash flow from ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 176.25 Td (operations and the sale of properties in 2014.) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 158.25 Td (W) Tj ET Q q 0 0 0 rg BT 112.14 158.25 Td (e may amend, suspend or terminate the program upon 30 days’) Tj ET Q q 0 0 0 rg BT 363.27 158.25 Td ( notice to our stockholders. ) Tj ET Q q 0 0 0 rg BT 476.68 158.25 Td (W) Tj ET Q q 0 0 0 rg BT 485.32 158.25 Td (e may provide this ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 146.25 Td (notice by including such information in a Current Report on Form 8-K or in our annual or quarterly reports, all ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 134.25 Td (publicly filed with the SEC, or by a separate mailing to our stockholders.) Tj ET Q endstream endobj 95 0 obj <>] /Rotate 0 /Contents 96 0 R>> endobj 96 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( II. OTHER INFORMA) Tj ET Q q 0 0 0 rg BT 177.99 748.60 Td (TION \(CONTINUED\)) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 2. ) Tj ET Q q 0 0 0 rg BT 86.00 730.60 Td (Unr) Tj ET Q q 0 0 0 rg BT 103.04 730.60 Td (egister) Tj ET Q q 0 0 0 rg BT 131.18 730.60 Td (ed Sales of Equity Securities and Use of Pr) Tj ET Q q 0 0 0 rg BT 312.10 730.60 Td (oceeds \(continued\)) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (46) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 704.10 Td (On December 9, 2014, our board of directors approved an estimated value per share of our common stock of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 692.10 Td ($4.52 per share \(unaudited\), based on the estimated value of our assets less the estimated value of our liabilities, ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 680.10 Td (divided by the number of shares outstanding, all as of September 30, 2014. ) Tj ET Q q 0 0 0 rg BT 405.48 680.10 Td (The change in redemption price ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 668.10 Td (became ef) Tj ET Q q 0 0 0 rg BT 144.12 668.10 Td (fective for the December 2014 redemption date and will be ef) Tj ET Q q 0 0 0 rg BT 390.50 668.10 Td (fective until the estimated value per share ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 656.10 Td (is updated. For a full description of the methodologies and assumptions used to value our assets and liabilities in ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 644.10 Td (connection with the calculation of the estimated value per share, see Part II, Item 5, “Market for Registrant’) Tj ET Q q 0 0 0 rg BT 533.34 644.10 Td (s ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 632.10 Td (Common Equity) Tj ET Q q 0 0 0 rg BT 169.24 632.10 Td (, Related Stockholder Matters and Issuer Purchases of Equity Securities - Market Information” of ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 620.10 Td (our ) Tj ET Q q 0 0 0 rg BT 118.78 620.10 Td (Annual Report on Form 10-K for the year ended December 31, 2014 filed with the SEC on March 10, 2015. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 608.10 Td (W) Tj ET Q q 0 0 0 rg BT 112.14 608.10 Td (e currently expect to utilize our advisor and/or an independent valuation firm to update the estimated value per ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 596.10 Td (share in December of each year) Tj ET Q q 0 0 0 rg BT 229.26 596.10 Td (. ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 578.10 Td (During the ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 149.05 578.10 Td (three) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 169.03 578.10 Td ( months ended ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 229.86 578.10 Td (March 31, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 293.46 578.10 Td (, we redeemed shares pursuant to our share redemption program as ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 566.10 Td (follows:) Tj ET Q 0.8 0.9333333333333333 1 rg /GS0 gs 104.00 519.60 94.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 198.00 519.60 4.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 202.00 519.60 94.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 296.00 519.60 4.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 300.00 519.60 83.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 383.00 519.60 20.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 403.00 519.60 160.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 104.00 495.60 94.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 198.00 495.60 4.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 202.00 495.60 94.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 296.00 495.60 4.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 300.00 495.60 83.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 383.00 495.60 20.00 -12.00 re f /GS0 gs 0.8 0.9333333333333333 1 rg /GS0 gs 403.00 495.60 160.00 -12.00 re f /GS0 gs 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 104 519.6 m 198 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 202 519.6 m 296 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 300 519.6 m 383 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 403 519.6 m 563 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 104 519.6 m 198 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 202 519.6 m 296 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 300 519.6 m 383 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 403 519.6 m 563 519.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 202 483.6 m 296 483.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 202 472.6 m 296 472.6 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 202 470.6 m 296 470.6 l s BT /F2 8.00 Tf ET q 0 0 0 rg BT 106.50 523.83 Td (Month) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 224.60 531.83 Td (T) Tj ET Q q 0 0 0 rg BT 229.20 531.83 Td (otal Number) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 209.85 523.83 Td (of Shar) Tj ET Q q 0 0 0 rg BT 234.82 523.83 Td (es Redeemed ) Tj ET Q BT /F2 8.00 Tf ET BT /F2 5.20 Tf ET q 0 0 0 rg BT 281.03 527.46 Td (\(1\)) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 317.20 531.83 Td (A) Tj ET Q q 0 0 0 rg BT 322.38 531.83 Td (verage Price ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 315.35 523.83 Td (Paid Per) Tj ET Q q 0 0 0 rg BT 344.75 523.83 Td ( Shar) Tj ET Q q 0 0 0 rg BT 363.06 523.83 Td (e) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 385.50 523.85 Td ( ) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 420.70 539.83 Td (Appr) Tj ET Q q 0 0 0 rg BT 438.78 539.83 Td (oximate Dollar) Tj ET Q q 0 0 0 rg BT 489.51 539.83 Td ( ) Tj ET Q q 0 0 0 rg BT 491.37 539.83 Td (V) Tj ET Q q 0 0 0 rg BT 496.41 539.83 Td (alue of Shar) Tj ET Q q 0 0 0 rg BT 537.60 539.83 Td (es) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 436.75 531.83 Td (A) Tj ET Q q 0 0 0 rg BT 441.93 531.83 Td (vailable ) Tj ET Q q 0 0 0 rg BT 470.46 531.83 Td (That May ) Tj ET Q q 0 0 0 rg BT 506.16 531.83 Td (Y) Tj ET Q q 0 0 0 rg BT 511.05 531.83 Td (et Be) Tj ET Q BT /F2 8.00 Tf ET q 0 0 0 rg BT 430.30 523.83 Td (Redeemed Under) Tj ET Q q 0 0 0 rg BT 489.48 523.83 Td ( the Pr) Tj ET Q q 0 0 0 rg BT 512.43 523.83 Td (ogram) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 106.50 511.55 Td (January 2015) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 266.80 511.55 Td (126,394) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 302.50 511.55 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 365.80 511.55 Td (4.52) Tj ET Q BT /F1 5.20 Tf ET q 0 0 0 rg BT 385.50 515.96 Td (\(2\)) Tj ET Q BT /F1 5.20 Tf ET q 0 0 0 rg BT 479.45 515.96 Td (\(3\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 106.50 499.55 Td (February 2015) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 266.80 499.55 Td (117,979) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 302.50 499.55 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 365.80 499.55 Td (4.52) Tj ET Q BT /F1 5.20 Tf ET q 0 0 0 rg BT 385.50 503.96 Td (\(2\)) Tj ET Q BT /F1 5.20 Tf ET q 0 0 0 rg BT 479.45 503.96 Td (\(3\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 106.50 487.55 Td (March 2015) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 266.80 487.55 Td (100,367) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 302.50 487.55 Td ($) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 365.80 487.55 Td (4.52) Tj ET Q BT /F1 5.20 Tf ET q 0 0 0 rg BT 385.50 491.96 Td (\(2\)) Tj ET Q BT /F1 5.20 Tf ET q 0 0 0 rg BT 479.45 491.96 Td (\(3\)) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 124.50 475.55 Td (Total) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 266.80 475.55 Td (344,740) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 103.50 460.10 Td (_____________________) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 103.50 451.50 Td (\(1\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 109.18 448.10 Td ( ) Tj ET Q q 0 0 0 rg BT 110.92 448.10 Td (W) Tj ET Q q 0 0 0 rg BT 117.40 448.10 Td (e announced commencement of our share redemption program on ) Tj ET Q q 0 0 0 rg BT 316.30 448.10 Td (April 6, 2006 and amendments to the program on ) Tj ET Q q 0 0 0 rg BT 465.86 448.10 Td (August 16, 2006 \(which ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 439.10 Td (amendment became ef) Tj ET Q q 0 0 0 rg BT 170.83 439.10 Td (fective on December 14, 2006\), ) Tj ET Q q 0 0 0 rg BT 267.26 439.10 Td (August 1, 2007 \(which amendment became ef) Tj ET Q q 0 0 0 rg BT 405.21 439.10 Td (fective on September 13, 2007\), ) Tj ET Q q 0 0 0 rg BT 502.90 439.10 Td (August 14, 2008 ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 430.10 Td (\(which amendment became ef) Tj ET Q q 0 0 0 rg BT 193.53 430.10 Td (fective on September 13, 2008\), March 26, 2009 \(which amendment became ef) Tj ET Q q 0 0 0 rg BT 431.24 430.10 Td (fective on ) Tj ET Q q 0 0 0 rg BT 462.48 430.10 Td (April 26, 2009\), May 13, 2009 ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 421.10 Td (\(which amendment became ef) Tj ET Q q 0 0 0 rg BT 193.53 421.10 Td (fective on June 12, 2009\), March 26, 2012 \(which amendment became ef) Tj ET Q q 0 0 0 rg BT 412.91 421.10 Td (fective on ) Tj ET Q q 0 0 0 rg BT 444.15 421.10 Td (April 25, 2012\) and March 13, 2013 ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 412.10 Td (\(which amendment became ef) Tj ET Q q 0 0 0 rg BT 193.53 412.10 Td (fective on ) Tj ET Q q 0 0 0 rg BT 224.77 412.10 Td (April 12, 2013\).) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 103.50 403.50 Td (\(2\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 109.18 400.10 Td ( In accordance with our share redemption program, the redemption price for all stockholders is equal to the most recent estimated value per share of ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 391.10 Td (our common stock as of the redemption date \(described above\). ) Tj ET Q BT /F1 7.50 Tf ET BT /F1 4.87 Tf ET q 0 0 0 rg BT 103.50 382.50 Td (\(3\)) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 109.18 379.10 Td ( ) Tj ET Q q 0 0 0 rg BT 110.92 379.10 Td (W) Tj ET Q q 0 0 0 rg BT 117.40 379.10 Td (e limit the dollar value of shares that may be redeemed under our share redemption program as described above. During the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 492.07 379.10 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 507.06 379.10 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 370.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 151.20 370.10 Td (, we redeemed ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 196.59 370.10 Td ($1.6 million) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 233.26 370.10 Td ( of shares of common stock. ) Tj ET Q q 0 0 0 rg BT 321.45 370.10 Td (The only redemptions we made under our share redemption program during the ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 361.10 Td (three) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 118.49 361.10 Td ( months ended ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 164.11 361.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 211.81 361.10 Td ( were those that qualified as, and met the requirements for) Tj ET Q q 0 0 0 rg BT 385.83 361.10 Td (, special redemptions under our share redemption ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 352.10 Td (program. On December 9, 2014, our board of directors approved an annual dollar limitation for redemptions of $10.0 million in the aggregate for ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 343.10 Td (calendar year 2015. Based on this redemption limitation and those described above and redemptions through ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 433.21 343.10 Td (March 31, 2015) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 480.91 343.10 Td (, we may redeem up to ) Tj ET Q BT /F1 7.50 Tf ET q 0 0 0 rg BT 103.50 334.10 Td ($8.4 million of shares that meet the requirements for special redemptions for the remainder of 2015.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 310.10 Td (Item 3. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 85.50 310.10 Td (Defaults upon Senior) Tj ET Q q 0 0 0 rg BT 175.33 310.10 Td ( Securities) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 292.10 Td (None.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 268.10 Td (Item 4. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 85.50 268.10 Td (Mine Safety Disclosur) Tj ET Q q 0 0 0 rg BT 179.20 268.10 Td (es) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 250.10 Td (None.) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 49.50 226.10 Td (Item 5. ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 85.50 226.10 Td (Other) Tj ET Q q 0 0 0 rg BT 110.87 226.10 Td ( Information) Tj ET Q BT /F4 10.00 Tf ET q 0 0 0 rg BT 49.50 208.10 Td (Departure of Chief Financial Of) Tj ET Q q 0 0 0 rg BT 183.77 208.10 Td (ficer ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 73.50 193.10 Td (On May 8, 2015, David Snyder notified us of his decision to resign as our Chief Financial Of) Tj ET Q q 0 0 0 rg BT 446.32 193.10 Td (ficer and from all other ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 181.10 Td (of) Tj ET Q q 0 0 0 rg BT 57.65 181.10 Td (ficer positions with us, our advisor) Tj ET Q q 0 0 0 rg BT 196.12 181.10 Td (, its af) Tj ET Q q 0 0 0 rg BT 220.66 181.10 Td (filiates, and other KBS-sponsored companies. Mr) Tj ET Q q 0 0 0 rg BT 420.62 181.10 Td (. Snyder) Tj ET Q q 0 0 0 rg BT 454.32 181.10 Td (’) Tj ET Q q 0 0 0 rg BT 457.10 181.10 Td (s resignation will be ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 169.10 Td (ef) Tj ET Q q 0 0 0 rg BT 57.09 169.10 Td (fective as of June 10, 2015. Mr) Tj ET Q q 0 0 0 rg BT 183.45 169.10 Td (. Snyder) Tj ET Q q 0 0 0 rg BT 217.15 169.10 Td (’) Tj ET Q q 0 0 0 rg BT 219.93 169.10 Td (s resignation is not due to any disagreement with us, our advisor) Tj ET Q q 0 0 0 rg BT 476.71 169.10 Td (, its af) Tj ET Q q 0 0 0 rg BT 501.24 169.10 Td (filiates, and ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 49.50 157.10 Td (other KBS-sponsored companies. ) Tj ET Q endstream endobj 97 0 obj <>] /Rotate 0 /Contents 98 0 R>> endobj 98 0 obj <> stream BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL 0 0 1 RG /GS0 gs 0.49 w 0 i [] 0 d 1 J 1 j 3 M 50 771.2669921875 m 120.9521484375 771.2669921875 l s q 0 0 1 rg BT 50.00 772.60 Td (T) Tj ET Q q 0 0 1 rg BT 55.41 772.60 Td (able of Contents) Tj ET Q BT /F1 10.00 Tf ET 0 Tr /GS0 gs 0 Tw 0 Tc 100 Tz 0 TL BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 748.60 Td (P) Tj ET Q q 0 0 0 rg BT 55.37 748.60 Td (AR) Tj ET Q q 0 0 0 rg BT 69.46 748.60 Td (T) Tj ET Q q 0 0 0 rg BT 75.95 748.60 Td ( II. OTHER INFORMA) Tj ET Q q 0 0 0 rg BT 177.99 748.60 Td (TION) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 50.00 730.60 Td (Item 6. Exhibits) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 301.00 33.60 Td (47) Tj ET Q 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 50 697.5 m 105 697.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 109 697.5 m 325 697.5 l s 0 0 0 RG /GS0 gs 1.00 w 0 i [] 0 d 0 J 0 j 3 M 325 697.5 m 561 697.5 l s BT /F2 10.00 Tf ET q 0 0 0 rg BT 52.50 701.23 Td (Ex.) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 107.50 701.75 Td ( ) Tj ET Q BT /F2 10.00 Tf ET q 0 0 0 rg BT 111.50 701.23 Td (Description) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.50 684.07 Td (3.1) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 107.50 685.45 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 111.50 684.07 Td (Articles of Amendment and Restatement of the Company, incorporated by reference to Exhibit 3.1 to the) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 111.50 674.07 Td (Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2006) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.50 655.07 Td (3.2) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 107.50 656.45 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 111.50 655.07 Td (Amended and Restated Bylaws of the Company, incorporated by reference to Exhibit 3.2 to the Company’s) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 111.50 645.07 Td (Quarterly Report on Form 10-Q for the period ended March 31, 2006) Tj ET Q BT /F1 10.00 Tf ET q 0 0 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Td (Advisors LLC,) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 111.50 567.07 Td (dated as of January 15, 2015, incorporated by reference to Exhibit 10.1 to the Company’) Tj ET Q q 0 0 0 rg BT 465.01 567.07 Td (s Current Report on) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 111.50 557.07 Td (Form 8-K, filed January 15, 2015) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.50 538.07 Td (31.1) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 107.50 539.45 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 111.50 538.07 Td (Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.50 519.07 Td (31.2) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 107.50 520.45 Td ( ) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 111.50 519.07 Td (Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002) Tj ET Q BT /F1 10.00 Tf ET q 0 0 0 rg BT 52.50 500.07 Td (32.1) Tj ET Q BT /F1 8.00 Tf ET q 0 0 0 rg BT 107.50 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