Pacific Oak Strategic Opportunity Reit, Inc. · OTC:PCOK
Pacific Oak Strategic Opportunity Reit — KBS Strategic Opportunity REIT — Corporate Update (November 2018)
25 slides from Pacific Oak Strategic Opportunity Reit's corporate update, Nov 15, 2018
Slide 1: Valuation and Portfolio Update
Strategic Opportunity KBS Strategic Opportunity REIT Valuation and Portfolio Update November 15, 2018
Slide 2: Forward-Looking Statements
Strategic Forward-Looking Statements KBS |: Speer The information contained herein should be read in conjunction with, and is qualified by, the information in the KBS Strategic Opportunity REIT, Inc. (“KBS Strategic Opportunity REIT”) Annual Report on Form 10-K for the year ended December 31, 2017,
Slide 3: Portfolio Overview
. 2 Strategic Portfolio Overview KBS |: Opportunity Total Acquisitions/Originations": $1,872,363,000 Current Portfolio Cost Basis: $1,284,100,000 19 Equity Assets 1 Debt Asset November 2018 Estimated Value of Portfolio®: $1,407,745,000 SOR Eauity Raised‘: $ 561,749,000 Real Estate Leverage’: 58% Per
Slide 4: Valuation
Strategic pepe Valuation’ KBS : « Estimated value per share? calculated using information as of September 30, 2018 + Net asset value; no enterprise (portfolio) premium or discount applied * Considered potential participation fee that would be due to the advisor in a hypothetical liquidation if the r
Slide 5: Valuation: Estimated Value of Portfolio
Valuation’ Estimated Value of Portfolio Assets: Real Estate (i) Investments in Unconsolidated JVs (i) Investments in Real Estate Debt & Equity Securities (i) Other Assets? Liabilities: Mortgage and Other Debt Advisor Incentive Fee Potential Liability Other Liabilities? Minority Interest in Consolida
Slide 6: Valuation: Change in Estimated Value Per Share
2 Strategic Valuation‘ KBS. | eeeettnv On November 12, 2018, KBS Strategic Opportunity REIT’s Board approved an estimated value per share as follows: Change in Estimated Value Per Share December 2017 estimated value per share $11.50 Investments Real Estate 1.31 Investments in Unconsolidated JVs 0.64
Slide 7: Real Estate Updates
Real Estate Updates KBS | 22% Park Highlands Land The appraised value plus the net sale price for two land sales during the 12 months ending September 30, 2018 resulted in an increase of $45.7 million from the prior year appraised value due to the following: > The market has experienced continued im
Slide 8: Dispositions
ri ortunity REIT Dispositions KBS Central Building (Seattle, WA) Acquisition Date: July 10, 2013 Acquisition Price: $34.5 Million Size: 191,784 SF Total Investment?: $39.9 Million Sale Date: July 17, 2018 Sale Price: $67.4 Million Profit / Equity Multiple: $27.5 Million 3.2x Park Highlands Land (Las
Slide 9: Dispositions — Under Contract
Strategic oe Dispositions — Under Contract KBS |: Westpark Portfolio (Redmond, WA) - Under Contract Acquisition Date: May 10, 2016 Acquisition Price: $125.8 Million Size: 782,035 SF Total Investment?: $144.0 Million Sale Date (Estimated): November 2018 Sale Price?: $165.5 Million Profit / Equity Mul
Slide 10: Dispositions History
Dispositions History KBS | 22% Following is a summary of the REIT’s real estate dispositions from inception through September 30, 2018: Investment Sale Price Acquisition | Disposition Sale Cost Basis vs. Investment Property Date Date Sq. Ft Price (1) at Sale (2) Cost Basis Roseville 6/27/11 Multiple
Slide 11: Recent Acquisition: Marquette Plaza
Recent Acquisition Marquette Plaza Location Acquisition date: Purchase price: Price per square foot: Buildings: Floors: Size: Year built/renovated % Leased at acq on: % Leased at Sept. 30, 2018: Avg. below market rental rate at acquisition Minneapolis, MN March 1, 2018 $88.3 Million $169 | 1s 522,65
Slide 12: Recent Acquisition: City Tower
Recent Acquisition City Tower Location: Acquisition date: Purchase price: Price per square foot: Buildings: Floors: Size: Year built: % Leased at acquisition: % Leased at Sept. 30, 2018: Avg. below market rental rate at acquisition Orange, CA March 6, 2018 $147.1 Million $341 al 24 431,007 SF 1988 /
Slide 13: Recent Acquisition: Eight & Nine Corporate Center
Recent Acquisition Eight & Nine Corporate Center Location: Acquisition date: Purchase price: Price per square foot: Buildings: Floors: Size: Year built: % Leased at acquisition: % Leased at Sept. 30, 2018: Avg. below market rental rate at acquisition Franklin, TN June 8, 2018 $73.0 Million $234 2 5/
Slide 14: Portfolio Summary
Portfolio Summary KBS Sppottunity Following is a summary of the REIT’s investment portfolio at September 30, 2018: 5 Sept.2018 | Acquisition | Changein Acq. % Sept 2018 Leased Leased Economic Property Type Location Date Sq.Ft. __| Ownership. Cost Basis (1) Occupancy @) | Occupancy (2)| Occupancy |Wh
Slide 15: Self-Tender Offer
Strategic pepe KBS | * Self-tender offer was originally for up to 8,234,217 shares of the Company’s outstanding common stock, or approximately $90 million * Due to demand, additional funds were made available and the final self-tender amount was approximately $104.1 million excluding fees and expens
Slide 16: Redemption Liquidity Provided
Redemption Liquidity Provided KBS | 22% Limit Basedon Redemptions Requests Percentage Prior Year DRP Requested Fulfilled Fulfilled Recent Liquidit in millions September 2015 (12 mo. Ended): $9.9 $25.6 $25.6 100% September 2016 (12 mo. Ended): $13.5 $37.5 $37.5 100% October 2017" 2 (13 mo. Ended): $1
Slide 17: Distribution History
Distribution History’ KBS | 22% Record Dates Amount/Share Reason 2011 Total $0.30000000 Estimated increase in portfolio value 2012 Total $0.40000000 —_|(i) Estimated increase in portfolio value as supported by BOVs, (ii) gain on sales of Roseville properties, and (iii) gain from paying off a loan at
Slide 18: Estimated Value Changes Since Inception
Opportunity REIT Excluding 2017 & 2018 Special Dividends Estimated Value Changes, Since Inception, KBS Strategic $18.00 $17.00 $16.00 $16.82 (2) $15.00 §15.11(1) $14.00 $14.81 $13.00 $12.00 $11.00 Offering Price $10.00 = $9.00 $10.00 $8.00 $8.89 $7.00 Offering and Asset Management Acquisition Period
Slide 19: Stockholder Performance
Strategic pepe Stockholder Performance KBS |: KBS Strategic Opportunity REIT is providing this estimated value per share to assist broker dealers that participated in its initial public offering in meeting their customer account statement reporting obligations. As with any valuation methodology, the
Slide 20: Stockholder Performance: Hypothetical Performance of First and Last Investors
Strategic Stockholder Performance KBS | Opportunity Hypothetical Performance of First and Last Investors $10.00 Offering Price Value Breakdown for Last Cash Investor Value Breakdown for First Cash Investor (at Offering Close Nov. 14, 2012) {at Escrow Break April 19, 2010) $18.60 $16.84 $16.87 $16.17
Slide 21: Nov. 12, 2018 Special Dividend
Strategic pepe Nov. 12, 2018 Special Dividend KBS |: The November 12, 2018 authorization of a special dividend was a result of the REIT’s estimates for a significant amount of taxable capital gains from property sales expected to close during 2018 and a transfer of a significant amount of Park Highl
Slide 22: Nov. 12, 2018 Special Dividend: Account Value
Nov. 12, 2018 Special Dividend KBS | 22% Client account statements will reflect a value of $9.91 as of November 30, 2018, which is the November 2018 estimated value per share after the November 12, 2018 special dividend of $2.95 per share. Only the cash portion of the special dividend ultimately imp
Slide 23: Stockholder Performance Illustration
A Strategic Stockholder Performance Illustration KBS |: Opportunity Since special dividends were declared on December 7, 2017 and November 12, 2018, a comparison of the estimated value per share over time is no longer a fair reflection of stockholder performance. The following illustration shows the
Slide 24: Potential Enhanced Liquidity and Future Steps
Strategic pepe KBS | Y Potential Enhanced Liquidity ¥ Additional Lease Up of the Portfolio ¥ Additional Acquisitions v Strategic Dispositions Y¥ Conversion to Daily NAV REIT 24
Slide 25: Thank you!
Strategic 2 aeaem KES Thank you! For more information, please contact your financial advisor or KBS Capital Markets Group at (866) 527-4264. KBS Capital Markets Group Member FINRA & SIPC 800 Newport Center Drive, Suite 700 Newport Beach, CA 92660 www.kbs-cmg.com 25
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