KBS Real Estate Investment Trust III, Inc. filed its quarterly report for the period ended September 30, 2025, reporting a net loss of $4.2 million for Q3 and $59.9 million for the nine months. Revenue softened as rental income declined year over year, while interest expense remained elevated.
The company recorded $65.5 million of non‑cash impairments on The Almaden, Towers at Emeryville, and 60 South Sixth, reflecting weaker leasing and valuation assumptions in select markets. Offsetting this, KBS REIT III completed two dispositions in July and September, recognizing a $77.4 million gain on sale and generating $220.1 million of net sale proceeds year to date, which supported debt paydowns.
Liquidity included $79.965 million of cash, cash equivalents and restricted cash at quarter end. The portfolio totaled 12 office properties at 77.0% occupancy; Accenture Tower represented 23.6% of total assets and was 90.1% leased. The filing states $790.0 million of debt maturities and required paydowns within 12 months and notes substantial doubt about the ability to continue as a going concern absent successful refinancings, asset sales or other actions. Stockholders’ equity was $196.7 million.
KBS Real Estate Investment Trust III, Inc. completed the sale of its mixed-use Park Place Village property in Leawood, Kansas on September 23, 2025 for a gross price of $100.0 million, generating $95.5 million of net sales proceeds after closing adjustments and $0.8 million of disposition fees to its advisor.
KBS REIT III used these proceeds to fully repay the Park Place Village Mortgage Loan, including $65.2 million of outstanding principal and accrued interest, and to pay down its Credit Facility by $25.4 million, reducing the Credit Facility’s outstanding principal balance to $37.5 million. Remaining proceeds will be used to manage the company’s liquidity needs.
KBS Real Estate Investment Trust III, Inc. entered into a material definitive agreement to renew its advisory agreement with KBS Capital Advisors LLC. The renewal, dated September 27, 2025, extends the term of the existing advisory agreement through September 27, 2026.
The advisory agreement can continue to be renewed for additional one-year periods if both the Company and the Advisor consent. It may be terminated by either party without cause or penalty on 60 days’ written notice, or immediately by the Company for cause or if the Advisor enters bankruptcy. Aside from extending the term by one year, the renewal leaves all other terms of the advisory agreement, as previously amended, unchanged.