Kbs Real Estate Invt Tr Iii Inc. · OTC:KBSR
Kbs Real Estate Invt Tr Iii — KBS Real Estate Investment Trust III — Corporate Update (December 2019)
28 slides from Kbs Real Estate Invt Tr Iii's corporate update, Dec 12, 2019
Slide 1: Valuation Update Meeting December 12, 2019
Exhibit 99.2 Valuation Update Meeting December 12, 2019
Slide 2: Disclosures and Forward-Looking Statements
The information contained herein should be read in conjunction with, and is qualified by, the information in KBS Real Estate Investment Trust III’s (the “Company” or “KBS REIT III”) Annual Report on Form 10-K for the year ended December 31, 2018 (the “Annual Report”), in the Company’s Quarterly Repo
Slide 3: Important Information for Stockholders and Where to Find It
IMPORTANT On December 12, 2019, the Company filed a preliminary proxy statement and the Company plans to file a definitive proxy statement for its INFORMATION FOR Annual Meeting of Stockholders with the SEC. The definitive proxy statement will be sent or given to the Company’s stockholders and will
Slide 4: About KBS
Transactional volume in excess of $42.3 billion1, About KBS AUM of $11.2 billion1 and 35.3 million square feet under management1. Formed by Peter Bren and Chuck 8th Largest Office Owner Globally, National Schreiber in 1992. Real Estate Investor2. Over 26 years of investment and Among Top 44 Global R
Slide 5: Regional Focus Map
Regional Focus Map Gateway Target First-tier Target Strong Employment / Growth KBS Offices WWW. KBS.COM 5
Slide 6: Office Market Update
Office Market EMPLOYMENT INDICATORS* Update Q3 18 Q3 19 12-Mo. Forecast Total Non-Farm Employment 149.4 M 151.5 M p According to Cushman & Wakefield’s Office-Using Employment 32.7 M 33.0 M p Third Quarter 2019 MarketBeat Report, the U.S. economy continued to grow at a Unemployment 3.8% 3.7% p steady
Slide 7: Fund and Portfolio Overview
Fund and Portfolio FUND PORTFOLIO Primary Offering Broke Escrow December 2019 Estimated Value of Overview May 24, 2011 Current Portfolio of Properties1 $3.3 billion Primary Offering Closed Current Cost Basis of Current Portfolio of As of September 30, 2019, unless July 28, 2015 Properties2 otherwise
Slide 8: Current Portfolio of Properties
Current Portfolio of Properties 20 Class A Properties $3.3 Billion1 8.3 Million RSF2 Urban, Well-Located, Institutional-Quality Portfolio 91.3% Leased3 Mass Transit Connectivity Growth Markets & Urban 4.4 Years Weighted Average Lease Term4 Live/Work/Play Locations In-place Rents 10% Below Market Rec
Slide 9: The Current Portfolio of Properties
The Current Portfolio of Properties Building Classification Leased Occupancy Mass Transit Leased Occupancy Property Metro City Class Sq. Ft. (CBD, Urban, at September 30, Availability at Acquisition ( A,B or C) Suburban) 20191 WEST Anchor Centre Phoenix A 333,014 Suburban Metro 78% 96% Gateway Tech
Slide 10: 2019 Estimated Value per Share
2019 Estimated Value per Share 107
Slide 11: Valuation Information
KBS REIT III’s estimated value per share was determined in accordance with the Institute for Portfolio Alternatives’ (formerly known as the Investment Program Association) Practice Guideline 2013-01, Valuations of Publicly Valuation Registered Non-Listed REITs. Duff & Phelps, an independent, third-p
Slide 12: Valuation Summary
December 20191 December 20182 Valuation Estimated Value Estimated Value Real estate properties $3,340.8 Million (90.8%) $4,145.7 Million (96.1%) Summary Investment in PRIME US REIT units $257.8 Million (7.0%) - Investment in unconsolidated joint venture - $34.7 Million (0.8%) Cash $64.1 Million (1.7
Slide 13: Valuation Summary: Change in Estimated Value per Share
December 2018 estimated value per share $12.02 Valuation Change Real Estate and investment in unconsolidated joint venture 1.31 Summary Investment in Prime US REIT units 0.02 Capital expenditures on real estate (0.62) On December 4, 2019, KBS REIT III’s Board Total changes related to investments 0.7
Slide 14: Significant Real Estate Changes: Hardware Village
Hardware Village Significant Real The appraised value increased $31.9 million, or 22.9%, compared to prior year appraised value plus capital expenditures due to the following: Estate Changes • The prior year appraisal assumed an additional $26 million of capital spend to complete construction on the
Slide 15: Significant Real Estate Changes: Congress
515 Congress Significant Real The appraised value increased $15.7 million, or 11.2%, compared to prior year appraised value plus capital expenditures due to the following: Estate Changes • Market rental rates have increased between appraisal periods in Austin, particularly within the CBD. Year 1 net
Slide 16: Significant Real Estate Changes: RBC Plaza
RBC Plaza Significant Real The appraised value decreased $13.1 million, or 7.8%, compared to prior year appraised value plus capital expenditures due to the following: Estate Changes • RBC Capital Markets will vacate approximately 280,000sf on November 30, 2021 and will move to development. As a res
Slide 17: Special Dividend
As a result of taxable capital gains, the REIT has November 4, 2019 authorized a Special Dividend to stockholders as of November 4, 2019 that will be paid in Special Dividend December 2019 • Special Dividend of $0.80 per share payable to stockholders of The Company will pay a Special record as of No
Slide 18: Special Dividend on Stockholder Account
Special Dividend Special Dividend on Stockholder Account: Record Date November 4, 2019 Total Estimated Total Account Cash The estimated value per share would Value Per Total Shares Account Value and Distributions be $12.45 before the Special Share Value Cash Distributions Dividend, and is $11.65 aft
Slide 19: Stockholder Performance
Stockholder The December 2019 estimated value per share was performed in accordance with the provisions of and also to comply with the IPA Valuation Guidelines. As with any valuation methodology, the methodologies used Performance are based upon a number of estimates and assumptions that may not be
Slide 20: Stockholder Performance
Further, the estimated value per share is based on the estimated value of KBS REIT III’s assets less the estimated Stockholder value of KBS REIT III’s liabilities, divided by the number of shares outstanding, all as of September 30, 2019, with the exception of adjustments to the Company’s net asset
Slide 21: Stockholder Performance: Distribution History
Stockholder Performance Distribution History1: June 24, 2011 – December 31, 2019: $0.65/share on an annualized basis 1 Based on distributions declared as of November 8, 2019. KBS REIT III funded its total distributions paid through September 30, 2019, which includes net cash distributions and divide
Slide 22: Hypothetical Performance of Early and Late Investors
Stockholder Hypothetical Performance of Early and Late Investors Hypothetical Assumes all distributions have been taken in cash other than the Special Dividend shares and stockholder Performance has held shares since the dates below: Sum of Estimated Value Per Cumulative Cash Share, Cumulative Cash
Slide 23: Hypothetical Performance of First and Last Investor
Hypothetical Performance of First and Last Investor Stockholder Performance $17.94 total value for first cash investor 1, 2 December 2019 $15.27 total value for last cash investor 1, 2 Breakdown of First Cash Investor Value Breakdown of Last Cash Investor Value $17.94 1, 2 $16.85 $15.91 $15.27 1, 2
Slide 24: Strategic Alternatives: Conversion to an NAV REIT
Strategic Conversion to an NAV REIT fulfills certain key Alternatives objectives of the Company including the Conversion to an current portfolio size and performance, shareholder desire for liquidity as well as their NAV REIT desire to stay invested and current market environments. Following the Por
Slide 25: NAV Conversion Process and Timeline
Strategic Alternatives The NAV conversion process will require us to proxy the shareholders of KBS NAV Conversion REIT III with respect to two proposals related to KBS REIT III’s conversion to an Process and Timeline NAV REIT. The anticipated timeline is as follows: Finalize Proxy with the SEC and s
Slide 26: Future Near-Term Liquidity
Strategic Alternatives Future Near-Term Liquidity We are focused on providing near term and long term liquidity for the REIT’s shareholders. In light of the proxy process for NAV conversion we will be suspending the share redemption program for ordinary redemptions in January 2020 through the proxy
Slide 27: REIT III Goals & Objectives
REIT III Goals & Objectives Provide enhanced shareholder liquidity Pursue NAV REIT Conversion Complete major capital projects, such as renovations or amenity enhancements, with the goal of attracting quality tenants Complete construction of Hardware Village property and continue to lease-up Lease-up
Slide 28: Q&A
Q&A For additional questions, contact KBS Capital Markets Group Investor Relations (866) 527-4264 28
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