10-K

Table of Contents ​

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

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☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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FOR THE FISCAL YEAR ENDED DECEMBER 31 , 2024

OR

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☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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Commission file number: 000-52596

Ares Real Estate Income Trust Inc.

(Exact name of registrant as specified in its charter)

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Maryland	30-0309068
(State or other jurisdiction of<br><br>incorporation or organization)	(I.R.S. Employer<br><br>Identification No.)
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One Tabor Center, 1200 Seventeenth Street, Suite 2900 , Denver , CO	80202
(Address of principal executive offices)	(Zip Code)

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( 303 ) 228-2200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

Class T Shares of Common Stock, $0.01 par value

Class S Shares of Common Stock, $0.01 par value

Class D Shares of Common Stock, $0.01 par value

Class I Shares of Common Stock, $0.01 par value

Class E Shares of Common Stock, $0.01 par value

(Title of each class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.   Yes  ☐    No  ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.   Yes  ☐    No  ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).   Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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Large accelerated filer	☐	Accelerated filer	☐	​	Smaller reporting company	☐
Non-accelerated filer	☒	​			Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes  ☐    No   ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

The aggregate market value of common stock held by non-affiliates of the registrant as of June 30, 2024 cannot be calculated because no established market exists for the registrant’s common stock.

There were 188,785,965 outstanding shares of common stock held by non-affiliates, as of June 30, 2024, the last business day of the registrant’s most recently completed second fiscal quarter.

Under the registrant's charter, shares of the registrant's Class S common stock are separated into a series called Class S-R and another series called Class S-PR; shares of the registrant's Class D common stock are separated into a series called Class D-R and another series called Class D-PR; shares of the registrant's Class I common stock are separated into a series called Class I-R and another series called Class I-PR. In order to mirror common industry terminology, in this Annual Report on Form 10-K the registrant refers to these separate series of common stock as different “classes”.

As of February 27, 2025, 26,592,252 shares of Class T-R common stock, 42,244,434 shares of Class S-R common stock, 5,987,712 shares of Class D-R common stock, 59,108,702 shares of Class I-R common stock, 42,493,173 shares of Class E common stock, 954,533 shares of Class S-PR common stock, 13,319 shares of Class D-PR common stock and 1,185,799 shares of Class I-PR common stock of the registrant, each with a par value $0.01 per share, were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

5
Part III of this Annual Report on Form 10-K incorporates certain information by reference to the definitive proxy statement for the registrant’s 2025 Annual Meeting of Stockholders, which will be filed with the Securities and Exchange Commission (the “SEC”) no later than April 30, 2025.
Auditor Name: KPMG LLP	Auditor Location: Denver, Colorado	Auditor Firm ID: 185

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Table of Contents TABLE OF CONTENTS

​	PART I	1
Item 1.	Business	1
Item 1A.	Risk Factors	5
Item 1B.	Unresolved Staff Comments	69
Item 1C.	Cybersecurity	69
Item 2.	Properties	71
Item 3.	Legal Proceedings	76
Item 4.	Mine Safety Disclosures	76
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​	PART II	77
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	77
Item 6.	[Reserved]	87
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations‌	88
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	104
Item 8.	Financial Statements and Supplementary Data	106
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	154
Item 9A.	Controls and Procedures	154
Item 9B.	Other Information	154
Item 9C.	Disclosure Regarding Foreign Jurisdictions That Prevent Inspections	155
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​	PART III	155
Item 10.	Directors, Executive Officers and Corporate Governance	155
Item 11.	Executive Compensation	155
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	155
Item 13.	Certain Relationships and Related Transactions, and Director Independence	155
Item 14.	Principal Accountant Fees and Services	155
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​	PART IV	156
Item 15.	Exhibits and Financial Statement Schedules	156
Item 16.	Summary of Form 10-K	164

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Table of Contents CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K includes certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, or the “Securities Act,” and Section 21E of the Securities Exchange Act of 1934, as amended, or the “Exchange Act.” Such forward-looking statements relate to, without limitation, our future capital expenditures, distributions, acquisitions and dispositions (including the amount and nature thereof), other developments and trends of the real estate industry, business strategies and the expansion and growth of our operations. These statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act and Section 21E of the Exchange Act. Such statements are subject to a number of assumptions, risks and uncertainties which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by these forward-looking statements. Forward-looking statements are generally identifiable by the use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “project,” “continue,” or the negative of these words, or other similar words or terms. Readers are cautioned not to place undue reliance on these forward-looking statements.

Some of the risks and uncertainties that may cause our actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, among others, the following:

●	the impact of macroeconomic trends, such as the unemployment rate, availability of credit, impact of inflation, changes in interest rates, uncertainties regarding actual and potential shifts in the U.S. and foreign trade, economic and other policies, including with respect to treaties and tariffs and the conflicts in Ukraine and in the Middle East, which may have a negative effect on the following, among other things:
●	the fundamentals of our business, including overall market occupancy, space utilization for our tenants, who we refer to as customers from time-to-time herein, and rental rates;
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●	the financial condition of our customers, some of which are retail, financial, legal and other professional firms, our lenders, and institutions that hold our cash balances and short-term investments, which may expose us to increased risks of breach or default by these parties;
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●	customers’ ability to pay rent on their leases or our ability to re-lease space that is or becomes vacant; and
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●	the value of our real estate assets, which may limit our ability to dispose of assets at attractive prices or obtain or maintain debt financing secured by our properties or on an unsecured basis;
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●	general risks affecting the real estate industry (including, without limitation, the inability to enter into or renew leases, dependence on customers’ financial condition and competition from other developers, owners and operators of real estate);
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●	our ability to effectively raise and deploy proceeds from our ongoing securities offerings;
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●	risks associated with the demand for liquidity under our share redemption program and our ability to meet such demand;
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●	risks associated with the availability and terms of debt and equity financing and the use of debt to fund acquisitions and developments, including the risk associated with interest rates impacting the cost and/or availability of financing;
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●	the business opportunities that may be presented to and pursued by us, changes in laws or regulations (including changes to laws governing the taxation of real estate investment trusts (“REITs”));
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●	conflicts of interest arising out of our relationships with Ares real estate (the “Sponsor”), Ares Commercial Real Estate Management LLC (the “Advisor”), and their affiliates;
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●	changes in accounting principles, policies and guidelines applicable to REITs;
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●	environmental, regulatory and/or safety requirements; and
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●	the availability and cost of comprehensive insurance, including coverage for terrorist acts.
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For further discussion of these and other factors, see Item 1A, “Risk Factors” in this Annual Report on Form 10-K. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of future events, new information or otherwise.

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Table of Contents SUMMARY RISK FACTORS

An investment in shares of our common stock involves significant risks, See “Risk Factors” beginning on page 4. These risks include, among others:

●	There is no public trading market for shares of our common stock, and it may therefore be difficult for you to sell your shares.
●	There are limits on the ownership, transferability and redemption of shares of our common stock which may significantly limit the liquidity of an investment in shares of our common stock.
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●	Since there is no public trading market for shares of our common stock, redemption of shares by us will likely be the only way to dispose of your shares. Our share redemption program provides stockholders with the opportunity to request that we redeem their shares on a monthly basis, but we are not obligated to redeem any shares and may choose to redeem only some, or even none, of the shares that have been requested to be redeemed in any particular month, in our discretion. In addition, redemptions will be subject to available liquidity, volume limits and other significant restrictions. Further, our board of directors may make exceptions to, modify or suspend our share redemption program if in its reasonable judgment it deems a modification or suspension to be in our best interest and the best interest of our stockholders. As a result, our shares should be considered as having only limited liquidity and at times may be illiquid.
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●	A portion of the proceeds raised in our securities offerings is expected to be used to satisfy redemption requests, including requests from our existing stockholders which may be significant. Using the proceeds raised in our securities offerings for redemptions will reduce the net proceeds available to retire debt, or acquire additional investments, which may result in reduced liquidity and profitability or restrict our ability to grow our net asset value (“NAV”).
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●	In connection with our securities offerings, we incur fees and expenses which will decrease the amount of cash we have available for operations and new investments. In the future, we may conduct other offerings of common stock (whether existing or new classes), preferred stock, debt securities or of interests in our operating partnership. We may also amend the terms of existing securities offerings. We may structure or amend such offerings to attract institutional investors or other sources of capital. The costs of our securities offerings may negatively impact our ability to pay distributions and your overall return.
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●	The purchase and redemption price for shares of our common stock will generally be based on our most recently disclosed monthly NAV (subject to material changes) and will not be based on any public trading market.
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●	In addition to being a month old when share purchases and redemptions take place, our NAV does not currently represent our enterprise value and may not accurately reflect the actual prices at which our assets could be liquidated on any given day, the value a third party would pay for all or substantially all of our shares, or the price that our shares would trade at on a national stock exchange. Our management's assessment of the market values of our properties may also differ from the appraised values of our properties. Further, it is possible that the annual appraisals of our properties may not be spread evenly throughout the year, and rapidly changing market conditions or material events may not be fully reflected in our monthly NAV. The resulting potential disparity in our NAV may inure to the benefit of redeeming stockholders or non-redeeming stockholders and new purchasers of our common stock, depending on whether our published NAV per share for such class is overstated or understated.
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●	Some of our executive officers, directors and other key personnel are also officers, directors, managers, and/or key personnel of the Advisor, our Dealer Manager and/or other entities related to our Sponsor. As a result, they face conflicts of interest, including but not limited to conflicts arising from time constraints, allocation of investment and leasing opportunities and the fact that the fees the Advisor receives for services rendered to us are based on our NAV, the procedures for which the Advisor assists our board of directors in developing, overseeing, implementing and coordinating.
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Table of Contents

●	We are subject to risks generally incident to the ownership of real property, including changes in global, national, regional or local economic, demographic, political, real estate or capital market conditions and other factors particular to the locations of our respective real property investments. We are unable to predict future changes in these market conditions. For example, an economic downturn or rise in interest rates could make it more difficult for us to lease properties or dispose of them. In addition, rising interest rates could make alternative interest-bearing and other investments more attractive and, therefore, potentially lower the relative value of our existing real estate investments.
●	Our use of leverage increases the risk of loss on our investments and places certain restrictions upon us which may limit us from realizing the most optimal value for such investments.
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●	If we fail to maintain our status as a REIT, it would adversely affect our results of operations and our ability to make distributions to our stockholders.
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●	The amount of distributions we may make is uncertain. We may pay distributions from sources other than cash flow from operations, including, without limitation, the sale of assets, borrowings or offering proceeds. The use of these sources for distributions would decrease the amount of cash we have available for new investments, repayment of debt, share redemptions and other corporate purposes, and could potentially reduce your overall return and adversely impact and dilute the value of your investment in shares of our common stock.
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●	Our NAV per share may suddenly change if the valuations of our properties materially change from prior valuations or the actual operating results materially differ from what we originally budgeted. For example, we regularly face lease expirations across our portfolio, and as we move further away from lease commencement toward the end of a lease term, the valuation of the underlying property generally will be expected to drop depending on the likelihood of a renewal or a new lease on similar terms.
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Table of Contents PART I

ITEM 1.BUSINESS

The Company

Ares Real Estate Income Trust Inc. is a net asset value (“NAV”)-based perpetual life REIT formed on April 11, 2005, as a Maryland corporation. We are primarily focused on investing in and operating a diverse portfolio of real property and investing in other real estate-related assets. As of December 31, 2024, our consolidated real property portfolio consisted of 124 properties, totaling approximately 24.6 million square feet located in 37 markets throughout the U.S. As used herein, the terms “AREIT,” the “Company,” “we,” “our” or “us” refer to Ares Real Estate Income Trust Inc. and its consolidated subsidiaries, except where otherwise indicated or the context otherwise requires.

We have operated and elected to be treated as a REIT for U.S. federal income tax purposes, commencing with the taxable year ended December 31, 2006, and we intend to continue to operate in accordance with the requirements for qualification as a REIT. We utilize an Umbrella Partnership Real Estate Investment Trust (“UPREIT”) organizational structure to hold all or substantially all of our assets through AREIT Operating Partnership LP (the “Operating Partnership”), a Delaware limited partnership, of which we are the sole general partner and a limited partner.

We rely on the Advisor, a related party, to manage our day-to-day activities and to implement our investment strategy pursuant to the terms of the second amended and restated advisory agreement (2024), effective as of August 2, 2024 (the “Advisory Agreement”), by and among us, the Operating Partnership, and the Advisor. The current term of the Advisory Agreement ends on April 30, 2025, subject to renewal by our board of directors for an unlimited number of successive one-year periods. The Advisor performs its duties and responsibilities under the Advisory Agreement as a fiduciary of us and our stockholders.

We intend to offer shares of our common stock on a continuous basis. We also intend to conduct an ongoing distribution reinvestment plan offering for our stockholders to reinvest distributions in our shares. During 2024, we raised $29.7 million of gross proceeds from the sale of common stock in our ongoing securities offerings and $32.1 million from the sale of common stock under our distribution reinvestment plan. See “Note 10 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for more information about our securities offerings.

Additionally, we have a program to raise capital through private placement offerings by selling beneficial interests (“DST Interests”) in specific Delaware statutory trusts (a “DST” or multiple “DSTs”) holding real properties (the “DST Program”). These private placement offerings are exempt from registration requirements pursuant to Rule 506(b) of Regulation D of the Securities Act of 1933, as amended (the “Securities Act”). Under the DST Program, each private placement will offer interests in one or more real properties placed into one or more DSTs by the Operating Partnership or its affiliates (each, a “DST Property” and collectively, the “DST Properties”). DST Properties may be sourced from properties currently indirectly owned by the Operating Partnership or newly acquired properties. We anticipate that these interests may serve as replacement properties for investors seeking to complete like-kind exchange transactions under Section 1031 of the Internal Revenue Code of 1986, as amended (the “Code”). Similar to our prior private placement offerings, we expect that the DST Program will give us the opportunity to expand and diversify our capital raise strategies by offering what we believe to be an attractive and unique investment product for investors that may be seeking replacement properties to complete like-kind exchange transactions under Section 1031 of the Code. We also make loans (the “DST Program Loans” and, each individually, a “DST Program Loan”) to finance up to 50% of the purchase price of DST Interests paid by certain purchasers of the interests in the Delaware statutory trusts. During 2024, we sold $797.0 million of gross interests related to the DST Program, $63.3 million of which were financed by DST Program Loans. Refer to “Note 7 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for additional detail regarding the DST Program. 1

Table of Contents Investment Objectives

Our primary investment objectives are:

●	providing current income to our stockholders in the form of consistent cash distributions;
●	preserving and protecting our stockholders’ capital investments;
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●	realizing capital appreciation in our share price from active investment management and asset management; and
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●	providing portfolio diversification in the form of multi-asset class investing in direct real property and investing in other real estate-related assets.
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There is no assurance that we will attain our investment objectives. Our charter places numerous limitations on us with respect to the manner in which we may invest our funds. In most cases these limitations cannot be changed unless our charter is amended, with the approval of our stockholders.

Investment Strategy

We are primarily focused on investing in and operating a diverse portfolio of real property and investing in other real estate-related assets. We currently focus our investment activities primarily across the major U.S. property sectors (residential, industrial, retail and office) and investments in real estate debt and securities. To a lesser extent, we invest in and/or intend to strategically invest in geographies outside of the U.S., which may include Canada, Mexico, the United Kingdom, Europe and other foreign jurisdictions, and in other sectors such as credit lease and self-storage, properties in sectors adjacent to our primary investment sectors and/or infrastructure, to create a diversified blend of current income and long-term value appreciation. Our objective is to bring the Ares leading institutional-quality real assets investment platform to income-focused investors, with significant diversification across real estate and real estate-related asset classes, geographies and sectors. We intend to allocate capital dynamically between sectors and strategies so as to achieve outperformance through strategic diversification rather than outsized risk. We expect real estate debt, non-US jurisdictions and/or infrastructure assets to comprise up to 30% of our assets. Currently, infrastructure is not expected to comprise more than 10% of our assets with a focus on real estate-related infrastructure and renewable energy sources. While we will not limit our investment opportunities to stay within these allocations, we may adjust our expectations based on market conditions and opportunities.

We believe that the real estate market is cyclical, with demand for property types peaking at different times. Although we do not typically invest for the short term, we are active portfolio managers and will seek to take advantage of opportunities to acquire or dispose of assets strategically at different points in the cycle. One reason we focus on multiple property types and markets is to increase our ability to take advantage of these market cycles. We believe that the broader the opportunity set in which to invest our capital, the more selective we can be in choosing strategic and accretive investments, which we believe may result in attractive total returns for our stockholders. Seeing more of the overall real estate market also may allow us to be consistent and meaningful investors throughout different cycles. When we believe one market and/or sector is overvalued, we patiently wait and focus on another market and/or sector that we believe is overlooked or has stronger fundamentals of relative value. We also believe that value generally is based on an investment’s ability to produce cash flow. We generally focus on select, targeted markets that exhibit characteristics of being supply-constrained with strong demand from customers seeking quality space.

Our near-term investment strategy is likely to prioritize new investments in the residential and industrial sectors due to relatively attractive fundamental conditions. Such investments may be in the form of equity or debt, and in particular, we believe that debt investments provide an increasingly attractive risk adjusted return in today's environment. We also intend to continue to hold an allocation of properties in the retail and office sectors, the former of which is largely grocery-anchored. To a lesser extent, we intend to invest in credit lease and self-storage, properties in sectors adjacent to our primary investment sectors, real estate-related securities and/or infrastructure. Our investments in real estate-related securities generally will focus on debt or equity issued by public and private real estate companies and/or certain other securities, with the primary goal of such investments being preservation of liquidity in support of our share redemption program, while also seeking income, potential for capital appreciation and further portfolio diversification. 2

Table of Contents We generally employ a long-term hold strategy for strategic investments within our portfolio of real estate assets. The majority of our current portfolio consists of primarily “core” or “core-plus” properties that have significant operating histories and are substantially leased whereby a significant portion of the total investment return is expected to be derived from current income. In addition, we have invested in and/or may invest in a relatively smaller proportion of “development” properties and/or “value-added” opportunities that have arisen in circumstances where we have determined that a property may be situationally undervalued or where re-development, re-leasing and/or improved asset management may increase cash flows, and where the total investment return is generally expected to have a relatively larger component derived from capital appreciation.

Financing Objectives

We use financial leverage to provide additional funds to support our investment activities. We may finance a portion of the purchase price of any real estate asset that we acquire with borrowings on short or long-term basis from banks, life insurance companies and other lenders. We calculate our leverage for reporting purposes as the outstanding principal balance of our borrowings less cash and cash equivalents, divided by the fair value of our real property, net investments in unconsolidated joint venture partnerships, investments in real estate-related securities and debt-related investments not associated with the DST Program (determined in accordance with our valuation procedures). For purposes of determining the fair value of our real property, we include the fair value of the properties that are part of the DST Program due to the master lease structure, including our purchase option. Based on this methodology, our leverage increased to 41.2% as of December 31, 2024, as compared to 36.4% as of December 31, 2023. There are other methods of calculating our overall leverage ratio that may differ from this methodology, such as the methodology used in determining our compliance with corporate borrowing covenants. Our current target leverage ratio is between 40-60%. Although we will generally work to maintain our targeted leverage ratio, there are no assurances that we will maintain the targeted range disclosed above or achieve any other leverage ratio that we may target in the future. Our board of directors may from time to time modify our borrowing policy in light of then-current economic conditions, the relative costs of debt and equity capital, the fair values of our properties, general conditions in the market for debt and equity securities, growth and acquisition opportunities or other factors. See Item 1A, “Risk Factors—Risks Associated with Debt Financing” for additional detail.

Competition

We face competition from various entities for investment opportunities in properties, including other REITs, pension funds, insurance companies, investment funds and companies, partnerships and developers. Many of these entities may have greater access to capital to acquire properties than we have. In addition to third-party competitors, we may compete with other programs sponsored or advised by affiliates of the Sponsor, particularly those with investment strategies that overlap with ours. In addition to competing for attractive investment opportunities, the current leasing and operating environment is also very competitive. See Item 1A, “Risk Factors—Risks Related to Conflicts of Interest” and “—Risks Related to Investments in Real Property” for additional detail.

Significant Customers

We are dependent upon the ability of current customers to pay their contractual rent amounts as the rents become due. As of December 31, 2024, there were no customers that represented more than 10.0% of total annualized base rent or more than 10.0% of total leased square feet. Our 10 largest customers represented 12.6% and 18.5% of total annualized base rent and total leased square feet, respectively. We are not aware of any current customers whose inability to pay their contractual rental amounts would have a material adverse impact on our results of operations. See Item 2, “Properties,” for further detail about customer diversification.

Conflicts of Interest

We are subject to various potential conflicts of interest that could arise out of our relationship with the Advisor and other affiliates and related parties, including: conflicts related to the compensation arrangements among the Advisor, certain affiliates and related parties, and us; conflicts with respect to the allocation of the Advisor’s and its key personnel’s time; conflicts related to our potential acquisition of assets from affiliates of the Advisor; and conflicts with respect to the allocation of investment and leasing opportunities. Further, entities currently sponsored by or that in the future may be advised by affiliates of the Sponsor, and those in which Sponsor-affiliated entities own interests, may compete with us or may be given priority over us with respect to the acquisition of certain types of investments. As a result of our potential competition with these entities, certain investment and leasing opportunities that would otherwise be available to us may not in fact be available. See Item 1A, “Risk Factors—Risks Related to Conflicts of Interest,” for additional detail. The independent directors have an obligation to function on our behalf in all situations in which a conflict of interest may arise and have a fiduciary obligation to act on behalf of our stockholders. 3

Table of Contents Compliance with Federal, State and Local Environmental Laws

Properties that we may acquire, and the properties underlying our investments, are subject to various federal, state and local environmental laws, ordinances and regulations. Under these laws, ordinances and regulations, a current or previous owner of real estate (including, in certain circumstances, a secured lender that succeeds to ownership or control of a property) may become liable for the costs of removal or remediation of certain hazardous or toxic substances or petroleum product releases at, on, under or in its property. These laws typically impose cleanup responsibility and liability without regard to whether the owner or control party knew of or was responsible for the release or presence of the hazardous or toxic substances. The costs of investigation, remediation or removal of these substances may be substantial and could exceed the value of the property. An owner or control party of a site may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from a site. Certain environmental laws also impose liability in connection with the handling of or exposure to materials containing asbestos. These laws allow third parties to seek recovery from owners of properties for personal injuries associated with materials containing asbestos. Our operating costs and the values of these assets may be adversely affected by the obligation to pay for the cost of complying with existing environmental laws, ordinances and regulations, as well as the cost of complying with future legislation, and our income and ability to make distributions to our stockholders could be affected adversely by the existence of an environmental liability with respect to our properties. We will endeavor to ensure our properties are in compliance in all material respects with all federal, state and local laws, ordinances and regulations regarding hazardous or toxic substances or petroleum products.

Employees

We have no employees. Pursuant to the terms of the Advisory Agreement, the Advisor assumes principal responsibility for managing our affairs and we compensate the Advisor for certain services.

Available Information

Our internet address is www.areswms.com/solutions/areit. Through a link on our website, we make available, free of charge, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and prospectus, along with any amendments to those filings, as soon as reasonably practicable after we file or furnish them to the Securities and Exchange Commission (the “SEC”).

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Table of Contents

ITEM 1A.RISK FACTORS

RISKS RELATED TO INVESTING IN SHARES OF OUR COMMON STOCK

There is no public trading market for the shares of our common stock and we do not anticipate that there will be a public trading market for our shares; therefore, our stockholders’ ability to dispose of their shares will likely be limited to redemption by us. If the stockholder does sell their shares to us, the stockholder may receive less than the price they paid.

There is no public market for the shares of our common stock and we currently have no obligation or plans to apply for listing on any public securities market. Therefore, redemption of the shares of our common stock by us will likely be the only way for the stockholders to dispose of their shares. We will redeem shares at a price equal to the transaction price on the last calendar day of the applicable month (which will generally be equal to our most recently disclosed monthly NAV per share), and not based on the price at which the stockholders initially purchased their shares. We may redeem the stockholder’s shares if they fail to maintain a minimum balance of $2,000 of shares, even if the stockholder’s failure to meet the minimum balance is caused solely by a decline in our NAV. Subject to limited exceptions, shares that have not been outstanding for at least one year will be redeemed at 95% of the transaction price, which will inure indirectly to the benefit of our remaining stockholders. As a result of this and the fact that our NAV will fluctuate, stockholders may receive less than the price they paid for their shares upon redemption by us pursuant to our share redemption program.

Our private offering is being conducted in reliance on a private offering exemption from registration under the Securities Act, and if the Company fails to comply with the requirements of such exemption, our stockholders would have the right to rescind their purchase of Shares of our common stock if they so desired.

Shares of our common stock are being offered and sold in reliance on a private offering exemption from registration provided in the Securities Act. If we should fail to comply with the requirements of such exemption, our stockholders would have the right to rescind their purchase of the shares of our common stock if they so desired. It is possible that one or more stockholders seeking rescission would succeed. This might also occur under applicable state securities laws and regulations in states where the shares will be offered without registration or qualification pursuant to a private offering or other exemption. If a number of our stockholders were successful in seeking rescission, we could face severe financial demands that would adversely affect the Company as a whole and, thus, the investment in the Company by our remaining stockholders.

Our ability to redeem stockholder shares may be limited, and our board of directors may make exceptions to, modify or suspend our share redemption program at any time.

We may redeem fewer shares than have been requested in any particular month to be redeemed under our share redemption program, or none at all, in our discretion at any time. We may redeem fewer shares due to lack of readily available funds because of adverse market conditions beyond our control, the need to maintain liquidity for our operations or because we have determined that investing in real property or other illiquid investments is a better use of our capital than redeeming our shares. In addition, the total amount of aggregate redemptions of our shares (based on the price at which the shares are redeemed) will be limited during each calendar month to 2% of the aggregate NAV of all classes as of the last calendar day of the previous quarter and in each calendar quarter will be limited to 5% of the aggregate NAV of all classes of shares as of the last calendar day of the previous calendar quarter; provided, however, that every month and quarter each class of our common stock will be allocated capacity within such aggregate limit to allow stockholders in such class to either (a) redeem shares (based on the price at which the shares are redeemed) equal to at least 2% of the aggregate NAV of such share class as of the last calendar day of the previous quarter, or, if more limiting, (b) redeem shares (based on the price at which the shares are redeemed) over the course of a given quarter equal to at least 5% of the aggregate NAV of such share class as of the last calendar day of the previous quarter (collectively, referred to herein as the “2% and 5% limits”), which in the second and third months of a quarter could be less than 2% of the NAV of such share class and could even be zero. In addition, for both the aggregate and class-specific allocations described above, (i) provided that the share redemption program has been operating and not suspended for the first month of a given quarter and that all properly submitted redemption requests were satisfied, any unused capacity for that month will carry over to the second month and (ii) provided that the share redemption program has been operating and not suspended for the first two months of a given quarter and that all properly submitted redemption requests were satisfied, any unused capacity for those two months will carry over to the third month. In no event will such carry-over capacity permit the redemption of shares with aggregate value (based on the redemption price per share for the month the redemption is effected) in excess of 5% of the combined NAV of all classes of shares as of the last calendar day of the previous calendar quarter (provided that for these purposes redemptions may be measured on a net basis as described in the paragraph below). 5

Table of Contents We currently measure the foregoing redemption allocations and limitations based on net redemptions during a month or quarter, as applicable. The term “net redemptions” means, during the applicable period, the excess of our share redemptions (capital outflows) over the proceeds from the sale of our shares (capital inflows). For purposes of measuring our redemption capacity pursuant to our share redemption program, proceeds from new subscriptions in a month are included in capital inflows on the first day of the next month because that is the first day on which such stockholders have rights in the Company. Also for purposes of measuring our redemption capacity pursuant to our share redemption program, redemption requests received in a month are included in capital outflows on the last day of such month because that is the last day stockholders have rights in the Company. We record these redemptions in our financial statements as having occurred on the first day of the next month following receipt of the redemption request because shares redeemed in a given month are outstanding through the last day of the month. With respect to future periods, our board of directors may choose whether the allocations and limitations will be applied to “gross redemptions,” i.e., without netting against capital inflows, rather than to net redemptions, which could limit the amount of shares redeemed in a given month or quarter despite our receiving a net capital inflow for that month or quarter.

The vast majority of our assets will consist of properties which cannot generally be readily liquidated on short notice without impacting our ability to realize full value upon their disposition. Therefore, we may not always have a sufficient amount of cash to immediately satisfy redemption requests. Our board of directors may make exceptions to, modify or suspend our share redemption program. In addition, limited partners in our Operating Partnership may have different redemption rights with respect to partnership interests in the Operating Partnership (“OP Units”) and may be treated differently than our stockholders requesting redemption under our share redemption program. As a result, the stockholders’ ability to have their shares redeemed by us may be limited, and our shares should be considered as having only limited liquidity and at times may be illiquid. See Item 5, “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Share Redemption Program and Other Redemptions” of this Annual Report on Form 10-K.

Our capacity to redeem shares may be further limited if we experience a concentration of investors.

The current limitations of our share redemption program are based, in part, on the number of outstanding shares. Thus, the ability of a single investor, or of a group of investors acting similarly, to redeem all of their shares may be limited if they own a large percentage of our shares. Similarly, if a single investor, or a group of investors acting in concert or independently, owns a large percentage of our shares, a significant redemption request by such investor or investors could significantly further limit our ability to satisfy redemption requests of other investors of such classes. Such concentrations could arise in a variety of circumstances. For example, we could sell a large number of our shares to one or more institutional investors. In addition, we may issue a significant number of our shares in connection with an acquisition of another company or a portfolio of properties to a single investor or a group of investors that may request redemption at similar times following the acquisition. As of December 31, 2024, based on the NAV per share of $7.59 on that date, we had outstanding approximately $204.6 million in Class T-R shares, $332.0 million in Class S-R shares, $46.4 million in Class D-R shares, $447.6 million in Class I-R shares, $327.7 million in Class E shares, $5.0 million in Class S-PR shares, $0.1 million in D-PR shares and $4.6 million in I-PR shares.

Purchases and redemptions of our common shares will not be made based on the current NAV per share of our common stock.

The purchase and redemption price for shares of our common stock will generally be based on our most recently disclosed monthly NAV (subject to material changes) and will not be based on any public trading market. We generally expect our transaction price to be equal to our NAV as of a date approximately one month prior to the dates when share purchases and redemptions take place. For example, if the stockholders wish to subscribe for shares of our common stock in October, the subscription request must be received in good order at least five business days before November 1. Generally, the offering price would equal the NAV per share of the applicable class as of the last calendar day of September, plus applicable upfront selling commissions and dealer manager fees. If accepted, the stockholder subscription would be effective on the first calendar day of November. Conversely, if the stockholders wish to submit their shares for redemption in October, the redemption request and required documentation must be received in good order by 4:00 p.m. (Eastern time) on the second to last business day of October. If accepted, the stockholders’ shares would be redeemed as of the last calendar day of October and, generally, the redemption price would equal the NAV per share of the applicable class as of the last calendar day of September, subject to reduction for early redemption. In each of these cases, the NAV that is ultimately determined as of the last day of October may be higher or lower than the NAV as of the last day of September used for determining the transaction price. Therefore, the price at which the stockholders purchase shares may be higher than the current NAV per share at the time of sale and the price at which they redeem shares may be lower than the current NAV per share at the time of redemption. 6

Table of Contents Economic events that may cause our stockholders to request that we redeem their shares may materially adversely affect our cash flow and our results of operations and financial condition.

Economic events affecting the U.S. economy, such as the general negative performance of the real estate sector, could cause our stockholders to seek to sell their shares to us pursuant to our share redemption program at a time when such events are adversely affecting the performance of our assets. Even if we decide to satisfy all resulting redemption requests, our cash flow could be materially adversely affected. In addition, if we determine to sell assets to satisfy redemption requests, we may not be able to realize the return on such assets that we may have been able to achieve had we sold at a more favorable time, and our results of operations and financial condition, including, without limitation, breadth of our portfolio by property type and location, could be materially adversely affected.

A portion of the proceeds raised in our securities offerings are expected to be used to satisfy redemption requests, and such portion of the proceeds may be substantial.

We currently expect to use a portion of the proceeds from our securities offerings to satisfy redemption requests, in particular redemption requests from our Class E stockholders who comprise a significant portion of our stockholders, have generally held their shares for a number of years and have demonstrated significant demand for liquidity in recent years. We have redeemed approximately $191.6 million of shares of our common stock during the year ended December 31, 2024. Using the proceeds from our securities offerings for redemptions will reduce the net proceeds available to retire debt or acquire additional properties, which may result in reduced liquidity and profitability or restrict our ability to grow our NAV.

We have experienced periods in the past in which redemption demand exceeded redemption capacity, and we could experience such situations again in the future.

We commenced our initial public offering in January 2006 and commenced operations later that year. At that time, we only offered Class E shares of common stock (referred to at that time simply as our shares of “common stock”), and our share redemption program for Class E stockholders (which was more restrictive than our current share redemption program) was subject to limitations that included a maximum number of redemptions during any calendar year of 5% of the weighted-average number of shares outstanding during the prior calendar year. Beginning in the first quarter of 2009 through the third quarter of 2016, redemption requests from Class E stockholders exceeded the redemption limits set forth in the Class E share redemption program and associated offering materials, and we conducted a number of self-tender offers to supplement this liquidity. As a result, we redeemed only a portion of the shares from investors who sought redemption during that period, either through the redemption program or self-tender offers, and the stockholders were required to resubmit redemption requests periodically in order to renew their requests to either have their shares redeemed pursuant to the share redemption program or purchased pursuant to a tender offer.

Although all properly submitted redemption requests and/or tenders in our self-tender offers have been satisfied beginning with the fourth quarter of 2016, in the future we could experience situations like that described above in which redemption demand exceeds capacity. Our current share redemption program has different limitations than our share redemption program did during that time, but it remains true that our ability to redeem the stockholder shares may be limited, and our board of directors may make exceptions to modify or suspend our share redemption program at any time. Furthermore, we may redeem fewer shares than have been requested in any particular month to be redeemed under our share redemption program, or none at all, in our discretion at any time. If a redemption request under our share redemption program is unsatisfied, it must be resubmitted after the start of the next month or quarter, or upon the recommencement of the share redemption program, as applicable.

Historical returns may be presented over limited timeframes and are inherently limited in their applicability to the future.

In our annual report and in other investor communications, we disclose certain historical NAV and total return information. This information may be presented on a class-by-class basis or on a weighted-average basis across all our classes. The information may go back one month, one quarter, or longer periods. While we believe this historical information is useful, investors should understand that any historical return presentation is inherently limited in its applicability to the future, for a variety of reasons. We may have performed better in certain past time periods than others, and we cannot predict the future performance of our company specifically or the broader economy and real estate markets more generally. Furthermore, from time to time we make changes to our portfolio, our investment focus, or structural aspects of our company that may make past returns less comparable. Over time, we have made changes to the fees and reimbursements we pay to the Advisor (in connection with managing our operations) and the dealer manager for our securities offerings, Ares Wealth Management Solutions, LLC (the “Dealer Manager”), and participating broker-dealers (in 7

Table of Contents connection with our securities offerings). Our share classes have different upfront fees and different class-specific fees that make their returns different from those of other classes and from average returns that may be shown. In some cases, we have changed the names of our share classes and the fees that affect their returns. Over time, we have also made changes to the frequency with which, and the methodologies with which, we estimate the value of our shares.

In particular, it was not until July 2012 that we converted to a perpetual-life “NAV REIT” that offers multiple classes of shares, moved to a fee structure similar to what we have now, and began providing regular NAV computations and disclosures similar to those we provide now. For this reason, our historical return disclosures typically do not go further back than September 30, 2012, which is the first quarter-end date as an NAV REIT and which we refer to as our “NAV inception.” Nevertheless, investors should be aware that we commenced operations in the first quarter of 2006, and from 2006 to 2009 raised capital through the sale of Class E shares of common stock (referred to at that time simply as our shares of “common stock”) at a fixed price of $10.00 per share. Prior to NAV inception in 2012, we had a materially different structure both in terms of the commissions charged in connection with sales of shares and the fees and reimbursements we paid to the Advisor and the Dealer Manager. As a result of both this different structure and the effects of the financial crisis, the performance returns for individual Class E stockholders that acquired shares in our offerings from 2006 to 2009 is lower than those for our other stockholders.

Stockholders will not have the opportunity to evaluate future investments we will make with the proceeds raised in our securities offerings prior to purchasing shares of our common stock.

We have not identified future investments that we will make with the proceeds of our securities offerings. As a result, stockholders will not be able to evaluate the economic merits, transaction terms or other financial or operational data concerning our future investments prior to purchasing shares of our common stock. Stockholders must rely on the Advisor and our board of directors to implement our investment policies, to evaluate our investment opportunities and to structure the terms of our investments. Because the stockholders cannot evaluate all of the investments we will make in advance of purchasing shares of our common stock, this additional risk may hinder the stockholders’ ability to achieve their own personal investment objectives related to portfolio diversification, risk-adjusted investment returns and other objectives.

We may not be able to raise significant funds in our securities offerings.

We may not raise significant funds in our securities offerings. Our ability to raise capital may be impacted by a variety of factors, including market demand, relative attractiveness of alternative investments, and the willingness of key distribution partners to continue to sell our shares on their respective platforms. The less capital we raise, the less capital we will have available to make investments in accordance with our investment strategy and policies, to provide liquidity to our stockholders and for general corporate purposes (which may include repayment of our debt or any other corporate purposes we deem appropriate).

Furthermore, the estimated use of proceeds figures presented in our offering documents are estimates based on numerous assumptions. The actual percentage of net proceeds available to use will depend on a number of factors, including the amount of capital we raise and the actual offering costs. For example, if we raise less than the assumed amount, we would expect the percentage of net offering proceeds available to us to be less (and may be substantially less) than the estimated use of proceeds figures presented in our offering documents because many offering costs are fixed and do not depend on the amount of capital raised in our securities offerings.

Even if we are able to raise substantial funds in our securities offerings, investors in our common stock are subject to the risk that our offering, business and operating plans may change.

Although we intend to operate as a perpetual-life REIT with an ongoing offering and share redemption program, this is not a requirement of our charter. Even if we are able to raise substantial funds in our securities offerings, if circumstances change such that our board of directors believes it is in the best interest of our stockholders to suspend the offering or to terminate our share redemption program, we may do so without stockholder approval. Our board of directors may also change our investment objectives, borrowing policies or other corporate policies without stockholder approval. In addition, we may change the way our fees and expenses are incurred and allocated to different classes of stockholders if the tax rules applicable to REITs change such that we could do so without adverse tax consequences. Our board of directors may decide that certain significant transactions that require stockholder approval such as dissolution, merger into another entity, consolidation or the sale or other disposition of all or substantially all of our assets, are in the best interests of our stockholders. Holders of all classes of our common stock have equal voting rights with respect to such matters and will vote as a single group rather than on a class-by-class basis. Accordingly, investors in our common stock are subject to the risk that our offering, business and operating plans may change. 8

Table of Contents Valuations and appraisals of our properties, real estate-related assets and real estate-related liabilities are estimates of value and may not necessarily correspond to realizable value.

The primary component of our NAV is the value of our investments. The valuation methodologies used to value our properties and certain real estate-related assets involve subjective judgments regarding such factors as comparable sales, rental revenue and operating expense data, known contingencies, the capitalization or discount rate, and projections of future rent and expenses based on appropriate analysis. Additionally, appraisals of our properties are in part based on historical transaction data. As a result, valuations and appraisals of our properties, real estate-related assets and real estate-related liabilities are only estimates of current market value. Ultimate realization of the value of an asset or liability depends to a great extent on economic and other conditions beyond our control and the control of the Independent Valuation Advisor (as defined below) and other parties involved in the valuation of our assets and liabilities. Further, these valuations may not necessarily represent the price at which an asset or liability would sell, because market prices of assets and liabilities are best determined by negotiation between a willing buyer and seller. As such, the carrying value of an asset may not reflect the price at which the asset could be sold in the market, and the difference between carrying value and the ultimate sales price could be material. In addition, accurate valuations are more difficult to obtain in times of low transaction volume because there are fewer market transactions that can be considered in the context of the appraisal. Valuations used for determining our NAV also are generally made without consideration of the expenses that would be incurred by us in connection with disposing of assets and liabilities. Therefore, the valuations of our properties, our investments in real estate-related assets and our liabilities may not correspond to the timely realizable value upon a sale of those assets and liabilities. In addition, the value of our interest in any joint venture or partnership that is a minority interest or is restricted as to salability or transferability may reflect or be adjusted for a minority or liquidity discount. In addition to being a month old when share purchases and redemptions take place, our NAV does not currently represent enterprise value and may not accurately reflect the actual prices at which our assets could be liquidated on any given day, the value a third party would pay for all or substantially all of our shares, or the price that our shares would trade at on a national stock exchange. The stock price of shares of a publicly traded REIT may materially differ than the NAV of a non-traded REIT with comparable portfolios. While any changes in the value of our real estate portfolio will ultimately be reflected in future calculations of NAV, there will be no retroactive adjustment in the valuation of such assets or liabilities, the price of our shares of common stock, the price we paid to redeem shares of our common stock or NAV-based fees we paid to the Advisor and the Dealer Manager to the extent such valuations prove to not accurately reflect the true estimate of value and are not a precise measure of realizable value. Because the price the stockholders will pay for shares of our common stock in our securities offerings, and the price at which their shares may be redeemed by us pursuant to our share redemption program, are generally based on our estimated NAV per share, the stockholders may pay more than realizable value or receive less than realizable value for their investment.

In order to disclose a monthly NAV, we are reliant on the parties that we engage for that purpose, in particular the Independent Valuation Advisor and the other appraisers that we hire to value and appraise our real property portfolio.

In order to disclose a monthly NAV, our board of directors, including a majority of our independent directors, has adopted valuation procedures that contain a comprehensive set of methodologies to be used in connection with the calculation of our NAV and caused us to engage independent third parties such as the Independent Valuation Advisor, to appraise our real property portfolio on a monthly basis, and independent appraisal firms, to provide periodic appraisals with respect to our properties. We have also engaged a firm to act as the NAV Accountant and may engage other independent third parties or the Advisor to value other assets or liabilities. Although our board of directors, with the assistance of the Advisor, oversees all of these parties and the reasonableness of their work product, we will not independently verify our NAV or the components thereof, such as the appraised values of our properties. Our management’s assessment of the market values of our properties may also differ from the appraised values of our properties as determined by the Independent Valuation Advisor. If the parties engaged by us to determine our monthly NAV are unable or unwilling to perform their obligations to us, our NAV could be inaccurate or unavailable, and we could decide to suspend our public offerings and our share redemption program.

Our NAV is not subject to U.S. generally accepted accounting principles (“GAAP”), will not be independently audited and will involve subjective judgments by the Independent Valuation Advisor and other parties involved in valuing our assets and liabilities.

Our valuation procedures and our NAV are not subject to GAAP and will not be subject to independent audit. Our NAV may differ from equity (net assets) reflected on our audited financial statements, even if we are required to adopt a fair value basis of accounting for GAAP financial statement purposes. Additionally, we are dependent on the Advisor to be reasonably aware of material events specific to our properties (such as customer disputes, damage, litigation and environmental issues) that may cause the value of a property to change materially and to promptly notify the Independent Valuation Advisor so that the information may be reflected in our real property portfolio valuation. In addition, the implementation and coordination of our valuation procedures include certain 9

Table of Contents subjective judgments of the Advisor, such as whether the Independent Valuation Advisor should be notified of events specific to our properties that could affect their valuations, as well as of the Independent Valuation Advisor and other parties we engage, as to whether adjustments to asset and liability valuations are appropriate. Accordingly, the stockholders must rely entirely on our board of directors to adopt appropriate valuation procedures and on the Independent Valuation Advisor and other parties we engage in order to arrive at our NAV, which may not correspond to realizable value upon a sale of our assets.

No rule or regulation requires that we calculate our NAV in a certain way, and our board of directors, including a majority of our independent directors, may adopt changes to the valuation procedures.

There are no existing rules or regulatory bodies that specifically govern the manner in which we calculate our NAV. As a result, it is important that stockholders pay particular attention to the specific methodologies and assumptions we use to calculate our NAV. Other peer REITs may use different methodologies or assumptions to determine their NAV. In addition, each year our board of directors, including a majority of our independent directors, will review the appropriateness of our valuation procedures and may, at any time, adopt changes to the valuation procedures. If we acquire real properties as a portfolio, we may pay a premium over the amount that we would pay for the assets individually. Our board of directors may change these or other aspects of our valuation procedures, which changes may have an adverse effect on our NAV and the price at which the stockholders may sell shares to us under our share redemption program. See Item 5, “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Net Asset Value Per Share” and our valuation procedures attached as Exhibit 99.2 to this Annual Report on Form 10-K for more details regarding our valuation methodologies, assumptions and procedures.

Our NAV per share may suddenly change if the valuations of our properties materially change from prior valuations.

Property valuation changes can occur for a variety of reasons, such as local real estate market conditions, market lease assumptions, rotation of different third-party appraisal firms, the financial condition of our customers, or leasing activity. For example, due to rapidly changing market conditions, such as tenant demand and resulting rental rates, the valuation of underlying properties correspondingly may change. Such a valuation drop can be particularly significant when closer to a lease expiration, especially for single customer buildings or where an individual customer occupies a large portion of a building and the determination is made that the customer will not renew, or is expected to renew based on terms that are less favorable than what were previously assumed. We are at the greatest risk of these valuation changes during periods in which we have a large number of lease expirations as well as when the lease of a significant customer is closer to expiration. Similarly, if a customer will have an option in the future to purchase one of our properties from us at a price that is less than the current valuation of the property, then if the value of the property exceeds the option price, the valuation will be expected to decline and begin to approach the purchase price as the date of the option approaches. In addition, actual operating results or observed market transactions could change unexpectedly. For example, if operating expenses suddenly increase or revenues decrease, such change may in turn cause a sudden increase or decrease in the NAV per share amounts.

New acquisitions may be valued for purposes of our NAV at less than what we pay for them, which would dilute our NAV, or at more than what we pay for them, which would be accretive to our NAV.

Pursuant to our valuation procedures, the acquisition price of a newly acquired property will serve as the basis for the initial monthly appraisal performed by the Independent Valuation Advisor. The price we pay to acquire a property will provide a meaningful data point to the Independent Valuation Advisor in its determination of the initial fair market value of the property; however, the Independent Valuation Advisor may conclude that the price we paid to acquire a property is higher or lower than the current estimate of fair market value of the property, which shall be used for purposes of determining our NAV. This is true whether the acquisition is funded with cash, equity or a combination thereof. Properties that we acquire will not join the cycle for annual appraisals performed by third-party appraisal firms until the following calendar year. When we obtain the first appraisal performed by a third-party appraisal firm on a property, it may not appraise at a value equal to the purchase price or the property value previously determined by the Independent Valuation Advisor, which could negatively affect our NAV. Large portfolio acquisitions, in particular, may require a “portfolio premium” to be paid by us in order to be a competitive bidder, and this “portfolio premium” may not be taken into consideration in calculating our NAV. We may make acquisitions (with cash or equity) of any size without stockholder approval, and such acquisitions may be dilutive or accretive to our NAV. In addition, acquisition expenses we incur in connection with new acquisitions will negatively impact our NAV. 10

Table of Contents The NAV per share that we publish may not necessarily reflect changes in our NAV that are not immediately quantifiable.

From time to time, we may experience events with respect to our investments that may have a material impact on our NAV. For example, and not by way of limitation, changes in governmental rules, regulations and fiscal policies, environmental legislation, natural disasters, pandemics, terrorism, war, social unrest, civil disturbances and major disturbances in financial markets may cause the value of a property to change materially. Similarly, negotiations, disputes and litigation that involve us and other parties may ultimately have a positive or negative impact on our NAV. The NAV per share of each class of our common stock as published for any given month may not reflect such extraordinary events to the extent that their financial impact is not immediately quantifiable. As a result, the NAV per share that we publish may not necessarily reflect changes in our NAV that are not immediately quantifiable, and the NAV per share of each class published after the announcement of a material event may differ significantly from our actual NAV per share for such class until such time as the financial impact is quantified and our NAV is appropriately adjusted in accordance with our valuation procedures. The resulting potential disparity in our NAV may inure to the benefit of redeeming stockholders or non-redeeming stockholders and new purchasers of our common stock, depending on whether our published NAV per share for such class is overstated or understated.

The realizable value of specific properties may change before the value is adjusted by the Independent Valuation Advisor and reflected in the calculation of our NAV.

Our valuation procedures generally provide that the Independent Valuation Advisor will adjust a real property’s valuation, as necessary, based on known events that have a material impact on the most recent value (adjustments for non-material events may also be made). We are dependent on the Advisor to be reasonably aware of material events specific to our properties (such as lease expirations, customer disputes, damage, litigation and environmental issues, as well as positive events such as new lease agreements) that may cause the value of a property to change materially and to promptly notify the Independent Valuation Advisor so that the information may be reflected in our real property portfolio valuation. Events may transpire that, for a period of time, are unknown to us or the Independent Valuation Advisor that may affect the value of a property, and until such information becomes known and is processed, the value of such asset may differ from the value used to determine our NAV. In addition, although we may have information that suggests a change in value of a property may have occurred, there may be a delay in the resulting change in value being reflected in our NAV until such information is appropriately reviewed, verified and processed. For example, we may receive an unsolicited offer from an unrelated third party to purchase one of our assets at a price that is materially different than the price included in our NAV. Or, we may be aware of a new lease, lease expiry, or a potential contract for capital expenditure. Where possible, adjustments generally are made based on events evidenced by proper final documentation. It is possible that an adjustment to the valuation of a property may occur prior to final documentation if the Independent Valuation Advisor determines that events warrant adjustments to certain assumptions that materially affect value. However, to the extent that an event has not yet become final based on proper documentation, its impact on the value of the applicable property may not be reflected (or may be only partially reflected) in the calculation of our NAV.

Our NAV and the NAV of stockholder shares may be diluted in connection with current and future securities offerings.

In connection with our securities offerings, we incur fees and expenses, which decrease the amount of cash we have available for operations and new investments. In addition, because the prices of shares sold in our securities offerings are based on our NAV, the offering may be dilutive if our NAV procedures do not fully capture the value of our shares and/or we do not utilize the proceeds accretively.

In the future we may conduct other offerings of common stock (whether existing or new classes), preferred stock, debt securities or of interests in the Operating Partnership. We may also amend the terms of our existing securities offerings. We may structure or amend such offerings to attract institutional investors or other sources of capital. The costs of our current and future securities offerings may negatively impact our ability to pay distributions and stockholders’ overall return. 11

Table of Contents Because we generally do not mark to market our property-level mortgages, corporate-level credit facilities and other secured and unsecured debt that are intended to be held to maturity, or our associated interest rate hedges that are intended to be held to maturity, the realizable value of our company or our assets that are encumbered by debt may be higher or lower than the value used in the calculation of our NAV.

In accordance with our valuation procedures, our property-level mortgages, corporate-level credit facilities and other secured and unsecured debt that are intended to be held to maturity (which for fixed rate debt not subject to interest rate hedges may be the date near maturity at which time the debt will be eligible for prepayment at par for purposes herein), including those subject to interest rates hedges, are valued at par (i.e. at their respective outstanding balances). Because we often utilize interest rate hedges to stabilize interest payments (i.e. to fix all-in interest rates through interest rate swaps or to limit interest rate exposure through interest rate caps) on individual loans, each loan and associated interest rate hedge is treated as one financial instrument, which is valued at par if intended to be held to maturity. This policy of valuing at par applies regardless of whether any given interest rate hedge is considered an asset or liability for GAAP purposes. Notwithstanding, if we acquire an investment and assume associated in-place debt from the seller that is above or below market, then consistent with how we recognize assumed debt for GAAP purposes when acquiring an asset with pre-existing debt in place, the liabilities used in the determination of our NAV will include the market value of such debt; the associated premium or discount on such debt will then be amortized through loan maturity. As a result of this policy, the realizable value of our company or our assets that are encumbered by debt used in the calculation of our NAV may be higher or lower than the value that would be derived if such debt instruments were marked to market. For example, if we decide to sell one or more assets, we may re-classify those assets as held-for-sale, which could then have a positive or negative impact on our calculation of NAV to the extent any associated debt is definitively intended to be prepaid. In some cases, such difference may be significant. We currently estimate the fair value of our debt (inclusive of associated interest rate hedges) that was intended to be held to maturity as of December 31, 2024 was $42.5 million lower than the carrying value used for calculation of our NAV for such debt in aggregate; meaning that if we used the fair value of our debt rather than the carrying value used for calculation of our NAV (and treated the associated hedge as part of the same financial instrument), our NAV would have been higher by approximately $42.5 million, or $0.12 per share, not taking into account all of the other items that impact our monthly NAV, as of December 31, 2024. As of December 31, 2024, we classified all of our debt as intended to be held to maturity.

Stockholders do not have the benefit of an independent due diligence review in connection with our securities offerings which increases the risk of their investment.

Because the Advisor and the Dealer Manager are related, investors do not have the benefit of an independent due diligence review and investigation of the type normally performed by an unrelated, independent underwriter in connection with a securities offering. In addition, DLA Piper LLP (US) has acted as counsel to us, the Advisor and the Dealer Manager in connection with our securities offerings and, therefore, investors do not have the benefit of a due diligence review that might otherwise be performed by independent counsel. Under applicable legal ethics rules, DLA Piper LLP (US) may be precluded from representing us due to a conflict of interest between us and the Dealer Manager. If any situation arises in which our interests are in conflict with those of the Dealer Manager or its related parties, we would be required to retain additional counsel and may incur additional fees and expenses. The lack of an independent due diligence review and investigation increases the risk of stockholders’ investment.

We currently do not have research analysts reviewing our performance.

We do not have research analysts reviewing our performance or our securities on an ongoing basis. Therefore, we do not have an independent review of our performance and value of our common stock relative to publicly traded companies.

Our investors may be at a greater risk of loss than the Advisor and members of our management team.

We have taken certain actions to increase the stock ownership in our Company by our management team, the Advisor and our directors over the past couple of years, including the implementation of certain stock-based awards. The current level of ownership by management may be less than the management teams of other public real estate companies and, as a result, our investors may be at a greater risk of loss than the Advisor and other members of our management, especially as compared to these other companies in which stock ownership by management and directors may be significantly greater. 12

Table of Contents The availability and timing of cash distributions to stockholders is uncertain.

Our board of directors intends to authorize a monthly distribution of a certain dollar amount per share of our common stock using monthly record dates. However, the payment of class-specific fees results in different amounts of distributions being paid with respect to each class of shares. In addition, the expenses incurred in our operations reduce the amount of cash available for distribution to our stockholders. Distributions may also be negatively impacted by the failure to deploy our net proceeds on an expeditious basis, the inability to find suitable investments that are not dilutive to our distributions, the poor performance of our investments (including vacancy or decline in rental rates), an increase in expenses for any reason (including expending funds for redemptions) and due to numerous other factors. Any request by the holders of OP Units to redeem some or all of their OP Units for cash may also impact the amount of cash available for distribution to our stockholders. In addition, our board of directors, in its discretion, may retain any portion of such funds for working capital. We cannot assure the stockholders that sufficient cash will be available to make distributions to our stockholders or that the amount of distributions will not either decrease or fail to increase over time. From time to time, we may adjust our distribution level and we may make such an adjustment at any time.

We have paid and may continue to pay distributions from sources other than our cash flow from operations, including, without limitation, the sale of assets, borrowings or offering proceeds, and we have no limits on the amounts we may pay from such sources.

Our total distributions declared for the years ended December 31, 2024, 2023, and 2022 were $122.0 million, $103.7 million, and $87.4 million, respectively, which includes $31.9 million, $32.7 million, and $29.9 million, respectively, of distributions reinvested in our shares pursuant to our distribution reinvestment plan. Our cash flow from operations the years ended December 31, 2024, 2023, and 2022 was $(169.5) million, $16.0 million, and $62.5 million, respectively. Accordingly, total distributions were not fully funded by cash flows from operations. In such cases, the shortfalls were funded from proceeds from our distribution reinvestment plan, borrowings or sale of DST Interests. In addition, for years in which total distributions were fully funded from our operations, in some cases our distributions were not fully funded from our operations for individual quarters. In such cases, the shortfalls were funded from proceeds from our distribution reinvestment plan, borrowings or sale of DST Interests. In the future, we may continue to fund our monthly regular distributions from sources other than cash flow from operations. Our long-term strategy is to strive to fund the payment of regular distributions to our stockholders entirely from our operations, but there may be quarters or even years when that is not the case. It will be up to the board of directors to determine the distribution level taking many factors into consideration beyond just cash flow from operations. If we are unsuccessful in investing the capital we raise from our securities offerings or decide to invest our capital in lower yielding assets, we may be required to fund our distributions to our stockholders from a combination of our operating, investing and financing activities, which include net proceeds of our securities offerings, dispositions and borrowings (including borrowings secured by our assets), or to reduce the level of our distributions. Using certain of these sources may result in a liability to us, which would require a future repayment. The use of these sources for distributions and the ultimate repayment of any liabilities incurred could adversely impact our ability to pay distributions in future periods, decrease the amount of cash we have available for new investments, repayment of debt, share redemptions and other corporate purposes, and potentially reduce stockholders’ overall return and adversely impact and dilute the value of their investment in shares of our common stock. We may pay distributions from sources other than cash flow from operations, including, without limitation, the sale of assets, borrowings or offering proceeds. Our ability to pay distributions solely from cash flows from operations has been impacted by certain factors, including the current yield environment. All distributions result in a decrease to our NAV while cash flow generated from our operations results in an increase to NAV. While we strive to fund our distributions solely from our cash flow from operations, in the long run, we also focus on total stockholder return as a metric for evaluating our distribution level in the event that it is not being fully covered by cash flow from operations. Any cash flow from operations in excess of our distributions results in a net increase to NAV (ignoring other factors). Conversely, if and when our distributions exceed our cash flow from operations, the net effect would be and has been a decrease to NAV (ignoring other factors). We have not established a limit on the amount of our distributions that may be paid from any of these sources. 13

Table of Contents If we raise substantial offering proceeds in a short period of time, we may not be able to invest all of the net offering proceeds promptly, which may cause our distributions and the long-term returns to our investors to be lower than they otherwise would.

We could suffer from delays in locating suitable investments. The more money we raise in our securities offerings, the more difficult it will be to invest the net offering proceeds promptly. Therefore, the large size of our securities offerings increases the risk of delays in investing our net offering proceeds. Our reliance on the Advisor to locate suitable investments for us at times when the management of the Advisor is simultaneously seeking to locate suitable investments for other entities sponsored or advised by affiliates of the Sponsor could also delay the investment of the proceeds of our securities offerings. Delays we encounter in the selection, acquisition and development of income-producing properties would likely negatively affect our NAV, limit our ability to pay distributions to the stockholders and reduce their overall returns.

The performance component of the advisory fee is calculated on the basis of the overall investment return provided to holders of Fund Interests over a calendar year, so it may not be consistent with the return on stockholders’ shares.

The performance component of the advisory fee is calculated on the basis of the overall investment return provided to holders of Fund Interests (as defined below) (i.e., our outstanding shares and OP Units held by third parties) in any calendar year such that the Special OP Unitholder, which is a wholly-owned subsidiary of our Advisor will receive the lesser of (1) 12.5% of (a) the annual total return amount less (b) any loss carryforward, and (2) the amount equal to (x) the annual total return amount, less (y) any loss carryforward, less (z) the amount needed to achieve an annual total return amount equal to 5% of the NAV per Fund Interest at the beginning of such year (the “Hurdle Amount”). The foregoing calculations are calculated on a per Fund Interest basis and multiplied by the weighted-average Fund Interests outstanding during the year. The “annual total return amount” referred to above means all distributions paid or accrued per Fund Interest plus any change in NAV per Fund Interest since the end of the prior calendar year, adjusted to exclude the negative impact on annual total return resulting from our payment or obligation to pay, or distribute, as applicable, the performance component of the advisory fee as well as ongoing distribution fees (i.e., our ongoing class-specific fees). The “loss carryforward” referred to above will track any negative annual total return amounts from prior years and offset the positive annual total return amount for purposes of the calculation of the performance component of the advisory fee. Therefore, payment of the performance component of the advisory fee (1) is contingent upon the annual total return to the holders of Fund Interests exceeding the 5% return, (2) will vary in amount based on our actual performance and (3) cannot, in and of itself, cause the overall return to the holders of Fund Interests for the year to be reduced below 5%. In addition, if the Special OP Unitholder receives a performance component of the advisory fee, it will not be obligated to return any portion of such advisory fees based on our subsequent performance. We completed the 2024 calendar year with a cumulative loss carryforward that will apply to future performance participation allocations. The cumulative loss carryforward as of December 31, 2024 is approximately $0.45 per Fund Interest, which takes into account a $0.41 per Fund Interest loss carryforward generated in the 2023 calendar year. Realization of the loss carryforward is contingent on future performance. Even after such offset, future performance participation allocations will be subject to the Hurdle Amount.

Additionally, the Advisor will provide us with a waiver of a portion of its fees generally equal to the amount of the performance component that would have been payable with respect to the Class E shares and the Series 1 Class E OP Units held by third parties until the NAV of such shares or units exceeds $10.00 per share or unit, the benefit of which will be shared among all holders of Fund Interests.

As a result, the performance component is not directly tied to the performance of the shares that stockholders purchase, the class of shares purchased, or the time period during which the stockholders own their shares. The performance component may be payable to the Special OP Unitholder even if the NAV of the stockholders’ shares at the end of the calendar year is below their purchase price, and the thresholds at which increases in NAV count towards the overall return to the holders of Fund Interests are not based on the stockholders’ purchase price. Because of the class-specific allocations of the ongoing distribution fee, which differ among classes, we do not expect the overall return of each class of Fund Interests to ever be the same. However, if and when the performance component of the advisory fee is payable, the expense will be allocated among all holders of Fund Interests ratably according to the NAV of their units or shares, regardless of the different returns achieved by different classes of Fund Interests during the year. Further, stockholders who redeem their shares during a given year may redeem their shares at a lower NAV per share as a result of an accrual for the estimated performance component of the advisory fee, even if no performance component is ultimately payable to the Special OP Unitholder at the end of such calendar year. 14

Table of Contents Payment of fees and expenses to the Advisor and the Dealer Manager reduces the cash available for distribution and increases the risk that the stockholders will not be able to recover the amount of their investment in our shares.

The Advisor and the Dealer Manager perform services for us, including, among other things, the selection and acquisition of our investments, the management of our assets, the disposition of our assets, the financing of our assets and certain administrative services. We pay the Advisor and the Dealer Manager fees and expense reimbursements for these services, which will reduce the amount of cash available for further investments or distribution to our stockholders.

We are required to pay substantial compensation to the Advisor and its affiliates, which may be increased or decreased during our securities offerings or future offerings by a majority of our board of directors, including a majority of the independent directors.

Pursuant to our agreements with the Advisor and its affiliates, we are obligated to pay substantial compensation to the Advisor and its affiliates. Subject to limitations in our charter, the fees, compensation, income, expense reimbursements, interests and other payments that we are required to pay to the Advisor and its affiliates may increase or decrease during our securities offerings or future offerings if such change is approved by a majority of our board of directors, including a majority of the independent directors. These types of payments to the Advisor and its affiliates will decrease the amount of cash we have available for operations and new investments and could negatively impact our NAV, our ability to pay distributions and the stockholders overall return.

We are dependent upon the Advisor and its affiliates to conduct our operations and our securities offerings; thus, adverse changes in their financial health or our relationship with them could cause our operations to suffer.

We are dependent upon the Advisor and its affiliates to conduct our operations and our securities offerings. Thus, adverse changes to our relationship with, or the financial health of, the Advisor and its affiliates, including changes arising from litigation, could hinder their ability to successfully manage our operations and our portfolio of investments.

If we were to internalize our management or if another investment program, whether sponsored or advised by affiliates of the Sponsor or otherwise, conducts its own internalization transaction, we could incur significant costs and/or our business could be harmed.

At some point in the future, we may consider internalizing the functions performed for us by the Advisor, although we do not currently intend to do so. Any internalization transaction could result in significant payments to the owners of the Advisor, including in the form of our stock which could reduce the percentage ownership of our then existing stockholders and concentrate ownership in the owner of the Advisor. In addition, we rely on persons employed by the Advisor or its affiliates to manage our day-to-day operating and acquisition activities. If we were to effectuate an internalization of the Advisor, we may not be able to retain all of the employees of the Advisor or its affiliates or to maintain relationships with other entities sponsored or advised by affiliates of the Sponsor. In addition, some of the employees of the Advisor or its affiliates may provide services to one or more other investment programs. These programs or third parties may decide to retain some or all of the key employees in the future. If this occurs, these programs could hire certain of the persons currently employed by the Advisor or its affiliates who are most familiar with our business and operations, thereby potentially adversely impacting our business.

We have broad authority to incur debt, and high debt levels could hinder our ability to make distributions and could decrease the value of the stockholders’ investment in shares of our common stock.

Under our charter, we have a limitation on borrowing which precludes us from borrowing in excess of 300% of the value of our net assets, provided that we may exceed this limit if a higher level of borrowing is approved by a majority of our independent directors. High debt levels would cause us to incur higher interest charges, would result in higher debt service payments, could be accompanied by restrictive covenants and would generally make us more subject to the risks associated with leverage. These factors could limit the amount of cash we have available to distribute and could result in a decline in our NAV and in the value of the stockholders’ investment in shares of our common stock. 15

Table of Contents We are dependent on our customers for revenue, and our inability to lease our properties or to collect rent from our customers would adversely affect our results of operations, NAV and returns to our stockholders.

Our revenues from our property investments are dependent on our ability to lease our properties and the creditworthiness of our customers and would be adversely affected by the loss of or default by one or more significant lessees. Furthermore, certain of our assets may utilize leases with payments directly related to customer sales, where some or all of the amount of rent that we charge a customer is calculated as a percentage of such customer’s revenues over a fixed period of time, and a reduction in sales can reduce the amount of the lease payments required to be made to us by customers leasing space in such assets. Much of our customer base is comprised of non-rated and non-investment grade customers. The success of our properties depends on the financial stability of such customers. The financial results of our customers can depend on several factors, including but not limited to the general business environment, interest rates, inflation, the availability of credit, taxation and overall consumer confidence.

In addition, our ability to increase our revenues and operating income partially depends on steady growth of demand for the products and services offered by the customers located in the assets that we own and manage. A drop in demand, as a result of a slowdown in the U.S. and global economy or otherwise, could result in a reduction in performance of our customers and consequently, adversely affect our results of operations, NAV and returns to our stockholders.

If indicators of impairment exist in any of our properties, for example, we experience negative operating trends such as prolonged vacancies or operating losses, we may not recover some or all of our investment.

Lease payment defaults by customers could impact operating results, causing us to lower our NAV, reduce the amount of distributions to our stockholders, or could force us to find an alternative source of funding to pay any mortgage loan interest or principal, taxes, or other obligations relating to the property. In the event of a customer default, we may also experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment and re-leasing our property. If a lease is terminated, the value of the property may be immediately and negatively affected and we may be unable to lease the property for the rent previously received or at all or sell the property without incurring a loss.

Some of our properties may be leased to a single or significant customer and, accordingly, may be suited to the particular or unique needs of such customer. We may have difficulty replacing such a customer if the floor plan of the vacant space limits the types of businesses that can use the space without major renovation. In addition, the resale value of the property could be diminished because the market value of a particular property will depend principally upon the value of the leases of such property.

As of December 31, 2024, our top five customers represented 9.0% of our total annualized base rent of our portfolio, our top ten customers represented 12.6% of our total annualized base rent of our portfolio and there were no customers that individually represented more than 5.0% of our total annualized base rent of our portfolio. Our results of operations are currently substantially dependent on our top customers, and any downturn in their business could have a material adverse effect on operations. In addition, certain of our properties are occupied by a single customer, and as a result, the success of those properties depends on the financial stability of that customer. Adverse impacts to such customers, businesses or operators, including as a result of changes in market or economic conditions, natural disasters, outbreaks of an infectious disease, pandemic or any other serious public health concern, political events or other factors that may impact the operation of these properties, may have negative effects on our business and financial results. As a result, some of our customers have been, and may in the future be, required to suspend operations at our properties for what could be an extended period of time. Further, if such customers default under their leases, we may not be able to promptly enter into a new lease or operating arrangement for such properties, rental rates or other terms under any new leases or operating arrangement may be less favorable than the terms of the current lease or operating arrangement or we may be required to make capital improvements to such properties for a new customer, any of which could adversely impact our operating results. 16

Table of Contents We are active portfolio managers and will incur transaction and transition costs each time that we acquire or dispose of an asset.

We believe that the real estate market is cyclical, with different demand for property types at different times. Although we do not invest for the short term, we are active portfolio managers and we will seek to take advantage of opportunities to acquire or dispose of assets presented to us by the real estate markets. Each time that we acquire or dispose of an asset, we incur associated transaction costs which may include, but are not limited to, broker fees, attorney fees, regulatory filings and taxes. In addition, each time that we sell an income-generating asset, our operating results will be negatively impacted unless and until we are able to reinvest the proceeds in an investment with an equal or greater yield, which we may be unable to do. Accordingly, in order for us to provide positive returns to our stockholders from active portfolio management, the benefits of active management must outweigh the associated transaction and transition costs. We may be unable to achieve this. These factors could adversely affect our results of operations, financial condition, NAV and ability to pay distributions to our stockholders.

In order to maintain what we deem to be sufficient liquidity for our redemption program it may cause us to keep more of our assets in securities, cash, cash equivalents and other short-term investments than we would otherwise like which would affect returns.

In order to provide liquidity for share redemptions, we intend to, subject to any limitations and requirements relating to our intention to qualify as a REIT, maintain a number of sources of liquidity including (i) cash equivalents (e.g. money market funds), other short-term investments, U.S. government securities, agency securities and liquid real estate-related securities and (ii) one or more borrowing facilities. We may fund redemptions from any available source of funds, including operating cash flows, borrowings, proceeds from our securities offerings and/or sales of our assets. This could adversely affect our results of operations, financial condition, NAV and ability to pay distributions to our stockholders.

Our board of directors also adopted a delegation of authority policy and, pursuant to such policy, has delegated the authority for certain actions to the AREIT Advisors Committee, which is not a committee of our board of directors, but rather is the Advisor’s investment and management committee for our company and consists of certain of our officers and officers of the Advisor. Our board of directors has delegated to the AREIT Advisors Committee certain responsibilities with respect to certain acquisition, disposition, leasing, capital expenditure and borrowing decisions, which may result in our making riskier investments and which could adversely affect our results of operations, financial condition, NAV and cash flows.

Our board of directors has delegated to the AREIT Advisors Committee the authority to execute certain transactions and make certain decisions on our behalf. The AREIT Advisors Committee has the authority to approve certain transactions, including acquisitions, dispositions and leases, as well as to make decisions with respect to capital expenditures and borrowings, in each case so long as such investments and decisions meet certain board-approved parameters (that include limitations regarding the dollar amount of the transactions, among others) and are consistent with the requirements of our charter. There can be no assurance that the AREIT Advisors Committee will be successful in applying any strategy or discretionary approach to our investment activities pursuant to this delegation of authority. Our board of directors will review the investment decisions made pursuant to this delegation of authority periodically. The prior approval of our board of directors or a committee of our independent directors will be required as set forth in our charter (including for transactions with affiliates of the Advisor) or for transactions or decisions that are outside of the board-approved parameters placed on this delegation of authority. Transactions entered into and decisions made by the AREIT Advisors Committee on our behalf may be costly, difficult or impossible to unwind if our board of directors later reviews them and determines that they should not have been entered into or made. 17

Table of Contents RISKS RELATED TO CONFLICTS OF INTEREST

The Advisor faces a conflict of interest because the fees it receives for services performed are based on our NAV, the procedures for which the Advisor will assist our board of directors in developing, overseeing, implementing and coordinating.

The Advisor assists our board of directors in developing, overseeing, implementing and coordinating our NAV procedures. It assists our Independent Valuation Advisor in valuing our real property portfolio by providing the firm with property-level information, including (i) historical and projected operating revenues and expenses of the property; (ii) lease agreements on the property; and (iii) revenues and expenses of the property. Our Independent Valuation Advisor assumes and relies upon the accuracy and completeness of all such information, and does not undertake any duty or responsibility to verify independently any of such information and relies upon us and the Advisor to advise if any material information previously provided becomes inaccurate or was required to be updated during the period of its review. In addition, the Advisor may be the approved pricing source for certain assets and liabilities, and its discretion with respect to the valuations of such assets and liabilities could affect our NAV. Because the Advisor is paid fees for its services based on our NAV, the Advisor could be motivated to influence our NAV and NAV procedures such that they result in an NAV exceeding realizable value, due to the impact of higher valuations on the compensation to be received by the Advisor. If our NAV is calculated in a way that is not reflective of our actual NAV, then the purchase price of shares of our common stock on a given date may not accurately reflect the value of our portfolio, and the stockholders’ shares may be worth less than the purchase price.

The Advisor’s fee may not create proper incentives or may induce the Advisor and its affiliates to make certain investments, including speculative investments, that increase the risk of our real property portfolio.

The advisory fee we pay the Advisor and its affiliates is made up of a fixed component and a performance component. We will pay the Advisor the fixed component regardless of the performance of our portfolio. The Advisor’s entitlement to the fixed component, which is not based upon performance metrics or goals, might reduce the Advisor’s incentive to devote its time and effort to seeking investments that provide attractive risk-adjusted returns for our portfolio. We will be required to pay the Advisor the fixed component in a particular period despite experiencing a net loss or a decline in the value of our portfolio during that period. The performance component, which is based on our total distributions plus the change in NAV per share, may create an incentive for the Advisor to make riskier or more speculative investments on our behalf than it would otherwise make in the absence of such performance-based compensation.

The Advisor’s management personnel face conflicts of interest relating to time management and there can be no assurance that the Advisor’s management personnel will devote adequate time to our business activities or that the Advisor will be able to hire adequate additional employees.

All of the Advisor’s management personnel, other employees, affiliates and related parties may also provide services to other entities sponsored or advised by affiliates of the Sponsor. We are not able to estimate the amount of time that such management personnel will devote to our business. As a result, certain of the Advisor’s management personnel may have conflicts of interest in allocating their time between our business and their other activities which may include advising and managing various other real estate programs and ventures, which may be numerous and may change as programs are closed or new programs are formed. During times of significant activity in other programs and ventures, the time they devote to our business may decline and be less than we would require. There can be no assurance that the Advisor’s affiliates will devote adequate time to our business activities or that the Advisor will be able to hire adequate additional employees to perform the tasks currently being performed by the Advisor’s affiliates should the amount of time devoted to our business activities by such affiliates prove to be insufficient. Should the Advisor fail to allocate sufficient resources to perform its responsibilities to us for any reason we may be unable to achieve our investment objectives or pay distributions to our stockholders. 18

Table of Contents The Advisor and its affiliates, including our officers and three of our directors, face conflicts of interest caused by compensation arrangements with us and other entities sponsored or advised by affiliates of the Sponsor, which could result in actions that are not in our stockholders’ best interests.

Some of our executive officers, three of our directors and other key personnel are also officers, directors, managers, and/or key personnel in the Advisor, the Dealer Manager and/or other entities related to the Sponsor. The Advisor and its affiliates receive substantial fees from us in return for their services and these fees could influence their advice to us. Among other matters, the compensation arrangements could affect their judgment with respect to:

●	the continuation, renewal or enforcement of our agreements with the Advisor and its affiliates, including the Advisory Agreement, the agreement with the Dealer Manager and any property management agreements;
●	recommendations to our board of directors with respect to developing, overseeing, implementing and coordinating our NAV procedures, or the decision to adjust the value of certain of our assets or liabilities if the Advisor is responsible for valuing them;
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●	securities offerings of equity by us, which may result in increased fees for the Advisor and other related parties;
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●	competition for customers from entities sponsored or advised by affiliates of the Sponsor that own properties in the same geographic area as us; and
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●	investments through joint ventures or other co-ownership arrangements, which may result in increased fees for the Advisor.
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We will be responsible for certain fees and expenses, including due diligence costs, as determined by the Advisor, including legal, accounting and financial advisor fees and related costs, incurred in connection with evaluating and consummating investment opportunities, regardless of whether such transactions are ultimately consummated by the parties thereto.

In addition, we reimburse the Advisor and its affiliates for the salaries and other compensation of its personnel in accordance with the Advisory Agreement based on the percentage of such personnel’s time spent on our affairs. Pursuant to the terms of the Advisory Agreement, we reimburse the Advisor and its affiliates for personnel (and related employment) costs and overhead (including, but not limited to, allocated rent paid, equipment, utilities, insurance, travel and entertainment, and other costs) incurred by the Advisor or its affiliates in performing the services under the Advisory Agreement, including, but not limited to, total compensation, benefits and other overhead of all employees involved in the performance of such services; provided, that we will not reimburse the Advisor or its affiliates for services for which the Advisor or its affiliates are entitled to compensation in the form of a separate fee, or for compensation of the Company’s named executive officers, unless the named executive officer provides services related to stockholder services.

Certain of our service providers may also provide services to or have business, personal, political, financial or other relationships with the Sponsor or other Sponsor affiliated entities and related parties. These relationships have the potential to include us and the Advisor in deciding whether to select or recommend such a service provider to perform services for us, whether to cause us to invest in investment opportunities sourced by such a service provider or whether to select such a service provider as a co-investor or counterparty in a transaction. Considerations relating to compensation to the Advisor and its affiliates from us and other entities sponsored or advised by affiliates of the Sponsor could result in decisions that are not in our stockholders’ best interests, which could hurt our ability to pay our stockholders distributions or result in a decline in the value of our stockholders’ investment. Conflicts of interest such as those described above have contributed to stockholder litigation against certain other externally managed REITs that are not affiliated with our Advisor or the Sponsor. 19

Table of Contents When considering whether to recommend investments through a joint venture or other co-ownership arrangement, the fee arrangements between the Advisor and the proposed joint venture partner may incentivize the Advisor to recommend investing a greater proportion of our resources in joint venture investments than may be in our stockholders’ best interests.

When we invest in assets through joint ventures or other co-ownership arrangements, the Advisor may, directly or indirectly (including, without limitation, through us or our subsidiaries), receive fees from our joint venture partners and co-owners of our properties for the services the Advisor provides to them with respect to their proportionate interests. Fees received from joint venture entities or partners and paid, directly or indirectly (including without limitation, through us or our subsidiaries), to the Advisor may be more or less than similar fees that we pay to the Advisor pursuant to the Advisory Agreement. Because the Advisor may receive fees from our joint venture partners and co-owners in connection with our joint venture or other co-ownership arrangements, the Advisor may be incentivized to recommend a higher level of investment through joint ventures than may otherwise be in the best interests of our stockholders.

The time and resources that entities sponsored or advised by affiliates of the Sponsor devote to us may be diverted and we may face additional competition due to the fact that these entities are not prohibited from raising money for another entity that makes the same types of investments that we target.

Entities sponsored or advised by affiliates of the Sponsor are not prohibited from raising money for another investment entity that makes the same types of investments as those we target. As a result, the time and resources they could devote to us may be diverted. For example, the Dealer Manager is currently involved in other offerings for other entities sponsored or advised by affiliates of the Sponsor. In addition, we may compete with any such investment entity for the same investors and investment opportunities. We may also co-invest with any such investment entity. Even though all such co-investments will be subject to approval by our independent directors, they could be on terms not as favorable to us as those we could achieve co-investing with an unrelated third party.

We may enter into joint ventures, co-investment or other arrangements with affiliates of the Sponsor or entities sponsored or advised by affiliates of the Sponsor to acquire, develop and/or manage property, debt and other investments; such investments may raise potential conflicts of interest between us and such other investment vehicles managed by the Advisor or its affiliates.

While our joint venture partners and co-owners have generally been third parties, we have and may in the future enter into joint ventures, co-investment or other arrangements with affiliates of the Sponsor or entities sponsored or advised by affiliates of the Sponsor to acquire, develop and/or manage property, debt and other investments. Such investments may raise potential conflicts of interest between us and such other investment vehicles managed by the Advisor or its affiliates, including determining which of such entities should enter into any particular joint venture, co-investment or other arrangement agreement. Joint venture, co-investment or other arrangement partners affiliated with the Advisor or sponsored or advised by affiliates of the Sponsor may have economic or business interests or goals which are or may become inconsistent with our business interests or goals. In addition, should any such joint venture, co-investment or other arrangement be consummated, the Advisor and its affiliates may face a conflict in structuring the terms of the relationship between the interests and the interests of other parties, in managing the joint venture, co-investment or other arrangement, and in resolving any conflicts or exercising any rights in connection with the joint venture, co-investment or other arrangement. Since the Advisor will make various decisions on our behalf, agreements and transactions between us and the Advisor’s affiliates or entities sponsored or advised by affiliates of the Sponsor will not have the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties. Furthermore, when such other investment vehicles managed by the Advisor or its affiliates have interests or requirements that do not align with our interests, including differing liquidity needs or desired investment horizons, conflicts may arise in the manner in which any voting or control rights are exercised with respect to the relevant investment, potentially resulting in an adverse impact on us. Ares has adopted a co-investment policy designed to ensure the fair allocation of co-investment opportunities, including compliance with applicable regulatory requirements as well as contractual obligations under the applicable governing documents of other entities sponsored or advised by affiliates of Ares. In exercising their discretion to allocate co-investment opportunities with respect to a particular investment to and among potential co-investors and the terms thereof, Ares, the Advisor and their respective affiliates, in a manner consistent with the co-investment policy, are permitted to consider some or all of a wide range of factors, including, but not limited to, strategic advantages that may result from a potential co-investor’s participation in a co-investment opportunity, whether a potential co-investor has the requisite resources to evaluate and make the investment, and the tax and legal characteristics of a potential investment or a potential co-investor. 20

Table of Contents In addition to the limitations described above, we may enter into joint ventures with affiliates of the Sponsor or entities sponsored or advised by affiliates of the Sponsor for the acquisition of investments, only if (i) a majority of the directors not otherwise interested in the transaction, including a majority of the independent directors, approve the transaction as being fair and reasonable to us and (ii) the investment by us and such affiliate are on terms and conditions that are no less favorable than those that would be available to unaffiliated parties.

With respect to any joint venture, we may enter into an advisory or sub-advisory agreement with an affiliate of the Advisor. We may also enter into arrangements with the Advisor in which the Advisor receives fees (directly or indirectly, including through a subsidiary of ours) from the joint venture entity or from the joint venture partner. Fees received from joint venture entities or partners and paid, directly or indirectly (including without limitation, through us or the subsidiaries), to the Advisor may be more or less than similar fees that we pay to the Advisor pursuant to the Advisory Agreement. In addition, the Advisor may, with respect to any investment in which we are a participant, also render advice and service to others in that investment, and earn fees for rendering such advice and service. Specifically, it is contemplated that we may enter into joint venture or other similar co-investment arrangements with certain individuals, corporations, partnerships, trusts, joint ventures, limited liability companies or other entities, with respect to which the Advisor or one of its affiliates may be engaged to provide advice and service to such individuals, corporations, partnerships, trusts, joint ventures, limited liability companies or other entities. The Advisor or its affiliate will earn fees for rendering such advice and service pursuant to the agreements governing such joint ventures or arrangements.

We may also enter into product specialist arrangements with third parties or affiliates or the Advisor with respect to certain asset types. Such services may include, without limitation, property identification, acquisition, management, development, oversight, construction management and disposition services. Such product specialists may provide similar services with respect to similar asset types to affiliates of the Sponsor or other entities sponsored or advised by affiliates of the Sponsor. The fees and expense reimbursements we may pay to such product specialists will be in addition to fees and expenses reimbursements we pay to our Advisor and will not reduce the advisory fees we pay to the Advisor. Any such arrangements with respect to product specialists affiliated with the Advisor will be approved by our board of directors, including a majority of our independent directors, and will be at market rates or reimbursement of costs incurred by the affiliate in providing the services.

The fees we pay to entities sponsored or advised by affiliates of the Sponsor in connection with our offerings of securities and in connection with the management of our investments were not determined on an arm’s-length basis, and therefore, we do not have the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties.

The Advisor, the Dealer Manager and other of the Advisor’s affiliates have earned and will continue to earn fees, commissions and expense reimbursements from us. The fees, commissions and expense reimbursements paid and to be paid to the Advisor, the Dealer Manager and other of the Advisor’s affiliates for services they provided us in connection with past offerings and in connection with our current securities offering were not determined on an arm’s-length basis. As a result, the fees have been determined without the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties.

We compete with entities sponsored or advised by affiliates of the Sponsor, for whom affiliates of the Sponsor provide certain advisory or management services, for opportunities to acquire, lease, finance, or sell investments, and for customers, which may have an adverse impact on our operations.

We compete with entities sponsored or advised by affiliates of the Sponsor and may compete with any such entity created in the future, as well as entities for whom affiliates of the Sponsor provide certain advisory or management services, for opportunities to acquire, lease, finance or sell certain types of properties. We may also buy, lease, finance or sell properties at the same time as these entities are buying, leasing, financing or selling properties. In this regard, there is a risk that we will purchase or lend on a property that provides lower returns to us than a property purchased or lent on by entities sponsored or advised by affiliates of the Sponsor and entities for whom affiliates of the Sponsor provide certain advisory or management services.

Certain entities sponsored or advised by affiliates of the Sponsor own and/or manage properties in geographical areas in which we expect to own properties. Therefore, our properties may compete for customers with other properties owned and/or managed by these entities. The Advisor may face conflicts of interest when evaluating customer leasing opportunities for our properties and other properties owned and/or managed by these entities and these conflicts of interest may have a negative impact on our ability to attract and retain customers. The Sponsor and the Advisor have implemented lease allocation guidelines to assist with the process of the allocation of leases when we and certain other entities to which affiliates of the Advisor are providing certain advisory services have potentially competing properties with respect to a particular customer. These guidelines are designed to allow, where possible, each fund with a potentially competing property to bid on a lease with a prospective customer in a fair and equitable manner. 21

Table of Contents Because affiliates of the Sponsor and the Advisor currently sponsor and advise, and in the future may sponsor and advise, other investment vehicles and clients (each, an “Advisory Client”) with overlapping investment objectives, strategies and criteria, potential conflicts of interest may arise with respect to real estate investment opportunities. In order to manage this potential conflict of interest, in allocating opportunities among the Advisory Clients, the Sponsor follows an allocation policy (the “Allocation Policy”) which endeavors to allocate investment opportunities in a fair and equitable manner. The Sponsor’s Allocation Policy, which may be amended without our consent, is intended to enable us to share equitably with any other Advisory Clients that are managed by the Sponsor and the Advisor and competing with us to acquire similar types of assets.

Under the Allocation Policy, real estate investments will be considered for Advisory Clients based on appropriateness and conformity with their respective investment objectives, as well as the suitability of the investment for each Advisory Client. Suitability is determined by a variety of factors related to the investment mandates of each Advisory Client, the nature of the investment opportunity and the composition of each client’s portfolio. In the circumstance where an investment is suitable for only one Advisory Client based on such factors, the investment will be allocated to that Advisory Client. Where an investment is suitable for more than one Advisory Client, the Sponsor generally employs an allocation rotation process pursuant to the Allocation Policy that is designed to facilitate an equitable allocation of such opportunities over time. Nevertheless, it is possible that we may not be given the opportunity to participate in certain investments made by Advisory Clients managed by affiliates of the Sponsor and the Advisor. In addition, the Sponsor may from time to time limit the number of positions in a rotation and/or grant to certain Advisory Clients certain exclusivity, rotation or other priority (each, a “Rotational Priority”) with respect to industrial investments or other investment opportunities. This means that, depending on the number of Advisory Clients and number of positions in each such rotation and/or the Rotational Priorities that have been granted, we may be offered fewer investment opportunities. The Sponsor or its affiliates may grant additional Rotational Priorities in the future and from time to time.

The ability of the Advisor to effect or recommend transactions is in certain cases restricted by applicable laws or regulatory requirements in or of the United States (including without limitation under the Investment Company Act) or elsewhere that are applicable to the Advisor, the Sponsor, and other investment vehicles sponsored or advised by the Advisor, the Sponsor or affiliates of the Advisor or the Sponsor. In addition, the Advisor, the Sponsor or their affiliates have adopted or are expected to adopt policies designed to comply with such laws or requirements and may vary or supplement such policies in the future. Accordingly, we may be subject to restrictions applicable to any potential co-investments alongside, or investments in portfolio companies or prospective portfolio companies of other vehicles sponsored or advised by the Advisor, the Sponsor or affiliates of the Advisor and the Sponsor, including regulated funds.

The Sponsor may modify its overall allocation policies from time to time. Any changes to the Sponsor’s allocation policies will be timely reported to our board of directors or our Conflicts Resolution Committee. The Advisor will be required to provide information to our board of directors on a quarterly basis to enable our board of directors, including the independent directors, to determine whether such policies are being fairly applied.

In addition, entities sponsored or advised by affiliates of the Advisor or the Sponsor are permitted to hold positions in securities or other assets or be subject to contractual or legal restraints that could prevent us from being able to initiate a transaction that we otherwise might have initiated or to sell an investment that we otherwise might have sold or, in our judgment, such position(s) or restraint(s) may make such a transaction inadvisable. The investment activities of one or more entities sponsored or advised by affiliates of the Advisor or the Sponsor have the potential to be inconsistent with our investment activities.

The Advisor may manage other investment vehicles (including public, non-listed REITs) that have investment objectives that compete or overlap with, and may from time to time invest in, our target asset classes.

Affiliates of the Advisor may manage other investment vehicles (including public, non-listed REITs) that have investment objectives that compete or overlap with, and may from time to time invest in, our target asset classes. This may apply to existing investment vehicles or investment vehicles that may be organized, or with respect to which affiliates of the Advisor may acquire and assume the role of management in the future. Consequently, we, on the one hand, and these other investment vehicles, on the other hand, may from time to time pursue the same or similar investment opportunities. To the extent such existing vehicles or other future investment vehicles managed by the Advisor or its affiliates seek to acquire the same target assets as our Company, the scope of opportunities otherwise available to us may be adversely affected and/or reduced. The Advisor or its affiliates may also give advice to investment vehicles managed by the Advisor or its affiliates that may differ from the advice given to us even though their investment objectives may be the same or similar to ours.^^ 22

Table of Contents We may invest in, acquire, sell assets to or provide financing to investment vehicles managed by the Advisor or its affiliates.

We may invest in, acquire, sell assets to or provide financing to investment vehicles managed by the Advisor or its affiliates and their portfolio companies or purchase assets from, sell assets to, or arrange financing from any such investment vehicles and their portfolio companies. Any such transactions will require approval by a majority of our independent directors. There can be no assurance that any procedural protections will be sufficient to ensure that these transactions will be made on terms that will be at least as favorable to us as those that would have been obtained in an arm’s-length transaction.

The Advisor is subject to extensive regulation as an investment adviser, which could adversely affect its ability to manage our business.

The Advisor is subject to regulation as an investment adviser by various regulatory authorities that are charged with protecting the interests of its clients, including us. Instances of criminal activity and fraud by participants in the investment management industry and disclosures of trading and other abuses by participants in the financial services industry have led the United States government and regulators to increase the rules and regulations governing, and oversight of, the United States financial system. This activity resulted in changes to the laws and regulations governing the investment management industry and more aggressive enforcement of the existing laws and regulations. The Advisor could be subject to civil liability, criminal liability, or sanction, including revocation of its registration as an investment adviser, revocation of the licenses of its employees, censures, fines, or temporary suspension or permanent bar from conducting business, if it is found to have violated any of these laws or regulations. Any such liability or sanction could adversely affect the Advisor’s ability to manage our business. The Advisor must continually address conflicts between its interests and those of its clients, including us. In addition, the Commission and other regulators have increased their scrutiny of potential conflicts of interest. The Advisor has procedures and controls that are reasonably designed to address these issues. However, appropriately dealing with conflicts of interest is complex and difficult and if the Advisor fails, or appears to fail, to deal appropriately with conflicts of interest, it could face litigation or regulatory proceedings or penalties, any of which could adversely affect its ability to manage our business.^^

We have purchased and may in the future purchase assets from third parties who have existing or previous business relationships with affiliates or other related entities of the Sponsor; as a result, in any such transaction, we may not have the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties.

We have purchased and may in the future purchase assets from third parties that have existing or previous business relationships with affiliates of the Sponsor. Affiliates of the Sponsor who also perform or have performed services for such third parties may have had or have a conflict in representing our interests in these transactions on the one hand and in preserving or furthering their respective relationships with such third parties on the other hand. In any such transaction, we will not have the benefit of arm’s-length negotiations of the type normally conducted between unrelated parties. 23

Table of Contents RISKS RELATED TO ADVERSE CHANGES IN GENERAL ECONOMIC CONDITIONS

Uncertainty and volatility in the credit markets could affect our ability to obtain debt financing on reasonable terms, or at all, which could reduce the number of properties we may be able to acquire and the amount of cash distributions we can make to our stockholders.

The U.S. and global credit markets have in the past experienced severe dislocations and liquidity disruptions, which caused volatility in the credit spreads on prospective debt financings and constrained the availability of debt financing due to the reluctance of lenders to offer financing at high leverage ratios. Similar conditions in the future could adversely impact our ability to access additional debt financing on reasonable terms or at all, which may adversely affect investment returns on future acquisitions or our ability to make acquisitions.

If mortgage debt or unsecured debt is unavailable on reasonable terms as a result of increased interest rates, increased credit spreads, decreased liquidity or other factors, we may not be able to finance the initial purchase of properties. In addition, when we incur mortgage debt or unsecured debt, we run the risk of being unable to refinance such debt upon maturity, or of being unable to refinance on favorable terms.

If interest rates are higher or other financing terms, such as principal amortization, the need for a corporate guaranty, or other terms are not as favorable when we refinance debt or issue new debt, our income could be reduced. To the extent we are unable to refinance debt on reasonable terms, at appropriate times or at all, we may be required to sell properties on terms that are not advantageous to us, or that could result in the foreclosure of such properties. If any of these events occur, our cash flow could be reduced. This, in turn, could reduce cash available for distribution to our stockholders and may hinder our ability to raise more capital by issuing securities or borrowing more money.

Economic events that may cause our stockholders to request that we redeem their shares may materially adversely affect our cash flow and our ability to achieve our investment objectives.

Future economic events affecting the U.S. economy generally, or the real estate sector specifically, could cause our stockholders to seek to sell their shares to us pursuant to our share redemption program or holders of OP units to seek to redeem their OP Units. The redemptions of our shares are subject to the 2% and 5% limits (as described above) (subject to potential carry-over capacity). Even if we are able to satisfy all resulting redemption requests, our cash flow could be materially adversely affected. In addition, if we determine to sell valuable assets to satisfy redemption requests, our ability to achieve our investment objectives, including, without limitation, diversification of our portfolio by property type and location, moderate financial leverage, conservative operating risk and an attractive level of current income, could be materially adversely affected.

Inflation, changing interest rates or deflation may adversely affect our financial condition and results of operations.

We are affected by the fiscal and monetary policies of the United States government and its agencies, including the policies of the Federal Reserve, which regulates the supply of money and credit in the United States. Changes in fiscal and monetary policies are beyond our control and are difficult to predict. Although the Federal Reserve decreased the federal funds rate multiple times in 2024, the rate continues to be elevated and there can be no assurance that the rates will continue to decrease or that it will not be increased in 2025 or beyond. While lower market rates and increased capital markets liquidity supports commercial real estate property transactions and values, regulated lending institutions are adjusting their business models to increase capital requirements for direct loans to real estate and thus continue to be constrained in providing capital for commercial real estate properties. Additionally, rising operating costs, such as property insurance and raw material costs for property development and improvements, have further pressured cash flow performance across many real estate property types. Changes in the federal funds rate as well as the other policies of the Federal Reserve affect interest rates, which have a significant impact on our financial condition.

Future periods of increased inflation and high interest rates could have an adverse impact on our floating rate mortgages, our ability to borrow money, and general and administrative expenses, as these costs could increase at a rate higher than our rental and other revenue. Increases in the costs of owning and operating our properties due to inflation could reduce our net operating income and our NAV to the extent such increases are not reimbursed or paid by our customers. If we are materially impacted by increasing inflation because, for example, inflationary increases in costs are not sufficiently offset by the contractual rent increases and operating expense reimbursement provisions or escalations in the leases with our customers, we may implement measures to conserve cash or preserve liquidity. Such measures could include deferring investments, reducing or suspending the number of shares redeemed under our share 24

Table of Contents redemption program and reducing or suspending distributions we make to our stockholders, which may adversely and materially affect our net operating income and NAV. In addition, due to rising interest rates, we may experience restrictions in our liquidity based on certain financial covenant requirements as well as our inability to refinance maturing debt in part or in full as it comes due depending on rates at such time and higher debt service costs and reduced yields relative to cost of debt. If we are unable to find alternative credit arrangements or other funding in a high interest environment, our business needs may not be adequately met.

In addition, customers and potential customers of our properties may be adversely impacted by inflation and high interest rates, which could negatively impact our customers’ ability to pay rent and demand for our properties. Such adverse impacts on our customers may cause increased vacancies, which may add pressure to lower rents and increase our expenditures for re-leasing. Inflation could also have an adverse effect on consumer spending which could impact our customers’ operations and, in turn, demand for our properties. Conversely, deflation could lead to downward pressure on rents and other sources of income.

Our business is dependent on bank relationships and strain from the banking system may severely impact us. Similarly, the failure of any banking institution in which we deposit our funds could have an adverse effect on our results of operations, financial condition and ability to pay distributions to our stockholders.

The financial markets have encountered and may in the future encounter volatility associated with concerns about the balance sheets of banks. Our business is dependent on bank relationships and we proactively monitor the financial health of such bank relationships. Strain on the banking system may adversely impact our operations and the economy more broadly, and in turn our cash flow, distributions and NAV.

Currently, the Federal Deposit Insurance Corporation (“FDIC”) generally, only insures amounts up to $250,000 per depositor per insured bank. A small proportion of our cash and cash equivalents, primarily those used to fund property-level working capital needs, are currently held in FDIC-insured bank accounts. To the extent that we have deposited funds with banking institutions, then if any of such institutions ultimately fail, we would lose the amount of our deposits over the then current FDIC insurance limit. The loss of our deposits could reduce the amount of cash we have available to distribute or invest and would likely result in a decline in the value of the stockholders’ investments.

We intend to disclose funds from operations (“FFO”) and adjusted funds from operations (“AFFO”), each a non-GAAP financial measure, in future communications with investors, including documents filed with the SEC. However, FFO and AFFO are not equivalent to our net income or loss as determined under GAAP, and do not represent a complete measure of our financial position and results of operations.

We use, and we disclose to investors, FFO and AFFO, which are considered non-GAAP financial measures. For a discussion of FFO and AFFO, including definitions, reconciliation to GAAP net income (loss), and the inherent limitations of FFO and AFFO, see Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in this Annual Report on Form 10-K. FFO and AFFO are not equivalent to our net income or loss as determined in accordance with GAAP. FFO and GAAP net income differ because FFO excludes gains or losses from sales of property and impairment of depreciable real estate, and adds back real estate-related depreciation and amortization. AFFO further adjusts FFO by removing the impact of (i) performance-based incentive fee (income) expense, (ii) unrealized (gain) loss from changes in fair value of financial instruments, and (iii) increase (decrease) in financing obligation liability appreciation.

No single measure can provide investors with sufficient information and investors should consider all of our disclosures as a whole in order to adequately understand our financial position, liquidity and results of operations. Because of the differences between FFO, AFFO and GAAP net income or loss, FFO and AFFO may not be accurate indicators of our operating performance, especially during periods in which we are acquiring properties. In addition, FFO and AFFO are not necessarily indicative of cash flow available to fund cash needs and investors should not consider FFO and AFFO as alternatives to cash flows from operations or as indications of our liquidity, or indicative of funds available to fund our cash needs, including our ability to make distributions to our stockholders. Neither the SEC nor any other regulatory body has passed judgment on the acceptability of the adjustments that we use to calculate FFO and AFFO. Also, because not all companies calculate FFO and AFFO the same way, comparisons with other companies may not be meaningful. 25

Table of Contents RISKS RELATED TO OUR GENERAL BUSINESS OPERATIONS AND OUR CORPORATE STRUCTURE

A global economic slowdown, or further declines in real estate values could impair our investments and have a significant adverse effect on our business, financial condition and results of operations.

Geopolitical instability, including actual and potential shifts in U.S. foreign, trade, economic and other policies (including as a result of the 2024 U.S. presidential and congressional elections), the war between Russia and Ukraine, the conflicts in the Middle East, as well as other global events have created macroeconomic uncertainty at a global level. The current macroeconomic environment is characterized by inflation, labor shortages or interruptions, changing interest rates, foreign currency exchange volatility and volatility in global capital markets. Market and economic disruptions have affected, and may in the future affect, consumer confidence levels and spending, bankruptcy rates, levels of incurrence and default on consumer debt and home prices, among other factors. We cannot assure you that market disruptions, including the increased cost of funding for certain governments and financial institutions, will not impact the global economy. The risks associated with our business are more severe during periods of economic slowdown or recession and since such periods are accompanied by declining real estate values, our business could be materially adversely affected.

There is significant uncertainty about the future relationship between the U.S. and other countries with respect to trade policies, treaties and tariffs. Developments relating to tariffs between the U.S. and other countries, or the perception that they could occur, may have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global trade and, in particular, trade between the impacted nations and the U.S. Any of these factors could depress economic activity and impact our borrowers and the value of our collateral. Moreover, concerns over the United States’ debt ceiling and budget-deficit have driven downgrades by rating agencies to the U.S. government’s credit rating, which could cause borrowing costs to rise further, negatively impacting both the perception of credit risk associated with our debt portfolio and our ability to access the debt markets on favorable terms. Although U.S. lawmakers passed legislation to raise the federal debt ceiling on multiple occasions, rating agencies have lowered or threatened to lower the long-term sovereign credit rating on the United States. Market conditions may also make it difficult for us to extend the maturity of or refinance our existing indebtedness or to access or obtain new indebtedness with similar terms and any failure to do so could have a material adverse effect on our business.

We believe the risks associated with our business are more severe during periods of economic downturn if these periods are accompanied by declining values in real estate. For example, a prolonged economic downturn could negatively impact our property investments as a result of increased customer delinquencies and/or defaults under our leases, generally lower demand for rentable space, potential oversupply of rentable space leading to increased concessions, and/or tenant improvement expenditures, or reduced rental rates to maintain occupancies. Our operations could be negatively affected to a greater extent if an economic downturn occurs, is prolonged or becomes more severe, which could significantly harm our revenues, results of operations, financial condition, liquidity, business prospects and our ability to make distributions to our stockholders. If the current macroeconomic environment worsens and an economic slowdown or a recession occurs or real estate values continue to decline, our results of operations, financial condition, liquidity and business and our ability to pay dividends to stockholders could be materially and adversely affected.

A major public health crisis, pandemic or epidemic, like the COVID-19 pandemic, could disrupt the U.S. and global economy and industries in which we operate and negatively impact us.

A major public health crisis, pandemic or epidemic could impact the U.S. and global economy. Disruptions to commercial activity (such as the imposition of quarantines or travel restrictions) or, more generally, a failure to contain or effectively manage a public health crisis may adversely impact our financial condition, results of operations and ability to pay distributions to our stockholders. Public health crises, pandemics and epidemics could contribute to adverse impacts on global commercial activity and the inability of tenants to pay rent on their leases, or inability to re-lease space that becomes vacant. Such volatility may also adversely affect our liquidity position, which could disrupt our business and adversely materially impact our financial results.

The impact and effects of any future health crises, pandemics or epidemics will depend on various factors, including how rapidly variants develop, availability, acceptance and effectiveness of vaccines along with related travel advisories, quarantines and restrictions, the recovery time of potentially disrupted supply chains and industries, the impact of labor market interruptions, and the impact of government interventions. Health crises, pandemics or epidemics, and resulting impacts on the financial, economic and capital markets environment, and future developments in these and other areas present uncertainty and risk with respect to our performance, results of operations and ability to pay distributions. 26

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We are highly dependent on the information systems of Ares Management Corporation (“Ares”) and systems failures could significantly disrupt our business, which may, in turn, negatively affect our operating results and our ability to pay distributions.

Our business is highly dependent on communications and information systems of Ares. Any failure or interruption of Ares’ systems could cause delays or other problems in our business, which could have a material adverse effect on our operating results and negatively affect our ability to pay distributions to our stockholders.

Ares’ information systems and technology may not continue to be able to accommodate the growth of our business, and the cost of maintaining the information systems and technology, which is partially allocated to us pursuant to the Advisory Agreement, may increase from its current level. Such a failure to accommodate growth, or an increase in costs related to the information systems and technology, could have a material adverse effect on our business and results of operations.

Furthermore, a disaster or a disruption in the infrastructure that supports our business, including a disruption involving electronic communications, human resources systems or other services used by us, our Advisor, Ares or third parties with whom we conduct business, could have a material adverse effect on our ability to continue to operate our business without interruption. Although Ares has disaster recovery programs in place, these may not be sufficient to mitigate the harm that may result from such a disaster or disruption. In addition, insurance and other safeguards might only partially reimburse us for any losses as a result of such a disaster or disruption, if at all.

We, our Advisor and Ares also rely on third-party service providers for certain aspects of our respective businesses, including for certain information systems, technology and administration of our loan portfolio and compliance matters. Any interruption or deterioration in the performance of these third parties or failures or vulnerabilities of their information systems or technology could impair the quality of our operations and could impact our reputation and adversely affect our business.

Finally, there continues to be significant evolution and developments in the use of artificial intelligence technologies, including generative artificial intelligence. While our Advisor has not integrated the use of artificial intelligence in our business currently, we could integrate it in the future and at this time cannot fully determine the impact of such evolving technology to our industry or business.

Terrorist attacks and other acts of violence, civilian unrest, military conflict or war may affect the markets in which we operate, our operations and our profitability.

Terrorist attacks and other acts of violence, civilian unrest, military conflict or war may negatively affect our operations and our stockholders’ investment. We may acquire real estate assets located in areas that are susceptible to attack. In addition, any kind of terrorist activity or violent criminal acts, including terrorist acts against public institutions or buildings or modes of public transportation (including airlines, trains or buses) could have a negative effect on our business. These events may directly impact the value of our assets through damage, destruction, loss or increased security costs. Although we may obtain terrorism insurance, we may not be able to obtain sufficient coverage to fund any losses we may incur. Risks associated with potential acts of terrorism could sharply increase the premiums we pay for coverage against property and casualty claims. Further, certain losses resulting from these types of events are uninsurable or not insurable at reasonable costs.

More generally, any terrorist attack, other act of violence or war, including military conflicts, such as the ongoing conflicts between Russia and Ukraine and Israel and Hamas, could result in increased volatility in, or damage to, the worldwide financial markets and economy. Increased economic volatility and trade restrictions could adversely affect our customers’ ability to pay rent on their leases or our ability to borrow money or issue capital stock at acceptable prices and have a material adverse effect on our financial condition, results of operations and ability to pay distributions to our stockholders. 27

Table of Contents We depend on the Advisor and its key personnel; if any of such key personnel were to cease employment with the Advisor, our business could suffer.

Our ability to make distributions and achieve our investment objectives is dependent upon the performance of the Advisor in the acquisition, disposition and management of real properties and debt-related investments, the selection of customers for our real properties, the determination of any financing arrangements and other factors. In addition, our success depends to a significant degree upon the continued contributions of certain of the Advisor’s key personnel, including William S. Benjamin, Michael J. Blum, David M. Fazekas, Jay W. Glaubach, Marshall P. Hayes, Andrew E. Holm, Andrea L. Karp, Taylor M. Paul, Scott W. Recknor, David A. Roth, Julie B. Solomon, Jeffrey W. Taylor, and Joshua J. Widoff, each of whom would be difficult to replace. We currently do not have, nor do we expect to obtain key man life insurance on any of the Advisor’s key personnel. If the Advisor were to lose the benefit of the experience, efforts and abilities of one or more of these individuals, our operating results and NAV could suffer. In addition, our operating results could suffer as a result of any misconduct by any of these individuals.

Our board of directors determines our major policies and operations, which increases the uncertainties faced by our stockholders.

Our board of directors determines our major policies, including our policies regarding acquisitions, dispositions, financing, growth, REIT qualification, redemptions and distributions. Our board of directors may amend or revise these and other policies without a vote of the stockholders. Under the Maryland General Corporation Law and our charter, our stockholders have a right to vote only on limited matters. Our board of directors’ broad discretion in setting policies and our stockholders’ inability to exert control over those policies increases the uncertainty and risks our stockholders face, especially if our board of directors and our stockholders disagree as to what course of action is in our stockholders’ best interests.

Our UPREIT structure may result in potential conflicts of interest with limited partners in the Operating Partnership whose interests may not be aligned with those of our stockholders.

Limited partners in the Operating Partnership have the right to vote on certain amendments to the agreement that governs the Operating Partnership, as well as on certain other matters. Persons holding such voting rights may exercise them in a manner that conflicts with our stockholders’ interests. As general partner of the Operating Partnership, we are obligated to act in a manner that is in the best interests of all partners of the Operating Partnership. Circumstances may arise in the future when the interests of limited partners in the Operating Partnership may conflict with the interests of our stockholders. These conflicts may be resolved in a manner the stockholders believe is not in their best interests.

We may assume unknown liabilities in connection with acquisitions which could result in unexpected liabilities and expenses.

In connection with an acquisition, we may receive certain assets or interests in certain assets subject to existing liabilities, some of which may be unknown to us at the time of the acquisition. Unknown liabilities might include liabilities for cleanup or remediation of undisclosed environmental conditions, claims of customers, vendors or other persons dealing with the entities prior to an acquisition (including those that had not been asserted or threatened prior to an acquisition), tax liabilities, and accrued but unpaid liabilities incurred in the ordinary course of business. If we acquire an entity, that entity may be subject to liabilities that become our responsibility upon acquisition of the entity. Our recourse with respect to such liabilities may be limited. Depending upon the amount or nature of such liabilities, our business, financial condition and results of operations, our ability to make distributions to our stockholders and the NAV of our shares may be adversely affected.

Tax protection agreements could limit our ability to sell or otherwise dispose of property contributed to the Operating Partnership.

In connection with contributions of property to the Operating Partnership, the Operating Partnership may enter into a tax protection agreement with the contributor of such property that provides that if we dispose of any interest in the contributed property in a taxable transaction within a certain time period, subject to certain exceptions, we may be required to indemnify the contributor for its tax liabilities attributable to the built-in gain that exists with respect to such property interests, and the tax liabilities incurred as a result of such tax protection payment. Therefore, although it may be in our stockholders’ best interests that we sell the contributed property, it may be economically prohibitive for us to do so because of these obligations or similar considerations. While we may be able to avoid these indemnification requirements by contributing such properties to an acquired subsidiary real estate investment trust (a "Subsidiary REIT") prior to any such sale there can be no assurances that such strategies will be implemented or successful. 28

Table of Contents Tax protection agreements may require the Operating Partnership to maintain certain debt levels that otherwise would not be required to operate our business.

Under a tax protection agreement, the Operating Partnership may provide the contributor of property the opportunity to guarantee debt or enter into a deficit restoration obligation. If we fail to make such opportunities available, we may be required to deliver to such contributor a cash payment intended to approximate the contributor’s tax liability resulting from our failure to make such opportunities available to that contributor and the tax liabilities incurred as a result of such tax protection payment. These obligations may require the Operating Partnership to maintain more or different indebtedness than we would otherwise require for our business.

Certain provisions in the partnership agreement of the Operating Partnership may delay or defer an unsolicited acquisition of us or a change of our control.

Provisions in the partnership agreement of the Operating Partnership may delay or defer an unsolicited acquisition of us or changes of our control. These provisions include, among others, redemption rights of qualifying parties and the rights of the limited partners to consent to transfers of the general partnership interest and mergers under specified circumstances. These provisions could discourage third parties from making proposals involving an unsolicited acquisition of us or a change of our control, although some stockholders might consider such proposals, if made, desirable.

The Operating Partnership’s private placements of beneficial interests in specific Delaware statutory trusts under our DST Program could cause our leverage ratio to increase or subject us to liabilities from litigation or otherwise.

We, through the Operating Partnership, conduct a program to raise capital in private placements exempt from registration pursuant to Rule 506(b) of Regulation D under the Securities Act through the sale of DST Interests in specific DSTs holding DST Properties. These interests may serve as replacement properties for investors seeking to complete like-kind exchange transactions under Section 1031 of the Code. All of the properties the interests in which are sold to investors pursuant to such private placements will be leased-back by the Operating Partnership or a wholly owned subsidiary thereof, as applicable, with such lease fully guaranteed by the Operating Partnership, although there can be no assurance that the Operating Partnership can or will fulfill these guarantee obligations. Additionally, the Operating Partnership will be given a fair market value purchase option giving it the right, but not the obligation, to acquire the DST Interests from the investors at a later time in exchange for OP Units, cash or a combination of OP Units and cash (the "FMV Option"). Specifically, if the Operating Partnership exercises the FMV Option with respect to a DST, then the Operating Partnership may grant investors who own the DST Interests the option to (i) accept OP Units in exchange for their DST Interests (the "OP Unit Election"), (ii) sell their DST Interests to the Operating Partnership for cash (the "Cash Election"), or (iii) dispose of their DST Interests using a combination of the OP Unit Election and the Cash Election, in which case the Operating Partnership will make at least 15% of the total consideration payable with respect to the exercise of the FMV Option available in cash to fund payments to holders of DST Interests making the Cash Election with respect to all or a portion of their DST Interests. In the event the Operating Partnership elects not to exercise the purchase option our leverage ratio could increase based on remaining master lease obligations. This may result in both increased costs to us and a negative impact on our overall debt covenants. In addition, in the event the Operating Partnership elects not to exercise the purchase option and the DST Property is sold to a third party, the master lease will terminate, triggering an obligation on the part of a subsidiary of the Operating Partnership, as master tenant, to pay to the DST an amount equal to the positive difference, if any, between the fair market value of the DST Property with the master lease in place as if such automatic termination had not occurred, and the gross purchase price to be paid by the third party buyer to the DST to acquire the DST Property. However, if the gross purchase price for the DST Property exceeds the fair market value of the DST Property subject to the master lease, no payment to the DST by the master tenant will be required.

Further, investors who acquired DST Interests pursuant to such private placements may have been seeking certain tax benefits that depend on the interpretation of, and compliance with, U.S. federal and state income tax laws and regulations. As the general partner of the Operating Partnership, we may become subject to liability, from litigation or otherwise, as a result of such transactions, including in the event an investor fails to qualify for any desired tax benefits. 29

Table of Contents The Operating Partnership’s private placements of DST Interests under our DST Program will not shield us from risks related to the performance of the real properties held through such structures.

Pursuant to the DST Program, the Operating Partnership intends to place certain of its existing real properties and/or acquire new properties to place into specific DSTs and then sell DST Interests, via its taxable REIT subsidiary (“TRS”), to third-party investors. We will hold long-term leasehold interests in the property pursuant to master leases that are fully guaranteed by the Operating Partnership, while the third-party investors indirectly hold some or all of the interests in the real estate. There can be no assurance that the Operating Partnership can or will fulfill these guarantee obligations. Although we will hold a fair market value purchase option to reacquire the real estate through a purchase of DST Interests, the purchase price will be based on the then-current fair market value of the third-party investor’s interest in the real estate, which will be greatly impacted by the rental terms fixed by the long-term master lease. Under the lease, we are responsible for subleasing the property to occupying customers until the earlier of the expiration of the master lease or our exercise of the fair market value option, which means that we bear the risk that the underlying cash flow from the property and all capital expenditures may be less than the master lease payments at such time. Therefore, even though we will no longer own the underlying real estate while it is held by the DST, because of the fixed terms of the long-term master lease guaranteed by the Operating Partnership, negative performance by the underlying properties could affect cash available for distributions to our stockholders and will likely have an adverse effect on our results of operations and NAV. In addition, if we determine to exercise the fair market value purchase option and the underlying cash flow at the property owned by the DST is or is anticipated to be lower than the master lease rent payments, then the presence of the master lease may cause the property to have a higher fair market value than would otherwise be the case if the property had not been sold subject to the master lease.

We may own DST Interests in DSTs owning real property that will be subject to the agreements under our DST Program, which may have an adverse effect on our results of operations, relative to if the DST Program agreements did not exist.

In connection with our DST Program, we may own DST Interests in DSTs owning real property that are subject to the terms of the agreements provided by our DST Program. The DST Program agreements may limit our ability to encumber, lease or dispose of our DST Interests. Such agreements could affect our ability to turn our DST Interests into cash and could affect cash available for distributions to our stockholders. The DST Program agreements used in connection with the DST Program could also impair our ability to take actions that would otherwise be in the best interests of our stockholders and, therefore, may have an adverse effect on our results of operations and NAV, relative to if the DST Program agreements did not exist.

Properties that are placed into the DST Program and later reacquired may be less liquid than other assets, which could impair our ability to utilize cash proceeds from sales of such properties for other purposes such as paying down debt, distributions, or additional investments.

Properties that are placed into the DST Program (each, a “Original DST Program Asset”) may later be reacquired through exercise of the fair market value purchase option granted to our Operating Partnership. In such cases the investors who become limited partners in the Operating Partnership (the “Original DST Investors”) will generally remain tied to the Original DST Program Asset in terms of basis and built-in-gain. As a result, if the Original DST Program Asset is subsequently sold, unless we effectuate a like-kind exchange under Section 1031 of the Code, then tax will be triggered on the Original DST Investors’ built-in-gain. Although we are not contractually obligated to do so, we have generally sought to execute 1031 exchanges in such situations rather than trigger gain. Any replacement property acquired in connection with a 1031 exchange will similarly be tied to the Original DST Investors with similar considerations if such replacement property ever is sold. There may be way to avoid triggering the Original DST Investors' built-in-gain, such as by contributing such properties to a Subsidiary REIT prior to any such sale. However, there can be no assurances that such strategies will be implemented or successful. In addition, contributing such properties to a Subsidiary REIT may indirectly negatively impact our stockholders because the tax liability would be borne by the Operating Partnership, which would be allocated pro rata to all limited partners of the Operating Partnership, including us and our stockholders, rather than limiting the impact to just the applicable DST Investors. As a result of these factors, placing properties into the DST Program may limit our ability to access liquidity from such properties or replacement properties through sale without triggering taxes due to the built-in-gain tied to Original DST Investors. Such reduced liquidity could impair our ability to utilize cash proceeds from sales for other purposes such as paying down debt, paying distributions, funding redemptions or making additional investments. 30

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Investors who use DST Program Loans to acquire DST Interests as part of the DST Program may default on such loans.

As part of the DST Program, a subsidiary of ours will provide DST Program Loans of no more than 50% of the purchase price to certain Original DST Investors who acquire DST Interests. DST Program Loans will be secured by the DST Interests acquired using the DST Program Loan, and will be non-recourse to the borrowing Original DST Investors subject to commercially customary recourse carveouts. We may suffer losses if the fair market value of the asset underlying the DST Interests acquired by the Original DST Program Investor declines after the Original DST Investor’s borrowing with respect to a DST Program Loan, or if there is otherwise a default on a DST Program Loan.

Cash redemptions to holders of OP Units will reduce cash available for distribution to our stockholders or to honor their redemption requests under our share redemption program.

The holders of OP Units (other than us and including both third parties and affiliates of the Sponsor) generally have the right to cause the Operating Partnership to redeem all or a portion of their OP Units for, at our sole discretion, shares of our common stock, cash, or a combination of both. Our election to redeem OP Units for cash may reduce funds available for distribution to our stockholders or to honor our stockholders’ redemption requests under our share redemption program.

We may be limited or restricted in engaging in Section 1031 Exchanges.

We may dispose of properties in transactions intended to qualify as Section 1031 Exchanges. Such Section 1031 Exchanges are intended to result in the deferral of gain for U.S. federal income tax purposes. The failure of any such transaction to qualify as a Section 1031 Exchange could require us to pay U.S. federal income tax, possibly including the 100% prohibited transaction tax, depending on the facts and circumstances surrounding the particular transaction.

Maryland law and our organizational documents limit our stockholders’ right to bring claims against our officers and directors.

Maryland law provides that a director will not have any liability as a director so long as he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. In addition, our charter provides that, subject to the applicable limitations set forth therein or under Maryland law, no director or officer will be liable to us or our stockholders for monetary damages. Our charter also provides that we will generally indemnify our directors, our officers, the Advisor and its affiliates for losses they may incur by reason of their service in those capacities unless (i) their act or omission was material to the matter giving rise to the proceeding and was committed in bad faith or was the result of active and deliberate dishonesty, (ii) they actually received an improper personal benefit in money, property or services or, (iii) in the case of any criminal proceeding, they had reasonable cause to believe the act or omission was unlawful. Moreover, we have entered into separate indemnification agreements with each of our independent directors and executive officers. As a result, we and our stockholders have more limited rights against these persons than might otherwise exist under common law. In addition, we are obligated to fund the defense costs incurred by these persons in some cases. However, our charter does provide that we may not indemnify our directors, the Advisor and its affiliates for any liability or loss suffered by them unless they have determined that the course of conduct that caused the loss or liability was in our best interests, they were acting on our behalf or performing services for us, the liability or loss was not the result of negligence or misconduct by our non-independent directors, the Advisor and its affiliates or gross negligence or willful misconduct by our independent directors, and the indemnification is recoverable only out of our net assets and not from the stockholders.

Our bylaws designate the Circuit Court for Baltimore City, Maryland as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Circuit Court for Baltimore City, Maryland shall be the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders with respect to our company, our directors, our officers or our employees (we note we currently have no employees). This choice of forum provision does not apply to claims under the Securities Act, the Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction or any action or proceeding against us arising out of, or in connection with, the sale of securities or out of violation of state securities laws. This choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that the stockholder believes is favorable for disputes with us or our directors, officers or employees, which may discourage meritorious claims from being asserted against us and our directors, officers and employees. Alternatively, if a court were to find this 31

Table of Contents provision of our bylaws inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition or results of operations. We adopted this provision because we believe it makes it less likely that we will be forced to incur the expense of defending duplicative actions in multiple forums and less likely that plaintiffs’ attorneys will be able to employ such litigation to coerce us into otherwise unjustified settlements, and we believe the risk of a court declining to enforce this provision is remote, as the General Assembly of Maryland has specifically amended the Maryland General Corporation Law to authorize the adoption of such provisions.

Stockholders’ interest will be diluted if we or the Operating Partnership issue additional securities.

Existing stockholders and new investors purchasing shares of common stock in our securities offerings do not have preemptive rights to any shares issued by us in the future. Under our charter, we have authority to issue a total of 2,700,000,000 shares of capital stock. Of the total number of shares of capital stock authorized (a) 2,500,000,000 shares are designated as common stock, 500,000,000 of which are classified as Class D shares (100,000,000 of which are designated as a series of Class D shares named Class D-R shares and 400,000,000 of which are designated as a series of Class D shares named Class D-PR shares), 100,000,000 of which are classified as Class E shares, 1,300,000,000 of which are classified as Class I shares (600,000,000 of which are designated as a series of Class I shares named Class I-R shares and 700,000,000 of which are designated as a series of Class I shares named Class I-PR shares), 500,000,000 of which are classified as Class S shares (100,000,000 of which are designated as a series of Class S shares named Class S-R shares and 400,000,000 of which are designated as a series of Class S shares named Class S-PR shares) and 100,000,000 of which are classified as Class T shares (all of which are designated as a series of Class T shares), and (b) 200,000,000 shares are designated as preferred stock. Our board of directors may amend our charter to increase the aggregate number of authorized shares of capital stock or the number of authorized shares of capital stock of any class or series without stockholder approval. We intend to operate as a perpetual-life REIT, and investors purchasing shares in our securities offerings will likely experience dilution of their equity investment in us as a result of our ongoing offerings, including the distribution reinvestment plan, our current and future securities offerings. Investors will also experience dilution if we issue equity compensation pursuant to our equity incentive plans, issue shares to the Advisor in lieu of cash payments or reimbursements under the Advisory Agreement, or redeem OP Units for shares of common stock. In addition, we may in the future cause the Operating Partnership to issue a substantial number of additional OP Units in order to raise capital in relation to the DST Program or otherwise, acquire properties, consummate a merger, business combination or another significant transaction or to pay the Advisor in lieu of cash payments. OP Units may generally be converted into shares of our common stock, thereby diluting the percentage ownership interest of other stockholders. Ultimately, any additional issuance by us of equity securities or by the Operating Partnership of OP Units will dilute stockholders’ indirect interest in the Operating Partnership, through which we own all of our interests in our investments.

We may issue preferred stock or new classes of OP Units, which issuance could adversely affect those stockholders who purchased shares of our common stock in our securities offerings.

If we ever created and issued preferred stock or one or more new classes of OP Units with a distribution preference over common stock, payment of any distribution preferences on outstanding preferred stock or OP Units would reduce the amount of funds available for the payment of distributions on our common stock. Further, holders of preferred stock are normally entitled and holders of new classes of OP Units could be entitled to receive a preference payment in the event we liquidate, dissolve or wind up before any payment is made to our common stockholders, likely reducing the amount common stockholders would otherwise receive upon such an occurrence. Holders of preferred stock or new classes of OP Units could be given other preferential rights, such as preferential redemption rights or preferential tax protection agreements, that could reduce the amount of funds available for the payment of distributions on our common stock or otherwise negatively affect our common stockholders. In addition, under certain circumstances, the issuance of preferred stock, a new class of OP Units, or a separate class or series of common stock may render more difficult or tend to discourage:

●	a merger, offer or proxy contest;
●	the assumption of control by a holder of a large block of our securities;
---	---
●	the removal of incumbent management; and/or
---	---
●	liquidity options that otherwise may be available.
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Table of Contents We are not limited to making acquisitions with cash or borrowings.

We are not limited to making acquisitions with cash or borrowings. We may also make investments through either public or private offerings of equity securities from us or the Operating Partnership, and we may do so when attractive acquisition opportunities are available. We are not limited in the number or size of investments we may make with equity issuances, and we may effect a merger, business combination or another significant transaction through equity issuances. Such issuances may be comprised of existing classes of shares of our common stock or OP Units in the Operating Partnership, new classes of shares of our common stock or OP Units in the Operating Partnership with preferential terms compared to those of our existing investors (such as preferred stock, preferred OP Units, or contractual obligations to provide protection from adverse tax consequences), or tenancy-in-common interests. We and the Operating Partnership may, with the approval of a majority of our independent directors, agree to pay additional fees to the Advisor, the Dealer Manager and their affiliates in connection with any such transactions, which may negatively affect the NAV of stockholders’ shares, our ability to pay distributions and the stockholders’ overall return.

The limit on the percentage of shares of our common stock that any person may own may discourage a takeover or business combination that may have benefited our stockholders.

Our charter restricts the direct or indirect ownership by one person or entity to no more than 9.8% of the value of our then outstanding capital stock (which includes common stock and any preferred stock we may issue) and no more than 9.8% of the value or number of shares, whichever is more restrictive, of our then outstanding common stock. This restriction may discourage a change of control of us and may deter individuals or entities from making tender offers for shares of our common stock on terms that might be financially attractive to stockholders or which may cause a change in our management. This ownership restriction may also prohibit business combinations that would have otherwise been approved by our board of directors and our stockholders. In addition to deterring potential transactions that may be favorable to our stockholders, these provisions may also decrease our stockholders’ ability to sell their shares of our common stock.

Although we are not currently afforded the full protection of the Maryland General Corporation Law relating to deterring or defending hostile takeovers, our board of directors could opt into these provisions of Maryland law in the future, which may discourage others from trying to acquire control of us and may prevent our stockholders from receiving a premium price for their stock in connection with a business combination.

Under Maryland law, “business combinations” between a Maryland corporation and certain interested stockholders or affiliates of interested stockholders are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. These business combinations include a merger, consolidation, share exchange, or, in circumstances specified in the statute, an asset transfer or issuance or reclassification of equity securities. Also under Maryland law, control shares of a Maryland corporation acquired in a control share acquisition have no voting rights except to the extent approved by a vote of two-thirds of the votes entitled to be cast on the matter. Shares owned by the acquirer, an officer of the corporation or an employee of the corporation who is also a director of the corporation are excluded from the vote on whether to accord voting rights to the control shares. Should our board of directors opt into these provisions of Maryland law, it may discourage others from trying to acquire control of us and increase the difficulty of consummating any offer. Similarly, provisions of Title 3, Subtitle 8 of the Maryland General Corporation Law could provide similar anti-takeover protection.

Our charter includes a provision regarding tender offers that may discourage a stockholder from launching a tender offer for our shares.

Our charter provides that any person making a tender offer that is not otherwise subject to Regulation 14D of the Exchange Act, including any “mini-tender” offer, must comply with most of the provisions of Regulation 14D of the Exchange Act, including the notice and disclosure requirements. In addition, the offeror must provide us notice of such tender offer at least 10 business days before initiating the tender offer. If the offeror does not comply with the provisions set forth above, we will have the right to redeem that offeror’s shares, if any, and any shares acquired in such tender offer. In addition, the non-complying offeror will be responsible for all of our expenses in connection with that offeror’s noncompliance. This provision of our charter may discourage a stockholder from initiating a tender offer for our shares. 33

Table of Contents We depend on our relationships with lenders, joint venture partners, and property managers to conduct our business. If we fail to honor any of our contractual obligations, there could be a material and adverse impact on our ability to raise capital or manage our portfolio.

If we are viewed as developing underperforming properties, suffer sustained losses on our investments, default on a significant level of loans or experience significant foreclosure of our properties, our reputation could be damaged. Damage to our reputation could make it more difficult to successfully develop or acquire properties in the future and to continue to grow and expand our relationships with our lenders, joint venture partners, customers and third-party management clients, which could adversely affect our business, financial condition, NAV, results of operations and ability to make distributions.

Security incidents or cyber-attacks could adversely affect our business by causing a disruption to our operations or the operations of the Advisor, the Dealer Manager, our transfer agent or any other party that provides us with services essential to our operations, a compromise or corruption of our confidential, personal or other sensitive information and/or damage to our business relationships or reputation or the business relationships or reputations of the Advisor, the Dealer Manager, our transfer agent or any other party that provides us with essential services, which could negatively impact our business, financial condition and operating results.

The efficient operation of our business is dependent on information systems and technology, including computer hardware and software systems, as well as data processing systems and the secure processing, storage and transmission of information, all of which are potentially vulnerable to security incidents and cyber-attacks. These attacks may take the form of an intentional attack or an unintentional event, either of which could involve a third party gaining unauthorized access to our information systems or those of the Advisor, the Dealer Manager, our transfer agent or any other party that provides us with services for purposes of misappropriating assets, stealing confidential information, corrupting data or causing operational disruption. The risk of a security breach or disruption, particularly through cyber-attacks or cyber intrusions, including by computer hackers, nation-states or nation-state affiliated actors and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have increased. We, along with the Advisor and the Dealer Manager, have been and expect to continue to be the target of fraudulent calls, emails and other forms of potentially malicious or otherwise negatively impacting activities and attempts to gain unauthorized access to confidential, personal or other sensitive information, which are becoming more difficult to detect. Cybersecurity risks are also exacerbated by the rapidly increasing volume of highly sensitive data, including our proprietary business information and intellectual property, personal information of our Advisor’s employees, the Dealer Manager, our transfer agent and others, and other sensitive information that our Adviser collects, processes and stores in its data centers and on its networks or those of its third-party service providers. Many jurisdictions have also enacted laws requiring companies to notify individuals of data security breaches involving certain types of personal information, with which we and our Advisor must comply in the event of a security incident or cyber-attack. The rapid evolution and increasing prevalence of artificial intelligence technologies may also increase our and our Advisor’s cybersecurity risks.

The result of any security incident or cyber-attack may include disrupted operations, including our, our Advisor’s, our counterparties’ or third parties’ operations, misstated or unreliable financial data, fraudulent transfers or requests for transfer of money, liability for stolen assets or improperly accessed information (including personal information), fines or penalties, investigations, increased cybersecurity protection and insurance costs, litigation, or damage to our business relationships and reputation, in each case, causing our business and results of operations to suffer. The costs related to cyber-attacks or other security incidents or disruptions may not be fully insured or indemnified by other means. As reliance on technology has increased, so have the risks posed to our information systems, both internal and those provided by Ares and third party service providers. Ares has implemented processes, procedures and internal controls to help mitigate security incidents and cyber-attacks and endeavors to strengthen its computer systems, software, technology assets and networks to prevent and address potential security interests and cyber-attacks (see Item 1C. Cybersecurity of this Annual Report on Form 10-K for additional detail regarding such processes, procedures and internal controls), but these measures do not guarantee that a security incident or cyber-attack will not occur or that our financial results or operations will not be negatively impacted by such an incident. 34

Table of Contents In addition, Ares is dependent on third-party service providers for hosting hardware, software and data processing systems that they do not control. While we rely on the cybersecurity strategy and policies implemented by Ares, which includes the performance of risk assessments on third-party providers, our reliance on them and their potential reliance on third-party providers removes certain cybersecurity functions from outside their immediate control, and cyber-attacks on us, our Advisor, the Dealer Manager, our transfer agent, Ares or on third-party service providers could adversely affect us, our business and our reputation. We cannot guarantee that Ares’ networks and its partners’ networks have not been compromised or that they do not contain exploitable defects or bugs that could result in a breach of or disruption to Ares’ information technology systems or the third-party information technology systems that support services. Ares’ ability to monitor these third parties’ information security practices is limited, and they may not have adequate information security measures in place.

Even the most well-protected information, networks, systems and facilities remain potentially vulnerable because the techniques used in such attempted security breaches evolve and generally are not recognized until launched against a target, and may be enhanced by artificial intelligence technologies, and in some cases are designed to not be detected and, in fact, may not be detected. Moreover, our systems, servers and platforms and those of our third party service providers may be vulnerable to computer viruses or physical or electronic break-ins and similar disruptions that our or their security measures may not detect, which could cause system interruptions, website slowdown or unavailability, delays in communication or loss of data. Accordingly, we and our service providers may be unable to anticipate these techniques or to implement adequate security barriers or other preventative measures, and thus it is impossible for us and our service providers to entirely mitigate this risk. We may need to expend significant resources and make significant capital investment to protect against security breaches or to mitigate the impact of any such breaches. There can be no assurance that we or our third party service providers will be successful in preventing cyber-attacks or successfully mitigate their effects. Cybersecurity risks require continuous and increasing attention and other resources from us to, among other actions, identify and quantify these risks, upgrade and expand our technologies, systems and processes to adequately address such risks. Such attention diverts time and other resources from other activities and there is no assurance that our efforts will be effective.

In addition, cybersecurity has become a top priority for regulators around the world. State and federal laws and regulations related to cybersecurity compliance continue to evolve and change, which may require substantial investments in new technology, software and personnel, which could affect our profitability. Recently, the SEC adopted rules requiring public companies to disclose material cybersecurity incidents in Current Reports on Form 8-K and periodic disclosure of a registrant’s cybersecurity risk management, strategy, and governance in Annual Reports on Form 10-K.

With the SEC particularly focused on cybersecurity, we expect increased scrutiny of our, our Advisor’s, and Ares’ policies and systems designed to manage cybersecurity risks and related disclosures. We also expect to face increased costs to comply with the new SEC rules, including increased costs for cybersecurity training and management. Many jurisdictions in which we operate have laws and regulations relating to data privacy, cybersecurity and protection of personal information, including, the California Consumer Privacy Act and the New York SHIELD Act. The SEC has also indicated that one of its examination priorities for the Office of Compliance Inspections and Examinations is to continue to examine cybersecurity procedures and controls, including testing the implementation of these procedures and controls. If we fail to comply with the relevant laws and regulations, we could suffer financial loss, a disruption of our business, liability to investors, regulatory intervention or reputational damage.

The termination or replacement of the Advisor could trigger a repayment event under our mortgage loans for some of our properties and the credit agreement governing any line of credit or other form of unsecured debt that we obtain, or a default under other agreements.

Lenders for certain of our properties may request provisions in the mortgage loan documentation that would make the termination or replacement of the Advisor an event requiring the immediate repayment of the full outstanding balance of the loan. Similarly, under any line of credit or other form of unsecured debt such as term loans that we currently have, or we may obtain in the future, the termination or replacement of the Advisor could trigger repayment of outstanding amounts under the credit agreement governing that line of credit or other form of unsecured debt. If a debt repayment event occurs, our results of operations, ability to pay distributions, and financial condition may be adversely affected. The termination or replacement of the Advisor also could trigger a default under the permitted transfer provisions of certain agreements, including joint ventures. 35

Table of Contents The success of our securities offerings is dependent, in part, on the ability of the Dealer Manager to retain key employees and to successfully build and maintain a network of licensed broker-dealers.

The success of our securities offerings and our ability to implement our business strategy are dependent upon the ability of the Dealer Manager to retain key employees and to build and maintain a network of licensed securities broker-dealers and other agents. If the Dealer Manager is unable to retain qualified employees or build and maintain a sufficient network of participating broker-dealers to distribute shares in our securities offerings, we may not be able to raise adequate proceeds through our securities offerings to implement our investment strategy. In addition, the Dealer Manager currently serves and may serve as dealer manager for other issuers. As a result, the Dealer Manager may experience conflicts of interest in allocating its time between our securities offerings and such other issuers, which could adversely affect our ability to raise adequate proceeds through our securities offerings and implement our investment strategy. Further, the participating broker-dealers retained by the Dealer Manager may have numerous competing investment products, some with similar or identical investment strategies and areas of focus as us, which they may elect to emphasize to their retail clients.

Increasing scrutiny from stakeholders and regulators with respect to ESG matters may impose additional costs and expose us to additional risks.

Our business faces increasing public scrutiny related to environmental, social and governance (“ESG”) activities. A variety of organizations measure the performance of companies on ESG topics, and the results of these assessments are widely publicized. If our ESG ratings or performance do not meet the standards set by such investors or our stockholders, they may choose to exclude our securities from their investments. In addition, investment in funds that specialize in companies that perform well in such assessments remain popular, and major institutional investors have publicly discussed their consideration of such ESG ratings and measures in making their investment decisions.

We risk damage to our brand and reputation if we fail to act responsibly in a number of areas, including, but not limited to human rights, climate change and environmental stewardship, support for local communities, corporate governance and transparency, or consideration of ESG factors in our investment processes. Adverse incidents with respect to ESG activities could impact the value of our brand, the cost of our operations and relationships with investors, all of which could adversely affect our business and results of operations.

“Anti-ESG” sentiment has gained momentum across the U.S., with a growing number of states, federal agencies, the executive branch and Congress having enacted, proposed or indicated an intent to pursue “anti-ESG” policies, legislation or issued related legal opinions and engaged in related investigations and litigation. If investors subject to “anti-ESG” legislation view our Advisor's responsible investing or ESG practices as being in contradiction of such “anti-ESG” policies, legislation or legal opinions, such investors may not invest in us. In addition, corporate diversity, equity and inclusion (“DEI”) practices have recently come under increasing scrutiny. For example, some advocacy groups and federal and state officials have asserted that the U.S. Supreme Court’s decision striking down race-based affirmative action in higher education in June 2023 should be analogized to private employment matters and private contract matters and several media campaigns and cases alleging discrimination based on such arguments have been initiated since the decision. Additionally, in January 2025, President Trump signed a number of Executive Orders focused on DEI, which indicate continued scrutiny of DEI initiatives and potential related investigations of certain private entities with respect to DEI initiatives. If we do not successfully manage expectations across varied stakeholder interests, it could erode stakeholder trust, impact our reputation and constrain our investment opportunities. Such scrutiny of both ESG and DEI related practices could expose our Advisor to the risk of litigation, investigations or challenges by federal or state authorities or result in reputational harm.

There is also regulatory interest across jurisdictions in improving transparency regarding the definition, measurement and disclosure of ESG factors in order to allow investors to validate and better understand sustainability claims. For example, the SEC sometimes reviews compliance with ESG commitments in examinations and has taken enforcement actions against registered investment advisers for not establishing adequate or consistently implementing ESG policies and procedures to meet ESG commitments to investors.

In March 2024, the SEC adopted rules aimed at enhancing and standardizing climate-related disclosures; however, these rules are stayed pending the outcome of consolidated legal challenges in the Eighth Circuit Court of Appeals. Compliance with any new laws or regulations increases our regulatory burden and could result in increased legal, accounting and compliance costs, make some activities more difficult, time-consuming and costly, affect the manner in which we conduct our business and adversely affect our profitability. 36

Table of Contents RISKS RELATED TO INVESTMENTS IN REAL PROPERTY

Real properties are illiquid investments, and we may be unable to adjust our portfolio in response to changes in economic or other conditions or sell a property if or when we decide to do so.

Real properties are illiquid investments and we may be unable to adjust our portfolio in response to changes in economic or other conditions. In addition, the real estate market is affected by many factors, such as general economic conditions, availability of financing, interest rates and other factors, including supply and demand, that are beyond our control. We cannot predict whether we will be able to sell any real property for the price or on the terms set by us, or whether any price or other terms offered by a prospective purchaser would be acceptable to us. We cannot predict the length of time needed to find a willing purchaser and to close the sale of a real property. We may acquire real properties that are subject to contractual “lock-out” provisions that could restrict our ability to dispose of the real property for a period of time. In addition, U.S. federal tax laws that impose a 100% excise tax on gains from sales of dealer property by a REIT (generally, property held for sale, rather than investment) could limit our ability to sell properties and may affect our ability to sell properties without adversely affecting returns to our stockholders. These restrictions could adversely affect our results of operations and financial condition.

We may also be required to expend funds to correct defects or to make improvements before a property can be sold. We cannot assure stockholders that we will have funds available to correct such defects or to make such improvements.

In acquiring a real property, we may agree to restrictions that prohibit the sale of that real property for a period of time or impose other restrictions, such as a limitation on the amount of debt that can be placed or repaid on that real property. Our real properties may also be subject to resale restrictions. All of these provisions would restrict our ability to sell a property.

We are dependent on customers for revenue, and our inability to lease our real properties or to collect rent from our customers may adversely affect our results of operations, NAV and returns to our stockholders.

Our revenues from our real property investments are dependent on our ability to lease our real properties and the creditworthiness of our customers and would be adversely affected by the loss of or default by one or more significant lessees. Furthermore, certain of our assets may utilize leases with payments directly related to tenant sales, where some or all of the amount of rent that we charge a tenant is calculated as a percentage of such tenant’s revenues over a fixed period of time, and a reduction in sales can reduce the amount of the lease payments required to be made to us by customers leasing space in such assets. The success of those real properties depends on the financial stability of the respective customers. The financial results of our customers can depend on several factors, including but not limited to the general business environment, interest rates, inflation, the availability of credit, taxation and overall consumer confidence.

In addition, our ability to increase our revenues and operating income partially depends on steady growth of demand for the products and services offered by the customers located in the assets that we own and manage. A drop in demand, as a result of a slowdown in the U.S. and global economy or otherwise, could result in a reduction in tenant performance and consequently, adversely affect our results of operations, NAV and returns to our stockholders. Inflation could also have an adverse effect on consumer spending which could impact our customers’ sales and, in turn, our percentage rents, where applicable. Conversely, deflation could lead to downward pressure on rents and other sources of income.

If indicators of impairment exist in any of our real properties, for example, we experience negative operating trends such as prolonged vacancies or operating losses, we may not recover some or all of our investment. Refer to “Note 3 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for historical information regarding our impairments. 37

Table of Contents Lease payment defaults by customers could cause us to reduce the amount of distributions to our stockholders and could force us to find an alternative source of funds to make mortgage payments on any mortgage loans or payments due under our unsecured credit facilities. In the event of a tenant default, we may also experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment and re-leasing our real property. If a lease is terminated, we may be unable to lease the real property for the rent previously received or sell the real property without incurring a loss.

Some of our properties may be leased to a single or significant customer and, accordingly, may be suited to the particular or unique needs of such customer. We may have difficulty replacing such a customer if the floor plan of the vacant space limits the types of businesses that can use the space without major renovation. In addition, the resale value of the property could be diminished because the market value of a particular property will depend principally upon the value of the leases of such property.

Similarly, certain of our other commercial properties are leased out to single customers or customers that are otherwise reliant on a single enterprise to remain in business. Adverse impacts to such customers, businesses or operators, including as a result of changes in market or economic conditions, natural disasters, outbreaks of an infectious disease, pandemic or any other serious public health concern, political events or other factors that may impact the operation of these properties, may have negative effects on the business and financial results. As a result, some of the customer or operators have been, and may in the future be, required to suspend operations at our properties for what could be an extended period of time. Further, if such customers default under their leases or such operators are unable to operate the assets, we may not be able to promptly enter into a new lease or operating arrangement for such properties, rental rates or other terms under any new leases or operating arrangement may be less favorable than the terms of the current lease or operating arrangement or we may be required to make capital improvements to such properties for a new customer or operator, any of which could adversely impact the operating results.

If the market for commercial real estate experiences increased vacancy rates, particularly in certain large metropolitan areas, it could result in lower revenues for us.

In the relatively recent past, there have been global economic downturns that negatively impacted the commercial real estate market in the U.S., and resulted in, among other things, increased tenant defaults under leases, generally lower demand for rentable space, and an oversupply of rentable space, all of which could lead to increased concessions, tenant improvement expenditures or reduced rental rates to maintain occupancies. We believe that the risks associated with our business could be more severe if the economy deteriorates again or if commercial real estate values decline. Our revenues will decline and our NAV and ability to pay distributions will be negatively impacted if our commercial properties experience higher vacancy rates or decline in value.

A real property that incurs a vacancy could be difficult to sell or re-lease.

A real property may incur a vacancy either by the continued default of a customer under its lease or the expiration of the lease. In addition, certain of the real properties we acquire may have some vacancies at the time of closing. Certain other real properties may be specifically suited to the particular needs of a customer and such real property may become vacant. Certain of our leases with retail customers contain provisions giving the particular tenant the exclusive right to sell particular types of merchandise or provide specific types of services within the particular retail center. These provisions may limit the number and types of prospective customers interested in leasing space in a particular retail property. Therefore, we may have difficulty obtaining a new tenant for any vacant space we have in our real properties. In certain cases, we may need to offer free rent or other concessions to attract customers. If the vacancy continues for a long period of time, we would suffer reduced revenues, which could materially and adversely affect our liquidity and NAV, and result in lower distributions to our stockholders. In addition, the resale value of the real property could be diminished because the market value may depend principally upon the value of the leases of such real property. 38

Table of Contents Adverse economic and other conditions in the regions where our assets are located may have a significant adverse impact on our financial results.

A deterioration of general economic or other relevant conditions, general demand for certain types of properties, changes in governmental laws and regulations, acts of nature, demographics or other factors in any of the states or the geographic region in which our assets are located could result in the loss of a tenant, a decrease in the demand for our properties and a decrease in our revenues from those markets, which in turn may have a disproportionate and material adverse effect on our results of operations and financial condition. In addition, some of our investments are located in areas that are more susceptible to natural disasters, and therefore, our customers and properties are particularly susceptible to revenue loss, cost increase or damage caused by earthquakes or other severe weather conditions or natural disasters. Any significant loss due to a natural disaster may not be covered by insurance and may lead to an increase in the cost of insurance and expenses for our customers, or could limit the future availability of such insurance, which could limit our customers’ ability to satisfy their obligations to us.

In addition, our results of operations depend substantially on our ability to lease the spaces available in the assets that we own as well as the price at which we lease such space. Adverse conditions in the regions and specific markets where we operate may reduce our ability to lease our properties, reduce occupancy levels, restrict our ability to increase lease prices and force us to lower lease prices and/or offer tenant incentives. Should our assets fail to generate sufficient revenues for us to meet our obligations, our financial condition and results of operations, as well as our NAV and ability to make distributions or repay debt, could be adversely affected.

We may be adversely affected by trends in the office real estate industry.

Some businesses are rapidly evolving to make employee telecommuting, flexible work schedules, open workplaces and teleconferencing increasingly common. These practices enable businesses to reduce their space requirements. A continuation of the movement towards these practices could over time erode the overall demand for office space and, in turn, place downward pressure on occupancy, rental rates and property valuations, each of which could have an adverse effect on our financial position, results of operations, cash flows and ability to make expected distributions to our stockholders. We may also be negatively impacted by competition from other short-term office or shared space leasing companies.

Properties that have significant vacancies, especially value-add or other types of discounted real estate assets, may experience delays in leasing up or could be difficult to sell, which could diminish our return on these properties and the return on the stockholders’ investments.

Our investments in value-add properties or other types of discounted properties may have significant vacancies at the time of acquisition and/or thereafter. If vacancies continue for a prolonged period of time beyond the expected lease-up stage that we anticipate will follow any redevelopment or repositioning efforts, we may suffer reduced revenues, resulting in less cash available for distributions to our stockholders. In certain cases, we may need to offer free rent or other concessions to attract customers. In addition, the resale value of the property could be diminished because the market value of a particular property depends principally upon the value of the cash flow generated by the leases associated with that property. Such a reduction on the resale value of a property could also reduce our NAV and the overall return on the stockholders’ investment.

Changes in supply of or demand for similar real properties in a particular area may increase the price of real properties we seek to purchase or adversely affect the value of the real properties that we own.

The real estate industry is subject to market forces and we are unable to predict certain market changes including changes in supply of or demand for similar real properties in a particular area. For example, if demand for the types of real properties in which we seek to invest were to sharply increase or supply of those assets were to sharply decrease, the prices to acquire those assets could rise significantly. Any potential purchase of an overpriced asset could decrease our rate of return on these investments and result in lower operating results and overall returns to our stockholders. Likewise, a sharp decrease in demand or increase in supply could adversely affect leasing rates and occupancy, which could lower operating results, our NAV and overall returns to our stockholders. 39

Table of Contents Actions of our joint venture partners could adversely impact our performance.

We have entered into and may continue to enter into joint ventures with third parties, including entities that are affiliated with the Advisor or entities sponsored or advised by affiliates of the Sponsor. We may be a general partner, but also could be a limited partner. Such venture may give substantial discretionary authority to a third party general partner or to an affiliate of the Advisor or Sponsor as general partner. We have purchased and developed and may also continue to purchase and develop properties in joint ventures or in partnerships, co-tenancies or other co-ownership arrangements with the sellers of the properties, affiliates of the sellers, developers or other persons. Such investments may involve risks not otherwise present with a direct investment in real estate, including, for example:

●	the possibility that our venture partner, co-tenant or partner in an investment might become bankrupt or otherwise be unable to meet its capital contribution obligations;
●	that such venture partner, co-tenant or partner may at any time have economic or business interests or goals which are or which become inconsistent with our business interests or goals;
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●	that such venture partner, co-tenant or partner may be in a position to take action contrary to our instructions or requests or contrary to our policies or objectives;
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●	that actions by such venture partner, co-tenant or partner could adversely affect our reputation, negatively impacting our ability to conduct business; or
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●	that such venture partner, co-tenant or partner has legal or other effective control over the asset, partnership or venture.
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Actions by a joint venture partner or co-tenant might have the result of subjecting the property to liabilities in excess of those contemplated and may have the effect of reducing our stockholders’ returns.

Under certain joint venture arrangements, neither venture partner may have the power to control the venture, and an impasse could be reached, which might have a negative influence on the joint venture and decrease potential returns to our stockholders. In the event that a venture partner has a right of first refusal to buy out the other partner, it may be unable to finance such a buy-out at that time. It may also be difficult for us to sell our interest in any such joint venture or partnership or as a co-tenant in a particular property. In addition, to the extent that our venture partner or co-tenant is an affiliate of the Advisor or an entity sponsored or advised by affiliates of the Sponsor, certain conflicts of interest will exist.

We compete with numerous other parties or entities for real property investments and customers, and we may not compete successfully.

We compete with numerous other persons or entities seeking to buy real properties or to attract customers to real properties we already own, which may have a negative impact on our ability to acquire real properties or attract customers on favorable terms, if at all, and the returns on our real properties. These persons or entities may have greater experience and financial strength than us. For example, our competitors may be willing to offer space at rental rates below our rates, causing us to lose existing or potential customers and pressuring us to reduce our rental rates to retain existing customers or convince new customers to lease space at our properties. Similarly, the opening of new competing assets near the assets that we own may hinder our ability to renew our existing leases or to lease to new customers, because the proximity of new competitors may divert existing or new customers to such competitors. In addition, if market rental rates decline during the term of an existing lease, we may be unable to renew or find a new tenant without lowering the rental rate. Each of these factors could adversely affect our results of operations, financial condition, NAV and ability to repay debt, and pay distributions to our stockholders. 40

Table of Contents Delays in the selection, acquisition, development and construction of real properties or debt investments may have adverse effects on portfolio diversification, results of operations and returns to our stockholders.

Delays we encounter in selecting, acquiring and developing additional real properties or debt investments could adversely affect our stockholders’ returns. The uncertain state of the real estate markets in recent years and the resulting incentives of lenders and sellers to retain their investments had previously led to generally lower transaction volume in the broader real estate market and for us, in part due to pricing and valuation uncertainties. It is possible that such disruptions and uncertainties may reoccur. Alternatively, increased competition for high quality investments may also limit our ability to make incremental accretive investments in real properties and debt investments. These factors may continue to have a negative effect on our stockholders’ returns, and may also hinder our ability to reach our portfolio diversification objectives.

In addition, where properties are acquired prior to the start of construction or during the early stages of construction, it will typically take several months to complete construction and rent available space. Therefore, we may not receive any income from these properties for a significant period of time or at all if we are required to abandon such construction following acquisition, and distributions to our stockholders could suffer. Delays in the completion of construction could give customers the right to terminate preconstruction leases for space at a newly developed project. We may incur additional risks when we make periodic progress payments or other advances to builders prior to completion of construction. Each of those factors could result in increased costs of a project or loss of our investment. In addition, we will be subject to normal lease-up risks relating to newly constructed projects. Furthermore, the price we agree to for a real property will be based on our projections of rental income and expenses and estimates of the fair market value of the real property upon completion of construction. If our projections are inaccurate, we may pay too much for a property.

We may be unable to achieve our diversification goals or to realize benefits from diversification.

We are primarily focused on investing in and operating a diverse portfolio of real property and investing in other real estate-related assets. We currently focus our investment activities primarily across the major U.S. property sectors (residential, industrial, retail and office) and investments in real estate debt and securities. To a lesser extent, we invest in and/or intend to strategically invest in geographies outside of the U.S., which may include Canada, Mexico, the United Kingdom, Europe and other foreign jurisdictions, and in other sectors such as student housing, data centers, credit lease and self-storage, properties in sectors adjacent to our primary investment sectors and/or infrastructure, to create a diversified blend of current income and long-term value appreciation. Although there can be no assurance that we will achieve this objective, we intend to diversify our portfolio by key portfolio attributes including, but not limited to, (i) property sector and type, (ii) target market, with consideration given to geographic concentrations, (iii) average lease terms and portfolio occupancy expectations, (iv) customer concentrations, including credit and exposure to particular businesses or industries and (v) debt profile with the goal of maximizing flexibility while seeking to minimize cost and mitigate the risks associated with changes in interest rates and debt maturities. However, we may not successfully implement our diversification strategy. Even if we do fully achieve our diversification goals, it is possible our diversified portfolio will not perform as well as a portfolio that is concentrated in a particular type of real estate.

We may alter our exposure to various real property sectors and we may not always own properties in each sector.

We currently focus our investment activities primarily across the major U.S. property sectors (residential, industrial, retail and office) and investments in real estate debt and securities but to a lesser extent intend to strategically invest in other sectors such as student housing, data centers, credit lease, self-storage, properties in sectors adjacent to our primary investment sectors and/or infrastructure. Although we aim to diversify our real property portfolio by owning properties in a number of these sectors, we may not always have significant holdings, or any holdings at all, in each sector. We may elect to increase or decrease our holdings in each sector at any time and we may change our target property sectors at any time. If we decrease or eliminate our holdings in any property sector or cease to target any of these property sectors our real property portfolio will be less diversified and we may not realize the benefits of diversification. 41

Table of Contents We are subject to the risk that, with respect to assets that we have acquired and may acquire based on growth potential, such growth potential is not realized.

From 2022 to 2024, we disposed of approximately $373.0 million of properties and we acquired approximately $2.48 billion of properties. The properties that we sold were generally higher-yielding than the new properties we acquired, although we believe the acquired assets exhibit greater potential for future growth. We believe that market conditions may cause us to continue to explore in certain markets the disposition of higher-yielding assets and in certain target markets the acquisition of assets that may generate lower initial yields but with greater growth potential. Although there can be no assurance that we will continue to pursue this strategy or be successful in its execution, for some period of time this may mean that higher-yielding assets are sold from our portfolio in exchange for assets that initially may produce lower current income but which we believe may generate increased income over time through increased tenant demand and/or rental rate growth in order to generate long-term growth in NAV. With respect to such assets, we are subject to the risk that the expected growth potential is not realized. This may result from a variety of factors, including but not limited to unanticipated changes in local market conditions or increased competition for similar properties in the same market. Acquiring properties that do not realize their expected growth potential, or properties that take longer than expected to realize their growth potential, would likely negatively affect our NAV, limit our ability to pay distributions to stockholders and reduce their overall returns.

Our real properties are subject to property and other taxes that may increase in the future, which could adversely affect our cash flow.

Our real properties are subject to real and personal property and other taxes that may increase as tax rates change and as the properties are assessed or reassessed by taxing authorities. Certain of our leases provide that the property taxes, or increases therein, are charged to the lessees as an expense related to the real properties that they occupy while other leases will generally provide that we are responsible for such taxes. In any case, as the owner of the properties, we are ultimately responsible for payment of the taxes to the applicable governmental authorities. If property taxes increase, our customers may be unable to make the required tax payments, ultimately requiring us to pay the taxes even if otherwise stated under the terms of the lease. If we fail to pay any such taxes, the applicable taxing authorities may place a lien on the property and the property may be subject to a tax sale. In addition, we will generally be responsible for property taxes related to any vacant space.

Potential changes to the U.S. tax laws could have a significant negative impact on our business operations, financial condition and earnings.

U.S. federal income tax laws governing REITs and other corporations and the administrative interpretations of those laws may be amended at any time, potentially with retroactive effect. Future legislation, new regulations, administrative interpretations or court decisions could adversely affect our ability to qualify as a REIT or adversely affect our stockholders.

We are subject to litigation that could adversely affect our results of operations.

We are a defendant from time to time in lawsuits and/or regulatory proceedings relating to our business. Unfavorable outcomes resulting from such lawsuits and/or regulatory proceedings could adversely impact our business, financial condition, NAV or results of operations.

Uninsured losses or premiums for insurance coverage relating to real property may adversely affect our operating results.

There are types of losses, generally catastrophic in nature, such as losses due to wars, acts of terrorism, earthquakes, floods, hurricanes, pollution or environmental matters that are uninsurable or not economically insurable, or may be insured subject to limitations, such as large deductibles or co-payments. Risks associated with potential acts of terrorism could sharply increase the premiums we pay for coverage against property and casualty claims. Additionally, mortgage lenders sometimes require commercial property owners to purchase specific coverage against terrorism as a condition for providing mortgage loans. These policies may not be available at a reasonable cost, if at all, which could inhibit our ability to finance or refinance our real properties. In such instances, we may be required to provide other financial support, either through financial assurances or self-insurance, to cover potential losses. Changes in the cost or availability of insurance could expose us to uninsured property or casualty losses. In the event that any of our real properties incurs a property or casualty loss that is not fully covered by insurance, the value of our assets will be reduced by any such uninsured loss. In addition, we could be held liable for indemnifying possible victims of an accident. We cannot assure our stockholders that funding will be available to us for the repair or reconstruction of damaged real property in the future or for liability payments to accident victims. 42

Table of Contents The real estate industry is subject to extensive regulation, which may result in higher expenses or other negative consequences that could adversely affect us.

Our activities are subject to federal, state and municipal laws, and to regulations, authorizations and license requirements with respect to, among other things, zoning, environmental protection and historical heritage, all of which may affect our business. We may be required to obtain licenses and permits with different governmental authorities in order to acquire and manage our assets.

In addition, public authorities may enact new and more stringent standards, or interpret existing laws and regulations in a more restrictive manner, which may force companies in the real estate industry, including us, to spend funds to comply with these new rules, alter the use and occupancy of certain properties, or reduce revenue. Currently across the United States and elsewhere, owners of real property, especially those occupied by individuals (e.g., apartments), as well as industrial warehouses and distribution centers, are coming under increased scrutiny from local, state and federal authorities as well as tenant activist groups. Some are taking proactive measures, either in the form of legislation, administrative actions, or litigation, that could ultimately adversely affect our results from operations, cash flow, distributions and NAV.

In the event of noncompliance with such laws, regulations, licenses and authorizations, we may face the payment of fines, project shutdowns, cancellation of licenses, and revocation of authorizations, in addition to other civil and criminal penalties.

Environmentally hazardous conditions may adversely affect our operating results.

Under various federal, state and local environmental laws, a current or previous owner or operator of real property may be liable for the cost of removing or remediating hazardous or toxic substances on such real property. Such laws often impose liability whether or not the owner or operator knew of, or was responsible for, the presence of such hazardous or toxic substances. Third parties may also sue the owner or operator of a site for damages based on personal injury, natural resources or property damage or other costs, including investigation and clean-up costs resulting from the environmental contamination. In addition, the presence of hazardous substances, or the failure to properly remediate these substances, may adversely affect our ability to sell, rent or pledge such real property as collateral for future borrowings. Environmental laws also may impose restrictions on the manner in which real property may be used or businesses may be operated. A property owner who violates environmental laws may be subject to sanctions, which may be enforced by government agencies or, in certain circumstances, private parties. Some of these laws and regulations have been amended so as to require compliance with new or more stringent standards as of future dates. Compliance with new or more stringent laws or regulations or stricter interpretation of existing laws may require us to incur material expenditures. Future laws, ordinances or regulations may impose material environmental liability. Our customers’ operations, the existing condition of land when we buy it, operations in the vicinity of our real properties, such as the presence of underground storage tanks, or activities of unrelated third parties may affect our real properties. In addition, there are various local, state and federal fire, health, life-safety and similar regulations with which we may be required to comply, and which may subject us to liability in the form of fines or damages for noncompliance. In connection with the acquisition and ownership of our real properties, we may be exposed to such costs in connection with such regulations. The cost of defending against environmental claims, of any damages or fines we must pay, of compliance with environmental regulatory requirements or of remediating any contaminated real property could materially and adversely affect our business, lower the value of our assets or results of operations and, consequently, lower our NAV and the amounts available for distribution to our stockholders.

Environmental laws in the U.S. also require that owners or operators of buildings containing asbestos properly manage and maintain the asbestos, adequately inform or train those who may come into contact with asbestos and undertake special precautions, including removal or other abatement, in the event that asbestos is disturbed during building renovation or demolition. These laws may impose fines and penalties on building owners or operators who fail to comply with these requirements and may allow third parties to seek recovery from owners or operators for personal injury associated with exposure to asbestos. Some of our properties may contain asbestos-containing building materials. 43

Table of Contents We may invest in properties historically used for industrial, manufacturing and commercial purposes. Some of these properties may contain at the time of our investment, or may have contained prior to our investment, underground storage tanks for the storage of petroleum products and other hazardous or toxic substances. All of these operations create a potential for the release of petroleum products or other hazardous or toxic substances. Some of the properties that we acquire may be adjacent to or near other properties that have contained or then currently contain underground storage tanks used to store petroleum products or other hazardous or toxic substances. In addition, certain of the properties that we acquire may be on or adjacent to or near other properties upon which others, including former owners or customers of our properties, have engaged, or may in the future engage, in activities that may release petroleum products or other hazardous or toxic substances.

From time to time, we may acquire properties, or interests in properties, with known adverse environmental conditions where we believe that the environmental liabilities associated with these conditions are quantifiable and that the acquisition will yield an appropriate risk-adjusted return. In such an instance, we will underwrite the costs of environmental investigation, clean-up and monitoring into the cost. Further, in connection with property dispositions, we may agree to remain responsible for, and to bear the cost of, remediating or monitoring certain environmental conditions on the properties.

Generally, our properties are subject to a Phase I or similar environmental assessment by independent environmental consultants prior to or in connection with our acquisition of such properties. Phase I assessments are intended to discover and evaluate information regarding the environmental condition of the surveyed property and surrounding properties. Phase I assessments generally include a historical review, a public records review, an investigation of the surveyed site and surrounding properties and preparation and issuance of a written report, but do not include soil sampling or subsurface investigations and typically do not include an asbestos survey. We cannot give any assurance that an environmental liability that we believe would have a material adverse effect on our business, financial condition or results of operations taken as a whole, will not currently exist at the time of acquisition or may not arise in the future, with respect to any of our properties. Material environmental conditions, liabilities or compliance concerns may arise after an environmental assessment has been completed. Moreover, there can be no assurance that future laws, ordinances or regulations will not impose any material environmental liability, or that the then current environmental condition of our properties will not be affected by customers, by the condition of land or operations in the vicinity of such properties (such as releases from underground storage tanks), or by third parties unrelated to us.

Costs of complying with governmental laws and regulations related to environmental protection and human health and safety may be high.

All real property and the operations conducted on the real property are subject to federal, state and local laws and regulations relating to environmental protection and human health and safety. Some of these laws and regulations may impose joint and several liability on customers, owners or operators for the costs to investigate or remediate contaminated properties, regardless of fault or whether the acts causing the contamination were legal. Leasing properties to customers that engage in industrial, manufacturing, and commercial activities will cause us to be subject to the risk of liabilities under environmental laws and regulations. In addition, the presence of hazardous or toxic substances, or the failure to properly remediate these substances, may adversely affect our ability to sell, rent or pledge such property as collateral for future borrowings.

Some of these laws and regulations have been amended so as to require compliance with new or more stringent standards as of future dates. Compliance with new or more stringent laws or regulations or stricter interpretation of existing laws may require us to incur material expenditures. Future laws, ordinances or regulations may impose material environmental liability. Additionally, our customers’ operations, the existing condition of land when we buy it, operations in the vicinity of our properties, such as the presence of underground storage tanks, or activities of unrelated third parties may affect our properties. In addition, there are various local, state and federal fire, health, life-safety and similar regulations with which we may be required to comply and which may subject us to liability in the form of fines or damages for noncompliance. Any material expenditures, fines or damages we must pay will reduce our ability to make distributions.

In addition, changes in these laws and governmental regulations, or their interpretation by agencies or the courts, could occur. 44

Table of Contents The sale and disposition of real properties carry certain litigation risks at the property level that may reduce our profitability and the return on stockholders’ investments.

The acquisition, ownership and disposition of real properties carry certain specific litigation risks. Litigation may be commenced with respect to a property acquired by us in relation to activities that took place prior to our acquisition of such property. In addition, at the time of disposition of an individual property, a potential buyer may claim that it should have been afforded the opportunity to purchase the asset or alternatively that such potential buyer should be awarded due diligence expenses incurred or statutory damages for misrepresentation relating to disclosure made, if such buyer is passed over in favor of another as part of our efforts to maximize sale proceeds. Similarly, successful buyers may later sue us under various damage theories, including those sounding in tort, for losses associated with latent defects or other problems not uncovered in due diligence.

The costs associated with complying with the Americans with Disabilities Act and the Fair Housing Amendment Act may reduce the amount of cash available for distribution to our stockholders.

Investment in real properties may also be subject to the Americans with Disabilities Act of 1990, as amended, or the “Disabilities Act” and the Fair Housing Amendment Act, as amended, or the “Fair Housing Act.” Under the Disabilities Act, all places of public accommodation are required to comply with federal requirements related to access and use by disabled persons. The Disabilities Act has separate compliance requirements for “public accommodations” and “commercial facilities” which generally require that buildings and services be made accessible and available to people with disabilities. The Disabilities Act’s requirements could require us to remove access barriers and our failure to comply with the Disabilities Act’s requirements could result in the imposition of injunctive relief, monetary penalties or, in some cases, an award of damages. The Fair Housing Act requires residential dwellings first occupied after March 13, 1991 to comply with design and construction requirements related to access and use by disabled persons. We will attempt to acquire properties that comply with these acts or place the burden on the seller or other third party, such as a customer, to ensure compliance with these acts. We cannot assure our stockholders that we will be able to acquire properties or allocate responsibilities in this manner. Any monies we use to comply with or defend lawsuits related to the Disabilities Act and Fair Housing Act will reduce our NAV and the amount of cash available for distribution to our stockholders.

We may not have funding for future tenant improvements, which may adversely affect the value of our assets, our results of operations and returns to our stockholders.

When a tenant at one of our real properties does not renew its lease or otherwise vacates its space in one of our buildings, it is likely that, in order to attract one or more new customers, we will be required to expend substantial funds to construct new tenant improvements in the vacated space. We expect to invest the net proceeds from our securities offerings in real estate-related investments, and we do not anticipate that we will maintain permanent working capital reserves. We do not currently have an identified funding source to provide funds that may be required in the future for tenant improvements and tenant refurbishments in order to attract new customers. If we do not establish sufficient reserves for working capital or obtain adequate financing to supply necessary funds for capital improvements or similar expenses, we may be required to defer necessary or desirable improvements to our real properties. If we defer such improvements, the applicable real properties may decline in value, and it may be more difficult for us to attract or retain customers to such real properties or the amount of rent we can charge at such real properties may decrease. We cannot assure our stockholders that we will have any sources of funding available to us for the repair or reconstruction of damaged real property in the future.

Lease agreements may have specific provisions that create risks to our business and may adversely affect us.

Our lease agreements are regulated by local, municipal, state and federal laws, which may grant certain rights to customers, such as the compulsory renewal of their lease by filing lease renewal actions when certain legal conditions are met. A lease renewal action may represent two principal risks for us: (i) if we plan to vacate a given unit in order to change or adapt an asset’s mix of customers, the customer could remain in that unit by filing a lease renewal action and interfere with our strategy; and (ii) if we desire to increase the lease price for a specific unit, this increase may need to be approved in the course of a lease renewal action, and the final value could be decided at the discretion of a judge. We would then be subject to the court’s interpretation and decision, and could be forced to accept an even lower price for the lease of the unit. The compulsory renewal of our lease agreements and/or the judicial review of our lease prices may adversely affect our cash flow and our operating results. 45

Table of Contents Certain of our lease agreements may not be “triple net leases,” under which the lessee undertakes to pay all the expenses of maintaining the leased property, including insurance, taxes, utilities and repairs. We will be exposed to higher maintenance, tax and property management expenses with respect to all of our leases that are not “triple net.”

Operating expenses, such as expenses for fuel, utilities, labor, building materials and insurance are not fixed and may increase in the future. There is no guarantee that we will be able to pass such increases on to our customers. To the extent such increases cannot be passed on to our customers, any such increases would cause our cash flow, NAV and operating results to decrease.

We depend on the availability of public utilities and services, especially for water and electric power. Any reduction, interruption or cancellation of these services may adversely affect us.

Public utilities, especially those that provide water and electric power, are fundamental for the sound operation of our assets. The delayed delivery or any material reduction or prolonged interruption of these services could allow certain customers to terminate their leases or result in an increase in our costs, as we may be forced to use backup generators, which also could be insufficient to fully operate our facilities and could result in our inability to provide services. Accordingly, any interruption or limitation in the provision of these essential services may adversely affect us.

Acquiring or attempting to acquire multiple properties in a single transaction may adversely affect our operations.

From time to time, we may acquire multiple properties in a single transaction. Portfolio acquisitions typically are more complex and expensive than single-property acquisitions, and the risk that a multiple-property acquisition does not close may be greater than in a single-property acquisition. Portfolio acquisitions may also result in us owning investments in geographically dispersed markets, placing additional demands on the Advisor in managing the properties in the portfolio. In addition, a seller may require that a group of properties be purchased as a package even though we may not want to purchase one or more properties in the portfolio. In these situations, if we are unable to identify another person or entity to acquire the unwanted properties, we may be required to operate or attempt to dispose of these properties. We also may be required to accumulate a large amount of cash to fund such acquisitions. We would expect the returns that we earn on such cash to be less than the returns on investments in real property. Therefore, acquiring multiple properties in a single transaction may reduce the overall yield on our portfolio.

In the event we obtain options to acquire properties, we may lose the amount paid for such options whether or not the underlying property is purchased.

We may obtain options to acquire certain properties. The amount paid for an option, if any, is normally surrendered if the property is not purchased and may or may not be credited against the purchase price if the property is purchased. Any unreturned option payments will reduce the amount of cash available for further investments or distributions to our stockholders.

We will rely on property managers to operate our properties and leasing agents to lease vacancies in our properties.

The Advisor intends to hire property managers, which may include affiliates of the Advisor, to manage our properties and leasing agents to lease vacancies in our properties. The property managers will have significant decision-making authority with respect to the management of our properties. Our ability to direct and control how our properties are managed on a day-to-day basis may be limited because we will engage third parties to perform this function. Thus, the success of our business may depend in large part on the ability of our property managers to manage the day-to-day operations and the ability of our leasing agents to lease vacancies in our properties. Any adversity experienced by, or problems in our relationship with, our property managers or leasing agents could adversely impact the operation and profitability of our properties.

Our properties may be leased at below-market rates under long-term leases.

We may seek to negotiate longer-term leases to reduce the cash flow volatility associated with lease rollovers, in particular when contractual rent increases are included. In addition, where appropriate, we may seek leases that provide for operating expenses, or expense increases to be paid by the customers. These leases may allow customers to renew the lease with pre-defined rate increases. If we do not accurately judge the potential for increases in market rental rates or expenses, we may set the rental rates (or expense reimbursements) of these long-term leases at levels such that even after contractual rental increases, the resulting rental rates (or net revenues to us) are less than then-current market rental rates. Further, we may be unable to terminate those leases or adjust the rent or expense reimbursements to then-prevailing market rates. As a result, our income and distributions to our stockholders could be lower than if we did not enter into long-term leases. 46

Table of Contents Retail properties depend on anchor customers to attract shoppers and could be adversely affected by the loss of a key anchor customer.

Retail properties, like other properties, are subject to the risk that customers may be unable to make their lease payments or may decline to extend a lease upon its expiration. A lease termination by a customer that occupies a large area of a retail center (commonly referred to as an anchor customer) could impact leases of other customers. Other customers may be entitled to modify the terms of their existing leases (or terminate their leases) in the event of a lease termination by an anchor customer, or the closure of the business of an anchor customer that leaves its space vacant even if the anchor customer continues to pay rent. Any such modifications, conditions or terminations could be unfavorable to us as the property owner and could decrease rents or expense recoveries. Additionally, major customer closures may result in decreased customer traffic, which could lead to decreased sales at other stores. In the event of default by a customer or anchor store, we may experience delays and costs in enforcing our rights as landlord to recover amounts due to us under the terms of our agreements with those parties.

Our investments in industrial properties are more dependent on economic activity and trade regulation than other real estate sectors.

Some of our investments in real estate assets are in industrial properties. The demand for industrial space in the U.S. is more strongly dependent on economic activity and trade regulation than other real estate sectors. For example, customers and potential customers of our industrial properties operate in industries including e-commerce, traditional retail, third-party logistics, warehousing and manufacturing, all of which may be adversely impacted by recently enacted and proposed changes to U.S. foreign trade policies, including tariffs and other impositions on imported goods, trade sanctions imposed on certain countries, the limitation on the importation of certain types of goods or of goods containing certain materials from other countries and other policies. Our performance may be more dependent on economic activity and trade regulation than that of real estate companies that do not invest in industrial properties.

Student housing properties are subject to seasonality.

Student housing properties are typically leased during prime leasing seasons, and are therefore highly dependent on the effectiveness of our marketing and leasing efforts and personnel during such seasons. Additionally, student housing properties are generally on short-term leases, exposing owners of such properties to increased leasing risk. We may not be able to re-lease our properties on similar terms, if we are able to re-lease our properties at all. The terms of renewal or re-lease (including the cost of required renovations) may be less favorable to us than the prior lease. If we are unable to re-lease all or a substantial portion of our properties, or if the rental rates upon such re-leasing are significantly lower than expected rates, our cash flows from operations could be adversely affected.

Prior to the commencement of each new lease period, we prepare the units for new incoming residents. Other than revenue generated by in-place leases for returning residents, we do not generally recognize lease revenue during this period referred to as “turn” as we have no leases in place. In addition, during turn, we incur expenses preparing our units for occupancy, which we recognize immediately. This lease turn period results in seasonality in our operating results, and as a result, we may experience significantly reduced cash flows during such periods.

In addition, we may be adversely affected by a change in university admission policies. For example, if a university reduces the number of student admissions, the demand for our student housing properties may be reduced and our occupancy rates may decline. Our student housing properties also compete with university-owned student housing and other national and regional owner-operators of off-campus student housing in a number of markets as well as with smaller local owner-operators. 47

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We may be subject to tenant relief laws and may be subject to rent control laws, which could negatively impact our rental revenue.

To the extent we own residential rental properties, we expect that we will regularly be seeking to evict tenants who are not paying their rent or are otherwise in material violation of the terms of their lease. Eviction activities will result in additional legal costs and require the time and attention of our management. The eviction process is typically subject to numerous legal requirements and mandatory “cure” policies, which may increase our costs and delay our ability to gain possession of and stabilize a property. Additionally, state and local landlord-tenant laws may impose legal duties on us to assist tenants in relocating to new housing, or restrict our ability to recover certain costs or charge tenants for damage tenants cause to our property. Because such laws vary by state and locality, we will need to be familiar with and take appropriate steps to comply with applicable landlord-tenant laws in the jurisdictions in which we operate, and we will need to incur supervisory and legal expenses to ensure such compliance. To the extent that we do not comply with state or local laws, we may be subjected to civil litigation filed by individuals, a class of plaintiffs or by state or local law enforcement. We may be required to pay our adversaries’ litigation fees and expenses if judgment is entered against us in such litigation or if we settle such litigation.

We may be subject to additional risks from non-U.S. investments.

We invest in and may continue to invest in real properties and loans located in countries outside the United States, which may include Canada, Mexico, the United Kingdom, Europe and other foreign jurisdictions, which involve certain factors not typically associated with investing in the U.S., including risks relating to (i) currency exchange matters, including fluctuations in the rate of exchange between the U.S. dollar and the various non-U.S. currencies in which such investments are denominated, and costs associated with conversion of investment principal and income from one currency into another; (ii) differences in conventions relating to documentation, settlement, corporate actions, stakeholder rights and other matters; (iii) differences between U.S. and non-U.S. asset markets, including potential price volatility in and relative illiquidity of some non-U.S. markets; (iv) the absence of uniform accounting, auditing and financial reporting standards, practices and disclosure requirements and differences in government supervision and regulation; (v) certain economic, social and political risks, including potential exchange-control regulations, potential restrictions on non-U.S. investment and repatriation of capital, the risks associated with political, economic or social instability, including the risk of sovereign defaults, regulatory change, and the possibility of expropriation or confiscatory taxation or the imposition of withholding or other taxes on dividends, interest, capital gains, other income or gross sale or disposition proceeds, and adverse economic and political developments; (vi) the possible imposition of non-U.S. taxes on income and gains and gross sales or other proceeds recognized with respect to such investments; (vii) differing and potentially less well-developed or well-tested corporate laws regarding stakeholder rights, creditors’ rights (including the rights of secured parties), fiduciary duties and the protection of investors; (viii) different laws and regulations including differences in the legal and regulatory environment or enhanced legal and regulatory compliance; (ix) political hostility to investments by foreign investors; and (x) less publicly available information. Furthermore, while we may have the capacity, but not the obligation, to mitigate such additional risks, including through the utilization of certain foreign exchange hedging instruments, there is no guarantee that we will be successful in mitigating such risks and in turn may introduce additional risks and expenses linked to such efforts.

We face possible risks associated with the physical effects of climate change.

The physical effects of climate change, including extreme weather events such as hurricanes or floods, could have a material adverse impact on our properties, operations and business. For example, our properties could be severely damaged or destroyed from either singular extreme weather events (for example floods, storms and wildfires) or through long-term impacts of climatic conditions (such as precipitation frequency, weather instability and rising sea levels). Such events could also adversely impact us or the tenants of our properties if we or they are unable to operate our or their businesses due to damage resulting from such events. If we fail to adequately prepare for such events, our revenues, results of operations and financial condition may be impacted. Climate change could also increase utility and other costs of operating our properties, including increased costs for energy and other supply chain materials, which, if not offset by rising rental income and/or paid by tenants, could have a material adverse effect on our properties, operations and business. In addition, we may incur significant costs in preparing for possible future climate change or climate-related events or in response to our tenants’ requests for such investments and we may not realize desirable returns on those investments. 48

Table of Contents RISKS RELATED TO INVESTMENTS IN REAL ESTATE-RELATED DEBT AND SECURITIES

The mortgage loans in which we invest, either directly or indirectly through real estate-related debt securities, will be subject to the risk of delinquency, foreclosure and loss, which could result in losses to us.

Commercial mortgage loans are secured by commercial property and are subject to risks of delinquency and foreclosure and risks of loss. The ability of a borrower to repay a loan secured by a property typically is dependent primarily upon the successful operation of such property rather than upon the existence of independent income or assets of the borrower. If the net operating income of the property is reduced, the borrower’s ability to repay the loan may be impaired. Net operating income of an income-producing property can be affected by, among other things: customer mix, success of customer businesses, property management decisions, property location and condition, competition from comparable types of properties, changes in laws that increase operating expenses or limit rents that may be charged, any need to address environmental contamination at the property, the occurrence of any uninsured casualty at the property, changes in national, regional or local economic conditions and/or specific industry segments, current and potential future capital markets uncertainty, declines in regional or local real estate values, declines in regional or local rental or occupancy rates, increases in interest rates, real estate tax rates and other operating expenses, changes in governmental rules, regulations and fiscal policies, including environmental legislation, natural disasters, terrorism, social unrest and civil disturbances.

In the event of any default under a mortgage loan held directly by us, we will bear a risk of loss of principal to the extent of any deficiency between the value of the collateral and the principal and accrued interest of the mortgage loan, which could have a material adverse effect on our cash flow from operations, and results from operations and limit amounts available for distribution to our stockholders. In the event of the bankruptcy of a mortgage loan borrower, the mortgage loan to such borrower will be deemed to be secured only to the extent of the value of the underlying collateral at the time of bankruptcy (as determined by the bankruptcy court), and the lien securing the mortgage loan will be subject to the avoidance powers of the bankruptcy trustee or debtor-in-possession to the extent the lien is unenforceable under state law. Foreclosure of a mortgage loan can be an expensive and lengthy process, which could have a substantial adverse effect on our anticipated return on the foreclosed mortgage loan. In addition, if we foreclose on a particular property, we could become, as owner of the property, subject to liabilities associated with such property, including liabilities related to taxes and environmental matters.

We may make open market purchases or invest in traded securities.

Although not anticipated to be a large component of our investment strategy, we have the ability to invest in securities that are traded (publicly or through other active markets (including through private transactions)) and are, therefore, subject to the risks inherent in investing in traded securities. When investing in traded securities, we may be unable to obtain financial covenants or other contractual governance rights, including management rights that we might otherwise be able to obtain in making privately negotiated investments. Moreover, we may not have the same access to information in connection with investments in traded securities, either when investigating a potential investment or after making the investment, as compared to privately negotiated investments. Furthermore, we may be limited in our ability to make investments, and to sell existing investments, in traded securities because Ares may be deemed to have material, non-public information regarding the issuers of those securities or as a result of other internal policies or requirements. The inability to sell traded securities in these circumstances could materially adversely affect the investment results. In addition, securities acquired of a public company may, depending on the circumstances and securities laws of the relevant jurisdiction, be subject to lock-up periods.

The preferred equity, mezzanine loans and B-notes in which we invest involve greater risks of loss than senior loans secured by income-producing real properties.

We have and may continue to invest in preferred equity, mezzanine loans and/or B-notes. Preferred equity is unsecured, while mezzanine loans and B-notes substantially take the form of subordinated loans secured by second mortgages on the underlying real property or loans secured by a pledge of the ownership interests of either the entity owning the real property or the entity that owns the interest in the entity owning the real property. These types of investments involve a higher degree of risk than long-term senior mortgage loans secured by income-producing real property because the investment may become unsecured as a result of foreclosure by the senior lender. In the event of a bankruptcy of the entity providing the pledge of its ownership interests as security, we may not have full recourse to the assets of such entity, or the assets of the entity may not be sufficient to satisfy our preferred equity, mezzanine loan or B-note in whole or in part. In addition, there may be significant delays and costs associated with the process of foreclosing on collateral securing or supporting mezzanine loans and B-notes. If a borrower defaults on a mezzanine loan, B-note or debt senior to our loan, or in the event of a borrower bankruptcy, our mezzanine loan or B-note will be satisfied only after the senior 49

Table of Contents debt. As a result, we may not recover some or all of our investment. In addition, mezzanine loans or B-notes may have higher loan-to-value ratios than conventional mortgage loans, resulting in less equity in the real property and increasing the risk of loss of principal. Further, even if we are successful in foreclosing on the equity interests serving as collateral for our mezzanine loans or B-notes, such foreclosure will result in us inheriting all of the liabilities of the underlying mortgage borrower, including the senior mortgage on the applicable property. This may result in both increased costs to us and a negative impact on our overall debt covenants and occupancy levels. In many cases a significant restructuring of the senior mortgage may be required in order for us to be willing to retain longer term ownership of the property. If we are unsuccessful in restructuring the underlying mortgage debt in these scenarios, the mortgage lender ultimately may foreclose on the property causing us to lose any remaining investment.

A portion of our debt-related investments may be considered illiquid, and we may not be able to adjust our portfolio in response to changes in economic and other conditions.

Certain of the debt-related investments that we have purchased or may purchase in the future in connection with privately negotiated transactions are not or may not be registered under the relevant securities laws, resulting in a prohibition against their transfer, sale, pledge or other disposition except in a transaction that is exempt from the registration requirements of, or is otherwise effected in accordance with, those laws. As a result, our ability to vary our portfolio in response to changes in economic and other conditions may be limited. In addition, certain of our registered securities may not be as liquid as when originally purchased.

Bridge loans may involve a greater risk of loss than conventional mortgage loans.

We may provide bridge loans secured by first lien mortgages on properties to borrowers who are typically seeking short-term capital to be used in an acquisition, development or refinancing of real estate. The borrower may have identified an undervalued asset that has been undermanaged or is located in a recovering market. If the market in which the asset is located fails to recover according to the borrower’s projections, or if the borrower fails to improve the quality of the asset’s management or the value of the asset, the borrower may not receive a sufficient return on the asset to satisfy the bridge loan, and we may not recover some or all of our investment.

In addition, owners usually borrow funds under a conventional mortgage loan to repay a bridge loan. We may, therefore, be dependent on a borrower’s ability to obtain permanent financing to repay our bridge loan, which could depend on market conditions and other factors. Bridge loans, like other loans secured directly or indirectly by property, are subject to risks of borrower defaults, bankruptcies, fraud, losses and special hazard losses that are not covered by standard hazard insurance. In the event of any default under bridge loans held by us, we bear the risk of loss of principal and nonpayment of interest and fees to the extent of any deficiency between the value of the mortgage collateral and the principal amount of the bridge loan. Any such losses with respect to our investments in bridge loans could have an adverse effect on our NAV, results of operations and financial condition.

Interest rate and related risks may cause the value of our real estate-related securities investments to be reduced.

Interest rate risk includes the risk that fixed-income securities such as preferred and debt securities, and to a lesser extent dividend paying common stocks, will decline in value because of changes in market interest rates. Generally, when market interest rates rise, the market value of such securities will decline, and vice versa. In addition, during periods of rising interest rates, the average life of certain types of securities may be extended because of slower than expected principal payments. This may result in a below-market interest rate, an increase in the security’s duration, and a reduction in the value of the security. This is known as extension risk. During periods of declining interest rates, an issuer may be able to exercise an option to prepay principal earlier than scheduled, which is generally known as call or prepayment risk. If this occurs, we may be forced to reinvest in lower yielding securities. This is known as reinvestment risk. Preferred and debt securities frequently have call features that allow the issuer to repurchase the security prior to its stated maturity. An issuer may redeem an obligation if the issuer can refinance the debt at a lower cost due to declining interest rates or an improvement in the credit standing of the issuer. To the extent we invest in real estate-related securities going forward, these risks may reduce the value of such investments. Further, there is a risk that income from our portfolio will decline if we invest the proceeds from matured, traded or called securities at market interest rates that are below our real estate debt portfolio’s current earnings rate. A decline in income could affect the NAV of our shares or their overall returns. 50

Table of Contents Investments in real estate-related securities are subject to specific risks relating to the particular issuer of the securities and may be subject to the general risks of investing in subordinated real estate-related securities.

We have and may continue to invest in real estate-related securities and our investments may consist of real estate-related common equity, preferred equity and debt securities of both publicly traded and private real estate companies. Our investments in such real estate-related securities will involve special risks relating to the particular issuer of the securities, including the financial condition and business outlook of the issuer. Issuers of real estate-related securities generally invest in real estate or real estate-related assets and are subject to the inherent risks associated with real estate-related debt investments discussed in this section of our Annual Report on Form 10-K.

The value of real estate-related securities, including those of publicly listed REITs, fluctuates with general economic conditions. See “—Debt-oriented real estate investments face a number of general market-related risks that can affect the creditworthiness of issuers, and modifications to certain loan structures and market terms make it more difficult to monitor and evaluate investments.”

Real estate-related securities may be unsecured and subordinated to other obligations of the issuer. As a result, investments in real estate-related securities are subject to risks of (i) limited liquidity in the secondary trading, (ii) substantial market price volatility, (iii) subordination to prior claims of banks and other senior lenders of the issuer and preferred equity holders, (iv) the operation of mandatory sinking fund or call/redemption provisions during periods of declining interest rates that could cause the issuer to reinvest redemption proceeds in lower yielding assets, (v) the possibility that earnings of the issuer may be insufficient to meet its debt service and distribution obligations and (vi) the declining creditworthiness and potential for insolvency of the issuer during periods of rising interest rates and economic downturn. These risks may adversely affect the value of outstanding real estate-related securities and the ability of the issuers thereof to pay dividends.

Investments in structured products or similar products may include structural, legal and liquidity risks that may adversely affect our results of operations and financial condition.

We may invest from time to time in structured products, including pools of mortgages, inclusive of commercial mortgage backed securities (“CMBS”) secured by loans made to multiple entities and/or single asset single borrower (“SASB”) loans, as well as commercial real estate collateralized loan obligations (“CRE CLOs”) and other real estate-related interests. Our investments in structured products are subject to a number of risks, including risks related to the fact that the structured products may be leveraged, and other structural and legal risks related thereto. Utilization of leverage is a speculative investment technique and will generally magnify the opportunities for gain and risk of loss borne by an investor investing in debt securities. Many structured products contain covenants designed to protect the providers of debt financing to such structured products. A failure to satisfy those covenants could result in the untimely liquidation of the structured product and a complete loss of our investment therein. In addition, if the particular structured product is invested in a security in which we are also separately invested, this would tend to increase our overall exposure to the credit of the issuer of such securities, at least on an absolute, if not on a relative basis. The value of an investment in a structured product will depend on the investment performance of the assets in which the structured product invests and will, therefore be subject to all of the risks associated with an investment in those assets.

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These risks include the possibility of a default by, or bankruptcy of, the issuers of such assets or a claim that the pledging of collateral to secure any such asset constituted a fraudulent conveyance or preferential transfer that can be subordinated to the rights of other creditors of the issuer of such asset or nullified under applicable law.

The credit markets, including the CMBS market, have periodically experienced decreased liquidity on the primary and secondary markets during periods of increased market volatility. Such market conditions could re-occur and could impact the valuations of our investments and impair our ability to sell such investments if we were required to liquidate all or a portion of any CMBS investments quickly. Additionally, certain securities investments, such as horizontal or other risk retention investments in CMBS, may have certain holding period and other restrictions that limit our ability to sell any such investments. 51

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Debt-oriented real estate investments face a number of general market-related risks that can affect the creditworthiness of issuers, and modifications to certain loan structures and market terms make it more difficult to monitor and evaluate investments.

Any deterioration of real estate fundamentals generally, and in the United States in particular, could negatively impact our performance by making it more difficult for issuers to satisfy their debt payment obligations, increasing the default risk applicable to issuers, and/or making it relatively more difficult for us to generate attractive risk-adjusted returns. Changes in general economic conditions may affect the creditworthiness of issuers and/or real estate collateral relating to our investments and may include economic and/or market fluctuations, changes in environmental and zoning laws, casualty or condemnation losses, regulatory limitations on rents, decreases in property values, changes in the appeal of properties to tenants, changes in supply and demand for competing properties in an area (as a result, for instance, of overbuilding), fluctuations in real estate fundamentals, the financial resources of tenants, changes in availability of debt financing which may render the sale or refinancing of properties difficult or impracticable, changes in building, environmental and other laws, energy and supply shortages, various uninsured or uninsurable risks, natural disasters, political events, trade barriers, currency exchange controls, changes in government regulations, changes in real property tax rates and operating expenses, changes in interest rates, changes in the availability of debt financing and/or mortgage funds which may render the sale or refinancing of properties difficult or impracticable, increased mortgage defaults, increases in borrowing rates, outbreaks of an infectious disease, epidemics/pandemics or other serious public health concerns, negative developments in the economy or political climate that depress travel activity, environmental liabilities, contingent liabilities on disposition of assets, natural disasters, terrorist attacks, war, demand and/or real estate values generally. Such changes may develop rapidly and it may be difficult to determine the comprehensive impact of such changes on our investments, particularly for investments that may have inherently limited liquidity. These changes may also create significant volatility in the markets for our investments which could cause rapid and large fluctuations in the values of such investments. There can be no assurance that there will be a ready market for the resale of our debt investments because such investments may not be liquid. Illiquidity may result from the absence of an established market for the investments, as well as legal or contractual restrictions on their resale by us. The value of securities of companies which service the real estate business sector may also be affected by such risks.

We cannot predict whether economic conditions generally, and the conditions for real estate debt investing in particular, will deteriorate in the future. Declines in the performance of the U.S. and global economies or in the real estate debt markets could have a material adverse effect on our investment activities. In addition, market conditions relating to real estate debt investments have evolved since the financial crisis, which has resulted in a modification to certain loan structures and market terms. For example, it has become increasingly difficult for real estate debt investors in certain circumstances to receive full transparency with respect to underlying investments because transactions are often effectuated on an indirect basis through pools or conduit vehicles rather than directly with the borrower. These and other similar changes in loan structures or market terms may make it more difficult for us to monitor and evaluate investments.

Political changes may affect the real estate debt markets.

The current regulatory environment in the United States may be impacted by future legislative developments and the regulatory agenda of the then-current U.S. President.

The outcome of congressional and other elections creates uncertainty with respect to legal, tax and regulatory regimes in which we and our investments will operate. Any significant changes in, among other things, economic policy (including with respect to interest rates and foreign trade), the regulation of the investment management industry, tax law, immigration policy and/or government entitlement programs could have a material adverse impact on us and our investments.

Some of our securities investments may become distressed, which securities would have a high risk of default and may be illiquid.

While it is generally anticipated that our real estate-related investments will focus primarily on investments in non-distressed real estate-related interests (based on our belief that there is not a low likelihood of repayment), our investments may become distressed following our acquisition thereof. Additionally, we may invest in real estate debt investments that we believe are available to purchase at “discounted” rates or “undervalued” prices. Purchasing real estate debt at what may appear to be “undervalued” or “discounted” levels is no guarantee that these investments will generate attractive returns to us or will not be subject to further reductions in value. There is no assurance that such investments can be acquired at favorable prices, that such investments will not default, or that the market for such interests will improve. In addition, the market conditions for real estate debt investments may deteriorate further, which could have an adverse effect on the performance of our investments. 52

Table of Contents During an economic downturn or recession, securities of financially troubled or operationally troubled issuers are more likely to go into default than securities of other issuers. Securities of financially troubled issuers and operationally troubled issuers are less liquid and more volatile than securities of companies not experiencing financial difficulties. The market prices of such securities are subject to erratic and abrupt market movements and the spread between bid and asked prices may be greater than normally expected. Investment in the securities of financially troubled issuers and operationally troubled issuers involves a high degree of credit and market risk. There is no assurance that we will correctly evaluate the value of the assets collateralizing such investments or the prospects for a successful reorganization or similar action.

These financial difficulties may never be overcome and may cause issuers to become subject to bankruptcy or other similar administrative proceedings, or may require a substantial amount of workout negotiations or restructuring, which may entail, among other things, an extension of the term, a substantial reduction in the interest rate, a substantial write down of the principal of such investment and other concessions which could adversely affect our returns on the investment. There is a possibility that we may incur substantial or total losses on our investments and in certain circumstances, subject us to certain additional potential liabilities that may exceed the value of our original investment therein.

For example, under certain circumstances, a lender who has inappropriately exercised control over the management and policies of a debtor may have its claims subordinated or disallowed or may be found liable for damages suffered by parties as a result of such actions. In any reorganization or liquidation proceeding relating to our investments, we may lose our entire investment, may be required to accept cash or securities with a value less than our original investment and/or may be required to accept different terms, including payment over an extended period of time. In addition, payments to us may be reclaimed under certain circumstances if any such payment or distribution is later determined to have been a fraudulent conveyance, preferential payment, or similar transactions under applicable bankruptcy and insolvency laws. Furthermore, bankruptcy laws and similar laws applicable to administrative proceedings may delay our ability to realize on collateral for loan positions we held, or may adversely affect the economic terms and priority of such loans through doctrines such as equitable subordination or may result in a restructure of the debt through principles such as the “cramdown” provisions of the bankruptcy laws.

However, even if a restructuring were successfully accomplished, a risk exists that, upon maturity of such investment, replacement “takeout” financing will not be available, resulting in an inability by the issuer to repay the investment. Although unlikely, it is possible it may be necessary or desirable to foreclose on collateral securing one or more real estate debt we acquire. The foreclosure process varies jurisdiction by jurisdiction and can be lengthy and expensive. Issuers often resist foreclosure actions by asserting numerous claims, counterclaims and defenses against the holder of a real estate loan, including, without limitation, lender liability claims and defenses, even when such assertions may have no basis in fact, in an effort to prolong the foreclosure action, which often prolongs and complicates an already difficult and time consuming process. In some states or other jurisdictions, foreclosure actions can take up to several years or more to conclude. During the foreclosure proceedings, an issuer may have the ability to file for bankruptcy, potentially staying the foreclosure action and further delaying the foreclosure process. Foreclosure litigation tends to create a negative public image of the collateral property and may result in disrupting ongoing leasing, management, development and other operations of the property. In the event we foreclose on an investment, we will be subject to the risks associated with owning and operating real estate.

We face risks associated with our mortgage origination program.

Under our mortgage origination program, we originate mortgage loans with the intent to sell such loans to another party within a short period of time. We intend to borrow funds to originate such mortgage loans, and the size of such loans and our borrowings in connection therewith may be significant. Although we intend to sell each mortgage loan shortly after origination, we may be unable to secure a buyer for a loan, which would result in us holding the loan for longer than intended, requiring us to pay additional interest to the lender and subjecting us to heightened interest rate risk until we are able to sell the loan. Additionally, in order to secure borrowing for a mortgage origination, a lender may require our Sponsor to guarantee the borrowing, and our Sponsor will require us to pay a fee for such guarantee, reducing the proceeds we receive in connection with such origination.

Certain risks associated with CMBS may adversely affect our results of operations and financial condition.

We may invest a portion of our assets in pools or tranches of CMBS, which may include horizontal and other risk retention investments. The collateral underlying CMBS generally consists of commercial mortgages on real property that has an industrial use. CMBS have been issued in a variety of issuances, with varying structures including senior and subordinated classes. 53

Table of Contents Mortgage-backed securities may also have structural characteristics that distinguish them from other securities. The interest rate payable on these types of securities may be set or effectively capped at the weighted average net coupon of the underlying assets themselves. As a result of this cap, the return to investors in such a security would be dependent on the relevant timing and rate of delinquencies and prepayments of mortgage loans bearing a higher rate of interest. In general, early prepayments will have a greater impact on the yield to investors. Federal and state law may also affect the return to investors by capping the interest rates payable by certain mortgagors. Certain mortgage-backed securities may provide for the payment of only interest for a stated period of time. In addition, in a bankruptcy or similar proceeding involving the originator or the servicer of the CMBS (often the same entity or an affiliate), the assets of the issuer of such securities could be treated as never having been truly sold to the originator to the issuer and could be substantively consolidated with those of the originator, or the transfer of such assets to the issuer could be voided as a fraudulent transfer.

The credit markets, including the CMBS market, have periodically experienced decreased liquidity on the primary and secondary markets during periods of market volatility. Such market conditions could re-occur and would impact the valuations of our investments and impair our ability to sell such investments if we were required to liquidate all or a portion of any such CMBS investments quickly. Additionally, certain securities investments, such as horizontal or other risk retention investments in CMBS, may have certain holding period and other restrictions that limit our ability to sell any such investments.

Concentrated CMBS investments may pose specific risks that may adversely affect our results of operations and financial condition.

Default risks with respect to CMBS investments may be further pronounced in the case of single-issuer CMBS or CMBS secured by a small or less diverse collateral pool, such as SASB loans. At any one time, a portfolio of CMBS may be backed by commercial mortgage loans disproportionately secured by properties in only a few states, regions or foreign countries. As a result, such investments may be more susceptible to geographic risks relating to such areas, including adverse economic conditions, declining home values, adverse events affecting industries located in such areas and other factors beyond our control relative to investments in multi-issuer CMBS or a pool of mortgage loans having more diverse property locations.

The quality of the CMBS is dependent on the credit quality and selection of the mortgages for each issuance.

CMBS are also affected by the quality of the credit extended. As a result, the quality of the CMBS is dependent upon the selection of the commercial mortgages for each issuance and the cash flow generated by the commercial real estate assets, as well as the relative diversification of the collateral pool underlying such CMBS and other factors such as adverse selection within a particular tranche or issuance.

CMBS investments face risks associated with extensions that may adversely affect our results of operations and financial condition.

CMBS and other investments may be subject to extension, resulting in the term of the securities being longer than expected. Extensions are affected by a number of factors, including the general availability of financing in the market, the value of the related mortgaged property, the borrower’s equity in the mortgaged property, the financial circumstances of the borrower, fluctuations in the business operated by the borrower on the mortgaged property, competition, general economic conditions and other factors. To the extent we make such investments, such extensions may also be made without our consent. 54

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There are certain risks associated with the servicers of commercial real estate loans underlying CMBS and other investments.

The exercise of remedies and successful realization of liquidation proceeds relating to commercial real estate loans underlying CMBS and other investments may be highly dependent on the performance of the servicer or special servicer. The servicer may not be appropriately staffed or compensated to immediately address issues or concerns with the underlying loans. Such servicers may exit the business and need to be replaced, which could have a negative impact on the portfolio due to lack of focus during a transition. Special servicers frequently are affiliated with investors who have purchased the most subordinate bond classes, and certain servicing actions, such as a loan extension instead of forcing a borrower pay off, may benefit the subordinate bond classes more so than the senior bonds. While servicers are obligated to service the portfolio subject to a servicing standard and maximize the present value of the loans for all bond classes, servicers with an affiliate investment in the CMBS or other investments may have a conflict of interest. There may be a limited number of special servicers available, particularly those which do not have conflicts of interest. In addition, to the extent any such servicers fail to effectively perform their obligations pursuant to the applicable servicing agreements, such failure may adversely affect our investments, should we make such investments.

There are certain risks associated with CMBS interest shortfalls.

CMBS investments may be subject to interest shortfalls due to interest collected from the underlying loans not being sufficient to pay accrued interest to all of the CMBS interest holders. Interest shortfalls to the CMBS trust will occur when the servicer does not advance full interest payments on defaulted loans. The servicer in a CMBS trust is required to advance monthly principal and interest payments due on a delinquent loan. Once a loan is delinquent for a period of time (generally 60 days), the servicer is required to obtain a new appraisal to determine the value of the property securing the loan. The servicer is only required to advance interest based on the lesser of the loan amount or 90%, generally, of the appraised value. Interest shortfalls occur when 90%, generally, of the appraised value is less than the loan amount and the servicer does not advance interest on the full loan amount. The resulting interest shortfalls impact interest payments on the most junior class in the trust first. As interest shortfalls increase, more senior classes may be impacted. Over time, senior classes may be reimbursed for accumulated shortfalls if the delinquent loans are resolved, but there is no guarantee that shortfalls will be collected. Interest shortfalls to the CMBS trust may also occur as a result of accumulated advances and expenses on defaulted loans. When a defaulted loan or foreclosed property is liquidated, the servicer will be reimbursed for accumulated advances and expenses prior to payments to CMBS bond holders. If proceeds are insufficient to reimburse the servicer or if a defaulted loan is modified and not foreclosed, the servicer is able to make a claim on interest payments that is senior to the bond holders to cover accumulated advances and expenses. If the claim is greater than interest collected on the loans, interest shortfalls could impact one or more bond classes in a CMBS trust until the servicer’s claim is satisfied.

There are certain risks associated with the insolvency of obligations backing CMBS and other investments.

The real estate loans backing the CMBS and other investments may be subject to various laws enacted in the jurisdiction or state of the borrower for the protection of creditors. If an unpaid creditor files a lawsuit seeking payment, the court may invalidate all or part of the borrower’s debt as a fraudulent conveyance, subordinate such indebtedness to existing or future creditors of the borrower or recover amounts previously paid by the borrower in satisfaction of such indebtedness, based on certain tests for borrower insolvency and other facts and circumstances, which may vary by jurisdiction. There can be no assurance as to what standard a court would apply in order to determine whether the borrower was “insolvent” after giving effect to the incurrence of the indebtedness constituting the mortgage backing the CMBS and other investments, or that regardless of the method of valuation, a court would not determine that the borrower was “insolvent” after giving effect to such incurrence. In addition, in the event of the insolvency of a borrower, payments made on such mortgage loans could be subject to avoidance as a “preference” if made within a certain period of time (which may be as long as one year and one day) before insolvency. 55

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We will face risks related to our investments in CRE CLOs.

We currently invest in CRE CLOs and may continue to make new investments in CRE CLOs. A CLO is a trust typically collateralized by a pool of loans, which may include, among others, domestic and foreign senior secured loans, senior unsecured loans and subordinate corporate loans, including loans that may be rated below investment grade or equivalent unrated loans. CLOs may charge a management fee and administrative expenses. For CLOs, the cash flows from the trust are split into two or more portions, called tranches, varying in risk and yield. The riskiest portion is the “equity” tranche which bears the bulk of defaults from the bonds or loans in the trust and serves to protect the other, more senior tranches from default in all but the most severe circumstances. Since it is partially protected from defaults, a senior tranche from a CLO trust typically has higher ratings and lower yields than the underlying securities, and can be rated investment grade. Despite the protection from the equity tranche, CLO tranches can experience substantial losses due to actual defaults, increased sensitivity to defaults due to collateral default and disappearance of protecting tranches, market anticipation of defaults and aversion to CLO securities as a class.

Normally, CLOs are privately offered and sold, and thus are not registered under the securities laws. As a result, certain investments in CLOs may be characterized as illiquid securities and volatility in CLO trading markets may cause the value of these investments to decline. Moreover, if the underlying mortgage portfolio has been overvalued by the originator, or if the values subsequently decline and, as a result, less collateral value is available to satisfy interest and principal payments and any other fees in connection with the trust or other conduit arrangement for such securities, we may incur significant losses. Also, with respect to the CRE CLOs in which we may invest, control over the related underlying loans will be exercised through a special servicer or collateral manager designated by a “directing certificate holder” or a “controlling class representative,” or otherwise pursuant to the related securitization documents. We may acquire classes of CRE CLOs for which we may not have the right to appoint the directing certificate holder or otherwise direct the special servicing or collateral management. With respect to the management and servicing of those loans, the related special servicer or collateral manager may take actions that could adversely affect our interests. In addition to the risks associated with debt instruments (e.g., interest rate risk and credit risk), CLOs carry additional risks including, but not limited to: (i) the possibility that distributions from collateral securities will not be adequate to make interest or other payments; (ii) the quality of the collateral may decline in value or default; (iii) the possibility that we may invest in CRE CLOs that are subordinate to other classes; and (iv) the complex structure of the security may not be fully understood at the time of investment and may produce disputes with the issuer or unexpected investment results.

We will face “spread widening” risk related to our investment in securities.

For reasons not necessarily attributable to any of the risks set forth herein (for example, supply/demand imbalances or other market forces), the market spreads of the securities in which we invest may increase substantially causing the securities prices to fall. It may not be possible to predict, or to hedge against, such “spread widening” risk. The perceived discount in pricing described under “—Some of our securities investments may become distressed, which securities would have a high risk of default and may be illiquid.” may still not reflect the true value of the real estate assets underlying such real estate debt in which we may invest, and therefore further deterioration in value with respect thereto may occur following our investment therein. In addition, mark-to-market accounting of our investments will have an interim effect on the reported value prior to realization of an investment.

Absent our ability to rely upon available guidance from the CFTC that we are not a commodity pool, we, our board of directors or the Advisor, would be subject to additional regulation and required to comply with applicable CFTC disclosure, reporting, and record-keeping requirements.

Registration with the U.S. Commodity Futures Trading Commission (the “CFTC”) as a “commodity pool operator” or any change in our operations (including, without limitation, any change that causes us to be subject to certain specified covered statutory disqualifications) necessary to maintain our ability to rely upon CFTC Letter No. 12-13 or other exclusion from the definition of, or exemption from the requirement to register as, a “commodity pool operator” with the CFTC could adversely affect our ability to implement our investment program, conduct our operations or achieve our objectives and subject us to certain additional costs, expenses and administrative burdens. Furthermore, any determination by us to cease or to limit trading in interests that may be treated as “commodity interests” in order to comply with the regulations of the CFTC may have an adverse effect on our ability to implement our investment objectives and to hedge risks associated with our operations. 56

Table of Contents We may make investments in non-U.S. dollar denominated securities, which will be subject to currency rate exposure and risks associated with the uncertainty of foreign laws and markets, as well as potential trade wars.

Some of our real estate-related securities investments may be denominated in foreign currencies, and therefore, we expect to have currency risk exposure to any such foreign currencies. A change in foreign currency exchange rates may have an adverse impact on returns on our non-U.S. dollar denominated investments. Although we may hedge our foreign currency risk subject to the REIT income qualification tests, we may not be able to do so successfully and may incur losses on these investments as a result of exchange rate fluctuations. To the extent that we invest in non-U.S. dollar denominated securities, in addition to risks inherent in the investment in securities generally discussed in this Annual Report on Form 10-K, we will also be subject to risks associated with the uncertainty of foreign laws and markets including, but not limited to, unexpected changes in regulatory requirements, political and economic instability in certain geographic locations, difficulties in managing international operations, currency exchange controls, potentially adverse tax consequences, additional accounting and control expenses, the administrative burden of complying with a wide variety of foreign laws and the economic uncertainty that may be cause by the President’s imposition of tariffs on such countries and any retaliatory measure taken by such countries.

Investments in real estate-related debt securities are subject to risks including various creditor risks and early redemption features which may materially adversely affect our results of operations and financial condition.

The debt securities and other interests in which we may invest may include secured or unsecured debt at various levels of an issuer’s capital structure. The debt securities in which we may invest may not be protected by financial covenants or limitations upon additional indebtedness, may be illiquid or have limited liquidity, and may not be rated by a credit rating agency. Debt securities are also subject to other creditor risks, including (i) the possible invalidation of an investment transaction as a “fraudulent conveyance” under relevant creditors’ rights laws, (ii) so-called lender liability claims by the issuer of the obligation and (iii) environmental liabilities that may arise with respect to collateral securing the obligations. Our investments may be subject to early redemption features, refinancing options, prepayment options or similar provisions which, in each case, could result in the issuer repaying the principal on an obligation held by us earlier than expected, resulting in a lower return to us than anticipated or reinvesting in a new obligation at a lower return to us.

RISKS ASSOCIATED WITH DEBT FINANCING

We incur mortgage indebtedness and other borrowings, which may increase our business risks, and could hinder our ability to make distributions to our stockholders.

We have financed and may continue to finance a portion of the purchase price of certain of our investments by borrowing funds. As of December 31, 2024, our leverage ratio is approximately 41.2% and is calculated as the outstanding principal balance of our borrowings less cash and cash equivalents divided by the fair value of our real property, net investments in unconsolidated joint venture partnerships, investments in real estate-related securities and debt-related investments not associated with the DST Program (determined in accordance with our valuation procedures). Our current leverage target is between 40-60%. Although we will generally work to maintain our targeted leverage ratio, there are no assurances that we will maintain the targeted range disclosed above or achieve any other leverage ratio that we may target in the future. Our board of directors may from time to time modify our borrowing policy in light of then-current economic conditions, the relative costs of debt and equity capital, the fair values of our properties, general conditions in the market for debt and equity securities, growth and acquisition opportunities or other factors.

Under our charter, we have a limitation on borrowing that precludes us from borrowing in excess of 300% of the value of our net assets unless approved by a majority of the independent directors and disclosed to stockholders in our next quarterly report along with justification for the excess. Net assets for purposes of this calculation are defined to be our total assets (other than intangibles), valued at cost prior to deducting depreciation or other non-cash reserves, less total liabilities. Generally speaking, the preceding calculation is expected to approximate 75% of the aggregate cost of our real properties and debt-related investments before non-cash reserves and depreciation. In addition, we have incurred and may continue to incur mortgage debt secured by some or all of our real properties to obtain funds to acquire additional real properties or for working capital. We may also borrow funds to satisfy the REIT tax qualification requirement that we distribute at least 90% of our annual REIT taxable income to our stockholders. Furthermore, we may borrow funds if we otherwise deem it necessary or advisable to ensure that we maintain our qualification as a REIT for U.S. federal income tax purposes. 57

Table of Contents High debt levels would generally cause us to incur higher interest charges, and could result in higher debt service payments and could be accompanied by restrictive covenants. If there is a shortfall between the cash flow from a property and the cash flow needed to service mortgage debt on that property, then the amount available for distributions to our stockholders may be reduced. In addition, incurring mortgage debt increases the risk of loss of a property since defaults on indebtedness secured by a property may result in lenders initiating foreclosure action. In that case, we could lose the property securing the loan that is in default or be forced to sell the property at an inopportune time, thus reducing the value of our investments. For tax purposes, a foreclosure on any of our properties will be treated as a sale of the property for a purchase price equal to the outstanding balance of the debt secured by the mortgage. If the outstanding balance of the debt secured by the mortgage exceeds our tax basis in the property, we will recognize taxable income on foreclosure, but we would not receive any cash proceeds. We and the Operating Partnership have historically given certain full, partial or limited guarantees, and may continue to give full, partial or limited guarantees in the future, to lenders of mortgage debt on behalf of the entities that own our properties. When we give a guarantee on behalf of an entity that owns one of our properties, we are responsible to the lender for satisfaction of the debt if it is not paid by such entity. If any mortgage contains cross-collateralization or cross-default provisions, a default on a single property could affect multiple properties. If any of our properties are foreclosed upon due to a default, our NAV, liquidity and ability to pay cash distributions to our stockholders may be adversely affected.

Increases in interest rates could increase the amount of our debt service payments and therefore adversely impact our operating results.

As of December 31, 2024, our variable rate debt represented approximately 58.4% of our total debt. To the extent we do not have derivative instruments to hedge exposure to changes in interest rates and/or do not have fixed rate debt, increases in interest rates would increase our interest costs, which would reduce our cash flows and our ability to make distributions to our stockholders. In addition, from time to time we may finance or refinance our investments, or obtain new interest rate hedges in a rising interest rate environment. Accordingly, increases in interest rates could increase our interest and/or hedging expense, which could have an adverse effect on our cash flow from operating activities and our ability to make distributions. In addition, if rising interest rates cause us to need additional capital to repay indebtedness in accordance with its terms or otherwise, we may need to liquidate one or more of our investments at times that may not permit realization of the maximum return on these investments.

Our derivative instruments used to hedge against interest rate fluctuations may not be successful in mitigating our risks associated with interest rates and could reduce the overall returns on our investments.

We utilize derivative instruments to hedge exposure to changes in interest rates on certain of our loans secured by our real properties, but no hedging strategy can protect us completely. We may use derivative instruments, such as forward starting swaps, to hedge interest rate risks associated with debt incurrences that we anticipate may occur. However, if we fail to accurately forecast such debt incurrences we will be subject to interest rate risk without successfully hedging the underlying transaction. Furthermore, the use of derivative instruments may cause us to forgo the benefits of otherwise favorable fluctuations in interest rates, since derivative instruments may prevent us from realizing the full benefits of lower borrowing costs in an environment of declining interest rates.

In addition, derivative instruments may not mitigate all of the risk associated with fluctuations in borrowing costs. Derivative instruments are generally used to hedge fluctuations in benchmark interest rates, such as U.S. treasury security-based interest rates. However, there are other components of borrowing costs that may comprise the “spread” that lenders apply to the benchmark interest rates. The “spread” that lenders apply to benchmark interest rates when making loans may fluctuate from time to time. Fluctuations in the “spread” may be attributable to volatility in the credit markets or borrower-specific credit risk. When we enter into derivative instruments in anticipation of certain debt incurrences, such derivative instruments do not mitigate the risks of fluctuations in “spread” which could exacerbate the risks described above.

We cannot assure our stockholders that our hedging strategy and the derivatives that we use will adequately offset all of our risk related to interest rate volatility or that our hedging of these risks will not result in losses. These derivative instruments may also generate income that may not be treated as qualifying REIT income for purposes of the 75% gross income test or the 95% gross income test. See “Note 6 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for additional discussion regarding our derivative instruments and the related impact on our results of operations. 58

Table of Contents We assume the credit risk of our counterparties with respect to derivative transactions.

We may enter into derivative contracts for risk management purposes to hedge our exposure to cash flow variability caused by changing interest rates on our future variable rate real estate loans receivable and variable rate notes payable. These derivative contracts generally are entered into with bank counterparties and are not traded on an organized exchange or guaranteed by a central clearing organization. We would therefore assume the credit risk that our counterparties will fail to make periodic payments when due under these contracts or become insolvent. If a counterparty fails to make a required payment, becomes the subject of a bankruptcy case, or otherwise defaults under the applicable contract, we would have the right to terminate all outstanding derivative transactions with that counterparty and settle them based on their net market value or replacement cost. In such an event, we may be required to make a termination payment to the counterparty, or we may have the right to collect a termination payment from such counterparty. We assume the credit risk that the counterparty will not be able to make any termination payment owing to us. We may not receive any collateral from a counterparty, or we may receive collateral that is insufficient to satisfy the counterparty’s obligation to make a termination payment. Default by a counterparty may result in the loss of unrealized profits and may force us to enter into a replacement transaction at the then current market price.

We assume the risk that our derivative counterparty may terminate transactions early.

If we fail to make a required payment or otherwise default under the terms of a derivative contract, the counterparty would have the right to terminate all outstanding derivative transactions between us and that counterparty and settle them based on their net market value or replacement cost. In certain circumstances, the counterparty may have the right to terminate derivative transactions early even if we are not defaulting. If our derivative transactions are terminated early, it may not be possible for us to replace those transactions with another counterparty, on as favorable terms or at all.

We may be required to collateralize our derivative transactions.

We may be required to secure our obligations to our counterparties under our derivative contracts by pledging collateral to our counterparties. That collateral may be in the form of cash, securities or other assets. If we default under a derivative contract with a counterparty, or if a counterparty otherwise terminates one or more derivative contracts early, that counterparty may apply such collateral toward our obligation to make a termination payment to the counterparty. If we have pledged securities or other assets, the counterparty may liquidate those assets in order to satisfy our obligations. If we are required to post cash or securities as collateral, such cash or securities will not be available for use in our business. Cash or securities pledged to counterparties may be repledged by counterparties and may not be held in segregated accounts. Therefore, in the event of a counterparty insolvency, we may not be entitled to recover some or all collateral pledged to that counterparty, which could result in losses and have an adverse effect on our operations.

We may default on our derivative obligations if we default on the indebtedness underlying such obligations.

We have agreements with certain of our derivative counterparties that contain a provision where we could be declared in default on our derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to our default on the indebtedness. We also have agreements with certain other derivative counterparties that contain a provision whereby if we default on any of our indebtedness held by the Operating Partnership, including default where repayment of the indebtedness has not been accelerated by the lender, then we could also be declared in default on our derivative obligations. If we are declared in default under the terms of a derivative contract, the counterparty would have the right to terminate all outstanding derivative transactions between us and that counterparty and settle them based on their net market value or replacement cost. 59

Table of Contents We have entered into loan agreements that contain restrictive covenants relating to our operations, which could limit our ability to make distributions to our stockholders.

When providing financing, a lender typically imposes restrictions on us that may affect our distribution and operating policies and our ability to incur additional debt. Our loan agreements include restrictions, covenants, customary market carve-outs and/or guarantees by us. Certain financial covenants include tests of our general liquidity and debt servicing capability as well as certain collateral specific performance and valuation ratios. In addition, our loan agreements may contain covenants that limit our ability to further leverage the property, discontinue insurance coverage or replace the Advisor as our advisor. Further, our loan agreements may limit our ability to replace our property managers or terminate certain operating or lease agreements related to the property. These or other limitations may adversely affect our flexibility and our ability to achieve our investment objectives and make distributions to our stockholders. There can be no assurance that we will be able to comply with these covenants in the future, or that if we violate a covenant the lender would be willing to provide a waiver of such covenant. Violation of these covenants could result in the acceleration of maturities under the default provisions of our loan agreements. As of December 31, 2024, we were in compliance with our financial covenants.

We assume the risk that our credit facility lenders may not honor their commitments to us.

We may enter into credit facility arrangements with lenders pursuant to which, subject to certain conditions, they commit to lend us money, provide us with letters of credit or provide other financial services to us. If we fail to comply with the covenants in such arrangements, the lenders could declare us in default, accelerate the maturities of our borrowings and refuse to make loans or provide other financial services to us. Or, if a lender becomes unable or unwilling to honor its commitments to us, we may not receive the loans and other financial services for which we negotiated. In such a situation, a replacement lender may be difficult or impossible to find quickly or at all. If we are unable to receive loans and other financial services, our liquidity and business could be negatively impacted.

We have entered into, and may continue to enter into, financing arrangements involving balloon payment obligations, which may adversely affect our ability to refinance or sell properties on favorable terms, and to make distributions to our stockholders.

Most of our current financing arrangements require us to make a lump-sum or “balloon” payment at maturity. Our ability to make a balloon payment at maturity will be uncertain and may depend upon our ability to obtain additional financing or our ability to sell a particular property. At the time the balloon payment is due, we may or may not be able to refinance the balloon payment on terms as favorable as the original loan or to sell a particular property at a price sufficient to make the balloon payment. The effect of a refinancing or sale could affect the rate of return to our stockholders and the projected time of disposition of our assets. In an environment of increasing interest rates, if we place debt on properties or obtain corporate debt, we run the risk of being unable to refinance such debt if interest rates are higher at the time a balloon payment is due. In addition, payments of principal and interest made to service our debts, including balloon payments, may leave us with insufficient cash to pay the distributions that we are required to pay to maintain our qualification as a REIT.

Risks related to variable-rate indebtedness could increase the amount of our debt payments and therefore negatively impact our operating results.

Our debt may be subject to the fluctuation of market interest rates such as Term Secured Overnight Financing Rate (“Term SOFR”), Sterling Overnight Index Average Reference Rate (“SONIA”), Prime rate and other benchmark rates. Should such interest rates increase, our variable rate debt service payments may also increase, reducing cash available for distributions. Furthermore, if we need to refinance existing debt during periods of rising interest rates, we could be required to liquidate one or more of our investments at times given the property may not support the same level of loan proceeds, which may not permit realization of the maximum return on such investments. Additionally, as it relates to any real estate assets that we may own, an increase in interest rates may negatively impact activity in the consumer market and reduce consumer purchases, which could adversely affect us. 60

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If we were to use repurchase agreements to finance our securities investments, we may be exposed to risks that could result in losses.

We or the joint ventures in which we invest may use repurchase agreements as a form of leverage to finance our securities and loan investments, and the proceeds from repurchase agreements generally are invested in additional securities. There is a risk that the market value of the securities acquired from the proceeds received in connection with a repurchase agreement may decline below the price of the securities underlying the repurchase agreement that we have sold but remain obligated to repurchase. Repurchase agreements also involve the risk that the counterparty liquidates the securities we delivered to it under the repurchase agreements following the occurrence of an event of default under the applicable repurchase agreement by us. In addition, there is a risk that the market value of the securities we retain may decline. If the buyer of securities under a repurchase agreement were to file for bankruptcy or experience insolvency, we may be adversely affected. Furthermore, lenders may require us to provide additional margin in the form of cash, securities or other forms of collateral under the terms of the contract, and if we fail to resolve such margin calls when due, the lenders may exercise remedies, including taking ownership of the assets securing the applicable obligations. Also, in entering into repurchase agreements, we bear the risk of loss to the extent that the proceeds of the repurchase agreement are less than the value of the underlying securities. In addition, the interest costs associated with repurchase agreement transactions may adversely affect our results of operations and financial condition, and, in some cases, we may be worse off than if we had not used such instruments.

RISKS RELATED TO OUR TAXATION AS A REIT

Failure to qualify as a REIT could adversely affect our operations and our ability to make distributions.

We have operated and elected to be treated as a REIT for U.S. federal income tax purposes, commencing with the taxable year ended December 31, 2006, and we intend to continue to operate in accordance with the requirements for qualification as a REIT.

If we were to fail to qualify as a REIT for any taxable year, we would be subject to U.S. federal income tax on our taxable income at corporate rates. In addition, we would generally be disqualified from treatment as a REIT for the four taxable years following the year in which we lose our REIT status. Losing our REIT status would reduce our net earnings available for investment or distribution to stockholders because distributions to stockholders would no longer be deductible in computing our taxable income, resulting in additional tax liability. In addition, we would no longer be required to make distributions. To the extent that distributions had been made in anticipation of our qualifying as a REIT, we might be required to borrow funds or liquidate some investments in order to pay the applicable corporate income tax. In addition, although we intend to operate in a manner as to qualify as a REIT, it is possible that future economic, market, legal, tax or other considerations may cause our board of directors to determine that it is no longer in our best interest to continue to be qualified as a REIT and recommend that we revoke our REIT election.

Failure of the Operating Partnership to be taxable as a partnership could cause us to fail to qualify as a REIT and we could suffer other adverse tax consequences.

We believe that the Operating Partnership will continue to be treated for U.S. federal income tax purposes as a partnership and not as an association or as a publicly traded partnership taxable as a corporation. If the Internal Revenue Service (“IRS”) were successfully to determine that the Operating Partnership was properly treated as a corporation, the Operating Partnership would be required to pay U.S. federal income tax at corporate rates on its net income, its partners would be treated as stockholders of the Operating Partnership and distributions to partners would constitute distributions that would not be deductible in computing the Operating Partnership’s taxable income. In addition, if the Operating Partnership were treated as a corporation, we could fail to qualify as a REIT, with the resulting consequences described above. 61

Table of Contents To continue to qualify as a REIT, we must meet annual distribution requirements, which may result in us distributing amounts that may otherwise be used for our operations.

To maintain the favorable tax treatment accorded to REITs, we normally will be required each year to distribute to our stockholders at least 90% of our REIT taxable income, determined without regard to the deduction for distributions paid and by excluding net capital gains. We are subject to U.S. federal income tax on our undistributed taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than the sum of (i) 85% of our ordinary income, (ii) 95% of our capital gain net income and (iii) 100% of our undistributed income from prior years. These requirements could cause us to distribute amounts that otherwise would be spent on acquisitions of properties and it is possible that we might be required to borrow funds or sell assets to fund these distributions. Additionally, it is possible that we might not always be able to make distributions sufficient to meet the annual distribution requirements required to maintain our REIT status, avoid corporate tax on undistributed income and/or avoid the 4% excise tax.

From time to time, we may generate taxable income greater than cash flow due to differences in timing between the recognition of taxable income and the actual receipt of cash. If we do not have other funds available in these situations, we could be required to borrow funds on unfavorable terms, sell investments at disadvantageous prices or distribute amounts that would otherwise be invested in future acquisitions to make distributions sufficient to enable us to pay out enough of our taxable income to satisfy the REIT distribution requirement and to avoid corporate income tax and the 4% excise tax in a particular year. These alternatives could increase our costs or reduce our equity. Thus, compliance with the REIT requirements may hinder our ability to grow, which could adversely affect the value of our common stock.

Recharacterization of sale-leaseback transactions may cause us to lose our REIT status.

We may purchase real properties and lease them back to the sellers of such properties. If we were to attempt to structure a sale-leaseback transaction such that the lease would be characterized as a “true lease” that would allow us to be treated as the owner of the property for U.S. federal income tax purposes, we cannot assure our stockholders that the IRS will not challenge such characterization. In the event that any such sale-leaseback transaction is challenged and recharacterized as a financing transaction or loan for U.S. federal income tax purposes, deductions for depreciation and cost recovery relating to such property would be disallowed. If a sale-leaseback transaction were so recharacterized, we might fail to satisfy the REIT qualification “asset tests,” “income tests,” or the “distribution requirement” and, consequently, lose our REIT status effective with the year of recharacterization. Alternatively, the amount of our REIT taxable income could be recalculated, which might also cause us to fail to meet the distribution requirement for a taxable year in the event we cannot make a sufficient deficiency distribution.

Contributions of properties to a Subsidiary REIT or TRS could result in our recognizing additional taxable income.

We may choose to transfer certain properties held by the Operating Partnership to a Subsidiary REIT or TRS. Such transfer would generally be structured to be in a manner to qualify as a tax-free contribution under Section 351 of the Code and would allow such properties to be sold at a later date without triggering the recognition of “built-in gain” by the original contributor of such properties to the Operating Partnership. Upon such transfer, the Subsidiary REIT or TRS, and not the Operating Partnership, would be entitled to claim any depreciation deductions relating to the transferred property. This could result in a higher amount of taxable income being allocated to us under the Operating Partnership Agreement than would be allocated in the absence of such transfer to the Subsidiary REIT or TRS.

Our stockholders may have current tax liability on distributions if our stockholders elect to reinvest in shares of our common stock.

Even if our stockholders participate in our DRIP, our stockholders will be deemed to have received, and for U.S. federal income tax purposes will be taxed on, the amount reinvested in shares of our common stock to the extent the amount reinvested was not a tax-free return of capital. As a result, our stockholders that are not tax-exempt entities may have to use funds from other sources to pay their tax liability on the value of the common stock received. 62

Table of Contents Distributions payable by REITs do not qualify for the reduced tax rates that apply to other corporate distributions.

The current maximum U.S. federal income tax rate for distributions payable by corporations to domestic stockholders that are individuals, trusts or estates is 20%. Distributions payable by REITs, however, generally are taxed at the ordinary income tax rate applicable to the individual recipient, rather than the maximum 20% income tax rate, subject to certain applicable deductions and holding periods. Under current law, however, individuals may be able to deduct 20% of income received as ordinary REIT dividends until 2026, thus reducing the maximum effective U.S. federal income tax rate on such dividend to 29.6%. The more favorable rates applicable to regular corporate distributions could cause investors who are individuals to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay distributions, which could adversely affect the value of the stock of REITs, including our common stock.

If we were considered to have actually or constructively paid a “preferential dividend” to certain of our stockholders, our status as a REIT could be adversely affected.

For taxable years ending on or before December 31, 2014, in order for distributions to be counted as satisfying the annual distribution requirement for REITs, and to provide us with a REIT-level tax deduction, the distributions must not have been “preferential dividends.” A dividend is not a preferential dividend if the distribution is (1) pro rata among all outstanding shares within a particular class, and (2) in accordance with the preferences among different classes of shares as set forth in our organizational documents. For the taxable year that began on January 1, 2015 and all subsequent taxable years, so long as we continue to be a “publicly offered REIT” (i.e., a REIT which is required to file annual and periodic reports with the SEC under the Exchange Act), the preferential dividend rule will not apply to us.

In certain circumstances, we may be subject to U.S federal and state income taxes as a REIT, which would reduce our cash available for distribution to our stockholders.

We may be subject to taxes on our income or property even if we qualify as a REIT for U.S. federal income tax purposes, including those described below:

●	In order to qualify as a REIT, we are required to distribute annually at least 90% of our REIT taxable income (determined without regard to the dividends-paid deduction or net capital gain) to our stockholders. If we satisfy the distribution requirement but distribute less than 100% of our REIT taxable income (and any net capital gain), we will be subject to corporate income tax on the undistributed income.
●	We will be required to pay a 4% nondeductible excise tax on the amount, if any, by which the distributions we make to our stockholders in any calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income and 100% of our undistributed income from previous years.
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●	If we have net income from the sale of foreclosure property that we hold primarily for sale to customers in the ordinary course of business or other non-qualifying income from foreclosure property, we will be required to pay a tax on that income at the highest corporate income tax rate.
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●	Any gain we recognize on the sale of a property, other than foreclosure property, that we hold primarily for sale to customers in the ordinary course of business, could be subject to the 100% “prohibited transaction” tax unless the sale qualified for a statutory safe harbor that requires, among other things, a two-year holding period for the production of income.
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Investments in other REITs and real estate partnerships could subject us to the tax risks associated with the tax status of such entities.

We may invest in the securities of other REITs and real estate partnerships. Such investments are subject to the risk that any such REIT or partnership may fail to satisfy the requirements to qualify as a REIT or a partnership, as the case may be, in any given taxable year. In the case of a REIT, such failure would subject such entity to taxation as a corporation, may require such REIT to incur indebtedness to pay its tax liabilities, may reduce its ability to make distributions to us, and may render it ineligible to elect REIT status prior to the fifth taxable year following the year in which it fails to so qualify. In the case of a partnership, such failure could subject such partnership to an entity level tax and reduce the entity’s ability to make distributions to us. In addition, such failures could, depending on the circumstances, jeopardize our ability to qualify as a REIT because we may then own more than 10% of the securities of an issuer that was neither a REIT, a qualified REIT subsidiary nor a TRS.

If any Subsidiary REIT failed to qualify as a REIT, we could fail to remain qualified as a REIT.

We own and may acquire direct or indirect interests in one or more Subsidiary REITs. A Subsidiary REIT is subject to the various REIT qualification requirements and other limitations described herein that are applicable to us. If a Subsidiary REIT were to fail to qualify as a REIT, then (i) that Subsidiary REIT would become subject to U.S. federal income tax and (ii) the Subsidiary REIT’s failure to qualify could have an adverse effect on our ability to comply with the REIT income and asset tests, and thus could impair our ability to qualify as a REIT unless we could avail ourself of certain relief provisions.

Our board of directors is authorized to revoke our REIT election without stockholder approval, which may cause adverse consequences to our stockholders.

Our charter authorizes our board of directors to revoke or otherwise terminate our REIT election, without the approval of our stockholders, if it determines that it is not in our best interest to qualify as a REIT. In this event, we would become subject to U.S. federal income tax at regular corporate income tax rates on our taxable income and we would no longer be required to distribute most of our net income to our stockholders, which may cause a reduction in the total return to our stockholders.

Distributions to tax-exempt investors may be classified as unrelated business taxable income.

Neither ordinary nor capital gain distributions with respect to our common stock nor gain from the sale of common stock should generally constitute unrelated business taxable income to a tax-exempt investor. However, there are certain exceptions to this rule. In particular:

●	part of the income and gain recognized by certain qualified employee pension trusts with respect to our common stock may be treated as unrelated business taxable income if shares of our common stock are predominately held by qualified employee pension trusts, we are required to rely on a special look-through rule for purposes of meeting one of the REIT share ownership tests, and we are not operated in a manner to avoid treatment of such income or gain as unrelated business taxable income;
●	part of the income and gain recognized by a tax-exempt investor with respect to our common stock would constitute unrelated business taxable income if the investor incurs debt in order to acquire the common stock; and
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●	part or all of the income or gain recognized with respect to our common stock by social clubs, voluntary employee benefit associations, supplemental unemployment benefit trusts and qualified group legal services plans that are exempt from U.S. federal income taxation under Sections 501(c)(7), (9), (17) or (20) of the Code may be treated as unrelated business taxable income.
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Table of Contents The stock ownership limit imposed by the Code for REITs and our charter may restrict our business combination opportunities and stockholders may be restricted from acquiring or transferring certain amounts of our capital stock.

To maintain our status as a REIT under the Code, not more than 50% in value of our outstanding stock may be owned, directly or indirectly, by five or fewer individuals (as defined in the Code to include certain entities) at any time during the last half of each taxable year after our first year in which we qualify as a REIT. Our charter, with certain exceptions, authorizes our board of directors to take the actions that are necessary and desirable to preserve our qualification as a REIT. Unless an exemption is granted by our board of directors, no person (as defined to include entities) may own more than 9.8% in value of our capital stock or more than 9.8% in value or in number of shares, whichever is more restrictive, of our common stock following the completion of our securities offerings. In addition, our charter will generally prohibit beneficial or constructive ownership of shares of our capital stock by any person who owns, actually or constructively, an interest in any of our customers that would cause us to own, actually or constructively, more than a 9.9% interest in any of our customers. Our board of directors may grant an exemption in its sole discretion, subject to such conditions, representations and undertakings as it may determine. These ownership limitations in our charter are common in REIT charters and are intended, among other purposes, to assist us in complying with the tax law requirements and to minimize administrative burdens. However, these ownership limits might also delay or prevent a transaction or a change in our control that might involve a premium price for our common stock or otherwise be in the best interests of our stockholders.

The tax on prohibited transactions will limit our ability to engage in transactions, including certain methods of syndicating and securitizing mortgage loans, that would be treated as sales for U.S. federal income tax purposes.

A REIT’s net income from prohibited transactions is subject to a 100% tax. In general, prohibited transactions are sales or other dispositions of property, other than foreclosure property, but including mortgage loans that are held primarily for sale to customers in the ordinary course of business. We might be subject to this tax if we were to syndicate, dispose of or securitize loans in a manner that was treated as a sale of the loans for U.S. federal income tax purposes. Therefore, to avoid the prohibited transactions tax, we may choose not to engage in certain sales of loans at the REIT level and may limit the structures we utilize for our securitization transactions, even though the sales or structures otherwise might be beneficial to us.

In addition, the Code provides a safe harbor that, if met, allows us to avoid being treated as engaged in a prohibited transaction. In order to meet the safe harbor, (i) we must have held the property for at least two years (and, in the case of property which consists of land or improvements not acquired through foreclosure, we must have held the property for two years for the production of rental income), (ii) we must not have made aggregate expenditures includible in the basis of the property during the two-year period preceding the date of sale that exceed 30% of the net selling price of the property, and (iii) during the taxable year the property is disposed of, we must not have made more than seven property sales or, alternatively, the aggregate adjusted basis or fair market value of all the properties sold by us during the taxable year must not exceed 10% of the aggregate adjusted basis or 10% of the fair market value, respectively, of all our assets as of the beginning of the taxable year (with the 10% thresholds increased to 20% in certain circumstances). If the seven-sale limitation in (iii) above is not satisfied, substantially all of the marketing and development expenditures with respect to the property must be made through an independent contractor from whom we do not derive or receive any income (or, in certain circumstances, by a TRS). We will endeavor to avoid engaging in prohibited transactions or we will attempt to comply with the safe harbor provisions. There is no assurance, however, that we will not engage in prohibited transactions.

Our ownership of and relationship with our taxable REIT subsidiaries will be limited and a failure to comply with the limits would jeopardize our REIT status and may result in the application of a 100% excise tax.

A REIT may own up to 100% of the stock of one or more TRSs. A TRS may earn income that would not be qualifying income if earned directly by the parent REIT. Both the subsidiary and the REIT must jointly elect to treat the subsidiary as a TRS. A corporation of which a TRS directly or indirectly owns more than 35% of the voting power or value of the stock will automatically be treated as a TRS. Overall, no more than 20% of the value of a REIT’s assets may consist of stock or securities of one or more TRSs. A domestic TRS will pay federal, state and local income tax at regular corporate rates on any income that it earns. In addition, the TRS rules limit the deductibility of interest paid or accrued by a TRS to its parent REIT to assure that the TRS is subject to an appropriate level of corporate taxation. The rules also impose a 100% excise tax on certain transactions between a TRS and its parent REIT that are not conducted on an arm’s-length basis. We cannot assure our stockholders that we will be able to comply with the 20% value limitation on ownership of TRS stock and securities on an ongoing basis so as to maintain REIT status or to avoid application of the 100% excise tax imposed on certain non-arm’s length transactions. 65

Table of Contents Recharacterization of transactions under the Operating Partnership’s private placements could result in a 100% tax on income from prohibited transactions, which would diminish our cash distributions to our stockholders.

The IRS could recharacterize transactions under the Operating Partnership’s private placements such that the Operating Partnership could be treated as the bona fide owner, for tax purposes, of properties acquired and resold by the entity established to facilitate the transaction. Such recharacterization could result in the income realized on these transactions by the Operating Partnership being treated as gain on the sale of property that is held as inventory or otherwise held primarily for the sale to customers in the ordinary course of business. In such event, such gain could constitute income from a prohibited transaction and might be subject to a 100% tax. If this occurs, our ability to pay cash distributions to our stockholders will be adversely affected.

Legislative or regulatory action could adversely affect investors.

At any time, the U.S. federal income tax laws or regulations governing REITs or the administrative interpretations of those laws or regulations may be amended. We cannot predict when or if any new U.S. federal income tax law, regulation or administrative interpretation, or any amendment to any existing U.S. federal income tax law, regulation or administrative interpretation, will be adopted, promulgated or become effective and any such law, regulation or interpretation may take effect retroactively. In recent years, numerous legislative, judicial and administrative changes have been made to the U.S. federal income tax laws applicable to investments in REITs. Although REITs generally receive more favorable tax treatment than entities taxed as regular corporations, it is possible that future legislation would result in a REIT having fewer tax advantages, and it could become more advantageous for a company that invests in real estate to elect to be treated for U.S. federal income tax purposes as a corporation. Our charter provides our board of directors with the power, under certain circumstances, to revoke or otherwise terminate our REIT election and cause us to be taxed as a regular corporation, without the vote of our stockholders. Our board of directors has fiduciary duties to us and our stockholders and could only cause such changes in our tax treatment if it determines in good faith that such changes are in the best interest of our stockholders. You are urged to consult with your tax advisor regarding the effect of the potential future changes to the federal tax laws on an investment in our shares of common stock.

Qualifying as a REIT involves highly technical and complex provisions of the Code.

Qualification as a REIT involves the application of highly technical and complex Code provisions for which only limited judicial and administrative authorities exist. Even a technical or inadvertent violation could jeopardize our REIT qualification. Our continued qualification as a REIT will depend on our satisfaction of certain asset, income, organizational, distribution, stockholder ownership and other requirements on a continuing basis. In addition, our ability to satisfy the requirements to qualify as a REIT depends in part on the actions of third parties over which we have no control or only limited influence, including in cases where we own an equity interest in an entity that is classified as a partnership for U.S. federal income tax purposes.

Certain foreign investors may be subject to the Foreign Investment in Real Property Tax Act of 1980 (“FIRPTA”) on the sale of common shares if we are unable to qualify as a “domestically controlled qualified investment entity.”

A foreign person (subject to certain exceptions) disposing of a U.S. real property interest, including shares of a U.S. corporation whose assets consist principally of U.S. real property interests, is generally subject to a tax, known as FIRPTA, on the gain recognized on the disposition. FIRPTA does not apply, however, to the disposition of stock in a REIT if the REIT is a “domestically controlled qualified investment entity” (as defined in Section 897(h)(4)(B) of the Code). A domestically controlled qualified investment entity includes a REIT in which, at all times during a specified testing period, 50% or more (based on the value of its shares) is held directly or indirectly by U.S. holders. Final Treasury regulations effective April 25, 2024 (the “Final Regulations”) modify the existing prior tax guidance relating to the manner in which we determine whether we are a domestically controlled REIT. These regulations provide a look-through rule for our stockholders that are non-publicly traded partnerships, non-publicly traded REITs, non-publicly traded regulated investment companies, or domestic “C” corporations owned 50% or more directly or indirectly by foreign persons (“foreign-controlled domestic corporations”) and treat “qualified foreign pension funds” and “international organizations” as foreign persons for this purpose. The look-through rule in the Final Regulations applicable to foreign-controlled domestic corporations will not apply to a REIT for a period of up to ten years if the REIT is able to satisfy certain requirements during that time, including not undergoing a significant change in its ownership and not acquiring a significant amount of new U.S. real property interests, in each case since April 24, 2024, the date the Final Regulations were issued. If a REIT fails to satisfy such requirements during the ten-year period, the look-through rule in the Final Regulations applicable to foreign-controlled domestic corporations will apply to such REIT beginning on the day immediately following the date of such failure. We cannot predict when we will commence being subject to such look-through rule in the Final Regulations and we may not be able to satisfy the applicable requirements for the duration of the ten-year period. 66

Table of Contents Prospective investors are urged to consult with their tax advisors regarding the application and impact of these rules. There can be no assurance that we are or will qualify as a domestically controlled REIT. If we were to fail to so qualify, gain realized by a foreign investor on a sale of our common stock would potentially be subject to FIRPTA unless our common stock was traded on an established securities market and the foreign investor did not at any time during a specified testing period directly or indirectly own more than 10% of the value of our outstanding common stock. We do not, however, expect any of our shares to be regularly traded on an established securities market. Regardless of our status as a domestically controlled qualified investment entity, capital gain distributions attributable to a disposition of a U.S. real property interest will generally be subject to tax under FIRPTA in the hands of non-U.S. investors (unless an exception to FIRPTA applies to such investor).

Compliance with REIT requirements may force us to liquidate otherwise attractive investments.

To qualify as a REIT, at the end of each calendar quarter, at least 75% of our assets must consist of cash, cash items, government securities and qualified real estate assets. The remainder of our investments in securities (other than qualified real estate assets and government securities) generally cannot include more than 10% of the voting securities of any one issuer or more than 10% of the value of the outstanding securities of any one issuer unless we and such issuer jointly elect for such issuer to be treated as a “taxable REIT subsidiary” under the Code. Additionally, no more than 5% of the value of our assets (other than government securities and qualified real estate assets) can consist of the securities of any one issuer, and no more than 20% of the value of our assets may be represented by securities of one or more taxable REIT subsidiaries (25% in certain taxable years beginning before December 31, 2017). If we fail to comply with these requirements, we must dispose of a portion of our assets within 30 days after the end of the calendar quarter in order to avoid losing our REIT status and suffering adverse tax consequences. In order to satisfy these requirements, we may be forced to liquidate otherwise attractive investments.

The failure of a mezzanine loan to qualify as a real estate asset could adversely affect our ability to qualify as a REIT.

The IRS has provided a safe harbor for mezzanine loans but not rules of substantive law. Pursuant to the safe harbor, if a mezzanine loan meets certain requirements, it will be treated by the IRS as a real estate asset for purposes of the REIT asset tests, and interest derived from the mezzanine loan will be treated as qualifying mortgage interest for purposes of the REIT 75% gross income test. We may acquire mezzanine loans that do not meet all of the requirements of this safe harbor. In the event we own a mezzanine loan that does not meet the safe harbor, the IRS could challenge such loan’s treatment as a real estate asset for purposes of the REIT asset and income tests and, if such a challenge were sustained, we could fail to qualify as a REIT.

INVESTMENT COMPANY RISKS

Avoiding registration as an investment company imposes limits on our operations, and failure to avoid registration reduces the value of the stockholders’ investment.

We conduct our operations so as not to become regulated as an investment company under the Investment Company Act of 1940, as amended, which we refer to as the “Investment Company Act.” To do so, we will have to continue to monitor the value of our securities in comparison with the value of our other assets and make sure that the value of our securities does not exceed 40% of the value of all of our assets on an unconsolidated basis. As a result, we may be unable to sell assets we would otherwise want to sell and may be unable to purchase securities we would otherwise want to purchase.

If we were obligated to register as an investment company, we would have to comply with a variety of substantive requirements under the Investment Company Act that impose, among other things:

●	limitations on capital structure;
●	restrictions on specified investments;
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●	prohibitions on transactions with affiliates; and
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●	compliance with reporting, record keeping, voting proxy disclosure and other rules and regulations that would significantly increase our operating expenses.
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Registration with the SEC as an investment company would be costly, would subject our company to a host of complex regulations and would divert the attention of management from the conduct of our business. 67

Table of Contents Further, if it were established that we were an unregistered investment company, there would be a risk that we would be subject to monetary penalties and injunctive relief in an action brought by the SEC, that we would be unable to enforce contracts with third parties and that third parties could seek to obtain rescission of transactions undertaken during the period it was established that we were an unregistered investment company. Any such results would be likely to have a material adverse effect on us.

RETIREMENT PLAN RISKS

If the stockholders fail to meet the fiduciary and other standards under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) or the Code as a result of an investment in our stock, the stockholders could be subject to penalties.

There are special considerations that apply to employee benefit plans subject to ERISA (such as profit-sharing, section 401(k) or pension plans) and other retirement plans or accounts subject to Section 4975 of the Code (such as an IRA) or any entity whose assets include such assets (each a “Benefit Plan”) that are investing in our shares. If the stockholders are investing the assets of such a plan or account in our common stock, stockholders should satisfy themselves that:

●	stockholder investment is consistent with their fiduciary and other obligations under ERISA and the Code;
●	stockholder investment is made in accordance with the documents and instruments governing the plan or IRA, including the plan’s or account’s investment policy;
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●	stockholder investment satisfies the prudence and diversification requirements of Sections 404(a)(1)(B) and 404(a)(1)(C) of ERISA and other applicable provisions of ERISA and the Code;
---	---
●	stockholder investment in our shares, for which no trading market may exist, is consistent with the liquidity needs of the plan or IRA;
---	---
●	stockholder investment will not produce an unacceptable amount of “unrelated business taxable income” for the plan or IRA;
---	---
●	stockholder will be able to comply with the requirements under ERISA and the Code to value the assets of the plan or IRA annually; and
---	---
●	stockholder investment will not constitute a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code.
---	---

With respect to the annual valuation requirements described above, we expect to provide an estimated value of our net assets per share annually to those fiduciaries (including IRA trustees and custodians) who request it. Although this estimate will be based upon determinations of the NAV of our shares in accordance with our valuation procedures, no assurance can be given that such estimated value will satisfy the applicable annual valuation requirements under ERISA and the Code. The Department of Labor or the IRS may determine that a plan fiduciary or a fiduciary acting for an IRA is required to take further steps to determine the value of our common shares. In the absence of an appropriate determination of value, a plan fiduciary or a fiduciary acting for an IRA may be subject to damages, penalties or other sanctions.

Failure to satisfy the fiduciary standards of conduct and other applicable requirements of ERISA and the Code may result in the imposition of civil and criminal penalties, and can subject the fiduciary to claims for damages or for equitable remedies, including liability for investment losses. In addition, if an investment in our shares constitutes a prohibited transaction under ERISA or the Code, the fiduciary or IRA owner who authorized or directed the investment may be subject to the imposition of excise taxes with respect to the amount invested. Additionally, the investment transaction may have to be reversed. In the case of a prohibited transaction involving an IRA owner, the IRA may be disqualified as a tax-exempt account and all of the assets of the IRA may be deemed distributed and subjected to tax. ERISA plan fiduciaries and IRA owners should consult with counsel before making an investment in our shares. 68

Table of Contents If our assets are deemed to be plan assets, the Advisor and we may be exposed to liabilities under Title I of ERISA and the Code.

In some circumstances where an ERISA plan holds an interest in an entity, the assets of the entity are deemed to be ERISA plan assets unless an exception applies. This is known as the “look-through rule.” Under those circumstances, the obligations and other responsibilities of plan sponsors, plan fiduciaries and plan administrators, and of parties in interest and disqualified persons, under Title I of ERISA and Section 4975 of the Code, as applicable, may be applicable, and there may be liability under these and other provisions of ERISA and the Code. We believe that our assets should not be treated as plan assets because our classes of shares should already qualify as “publicly-offered securities” that are exempt from the look-through rules under applicable Treasury Regulations. We note, however, that because certain limitations are imposed upon the transferability of shares so that we may qualify as a REIT, and perhaps for other reasons, it is possible that this “publicly-offered securities” exemption may not apply. If that is the case, and if the Advisor or we are exposed to liability under ERISA or the Code or we are required to alter our operations to comply with ERISA or the Code, our performance and results of operations could be adversely affected. Prior to making an investment in us, stockholders should consult with their legal and other advisors concerning the impact of ERISA and the Code on stockholder investment and our performance.

We do not intend to provide investment advice to any potential investor for a fee. However, we, the Advisor, and our respective affiliates receive certain fees and other consideration disclosed herein in connection with an investment. If it were determined we provided a Benefit Plan investor with investment advice for a fee, or if our assets are not exempt from the look-through rules, it could give rise to a determination that we constitute an investment advice fiduciary under ERISA and/or that our fee arrangements or operations are in violation of ERISA or Section 4975 of the Code. Such a determination could give rise to claims that our fee arrangements constitute non-exempt prohibited transactions under ERISA or the Code and/or claims that we have breached a fiduciary duty to a Benefit Plan investor. Adverse determinations with respect to ERISA fiduciary status or non-exempt prohibited transactions could result in significant civil penalties and excise taxes.

ITEM 1B.UNRESOLVED STAFF COMMENTS

None.

​

ITEM 1C.CYBERSECURITY

Assessment, Identification and Management of Material Risks from Cybersecurity Threats

We rely on the cybersecurity strategy and policies implemented by Ares, the parent company of our Advisor. Ares’ cybersecurity strategy prioritizes the detection and analysis of and response to known, anticipated or unexpected threats, effective management of security risks and resilience against cyber incidents. Ares’ enterprise-wide cybersecurity program is aligned to the National Institute of Standards and Technology Cybersecurity Framework. Ares’ cybersecurity risk management processes include technical security controls, policy enforcement mechanisms, monitoring systems, tools and related services, which include tools and services from third-party providers, and management oversight to assess, identify and manage risks from cybersecurity threats. Ares has implemented and continues to implement risk-based controls designed to prevent, detect and respond to information security threats and we rely on those controls to help us protect our information, our information systems, and the information of our investors, and other third parties who entrust us with their sensitive information.

Ares’ cybersecurity program includes physical, administrative and technical safeguards, as well as plans and procedures designed to help Ares prevent and timely and effectively respond to cybersecurity threats and incidents, including threats or incidents that may impact us, our Advisor or Ares. Ares’ cybersecurity risk management process seeks to monitor cybersecurity vulnerabilities and potential attack vectors, evaluate the potential operational and financial effects of any threat and mitigate such threats. The assessment of cybersecurity threats, including those which may impact us, our Advisor or Ares, is integrated into Ares’ Enterprise Risk Management program, which is overseen by the Ares Enterprise Risk Committee (the “Ares ERC”), as discussed below. In addition, Ares periodically engages with third-party consultants and key vendors to assist it in assessing, enhancing, implementing, and monitoring its cybersecurity risk management programs and responding to incidents. 69

Table of Contents The Ares cybersecurity risk management and awareness programs include periodic identification and testing of vulnerabilities, regular phishing simulations and annual general cybersecurity awareness and data protection training, including for all of the employees of Ares. Ares’ cybersecurity training programs also include annual certification requirements for employees of Ares with respect to certain policies supporting the cybersecurity program including the Information Security and Electronic Communications policy, Data Protection policy and Privacy Policy. Ares undertakes periodic internal security reviews of its information systems and related controls, including systems affecting personal data and the cybersecurity risks of Ares’ and our critical third-party service providers and other partners. Ares also completes periodic external reviews of its cybersecurity program and practices, which include assessments of relevant data protection practices and targeted attack simulations.

In the event of a cybersecurity incident impacting us, our Advisor or Ares, Ares has developed an incident response plan that provides guidelines for responding to such an incident and facilitates coordination across multiple operational functions of Ares, including coordinating with the relevant members of our Advisor. The incident response plan includes notification to the applicable members of cybersecurity leadership, including Ares’ Chief Information Security Officer (“CISO”), and, as appropriate, escalation to the full Ares ERC and/or an internal ad-hoc group of senior employees, tasked with helping to manage the cybersecurity incident. Depending on their nature, incidents may also be reported to the audit committee or full board of directors of Ares, as well as to the audit committee of our board of directors and to our full board of directors, if appropriate.

Material Impact of Risks from Cybersecurity Threats

In the last three fiscal years, we have not experienced a material information security breach incident that has materially affected our business strategy, results of operations or financial conditions. The expenses we have incurred from information security breach incidents have been immaterial, and we are not aware of any cybersecurity risks that are reasonably likely to materially affect our business. However, future incidents could have a material impact on our business strategy, results of operations, or financial condition. For additional discussion of the risks posed by cybersecurity threats, see “Item 1A. Risk Factors—Risks Related to Our General Business Operations and Our Corporate Structure—Security incidents or cyber-attacks could adversely affect our business by causing a disruption to our operations or the operations of the Advisor, the Dealer Manager, our transfer agent or any other party that provides us with services essential to our operations…which could negatively impact our business, financial condition and operating results.”

Oversight of Cybersecurity Risks

Our cybersecurity program is managed by Ares’ dedicated internal cybersecurity team, which is responsible for enterprise-wide cybersecurity strategy, policies, standards, engineering, architecture and processes. The team is led by Ares’ CISO, who has a Master’s degree in Cybersecurity from Brown University and over 25 years of experience advising on and managing risks from cybersecurity threats as well as developing and implementing cybersecurity policies and procedures. The Ares CISO reports cybersecurity updates to the Ares ERC. The Ares ERC is a committee that governs and oversees the Ares Enterprise Risk Program, including cybersecurity. The Ares ERC includes members of Ares’ senior executive management, including its CEO, Co-Presidents, CFO, General Counsel, Global Chief Compliance Officer and Head of Enterprise Risk, who acts as chairperson of the Ares ERC. The Ares ERC, through regular consultation with the Ares internal cybersecurity team and representatives from our Advisor, assesses, discusses, and prioritizes Ares’ approach to high-level risks, mitigating controls, and ongoing cybersecurity efforts.

Our audit committee has primary responsibility for oversight and review of guidelines and policies with respect to risk assessment and risk management, including cybersecurity. Periodically, reports are provided to our audit committee as well as our full board of directors, as appropriate, on cybersecurity matters, primarily through presentations by the CISO and the Ares’ Head of Enterprise Risk. Such reporting includes updates on Ares’ cybersecurity program as it impacts us, the external threat environment, and Ares’ programs to address and mitigate the risks associated with the evolving cybersecurity threat environment. These reports also include updates on our and Ares’ preparedness, prevention, detection, responsiveness, and recovery with respect to cyber incidents. 70

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ITEM 2.PROPERTIES

As of December 31, 2024, our consolidated real property portfolio consisted of 124 properties, totaling approximately 24.6 million square feet located in 37 markets throughout the U.S. We also owned, either directly through our unconsolidated joint venture partnerships or indirectly through other entities owned by our unconsolidated joint venture partnerships, 161 credit lease properties, seven industrial properties, 13 data center investments and five debt-related investments as of December 31, 2024. Unless otherwise noted, these unconsolidated properties are excluded from the presentation of our portfolio data herein. Refer to “Note 3 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for detail relating to our 2024 acquisition and disposition activity and “Note 4 to the Consolidated Financial Statements” for detail relating to our unconsolidated joint venture partnerships. Unless otherwise indicated, the term “fair value” of our real estate investments as used herein refers to the fair value as determined pursuant to our valuation procedures.

As used herein, the term “commercial” refers to our industrial, retail and office properties or customers, as applicable.

Portfolio Overview. We currently group our real property portfolio into five categories: residential, industrial, retail, office and other. The following table summarizes our real property portfolio by category as of December 31, 2024:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	Average		​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	% of Total	​	Effective Annual		​	​	​	​	​	​	% of	****
( and square feet in thousands,	Number of	****	Number of	****	Rentable	****	Rentable	****	Base Rent per		****	%	****	Aggregate		****	Aggregate	​
except for per square foot data)	Markets (1)	​	Real Properties	​	Square Feet	​	Square Feet	****	Square Foot (2)		​	Leased	​	Fair Value		​	Fair Value	​
Residential properties	11		22	​	6,070		24.7	%	$	28.84		92.3	%	$	2,331,100		40.5	%
Industrial properties	31		69	​	14,219		57.7	​		6.99		97.7	​		2,102,900		36.5	​
Retail properties	8		18	​	2,292		9.3	​		20.15		96.7	​		694,900		12.1	​
Office properties	6		7	​	1,381		5.6	​		37.93		79.2	​		464,850		8.1	​
Other properties	4	​	8	​	669	​	2.7	​	​	19.85	​	82.6	​	​	164,300	​	2.8	​
Total real property portfolio	37		124		24,631		100.0	%	$	15.23		94.8	%	$	5,758,050		100.0	%

All values are in US Dollars.

(1)	Reflects the number of unique markets by category and in total. As such, the total number of markets does not equal the sum of the number of markets by category as certain categories are located in the same market.
(2)	Amount calculated as total annualized base rent, which includes the impact of any contractual tenant concessions (cash basis) per the terms of the lease, divided by total lease square footage as of December 31, 2024.
---	---

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Market Diversification. The following table summarizes certain operating metrics of our real property portfolio by market and by category as of December 31, 2024:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​	****	​		****	% of Gross	****	​	****	% of Total	****	​	****
​	​	Number of	​	Investment in		​	Investment	​	Rentable	​	Rentable	​	% Leased	****
($ and square feet in thousands)	​	Properties	​	Real Estate Properties		​	Amount	​	Square Feet	​	Square Feet	​	(1)	****
Residential properties:		​	​	​	​	​	​	​	​	​	​	​	​	​
Atlanta, GA		2	​	$	178,668		3.2	%	567		2.3	%	90.5	%
Central Florida		3	​		436,989		7.8		958		3.9		91.4	​
Charlotte, NC	​	2	​	​	168,466	​	3.0	​	487	​	2.0	​	88.6	​
Dallas, TX		4	​		360,795		6.5		1,124		4.6		93.6	​
D.C. / Baltimore		1	​		96,673		1.7		288		1.2		95.0	​
Denver, CO	​	1	​		80,971		1.5		201		0.8		94.6	​
Pennsylvania	​	1	​		93,277		1.7		235		1.0		93.7	​
San Antonio, TX		2	​	​	151,589	​	2.7	​	592	​	2.4	​	90.3	​
Seattle, WA	​	1	​	​	123,378	​	2.2	​	208	​	0.8	​	90.4	​
South Florida		4	​	​	464,938	​	8.4	​	1,202	​	4.9	​	93.3	​
Tucson, AZ		1	​		125,695		2.3		208		0.8		98.7	​
Total residential properties (6,734 units)		22	​		2,281,439		41.0		6,070		24.7		92.3	​
Industrial properties:		​	​	​	​	​	​	​	​	​	​	​	​	​
Atlanta, GA		1	​		66,470		1.2		798		3.2	​	100.0	​
Bay Area, CA		3	​		168,269		3.0		614		2.5	​	92.0	​
Central Florida		6	​		243,386		4.4		1,413		5.7	​	92.9	​
Charlotte, NC		1	​		22,625		0.4		208		0.8	​	100.0	​
Chicago, IL		1	​		9,480		0.2		110		0.4	​	100.0	​
Cincinnati, OH		2	​		34,039		0.6		395		1.6	​	100.0	​
Cleveland, OH	​	1	​		7,569		0.1		98		0.4	​	100.0	​
Columbus, OH	​	4	​		95,291		1.7		1,006		4.1	​	100.0	​
Dallas, TX		1	​		19,764		0.4		230		0.9	​	100.0	​
D.C. / Baltimore		2	​		17,250		0.3		75		0.3	​	100.0	​
Denver, CO		2	​		59,130		1.1		365		1.5	​	100.0	​
Grand Rapids, MI		1	​		7,009		0.1		189		0.8	​	100.0	​
Greater Boston	​	1	​	​	56,844	​	1.0	​	234	​	1.0	​	100.0	​
Houston, TX		5	​		138,610		2.5		1,210		4.9	​	93.5	​
Indianapolis, IN		7	​		135,257		2.4		1,591		6.5	​	100.0	​
Las Vegas, NV		2	​		33,790		0.6		276		1.1	​	100.0	​
Louisville, KY		1	​		19,393		0.4		235		1.0	​	100.0	​
Metro New York		2	​		29,798		0.5		172		0.7	​	100.0	​
Minneapolis / St. Paul, MN		1	​		6,193		0.1		108		0.4	​	100.0	​
New Jersey	​	4	​	​	68,459	​	1.2		571		2.3	​	100.0	​
Oklahoma City, OK		1	​		6,862		0.1		81		0.3	​	100.0	​
Pennsylvania		3	​	​	94,970	​	1.7	​	564	​	2.3	​	81.9	​
Phoenix, AZ		3	​	​	65,846	​	1.2	​	337	​	1.4	​	100.0	​
Portland, OR	​	1	​	​	15,723	​	0.3	​	123	​	0.5	​	100.0	​
Reno, NV	​	1	​	​	68,883	​	1.3	​	723	​	2.9	​	100.0	​
Richmond, VA	​	3	​	​	74,110	​	1.3	​	618	​	2.5	​	100.0	​
Salt Lake City, UT	​	2	​	​	144,067	​	2.6	​	916	​	3.7	​	100.0	​
San Antonio, TX	​	3	​	​	50,141	​	0.9	​	538	​	2.2	​	100.0	​
San Diego, CA	​	1	​	​	26,452	​	0.5	​	136	​	0.6	​	100.0	​
South Florida	​	1	​	​	14,197	​	0.3	​	76	​	0.3	​	100.0	​
Southern California	​	2	​	​	68,577	​	1.2	​	209	​	0.9	​	100.0	​
Total industrial properties	​	69	​		1,868,454		33.6		14,219		57.7		97.7	​

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​	****	​		****	% of Gross	****	​	****	% of Total	****	​	​
​	​	Number of	​	Investment in		​	Investment	​	Rentable	​	Rentable	​	% Leased	​
($ and square feet in thousands)	​	Properties	​	Real Estate Properties		​	Amount	​	Square Feet	​	Square Feet	​	(1)	​
Retail properties:			​											​
Atlanta, GA		1	​		58,304		1.0		328		1.4		99.4	​
Birmingham, AL		1	​		45,450		0.8		193		0.8		94.9	​
D.C. / Baltimore		1	​		40,926		0.7		131		0.5		100.0	​
Greater Boston		10	​		266,945		4.8		982		4.0		96.0	​
New Jersey		1	​		67,069		1.2		226		0.9		95.5	​
Raleigh, NC		1	​		45,267		0.8		125		0.5		96.1	​
South Florida		2	​		114,956		2.1		206		0.8		96.9	​
Tulsa, OK		1	​		36,110		0.7		101		0.4		97.7	​
Total retail properties		18	​		675,027		12.1		2,292		9.3		96.7	​
Office properties:				​										​
Austin, TX		1	​	​	84,789		1.5	​	272		1.1	​	78.2	​
Dallas, TX		1	​		52,723		0.9		161		0.7		93.0	​
D.C. / Baltimore		1	​		92,300		1.7		128		0.5		72.8	​
Metro New York		1	​		269,524		4.8		597		2.4		75.8	​
Minneapolis / St. Paul, MN		1	​		38,202		0.7		100		0.4		62.6	​
New Jersey		2	​		47,404		0.9		123		0.5		100.0	​
Total office properties		7	​		584,942		10.5		1,381		5.6		79.2	​
Other properties:		​	​	​	​	​	​	​	​	​	​	​	​	​
Central Florida	​	2	​	​	22,547	​	0.4	​	127	​	0.5	​	84.0	​
New Jersey		1	​		23,941		0.4		90		0.3	​	76.6	​
Pennsylvania	​	3	​	​	63,067	​	1.2	​	291	​	1.2	​	83.8	​
South Florida		2	​		44,030		0.8		161		0.7	​	82.7	​
Total other properties	​	8	​		153,585		2.8		669		2.7		82.6	​
Total real property portfolio	​	124	​	$	5,563,447		100.0	%	24,631		100.0	%	94.8	%
(1)	Percentage leased is based on executed leases as of December 31, 2024.
---	---

Lease Terms. Commercial lease terms typically range from one to 10 years, and often include renewal options. Substantially all of our commercial properties are subject to leases on a “triple net basis” in which customers pay their proportionate share of real estate taxes, insurance, common area maintenance, and certain other operating costs. Most of our commercial leases include fixed rental increases or Consumer Price Index-based rental increases and are not based on the income or profits of any person. The majority of our residential and self-storage leases expire within 12 months.

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Lease Expirations. As of December 31, 2024, the weighted-average remaining term of our total leased commercial portfolio was approximately 4.4 years based on annualized base rent and 3.9 years based on leased square footage, excluding renewal options. The following table summarizes the lease expirations at our commercial properties for leases in place as of December 31, 2024, without giving effect to the exercise of renewal options or termination rights, if any. The table excludes our residential and self-storage properties as substantially all leases at such properties expire within 12 months.

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	Number of	****	​	​	****	% of Total	****	​	****	% of Total	****
​	​	Commercial	​	Annualized Base		​	Annualized Base	​	Leased	​	Leased Square	****
($ and square feet in thousands)	​	Leases	​	Rent (1)		​	Rent (1)	​	Square Feet	​	Feet	****
2025 (2)	​	52	​	$	17,477	​	9.5	%	1,494	​	8.7	%
2026		76	​		21,719		11.8		2,488		14.4	​
2027		72	​		25,690		14.0		2,839		16.5	​
2028		87	​		28,396		15.4		2,898		16.8	​
2029		75	​		29,684		16.2		3,321		19.3	​
2030		42	​		15,317		8.3		903		5.2	​
2031		29	​		9,220		5.0		1,097		6.4	​
2032		27	​		13,554		7.4		1,035		6.0	​
2033		26	​		7,661		4.2		406		2.4	​
2034		23	​		5,956		3.2		353		2.1	​
Thereafter		26	​		9,230		5.0		385		2.2	​
Total leased		535	​	$	183,904		100.0	%	17,219		100.0	%
(1)	Annualized base rent is calculated as monthly base rent including the impact of any contractual tenant concessions (cash basis) per the terms of the lease as of December 31, 2024, multiplied by 12.
---	---
(2)	Includes three leases totaling approximately 11,000 square feet that expired on December 31, 2024.
---	---

Customer Diversification. We believe that the customer base that occupies our real property portfolio is generally stable and well-diversified. As of December 31, 2024, there were no customers that represented more than 10.0% of total annualized base rent or more than 10.0% of total leased square feet. The following table reflects our 10 largest customers, based on annualized base rent, as of December 31, 2024:

​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​	****	​	​	****	% of Total	****	​	****	% of Total	****
​	​	Number of	​	Annualized		​	Annualized	​	Leased	​	Leased Square	****
($ and square feet in thousands)	​	Locations (1)	​	Base Rent (2)		​	Base Rent (2)	​	Square Feet	​	Feet	****
S.P. Richards Company		10	​	$	9,481		2.7	%	1,331		5.7	%
Stop & Shop		7	​		8,034		2.2		449		1.9	​
Amazon.com / Whole Foods		5	​		5,500		1.5		604		2.6	​
Mizuho Bank Ltd.		1	​		4,570		1.3		107		0.5	​
FedEx		2	​		4,493		1.3		999		4.3	​
Harvest Right		1	​		2,952		0.8		340		1.5	​
Apple, Inc.		1	​		2,757		0.8		94		0.4	​
Best Buy Stores		2	​		2,422		0.7		153		0.6	​
Mattress Firm, Inc.		6	​		2,349		0.7		190		0.8	​
Financial Industry Regulatory Authority, Inc.		1	​		2,200		0.6		49		0.2	​
Total		36	​	$	44,758		12.6	%	4,316		18.5	%
(1)	Reflects the number of properties for which the customer has at least one lease in-place.
---	---
(2)	Annualized base rent is calculated as monthly base rent including the impact of any contractual tenant concessions (cash basis) per the terms of the lease as of December 31, 2024, multiplied by 12.
---	---

The majority of our customers do not have a public corporate credit rating. We evaluate creditworthiness and financial strength of prospective commercial customers based on financial, operating and business plan information that such prospective customers provide to us, as well as other market, industry and economic information that is generally publicly available. As a result of this assessment, we may require that the customers enhance their credit by providing us with security deposits, letters of credit from established financial institutions, or personal or corporate guarantees. Customer creditworthiness often influences the amount of upfront tenant improvements, lease incentives, concessions or other leasing costs. We evaluate creditworthiness of our residential customers based on standard market practice, which includes credit checks. 74

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Industry Diversification. We intend to maintain a well-diversified mix of customers to limit our exposure to any single customer or industry. Our diversified investment strategy inherently provides for customer diversity, and we continue to monitor our exposure relative to our larger customer industry sectors. The following table reflects the 10 largest industry concentrations within our portfolio, based on annualized base rent, as of December 31, 2024 and assumes that our residential and self-storage investments are not concentrated within any specific industry:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​	****	​	​	****	% of Total	****	​	****	% of Total	****
​	​	Number of	​	Annualized		​	Annualized Base	​	Leased Square	​	Leased Square	****
($ and square feet in thousands)	​	Leases	​	Base Rent (1)		​	Rent	​	Feet	​	Feet	****
Storage / Warehousing		25	​	$	20,148		5.7	%	2,956		12.7	%
Professional Services		52	​		16,029		4.5		669		2.9	​
Financial		26	​		14,731		4.1		338		1.4	​
Supermarket		17	​		14,245		4.0		843		3.6	​
Food & Beverage		83	​		12,809		3.6		784		3.3	​
Transportation / Logistics		13	​		7,652		2.2		1,243		5.3	​
Healthcare Services		40	​		7,627		2.1		255		1.1	​
Apparel / Clothing		18	​		6,657		1.9		786		3.4	​
Manufacturing		13	​		6,280		1.8		1,036		4.4	​
Post & Courier Services		8	​		6,151		1.7		1,167		5.0	​
Total		295	​	$	112,329		31.6	%	10,077		43.1	%
(1)	Annualized base rent is calculated as monthly base rent including the impact of any contractual tenant concessions (cash basis) per the terms of the lease as of December 31, 2024, multiplied by 12.
---	---

DST Program and DST Program Loans. Our DST Program raises capital through private placement offerings by selling DST Interests in specific DSTs holding real properties. The following table presents our DST Program activity for the years ended December 31, 2024, 2023, and 2022:

​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	​	2024		​	2023		**** ​	2022
DST Interests sold	​	$	797,022	​	$	479,155	​	$	758,995
DST Interests financed by DST Program Loans	​	​	63,332	​	​	51,360	​	​	51,496
Income earned from DST Program Loans (1)	​	​	6,793	​	​	5,155	​	​	3,420
Unrealized loss on DST Program Loans	​	​	(17)	​	​	—	​	​	—
Unrealized (loss) gain on financing obligations	​	​	(2,034)	​	​	932	​	​	—
Gain on extinguishment of financing obligations (2)	​	​	41,050	​	​	—	​	​	—
(Decrease) increase in financing obligation liability appreciation (3)	​	​	(69)	​	​	(459)	​	​	31,737
Rent obligation incurred under master lease agreements (3)	​	​	62,549	​	​	57,916	​	​	47,021
(1)	Included in other income and expenses on the consolidated statements of operations.
---	---
(2)	Included in gain (loss) on extinguishment of debt and financing obligations, net on the consolidated statements of operations and recorded upon extinguishment of our financing obligations in accordance with our Umbrella Partnership Real Estate Investment Trust (“UPREIT”) structure.
---	---
(3)	Included in interest expense on the consolidated statements of operations.
---	---

During the years ended December 31, 2024, 2023 and 2022, 83.6 million OP Units, 27.3 million OP Units and 28.8 million OP Units, respectively, were issued in exchange for DST Interests for a net investment of $639.1 million, $228.3 million and $252.6 million, respectively, in accordance with our UPREIT structure. In addition, we paid $3.9 million in cash in exchange for DST Interests during the year ended December 31, 2024. There was no cash paid in exchange for DST Interests during the years ended December 31, 2023 or 2022. As of December 31, 2024 and 2023, our DST Program Loans had a combined carrying value $120.9 million and $117.0 million, respectively. Refer to “Note 7 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for additional detail regarding the DST Program. 75

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Debt Obligations. Our consolidated indebtedness is currently comprised of borrowings under our line of credit, term loans and mortgage notes. As of December 31, 2024, we had approximately $2.7 billion of consolidated indebtedness with a weighted-average interest rate of 5.01%, which includes the effects of the interest rate swap and cap agreements. The weighted-average remaining term of our consolidated debt as of December 31, 2024 was 2.1 years, excluding the impact of certain extension options. The total gross book value of properties encumbered by our consolidated debt as of December 31, 2024 was approximately $2.31 billion. See “Note 6 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” and Item 15, “Schedule III—Real Estate and Accumulated Depreciation” for additional information.

​

ITEM 3.LEGAL PROCEEDINGS

From time to time, we, our executive officers, directors and our Advisor, and its affiliates and/or any of their respective principals and employees are subject to legal proceedings, including those arising from our investments, and we and our Advisor are also subject to extensive regulation, which, from time to time, results in requests for information from us or our Advisor or legal or regulatory proceedings or investigations against us or our Advisor, respectively. We incur significant costs and expenses in connection with any such proceedings, information requests, and investigations.

​

ITEM 4.MINE SAFETY DISCLOSURES

Not applicable. 76

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ITEM 5.MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information

There is no public trading market for shares of our common stock and we do not have an obligation nor plans to apply for listing on any public trading market. The prices at which our shares of common stock are sold pursuant to our securities offerings, or redeemed pursuant to our share redemption program, are based on the monthly NAV per share, which is determined in accordance with our valuation procedures, as described further below. On a limited basis, our stockholders may be able to have their shares redeemed through our share redemption program. Therefore, there is a risk that a stockholder may not be able to sell shares of our common stock at a time or price acceptable to the stockholder, or at all. Additionally, we may repurchase shares of our common stock pursuant to self-tender offers at a discount to NAV.

We commenced calculating a NAV on July 12, 2012. The following table presents the high and low NAV per share of each class of common stock reported for each quarter within the two most recent fiscal years. Each class of common stock has had the same NAV for each reported period.

​

​	​	​	​	​	​	​
Quarter	****	Low		****	High
2024		​			​
First Quarter	​	$	7.6998	​	$	7.9943
Second Quarter	​	$	7.4911	​	$	7.6794
Third Quarter	​	$	7.4662	​	$	7.4965
Fourth Quarter	​	$	7.5083	​	$	7.5867
2023	​		​	​
First Quarter	​	$	8.6328	​	$	8.7312
Second Quarter	​	$	8.3938	​	$	8.6056
Third Quarter	​	$	8.2246	​	$	8.3374
Fourth Quarter	​	$	8.0218	​	$	8.2077

Net Asset Value

Our board of directors, including a majority of our independent directors, has adopted valuation procedures, as amended from time to time, that contain a comprehensive set of methodologies to be used in connection with the calculation of our NAV. With the approval of our board of directors, including a majority of our independent directors, we have engaged Altus Group U.S. Inc., a third-party valuation firm, to serve as our independent valuation advisor (“Altus Group” or the “Independent Valuation Advisor”) with respect to helping us administer the valuation and review process for the real properties in our portfolio, providing monthly real property appraisals and valuations for certain of our debt-related assets, reviewing annual third-party real property appraisals, reviewing the internal valuations of DST Program Loans and debt-related liabilities performed by our Advisor, providing quarterly valuations of our properties subject to master lease obligations associated with the DST Program, and assisting in the development and review of our valuation procedures. See Exhibit 99.2 of this Annual Report on Form 10-K for a more detailed description of our valuation procedures, including important disclosure regarding real property valuations provided by the Independent Valuation Advisor.

Our valuation procedures, which address specifically each category of our assets and liabilities and are applied separately from the preparation of our financial statements in accordance with GAAP, involve adjustments from historical cost. There are certain factors which cause NAV to be different from total equity or stockholders’ equity on a GAAP basis. Most significantly, the valuation of our real assets, which is the largest component of our NAV calculation, is provided to us by the Independent Valuation Advisor. For GAAP purposes, these assets are generally recorded at depreciated or amortized cost. Another example that will cause our NAV to differ from our GAAP total equity or stockholders’ equity is the straight-lining of rent, which results in a receivable for GAAP purposes that is not included in the determination of our NAV. The fair values of our assets and certain liabilities are determined using widely accepted methodologies and, as appropriate, the GAAP principles within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification under Topic 820, Fair Value Measurements and Disclosures and are used by ALPS in calculating our NAV per share. However, our valuation procedures and our NAV are not subject to GAAP and will not be subject to independent audit. We did not develop our valuation procedures with the intention of complying with fair value concepts under GAAP and, 77

Table of Contents therefore, there could be differences between our fair values and the fair values derived from the principal market or most advantageous market concepts of establishing fair value under GAAP. The aggregate real property valuation of $5.76 billion compares to a GAAP basis of real properties (net of intangible lease liabilities and before accumulated amortization and depreciation) of $5.48 billion, representing a difference of approximately $279.5 million, or 5.1%.

As used below, “Fund Interests” means our outstanding shares of common stock, along with OP Units, which may be or were held directly or indirectly by the Advisor, Black Creek Diversified Property Advisors Group LLC (the “Former Sponsor”), members or affiliates of the Former Sponsor, and third parties, and “Aggregate Fund NAV” means the NAV of all the Fund Interests.

The following table sets forth the components of Aggregate Fund NAV as of December 31, 2024 and September 30, 2024:

​	​	​	​	​	​	​	​
​		As of
(in thousands)	​	December 31, 2024		​	​	September 30, 2024
Investments in residential properties	​	$	2,331,100	​	​	$	1,936,450
Investments in industrial properties	​		2,102,900	​	​		1,820,750
Investments in retail properties	​		694,900	​	​		685,650
Investments in office properties	​	​	464,850	​	​	​	462,500
Investments in other properties (1)	​	​	164,300	​	​	​	158,550
Total investment in real estate properties	​	​	5,758,050	​	​	​	5,063,900
Investments in real estate debt and securities	​		549,471	​	​		447,858
Investments in unconsolidated joint venture partnerships	​		235,413	​	​		272,168
DST Program Loans	​	​	120,651	​	​	​	124,711
Total investments	​	​	6,663,585	​	​	​	5,908,637
Cash and cash equivalents	​		19,554	​	​		21,020
Restricted cash	​		7,865	​	​		7,176
Other assets	​		71,071	​	​		64,232
Line of credit, term loans and mortgage notes	​		(2,723,502)	​	​		(2,176,697)
Financing obligations associated with our DST Program	​		(1,335,598)	​	​		(1,334,129)
Other liabilities	​		(105,577)	​	​		(117,860)
Accrued performance participation allocation	​	​	—	​	​	​	—
Accrued advisory fees	​		(3,646)	​	​		(3,474)
Noncontrolling interests in consolidated joint venture partnerships	​		(15,832)	​	​		(7,126)
Aggregate Fund NAV	​	$	2,577,920	​	​	$	2,361,779
Total Fund Interests outstanding	​		339,795	​	​		315,086
(1)	Includes self-storage properties.
---	---

The following table sets forth the NAV per Fund Interest as of December 31, 2024:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​	​	****	​		****	​		****	​		****	​		****	​		​	​		​	​		​	​		****	​
(in thousands, except per Fund Interest data)	****	Total		****	Class T-R Shares		****	Class S-R Shares		****	Class D-R Shares		****	Class I-R Shares		****	Class E Shares		****	Class S-PR Shares		****	Class D-PR Shares		****	Class I-PR Shares		****	OP Units
Monthly NAV	​	$	2,577,920	​	$	204,633	​	$	332,001	​	$	46,352	​	$	447,601	​	$	327,668	​	$	5,005	​	$	100	​	$	4,604	​	$	1,209,956
Fund Interests outstanding	​		339,795	​	​	26,972	​	​	43,761	​	​	6,110	​	​	58,998	​	​	43,190	​	​	660	​	​	13	​	​	607	​	​	159,484
NAV Per Fund Interest	​	$	7.5867	​	$	7.5867	​	$	7.5867	​	$	7.5867	​	$	7.5867	​	$	7.5867	​	$	7.5867	​	$	7.5867	​	$	7.5867	​	$	7.5867

78

Table of Contents Under GAAP, we record liabilities for ongoing distribution fees that we estimate we may pay in future periods for the Fund Interests. As of December 31, 2024, we estimated approximately $69.9 million of ongoing distribution fees were potentially payable. We do not deduct the liability for estimated future distribution fees in our calculation of NAV since we intend for our NAV to reflect our estimated value on the date that we determine our NAV. Accordingly, our estimated NAV at any given time does not include consideration of any estimated future distribution fees that may become payable after such date.

Financing obligations associated with our DST Program, as reflected in our NAV table above, represent outstanding proceeds raised from our private placements under the DST Program due to the fact that we have an option (which may or may not be exercised) to purchase the interests in the DSTs and thereby acquire the real property owned by the trusts. We may acquire these properties using OP Units, cash, or a combination of both. See “Note 7 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for additional details regarding our DST Program. We may use proceeds raised from our DST Program for the repayment of debt, acquisition of properties and other investments, distributions to our stockholders, payments under our debt obligations and master lease agreements related to properties in our DST Program, redemption payments, capital expenditures and other general corporate purposes. We pay our Advisor an annual, fixed component of our advisory fee of 1.10% of the consideration received for selling interests in DST Properties to third-party investors, net of upfront fees and expense reimbursements payable out of gross proceeds from the sale of such interests and DST Interests financed through DST Program Loans.

We include no discounts to our NAV for the illiquid nature of our shares, including the limitations on our stockholders’ ability to redeem shares under our share redemption program and our ability to make exceptions to, modify or suspend our share redemption program at any time. Our NAV generally does not reflect the potential impact of exit costs (e.g. selling costs and commissions related to the sale of a property) that would likely be incurred if our assets and liabilities were liquidated or sold today. While we may use market pricing concepts to value individual components of our NAV, our per share NAV is not derived from the market pricing information of open-end real estate funds listed on stock exchanges.

Our NAV is not a representation, warranty or guarantee that: (i) we would fully realize our NAV upon a sale of our assets; (ii) shares of our common stock would trade at our per share NAV on a national securities exchange; and (iii) a stockholder would be able to realize the per share NAV if such stockholder attempted to sell his or her shares to a third party.

The valuations of our real properties as of December 31, 2024, excluding certain newly acquired properties that are currently held at cost which we believe reflects the fair value of such properties, were provided by the Independent Valuation Advisor in accordance with our valuation procedures. Certain key assumptions that were used by the Independent Valuation Advisor in the discounted cash flow analysis are set forth in the following table based on weighted-averages by property type.

​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	Weighted-	​
​	****	Residential	****	Industrial	****	Retail	****	Office	****	Other	****	Average Basis	​
Exit capitalization rate		5.3	%	5.8	%	6.4	%	7.2	%	5.6	%	5.8	%
Discount rate / internal rate of return		7.0	%	7.3	%	7.3	%	8.7	%	7.7	%	7.3	%
Average holding period (years)		10.0	​	10.0	​	10.0	​	10.0	​	10.0	​	10.0	​

A change in the exit capitalization and discount rates used would impact the calculation of the value of our real property. For example, assuming all other factors remain constant, the changes listed below would result in the following effects on the value of our real properties, excluding certain newly acquired properties that are currently held at cost which we believe reflects the fair value of such properties:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	Hypothetical	****	​	****	​	****	​	****	​	****	​	****	Weighted-	****
Input	​	Change	​	Residential	​	Industrial	​	Retail	​	Office	​	Other	​	Average Values	****
Exit capitalization rate (weighted-average)		0.25% decrease		3.1	%	3.0	%	2.4	%	2.5	%	2.9	%	2.9	%
​		0.25% increase		(2.9)	%	(2.8)	%	(2.2)	%	(2.3)	%	(2.6)	%	(2.7)	%
Discount rate (weighted-average)		0.25% decrease		2.0	%	2.0	%	1.9	%	2.0	%	1.9	%	2.0	%
​		0.25% increase		(1.9)	%	(2.0)	%	(1.8)	%	(2.0)	%	(1.9)	%	(1.9)	%

From September 30, 2017 through November 30, 2019, we valued our debt-related investments and real estate-related liabilities generally in accordance with fair value standards under GAAP. Beginning with our valuation for December 31, 2019, our property-level mortgages, corporate-level credit facilities and other secured and unsecured debt that are intended to be held to maturity (which for fixed rate debt not subject to interest rate hedges may be the date near maturity at which time the debt will be eligible for prepayment at par for purposes herein), including those subject to interest rate hedges, were valued at par (i.e. at their respective outstanding balances). In addition, because we utilize interest rate hedges to stabilize interest payments (i.e. to fix all-in interest rates 79

Table of Contents through interest rate swaps or to limit interest rate exposure through interest rate caps) on individual loans, each loan and associated interest rate hedge is treated as one financial instrument which is valued at par if intended to be held to maturity. This policy of valuing at par applies regardless of whether any given interest rate hedge is considered as an asset or liability for GAAP purposes. Notwithstanding, if we acquire an investment and assume associated in-place debt from the seller that is above- or below-market, then consistent with how we recognize assumed debt for GAAP purposes when acquiring an asset with pre-existing debt in place, the liabilities used in the determination of our NAV will include the market value of such debt based on market value as of the closing date. The associated premium or discount on such debt as of closing that is reflected in our liabilities will then be amortized through loan maturity. Per our valuation policy, the corresponding investment is valued on an unlevered basis for purposes of determining NAV. Accordingly, all else equal, we would not recognize an immediate gain or loss to our NAV upon acquisition of an investment whereby we assume associated pre-existing debt that is above- or below-market. As of December 31, 2024, we classified all of our debt as intended to be held to maturity, and our liabilities included mark-to-market adjustments for pre-existing debt that we assumed upon acquisition. We currently estimate the fair value of our debt (inclusive of associated interest rate hedges) that was intended to be held to maturity as of December 31, 2024 was $42.5 million lower than the carrying value used for purposes of calculating our NAV (as described above) for such debt in aggregate; meaning that if we used the fair value of our debt rather than the carrying value used for purposes of calculating our NAV (and treated the associated hedge as part of the same financial instrument), our NAV would have been higher by approximately $42.5 million, or $0.12 per share, not taking into account all of the other items that impact our monthly NAV, as of December 31, 2024.

Reconciliation of Stockholders’ Equity and Noncontrolling Interests to NAV

The following table reconciles stockholders’ equity and noncontrolling interests per our consolidated balance sheet to our NAV as of December 31, 2024:

​	​	​	​
(in thousands)	​	As of December 31, 2024
Total stockholders' equity	​	$	745,824
Noncontrolling interests	​	​	660,147
Total equity under GAAP	​	​	1,405,971
​	​	​	​
Adjustments:	​	​	​
Accrued distribution fee (1)	​	​	69,922
Redeemable noncontrolling interests (2)	​	​	9,381
Unrealized net appreciation (depreciation) on real estate and financial assets and liabilities (3)	​	​	331,644
Unrealized gain (loss) on investments in unconsolidated joint venture partnerships (4)	​	​	23,117
Accumulated depreciation and amortization (5)	​	​	793,232
Other adjustments (6)	​	​	(55,347)
Aggregate Fund NAV	​	$	2,577,920
(1)	Accrued distribution fee represents the accrual for the full cost of the distribution fee for Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares and Class D-PR shares and OP Units. Under GAAP, we accrued the full cost of the distribution fee payable over the life of each share (assuming such share remains outstanding the length of time required to pay the maximum distribution fee) as an offering cost at the time we sold the Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares, Class D-PR shares and OP Units. Similarly, we accrued a liability for future distribution fees we expect will be paid based on our estimate of how long the Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares, Class D-PR shares and OP Units will be outstanding, also as an offering cost. For purposes of calculating the NAV, we recognize the distribution fee as a reduction of NAV on a monthly basis when such fee is paid and do not deduct the liability for estimated future distribution fees that may become payable after the date as of which our NAV is calculated.
---	---
(2)	Redeemable noncontrolling interests are related to our OP Units, and are included in our determination of NAV but not included in total equity under GAAP.
---	---
(3)	Our investments in real estate and certain of our financial assets and liabilities, including our debt, certain of our financing obligations, certain of our DST Program Loans, and certain of our investments in real estate debt and securities, are presented at their carrying value in our consolidated financial statements. As such, any increases or decreases in the fair market value of our investments in real estate and certain of our financial assets and liabilities are not included in our GAAP results. For purposes of determining our NAV, our investments in real estate, investments in real estate debt and securities, financing obligations, and DST Program Loans are recorded at fair value. Notwithstanding, our property-level mortgages and corporate-level credit facilities that are intended to be held to maturity are valued at par (i.e. at their respective outstanding balances).
---	---

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(4)	Certain of our investments in unconsolidated joint venture partnerships are presented using the equity method of accounting in our consolidated financial statements. As such, certain increases or decreases in the fair market value of the underlying investments or debt instruments associated with those investments in unconsolidated joint venture partnerships are not included in our GAAP results. For purposes of determining our NAV, the investments in the underlying real estate and certain of the underlying debt instruments are recorded at fair value and reflected in our NAV at our proportional ownership interest.
(5)	We depreciate our investments in real estate and amortize certain other assets and liabilities in accordance with GAAP. Such depreciation and amortization is not recorded for purposes of determining our NAV.
---	---
(6)	Includes (i) straight-line rent receivables, which are recorded in accordance with GAAP but not recorded for purposes of determining our NAV, (ii) certain interest rate hedges, which are recorded at fair value in accordance with GAAP but are not included for purposes of determining our NAV if intended to be held to maturity, and (iii) other minor adjustments.
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​ 81

Table of Contents Performance

Our NAV decreased from $8.02 per share as of December 31, 2023 to $7.59 per share as of December 31, 2024. The decrease in NAV was primarily driven by expansion in the capital market assumptions that are a major factor used in the valuation of our real estate portfolio. This decrease was partially offset by strong leasing and above-average market rent growth in our industrial properties.

Effective December 31, 2019, our board of directors approved amendments to our valuation procedures which revised the way we value property-level mortgages, corporate-level credit facilities, other secured and unsecured debt and associated interest rate hedges when loans, including associated interest rate hedges, are intended to be held to maturity, effectively eliminating all mark-to-market adjustments for such loans and hedges from the calculation of our NAV. The following table summarizes the impact of interest rate movements on our share class returns assuming we continued to include the mark-to-market adjustments for all borrowing-related interest rate hedge and debt instruments beginning with the December 31, 2019 NAV:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​	****	​	****	One-Year	****	​	****	​	****	​	​	​	****
​	​	Trailing	​	​	​	(Trailing	​	Three-Year	​	Five-Year	​	Ten-Year	​	Since Inception	****
(as of December 31, 2024) (1)	​	Three-Months	​	Year-to-Date	​	12-Months)	​	Annualized	​	Annualized	​	Annualized	​	Annualized (2)	****
Class T-R Share Total Return (with upfront selling commissions and dealer manager fees) (3)	​	(1.11)	%	(4.54)	%	(4.54)	%	0.22	%	3.56	%	4.30	%	5.43	%
Adjusted Class T-R Share Total Return (with upfront selling commissions and dealer manager fees) (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	(0.46)	%	(4.86)	%	(4.86)	%	0.81	%	3.92	%	4.40	%	5.51	%
Difference	​	(0.65)	%	0.32	%	0.32	%	(0.59)	%	(0.36)	%	(0.10)	%	(0.08)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class T-R Share Total Return (without upfront selling commissions and dealer manager fees) (3)	​	2.35	%	(1.20)	%	(1.20)	%	1.37	%	4.28	%	4.61	%	5.54	%
Adjusted Class T-R Share Total Return (without upfront selling commissions and dealer manager fees) (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	3.02	%	(1.53)	%	(1.53)	%	1.98	%	4.64	%	4.71	%	5.62	%
Difference	​	(0.67)	%	0.33	%	0.33	%	(0.61)	%	(0.36)	%	(0.10)	%	(0.08)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class S-R Share Total Return (with upfront selling commissions and dealer manager fees) (3)	​	(1.11)	%	(4.54)	%	(4.54)	%	0.22	%	3.56	%	4.30	%	5.43	%
Adjusted Class S-R Share Total Return (with upfront selling commissions and dealer manager fees) (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	(0.46)	%	(4.86)	%	(4.86)	%	0.81	%	3.92	%	4.40	%	5.51	%
Difference	​	(0.65)	%	0.32	%	0.32	%	(0.59)	%	(0.36)	%	(0.10)	%	(0.08)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class S-R Share Total Return (without upfront selling commissions and dealer manager fees) (3)	​	2.35	%	(1.20)	%	(1.20)	%	1.37	%	4.28	%	4.61	%	5.54	%
Adjusted Class S-R Share Total Return (without upfront selling commissions and dealer manager fees) (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	3.02	%	(1.53)	%	(1.53)	%	1.98	%	4.64	%	4.71	%	5.62	%
Difference	​	(0.67)	%	0.33	%	0.33	%	(0.61)	%	(0.36)	%	(0.10)	%	(0.08)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class D-R Share Total Return (3)	​	2.50	%	(0.61)	%	(0.61)	%	1.98	%	4.90	%	5.21	%	5.74	%
Adjusted Class D-R Share Total Return (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	3.18	%	(0.94)	%	(0.94)	%	2.59	%	5.26	%	5.31	%	5.82	%
Difference	​	(0.68)	%	0.33	%	0.33	%	(0.61)	%	(0.36)	%	(0.10)	%	(0.08)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class I-R Share Total Return (3)	​	2.57	%	(0.36)	%	(0.36)	%	2.24	%	5.16	%	5.54	%	6.10	%
Adjusted Class I-R Share Total Return (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	3.24	%	(0.69)	%	(0.69)	%	2.84	%	5.53	%	5.64	%	6.18	%
Difference	​	(0.67)	%	0.33	%	0.33	%	(0.60)	%	(0.37)	%	(0.10)	%	(0.08)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class E Share Return Total Return (3)	​	2.57	%	(0.36)	%	(0.36)	%	2.24	%	5.16	%	5.57	%	6.14	%
Adjusted Class E Share Total Return (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	3.24	%	(0.69)	%	(0.69)	%	2.84	%	5.53	%	5.67	%	6.22	%
Difference	​	(0.67)	%	0.33	%	0.33	%	(0.60)	%	(0.37)	%	(0.10)	%	(0.08)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​	****	​	****	One-Year	****	​	****	​	****	​	​	​	****
​	​	Trailing	​	​	​	(Trailing	​	Three-Year	​	Five-Year	​	Ten-Year	​	Since Inception	****
(as of December 31, 2024) (1)	​	Three-Months	​	Year-to-Date	​	12-Months)	​	Annualized	​	Annualized	​	Annualized	​	Annualized (2)	****
Class S-PR Share Total Return (with upfront selling commissions and dealer manager fees) (3)	​	(1.23)	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.47)	%
Adjusted Class S-PR Share Total Return (with upfront selling commissions and dealer manager fees) (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	(0.58)	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.12)	%
Difference	​	(0.65)	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.35)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class S-PR Share Total Return (without upfront selling commissions and dealer manager fees) (3)	​	2.35	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	3.14	%
Adjusted Class S-PR Share Total Return (without upfront selling commissions and dealer manager fees) (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	3.02	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	3.50	%
Difference	​	(0.67)	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.36)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class D-PR Share Total Return (with upfront selling commissions) (3)	​	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.47)	%
Adjusted Class D-PR Share Total Return (with upfront selling commissions) (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.24)	%
Difference	​	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.23)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class D-PR Share Total Return (without upfront selling commissions) (3)	​	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	1.05	%
Adjusted Class D-PR Share Total Return (without upfront selling commissions) (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	1.28	%
Difference	​	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.23)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Class I-PR Share Total Return (3)	​	2.57	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	3.43	%
Adjusted Class I-PR Share Total Return (continued inclusion of mark-to-market adjustments for borrowing-related interest rate hedge and debt instruments) (4)	​	3.24	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	3.80	%
Difference	​	(0.67)	%	n/a	%	n/a	%	n/a	%	n/a	%	n/a	%	(0.37)	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
(1)	Performance is measured by total return, which includes income and appreciation (i.e., distributions and changes in NAV) and is a compound rate of return that assumes reinvestment of all distributions for the respective time period, and excludes upfront selling commissions and dealer manager fees paid by investors, except for returns noted “with upfront selling commissions and dealer manager fees” (“Total Return”). Partial period returns are not calculated. Past performance is not a guarantee of future results. Current performance may be higher or lower than the performance data quoted.
---	---
(2)	NAV inception date for Class T-R shares, Class S-R shares, Class D-R shares, Class I-R shares (formerly known as Class T shares, Class S shares, Class D shares and Class I shares, respectively) and Class E shares was September 30, 2012, which is when we first sold shares of our common stock after converting to an NAV-based REIT on July 12, 2012. Investors in our fixed price offerings prior to NAV inception on September 30, 2012 are likely to have a lower return. The inception date for Class I-PR shares and Class S-PR shares was September 3, 2024 and the inception date for Class D-PR was December 2, 2024, which is when we first sold shares of such share classes of our common stock. Since inception returns are not annualized for shared classes outstanding less than one year.
---	---
(3)	The Total Returns presented are based on the actual NAVs at which stockholders transacted, calculated pursuant to our valuation procedures. From NAV inception to November 30, 2019, these NAVs reflected mark-to-market adjustments on our borrowing-related interest rate hedge positions; and from September 1, 2017 to November 30, 2019, these NAVs also reflected mark-to-market adjustments on our borrowing-related debt instruments. Prior to September 1, 2017, our valuation policies dictated marking borrowing-related debt instruments to par except in certain circumstances; therefore, we did not formally track mark-to-market adjustments on our borrowing-related debt instruments during such time.
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(4)

The Adjusted Total Returns presented are based on adjusted NAVs calculated as if we had continued to mark our hedge and debt instruments to market following a policy change to largely exclude borrowing-related interest rate hedge and debt marks to market from our NAV calculations (except in certain circumstances pursuant to our valuation procedures), beginning with our NAV calculated as of December 31, 2019 NAV. Therefore, the NAVs used in the calculation are identical to those presented per Note (3) above from NAV inception through November 30, 2019. The adjusted NAVs include the incremental impacts to advisory fees and performance fees; however, the adjusted NAVs are not assumed to have impacted any share purchase or redemption. For calculation purposes, transactions were assumed to occur at the adjusted NAVs.

Unregistered Sales of Equity Securities

On August 2, 2024, we commenced the Private Offering, which is exempt from the registration provisions of the Securities Act pursuant to Section 4(a)(2), Regulation D and/or Regulation S thereunder. Each purchaser of the shares of our common stock sold in the Private Offering is required to represent that it is an "accredited investor" as that term is defined in Rule 501 of Regulation D or a non-U.S. person and is acquiring shares for investment purposes only and not with a view to resale or distribution.

During the year ended December 31, 2024, we issued and sold 660,000 Class S-PR shares, 13,000 Class D-PR shares and 607,000 Class I-PR shares and generated gross aggregate proceeds of $9.7 million in connection with the Private Offering. During the year ended December 31, 2024, aggregate upfront selling commissions and dealer manager fees of $64,000 were paid in connection with the Private Offering.

Share Redemption Program

While stockholders may request on a monthly basis that we redeem all or any portion of their shares pursuant to our share redemption program, we are not obligated to redeem any shares and may choose to redeem only some, or even none, of the shares that have been requested to be redeemed in any particular month, in our discretion. In addition, our ability to fulfill redemption requests is subject to a number of limitations. As a result, share redemptions may not be available each month. Under our share redemption program, to the extent we choose to redeem shares in any particular month, we will only redeem shares as of the last calendar day of that month (each such date, a “Redemption Date”). Shares redeemed on the Redemption Date remain outstanding on the Redemption Date and are no longer outstanding on the day following the Redemption Date. Redemptions will be made at the transaction price in effect on the Redemption Date, except that shares that have not been outstanding for at least one year will be redeemed at 95% of the transaction price (an “Early Redemption Deduction”). The Early Redemption Deduction may be waived in certain circumstances including: (i) in the case of redemption requests arising from the death or qualified disability of the holder; (ii) in the event that a stockholder’s shares are redeemed because the stockholder has failed to maintain the $2,000 minimum account balance, (iii) with respect to shares purchased through our distribution reinvestment plan or (iv) with respect to redemption requests submitted by discretionary model portfolio management programs (and similar arrangements) or (v) with respect to redemption requests submitted by feeder vehicles (or similar vehicles) primarily created to hold shares of our common stock, which are offered to non-U.S. persons, where such vehicles seek to avoid imposing such a deduction because of administrative or systems limitations. To have his or her shares redeemed, a stockholder’s redemption request and required documentation must be received in good order by 4:00 p.m. (Eastern time) on the second to last business day of the applicable month. Settlements of share redemptions will be made within three business days of the Redemption Date. An investor may withdraw its redemption request by notifying the transfer agent before 4:00 p.m. (Eastern time) on the last business day of the applicable month.

The total amount of aggregate redemptions of Class T-R, Class S-R, Class D-R, Class I-R, Class E, Class S-PR, Class D-PR and Class I-PR shares (based on the price at which the shares are redeemed) will be limited during each calendar month to 2% of the aggregate NAV of all classes as of the last calendar day of the previous quarter and in each calendar quarter will be limited to 5% of the aggregate NAV of all classes of shares as of the last calendar day of the previous calendar quarter; provided, however, that every month and quarter each class of our common stock will be allocated capacity within such aggregate limit to allow stockholders in such class to either (a) redeem shares (based on the price at which the shares are redeemed) equal to at least 2% of the aggregate NAV of such share class as of the last calendar day of the previous quarter, or, if more limiting, (b) redeem shares (based on the price at which the shares are redeemed) over the course of a given quarter equal to at least 5% of the aggregate NAV of such share class as of the last calendar day of the previous quarter (collectively referred to herein as the “2% and 5% limits”), which in the second and third months of a quarter could be less than 2% of the NAV of such share class. In the event that we determine to redeem some but not all of the shares submitted for redemption during any month, shares redeemed at the end of the month will be redeemed on a pro rata basis. Even if the class-specific allocations are exceeded for a class, the program may offer such class additional capacity under the aggregate program limits. Redemptions and pro rata treatment, if necessary, will first be applied within the class-specific allocated capacity and then applied on an aggregate basis to the extent there is remaining capacity. All unsatisfied redemption requests must be resubmitted after the start of the next month or quarter, or upon the recommencement of the share redemption program, as applicable. 84

Table of Contents For both the aggregate and class-specific allocations described above, (i) provided that the share redemption program has been operating and not suspended for the first month of a given quarter and that all properly submitted redemption requests were satisfied, any unused capacity for that month will carry over to the second month and (ii) provided that the share redemption program has been operating and not suspended for the first two months of a given quarter and that all properly submitted redemption requests were satisfied, any unused capacity for those two months will carry over to the third month. In no event will such carry-over capacity permit the redemption of shares with aggregate value (based on the redemption price per share for the month the redemption is effected) in excess of 5% of the combined NAV of all classes of shares as of the last calendar day of the previous calendar quarter (provided that for these purposes redemptions may be measured on a net basis as described in the paragraph below).

We currently measure the foregoing redemption allocations and limitations based on net redemptions during a month or quarter, as applicable. The term “net redemptions” means, during the applicable period, the excess of our share redemptions (capital outflows) over the proceeds from the sale of our shares (capital inflows). For purposes of measuring our redemption capacity pursuant to our share redemption program, proceeds from new subscriptions in a month are included in capital inflows on the first day of the next month because that is the first day on which such stockholders have rights in the Company. Also for purposes of measuring our redemption capacity pursuant to our share redemption program, redemption requests received in a month are included in capital outflows on the last day of such month because that is the last day stockholders have rights in the Company. We record these redemptions in our financial statements as having occurred on the first day of the next month following receipt of the redemption request because shares redeemed in a given month are outstanding through the last day of the month. Net redemptions for the class-specific allocations will be based only on the capital inflows and outflows of that class, while net redemptions for the overall program limits would be based on capital inflows and outflows of all classes. Thus, for any given calendar quarter, the maximum amount of redemptions during that quarter will be equal to (i) 5% of the combined NAV of all classes of shares as of the last calendar day of the previous calendar quarter, plus (ii) proceeds from sales of new shares in our ongoing securities offerings (including purchases pursuant to our distribution reinvestment plan) since the beginning of the current calendar quarter. The same would apply for a given month, except that redemptions in a month would be subject to the 2% limit described above (subject to potential carry-over capacity), and netting would be measured on a monthly basis. With respect to future periods, our board of directors may choose whether the allocations and limitations will be applied to “gross redemptions,” i.e., without netting against capital inflows, rather than to net redemptions. If redemptions for a given month or quarter are measured on a gross basis rather than on a net basis, the redemption limitations could limit the amount of shares redeemed in a given month or quarter despite our receiving a net capital inflow for that month or quarter. In order for our board of directors to change the application of the allocations and limitations from net redemptions to gross redemptions or vice versa, we will provide notice to stockholders in a memorandum supplement or special or periodic report filed by us, as well as in a press release or on our website, at least 10 days before the first business day of the quarter for which the new test will apply. The determination to measure redemptions on a gross basis, or vice versa, will only be made for an entire quarter, and not particular months within a quarter.

Although the vast majority of our assets consist of properties that cannot generally be readily liquidated on short notice without impacting our ability to realize full value upon their disposition, we intend to maintain a number of sources of liquidity including (i) cash equivalents (e.g. money market funds), other short-term investments, U.S. government securities, agency securities and liquid real estate-related securities and (ii) one or more borrowing facilities. We may fund redemptions from any available source of funds, including operating cash flows, borrowings, proceeds from our offerings and our sale of DST Interests and/or sales of our assets.

Should redemption requests, in our judgment, place an undue burden on our liquidity, adversely affect our operations or risk having an adverse impact on the Company as a whole, or should we otherwise determine that investing our liquid assets in real properties or other illiquid investments rather than redeeming our shares is in the best interests of the company as a whole, then we may choose to redeem fewer shares than have been requested to be redeemed, or none at all. Further, our board of directors may make exceptions to, modify or suspend our share redemption program if it deems such action to be in our best interest and the best interest of our stockholders. If the transaction price for the applicable month is not made available by the tenth business day prior to the last business day of the month (or is changed after such date), then no redemption requests will be accepted for such month and stockholders who wish to have their shares redeemed the following month must resubmit their redemption requests. The above description of the share redemption program is a summary of certain of the terms of the share redemption program. Please see the full text of the share redemption program, which is incorporated by reference as Exhibit 4.3 to this Annual Report on Form 10-K, for all the terms and conditions.

Refer to Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for detail regarding our redemption and repurchase history. 85

Table of Contents The table below summarizes the redemption activity for the three months ended December 31, 2024, for which all eligible redemption requests were redeemed in full:

​	​	​	​	​	​	​	​	​	​
​	****	​	****	​	​	****	Total Number of Shares	****	Maximum Number of
​	​	​	​	​	​	​	Redeemed as Part of	​	Shares That May Yet Be
​	​	Total Number of	​	Average Price		​	Publicly Announced	​	Redeemed Pursuant
(shares in thousands)	​	Shares Redeemed	​	Paid Per Share (1)		​	Plans or Programs	​	to the Program (2)
For the Month Ended:				​
October 31, 2024		1,400	​	$	7.47		1,400	​	—
November 30, 2024		1,833	​		7.50		1,833		—
December 31, 2024 (3)		1,893	​		7.51		1,893		—
Total		5,126	​	$	7.49		5,126		—
(1)	Amount represents the average price paid to investors upon redemption.
---	---
(2)	We limit the number of shares that may be redeemed under the share redemption program as described above.
---	---
(3)	Redemption requests accepted in December 2024 are considered redeemed on January 1, 2025 for accounting purposes and, as a result, are not included in the table above. This differs from how we treat capital outflows for purposes of the limitations of our share redemption program. For purposes of measuring our redemption capacity pursuant to our share redemption program, redemption requests received in a month are included in capital outflows on the last day of such month because that is the last day stockholders have rights in the Company and we redeemed $39.7 million of shares of common stock for the three months ended December 31, 2024.
---	---

Distributions

We intend to continue to make distributions on a monthly basis following the end of each calendar month. We intend to use monthly record dates and, thus, monthly distribution accruals. However, we reserve the right to adjust the periods during which distributions accrue and are paid. Our total distributions declared, including distributions related to OP Units, during the years ended December 31, 2024, 2023 and 2022 were $122.0 million, $103.7 million and $87.4 million, respectively, which includes $31.9 million, $32.7 million and $29.9 million, respectively, of distributions reinvested in our shares pursuant to our distribution reinvestment plan. Our cash flow from operations for the years ended December 31, 2024, 2023, and 2022 was ($169.5) million, $16.0 million and $62.5 million, respectively. Accordingly, in certain years and certain individual quarters, total distributions were not fully funded by cash flows from operations. In such cases, the shortfalls were funded from proceeds from our distribution reinvestment plan, borrowings or sale of DST Interests. In the future, we may continue to fund monthly regular distributions from sources other than cash flow from operations. Our long-term strategy is to fund the payment of monthly regular distributions to our stockholders entirely from our operations, but there may be quarters or even years when that is not the case. It will be up to the board of directors to determine the distribution level taking many factors into consideration beyond just cash flow from operations. If we are unsuccessful in investing the capital we raise from securities offerings or decide to invest our capital in lower yielding assets, we may be required to fund our monthly cash distributions to our stockholders from a combination of our operating, investing, and financing activities, which include net proceeds of this offering, dispositions, and borrowings (including borrowings secured by our assets), or to reduce the level of our monthly distributions. We have not established a cap on the amount of our distributions that may be paid from any of these sources.

All distributions result in a decrease to our NAV while cash flow generated from our operations results in an increase to NAV. We generally seek to fund our distributions solely from our cash flow from operations, however we also focus on total stockholder return as a metric for evaluating our distribution level in the event that it is not being fully covered by cash flow from operations. Any cash flow from operations in excess of our distributions (all else equal) results in a net increase to NAV. Conversely, if our distributions exceed our cash flow from operations (all else equal), the net effect would result in a decrease to NAV.

Each quarter our board of directors determines the level of our distributions for each month in that quarter. In determining the appropriate level of a distribution, our board of directors considers a number of factors, including the current and anticipated market conditions, current and anticipated future performance and make-up of our investments, our overall financial projections and expected future cash needs. We can give no assurance that the board of directors will continue to set distributions at current levels and our distribution levels may change from time to time. Depending on the distribution level relative to cash flow generated from our portfolio, if our monthly distributions exceed cash flow generated from our operations, it may cause a decrease in our NAV if not offset by other effects. 86

Table of Contents In connection with a distribution to our stockholders, our board intends to authorize a monthly distribution of a certain dollar amount per share of our common stock before or on the first day of each calendar quarter for the months in such quarter. We will then calculate each stockholder’s specific distribution amount for the month using monthly record dates and stockholders distributions will accrue on the first record date after stockholders become a record owner of our common stock, subject to our board of directors declaring a distribution for record owners as of such date. We accrue the amount of declared distributions as a liability on the record date, and such liability is accounted for in determining the NAV.

The per share amount of any distributions for any class of common stock relative to the other classes of common stock shall be determined as described in the most recent multiple class plan approved by our board of directors. Under our multiple class plan in effect, distributions are made on all classes of our common stock at the same time. The per share amount of distributions on our shares of common stock differs because of different allocations of class-specific fees. We use the record share method of determining the per share amount of distributions on each class of shares, although our board of directors may choose other methods. The record share method is one of several distribution calculation methods for multiple-class funds recommended, but not required, by the American Institute of Certified Public Accountants. Under this method, the amount to be distributed on shares of our common stock is increased by the sum of all class-specific fees accrued for such period. Such amount is divided by the number of shares of our common stock outstanding on the record date. Such per share amount is reduced for each class of common stock by the per share amount of any class-specific fees allocable to such class.

We are required to make distributions sufficient to satisfy the requirements for qualification as a REIT for U.S. federal income tax purposes. Generally, income distributed will not be taxable to us under the Code if we distribute at least 90% of our taxable income each year (computed without regard to the distributions paid deduction and our net capital gain). In addition, if we fail to distribute during each calendar year at least the sum of (a) 85% of our ordinary income for such year, (b) 95% of our capital gain net income for such year, and (c) any undistributed taxable income from prior periods, we will be subject to a nondeductible 4% excise tax on the excess of the required distribution over the sum of (i) the amounts actually distributed by us, plus (ii) retained amounts on which we pay income tax at the corporate level. Distributions are authorized at the discretion of the board of directors, in accordance with our earnings, cash flow and general financial condition. The board’s discretion is directed, in substantial part, by its obligation to cause us to comply with the REIT requirements. Because we may receive income from interest or rents at various times during our fiscal year, distributions may not reflect our income earned in that particular distribution period and may be made in advance of actual receipt of funds in an attempt to make distributions relatively uniform. We are authorized to borrow money, issue new securities or sell assets in order to make distributions. There are no restrictions on the ability of the Operating Partnership to transfer funds to us.

Refer to Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for detail regarding our distribution history, as well as the sources used to pay our distributions.

Holders

The following table summarizes the number of shares outstanding and the number of stockholders, by class of common stock, and the number of OP Units outstanding and the number of OP Unitholders (other than us), in each case as of February 27, 2025:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	Class T-R	****	Class S-R	****	Class D-R	****	Class I-R	****	Class E	****	Class S-PR	****	Class D-PR	****	Class I-PR	****	​
(shares or units in thousands)	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares	​	OP Units (1)
Shares or units outstanding		26,592		42,244		5,988		59,109		42,493	​	955	​	13	​	1,186		158,891
Number of holders of record		4,083		3,090		647	​	3,815		7,156	​	71	​	1	​	85		1,180
(1)	Includes Series 1 and 2 Class T-R OP Units, Series 1 and 2 Class S-R OP Units, Class D-R OP Units, Class I-R OP Units and Series 1 and 2 Class E OP Units. The number of holders of record for OP Units represent the number of third-party investors.
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ITEM 6.[Reserved]

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Table of Contents

ITEM 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read together with our consolidated financial statements and notes thereto included in this Annual Report on Form 10-K. The following information contains forward-looking statements, which are subject to risks and uncertainties. Should one or more of these risks or uncertainties materialize, actual results may differ materially from those expressed or implied by the forward-looking statements. See “Cautionary Statement Regarding Forward-Looking Statements” above for a description of these risks and uncertainties.

OVERVIEW

General

Ares Real Estate Income Trust Inc. is a NAV-based perpetual life REIT that was formed on April 11, 2005, as a Maryland corporation. We are primarily focused on investing in and operating a diverse portfolio of real property. As of December 31, 2024, our consolidated real property portfolio consisted of 124 properties totaling approximately 24.6 million square feet located in 37 markets throughout the U.S. We also owned, either directly through our unconsolidated joint venture partnerships or indirectly through other entities owned by our unconsolidated joint venture partnerships, 161 credit lease properties, seven industrial properties, 13 data center investments and five debt-related investments as of December 31, 2024. Unless otherwise noted, these unconsolidated properties are excluded from the presentation of our portfolio data herein.

We have operated and elected to be treated as a REIT for U.S. federal income tax purposes, commencing with the taxable year ended December 31, 2006, and we intend to continue to operate in accordance with the requirements for qualification as a REIT. We utilize an UPREIT organizational structure to hold all or substantially all of our assets through the Operating Partnership.

We intend to offer shares of our common stock on a continuous basis. We also intend to conduct an ongoing distribution reinvestment plan offering for our stockholders to reinvest distributions in our shares. During the year ended December 31, 2024, we raised gross proceeds of approximately $61.8 million from the sale of approximately 8.0 million shares of our common stock in our ongoing securities offerings, including proceeds from our distribution reinvestment plan of approximately $32.1 million. See “Note 10 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for more information about our securities offerings.

Additionally, we have a program to raise capital through private placement offerings by selling DST Interests. These private placement offerings are exempt from registration requirements pursuant to Rule 506(b) of Regulation D under the Securities Act. We anticipate that these interests may serve as replacement properties for investors seeking to complete like-kind exchange transactions under Section 1031 (“Section 1031 Exchanges”) of the Code. Similar to our prior private placement offerings, we expect that the DST Program will give us the opportunity to expand and diversify our capital raise strategies by offering what we believe to be an attractive and unique investment product for investors that may be seeking replacement properties to complete like-kind exchange transactions under Section 1031 of the Code. We also offer DST Program Loans to finance no more than 50% of the purchase price of the DST Interests to certain purchasers of the DST Interests. During the year ended December 31, 2024, we sold $797.0 million of gross interests related to the DST Program, $63.3 million of which were financed by DST Program Loans. See “Note 7 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for additional detail regarding the DST Program.

​ 88

Table of Contents We currently group our real property portfolio into five categories: office, retail, residential, industrial and other. The following table summarizes our real property portfolio by category as of December 31, 2024:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	Average		​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	% of Total	​	Effective Annual		​	​	​	​	​	​	% of	****
( and square feet in thousands,	Number of	****	Number of	****	Rentable	****	Rentable	****	Base Rent per		****	%	****	Aggregate		****	Aggregate	​
except for per square foot data)	Markets (1)	​	Real Properties	​	Square Feet	​	Square Feet	****	Square Foot (2)		​	Leased	​	Fair Value		​	Fair Value	​
Residential properties	11		22	​	6,070		24.7	%	$	28.84		92.3	%	$	2,331,100		40.5	%
Industrial properties	31		69	​	14,219		57.7	​		6.99		97.7	​		2,102,900		36.5	​
Retail properties	8		18	​	2,292		9.3	​		20.15		96.7	​		694,900		12.1	​
Office properties	6		7	​	1,381		5.6	​		37.93		79.2	​		464,850		8.1	​
Other properties	4	​	8	​	669	​	2.7	​	​	19.85	​	82.6	​	​	164,300	​	2.8	​
Total real property portfolio	37		124		24,631		100.0	%	$	15.23		94.8	%	$	5,758,050		100.0	%

All values are in US Dollars.

(1)	Reflects the number of unique markets by category and in total. As such, the total number of markets does not equal the sum of the number of markets by category as certain categories are located in the same market.
(2)	Amount calculated as total annualized base rent, which includes the impact of any contractual tenant concessions (cash basis) per the terms of the lease, divided by total lease square footage as of December 31, 2024.
---	---

As of December 31, 2024, we had six floating-rate debt-related investments with a weighted-average interest rate of 8.5% and a weighted-average remaining life of 1.0 years. As of December 31, 2024, the aggregate outstanding principal was $217.6 million, the aggregate carrying amount was $216.7 million and total aggregate current commitments were up to $256.6 million.

As of December 31, 2024, we had three available-for-sale debt securities, which were comprised of one CRE CLO, one CMBS and one preferred equity investment. As of December 31, 2024, the aggregate fair value of these investments was $136.6 million.

In December 2024, we originated our first debt-related investment through our mortgage loan origination program, which was established with the purpose to allow us to earn origination fees for originating mortgage loans for which we intend to sell to another party within a short period. As of December 31, 2024, the carrying amount of this loan, which is classified as held for sale, was $193.9 million and the outstanding principal amount was $196.0 million, with an interest rate of 7.0% and maturity date of January 2027. Subsequent to December 31, 2024, we sold this debt-related investment to a joint venture partnership in which we have an ownership interest for a sale price of $194.5 million, equal to the carrying cost of the debt-related investment on the date of sale.

We currently focus our investment activities primarily across the major U.S. property sectors (residential (which includes and/or may include multi-family and other types of rental housing such as manufactured, student and single-family rental housing), industrial, retail and office (which includes and/or may include medical office and life science laboratories)) and investments in real estate debt and securities. To a lesser extent, we strategically invest in and/or intend to invest in geographies outside of the U.S., which may include Canada, Mexico, the United Kingdom, Europe and other foreign jurisdictions, and in other sectors such as credit lease and self-storage, properties in sectors adjacent to our primary investment sectors and/or infrastructure, to create a diversified blend of current income and long-term value appreciation. Our near-term investment strategy is likely to prioritize new investments in the residential and industrial sectors due to relatively attractive fundamental conditions. We also intend to continue to hold an allocation of properties in the retail and office sectors, the former of which is largely grocery-anchored. 89

Table of Contents Trends Affecting Our Business

Our results of operations are affected by a variety of factors, including conditions in both the U.S. and global financial markets and the economic and political environments.

Throughout 2024, the U.S. economy continued to expand with GDP growth driven by healthy household consumption and supported by the continued strength of the labor market, particularly in the first half of the year. While the Federal Reserve maintained a restrictive monetary policy stance for much of the year, inflation eased from peak levels and there were emerging signs of labor market softness. As a result, the Federal Reserve began easing monetary policy, reducing the federal funds rate by 100 basis points in the second half of 2024. However, in December 2024, persistent levels of inflation and continued strength in the labor markets led the Federal Reserve to take a more balanced monetary policy approach as opposed to its prior more accommodative approach by forecasting two 25 basis point rate reductions in 2025 as opposed to four 25 basis point rate reductions previously forecasted in September of 2024.

Against this backdrop of continued economic strength in 2024, publicly traded equity and credit markets delivered positive returns with incrementally lower risk premiums with expectations of lower future market rates. The overall stability in the economy and financial system supported increased values and liquidity in the market. These dynamics positively impacted the commercial real estate market, particularly during the second half of 2024, which delivered increased transactions and values.

Despite the overall improvement in the liquid capital markets throughout 2024, the commercial real estate markets continue to be impacted by macroeconomic factors, certain property specifics, regulatory changes and geopolitical risks. Regulated lending institutions continue to adjust their business models to increase capital requirements for direct loans to real estate and thus continue to be constrained in providing capital for commercial real estate properties. Rising operating costs, such as property insurance, have further pressured cash flow performance across many real estate property types. Office properties, in particular, continue to experience particular challenges driven by the increased prevalence of remote work and elevated costs to operate, improve or repurpose office properties. These factors have largely resulted in lower demand for office space and have driven elevated levels of vacancy rates and default rates.

Offsetting some of these challenges, there has been a significant decline in new commercial real estate development that began in 2023 and continued in 2024. Ultimately, this lack of new future inventory may result in a shortage of contemporary, in demand properties in the years to come, furthering the disparity between supply and demand dynamics. In addition, there is a significant amount of unspent capital targeting commercial real estate properties that could support values and elevate transaction activities. Property valuations are showing signs of recovery, and capitalization rates are stabilizing or compressing and we believe certain of these market trends will be offset by continued strong operating fundamentals, such as occupancy and rental rates, in property types that include multifamily and industrial.

We believe our portfolio is well-positioned in this market environment. However, there is no guarantee that our outlook will remain positive for the long-term, especially if leasing fundamentals weaken in the future. 90

Table of Contents RESULTS OF OPERATIONS

Summary of 2024 Activities

During 2024, we completed the following activities:

●	We acquired four residential, 16 industrial and six self-storage properties for an aggregate contractual purchase price of approximately $869.2 million. We also invested an aggregate of $137.5 million in our unconsolidated joint venture partnerships and our investments in real estate debt and securities.
●	We sold one industrial property, one parcel of land and two partial retail properties for net proceeds of approximately $31.2 million and recorded a net gain on sale of $12.9 million related to the sale of these properties.
---	---
●	We leased approximately 2.3 million square feet of our commercial properties, which included 0.2 million square feet of new leases and 2.1 million square feet of renewals. During 2024, rent growth on comparable commercial leases executed during the year averaged 32.6% when calculated using cash basis rental rates and 45.1% when calculated using GAAP basis rental rates. For our residential properties, rent growth on new and renewal leases executed during the year averaged 0.3%. As of December 31, 2024, rents across our residential properties and industrial properties, our two largest property segments, are estimated to be 4.5% and 22.9% below market (on a weighted-average basis), respectively, providing the opportunity for meaningful net operating income growth.
---	---
●	We increased our leverage ratio from 36.4% as of December 31, 2023, to 41.2% as of December 31, 2024. Our leverage ratio for reporting purposes is calculated as the outstanding principal balance of our borrowings less cash and cash equivalents divided by the fair value of our real property, net investments in unconsolidated joint venture partnerships, investments in real estate-related securities and debt-related investments not associated with the DST Program (determined in accordance with our valuation procedures).
---	---
●	We raised gross proceeds of $858.8 million from the sale of our common stock and DST Interests. This includes $61.8 million from the sale of 8.0 million shares of our common stock in our securities offerings, including proceeds from our distribution reinvestment plan of $32.1 million, and $797.0 million of gross capital through private placement offerings by selling DST Interests, $63.3 million of which were financed by DST Program Loans.
---	---
●	We redeemed 24.9 million shares of common stock at a weighted-average purchase price of $7.69 per share for an aggregate amount of $191.6 million.
---	---
●	We entered into two mortgage loans for a combined $535.8 million, secured by one of our residential properties and several of our industrial properties, at a fixed interest rate of 5.06% for $60.8 million and a floating interest rate of 6.55% as of December 31, 2024 for $475.0 million.
---	---

91

Table of Contents Results for the Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023

The following table sets forth information regarding our consolidated results of operations for the year ended December 31, 2024, as compared to the year ended December 31, 2023.

​	​	​	​	​	​	​	​	​	​	​
​	For the Year Ended December 31,						Change			​
( in thousands, except per share data)	2024			2023					%	​
Revenues:	​	​	​	​	​	​	​	​	​	​
Rental revenues	$	370,851	​	$	321,995	​		​	15.2	%
Debt-related income	​	46,642	​	​	31,175	​	​	​	49.6	​
Total revenues		417,493	​		353,170	​		​	18.2	​
Operating expenses:		​	​		​	​		​	​	​
Rental expenses		136,232	​		118,794	​		​	14.7	​
Real estate-related depreciation and amortization		152,777	​		149,985	​		​	1.9	​
General and administrative expenses		12,808	​		11,824	​	​	​	8.3	​
Advisory fees		40,786	​		38,645	​	​	​	5.5	​
Acquisition costs and reimbursements		7,034	​		7,034	​	​	​	NM	​
Valuation allowance on debt-related investment	​	—	​	​	(1,799)	​	​	​	100.0	​
Total operating expenses		349,637	​		324,483	​	​	​	7.8	​
Other income (expenses):	​	​	​	​	​	​	​	​	​	​
Income (loss) from unconsolidated joint venture partnerships	​	14,531	​	​	(3,578)	​	​	​	NM	​
Interest expense		(188,318)	​		(148,517)	​	​	​	(26.8)	​
Gain on sale of real estate property	​	12,913	​	​	36,884	​	​	​	(65.0)	​
Unrealized loss on DST Program Loans	​	(17)	​	​	—	​	​	​	NM	​
Unrealized (loss) gain on financing obligations	​	(2,034)	​	​	932	​	​	​	NM	​
Gain (loss) on extinguishment of debt and financing obligations, net	​	41,050	​	​	(700)	​	​	​	NM	​
Gain on derivative instruments	​	402	​	​	126	​	​	​	NM	​
Provision for current expected credit losses	​	1,533	​	​	(1,997)	​	​	​	NM	​
Other income and expenses	​	6,583	​	​	4,950	​	​	​	33.0	​
Total other income (expenses)		(113,357)	​		(111,900)	​	​	​	(1.3)	​
Net loss before income tax expense	​	(45,501)	​	​	(83,213)	​	​	​	45.3	​
Income tax expense	​	(11,842)	​	​	—	​	​	​	NM	​
Net loss		(57,343)	​		(83,213)	​	​	​	31.1	​
Net loss attributable to redeemable noncontrolling interests		273	​		597	​	​	​	(54.3)	​
Net loss attributable to noncontrolling interests		19,935	​		20,189	​	​	​	(1.3)	​
Net loss attributable to common stockholders	$	(37,135)	​	$	(62,427)	​		​	40.5	%
Weighted-average shares outstanding—basic	​	188,336	​	​	203,291	​	​	​	(7.4)	%
Weighted-average shares outstanding—diluted	​	305,179	​	​	267,556	​	​	​	14.1	%
Net loss attributable to common stockholders per common share—basic and diluted	$	(0.20)	​	$	(0.31)	​		​	35.5	%

All values are in US Dollars.

NM = Not meaningful

Total Revenues. In aggregate, total revenues increased by approximately $64.3 million for the year ended December 31, 2024, as compared to the same period in 2023, primarily due to the factors described below.

Rental Revenues. Rental revenues are comprised of rental income, straight-line rent, and amortization of above- and below-market lease assets and liabilities. Total rental revenues increased by approximately $48.9 million for the year ended December 31, 2024, as compared to the same period in 2023, primarily due to the increase in non-same store revenues resulting from significant net growth in our portfolio and increased market rents at various industrial properties. See “Same Store Portfolio Results of Operations” below for further details of the same store revenues.

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Table of Contents The following table presents the components of our consolidated rental revenues:

​

​	​	​	​	​	​	​	​	​	​	​
​	For the Year Ended December 31,					​	Change			​
( in thousands)	2024			2023					%	​
Rental income	$	360,139	​	$	315,036	​		​	14.3	%
Straight-line rent		6,823	​		3,384	​		​	NM	​
Amortization of above- and below-market intangibles		3,889	​		3,575	​		​	8.8	​
Total rental revenues	$	370,851	​	$	321,995	​			15.2	%

All values are in US Dollars.

NM = Not meaningful

Debt-Related Income. Debt-related income is comprised of interest income and amortization related to our debt-related investments and debt securities. Total debt-related income increased by $15.5 million for the year ended December 31, 2024 as compared to the year ended December 31, 2023 primarily due to the growth of our investments in real estate debt and securities.

Total Operating Expenses. In aggregate, total operating expenses increased by $25.2 million for the year ended December 31, 2024, as compared to the same period in 2023, primarily due to the factors described below.

Rental Expenses. Rental expenses include certain property operating expenses typically reimbursed by our customers at our commercial properties, such as real estate taxes, property insurance, property management fees, repair and maintenance, and include certain non-recoverable expenses, such as consulting services and tenant leasing costs. Total rental expenses increased by approximately $17.4 million for the year ended December 31, 2024, as compared to the same period in 2023, primarily due to an increase in non-same store rental expenses resulting from significant net growth in our portfolio; and an increase in real estate taxes at various industrial properties. See “Same Store Portfolio Results of Operations” below for further details of the same store expenses.

Real Estate-Related Depreciation and Amortization. In aggregate, real estate-related depreciation and amortization expense increased by $2.8 million for the year ended December 31, 2024, as compared to the previous year, primarily due to significant net growth in our portfolio, partially offset by the accelerated depreciation expense at our Bala Pointe property due to planned demolition of the building in advance of redevelopment in 2023.

Other Remaining Operating Expenses. In aggregate, the remaining operating expenses increased by $4.9 million for the year ended December 31, 2024, as compared to the same period in 2023, primarily due to an increase in advisory fees of $2.1 million and a reversal of the full valuation allowance of $1.8 million on our debt-related investments.

Other Income and Expenses. In aggregate, the remaining items that comprise our net income (loss) had a $(13.3) million impact on our net income (loss) for the year ended December 31, 2024, as compared to the same period in 2023, primarily due to the following:

●	an increase in interest expense of $39.8 million driven primarily by increased borrowings on our line of credit and additional mortgage notes and higher interest expense on financing obligations associated with an increase in the sale of interests related to our DST Program;
●	a decrease in gain on sale of real estate property of $24.0 million driven by a large gain recognized on a disposition in 2023; and
---	---
●	an increase in income tax expense of $11.8 million driven by activities of our taxable REIT subsidiaries associated with our DST Program, which resulted in taxable income for the period.
---	---

Partially offset by:

●	an increase in gain (loss) on extinguishment of debt and financing obligations, net of $41.8 million driven by the recognition of a gain on our financing obligations upon extinguishment when we exercised a purchase option for certain properties in our DST Program; and
●	an increase in income (loss) from unconsolidated joint venture partnerships of $18.1 million driven by increased investment in joint venture partnerships and unrealized gains recognized on investments held by these joint venture partnerships.
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93

Table of Contents Segment Summary for the Years Ended December 31, 2024 and 2023

Same Store Portfolio Results of Operations

Property net operating income (“NOI”) is a supplemental non-GAAP measure of our property operating results. We define property NOI as rental revenues less operating expenses. While we believe our net income (loss), as defined by GAAP, to be the most appropriate measure to evaluate our overall performance, we consider property NOI to be an appropriate supplemental performance measure. We believe property NOI provides useful information to our investors regarding our results of operations because property NOI reflects the operating performance of our properties and excludes certain items that are not considered to be controllable in connection with the management of properties, such as real estate-related depreciation and amortization, general and administrative expenses, advisory fees, impairment charges, interest expense, gains on sale of properties, other income and expenses, gains and losses on the extinguishment of debt and noncontrolling interests. However, property NOI should not be viewed as an alternative measure of our financial performance since it excludes such items, which could materially impact our results of operations. Further, our property NOI may not be comparable to that of other real estate companies, as they may use different methodologies for calculating property NOI, therefore, our investors should consider net income (loss) as the primary indicator of our overall financial performance.

We evaluate the performance of consolidated operating properties we own and manage using a same store analysis because the population of properties in this analysis is consistent from period to period, thereby eliminating the effects of any material changes in the composition of the aggregate portfolio on performance measures. We have defined the same store portfolio to include consolidated operating properties owned for the entirety of both the current and prior reporting periods for which the operations had been stabilized. Unconsolidated properties are excluded from the same store portfolio because we account for our interest in our joint venture partnership using the equity method of accounting; therefore, our proportionate share of income and loss is recognized in income (loss) of our unconsolidated joint venture partnerships on the consolidated statements of operations. Other operating properties not meeting the same store criteria are reflected in the non-same store portfolio. Our same store analysis may not be comparable to that of other real estate companies and should not be considered to be more relevant or accurate in evaluating our operating performance than current GAAP methodology.

The same store operating portfolio for the year ended December 31, 2024 as compared to the year ended December 31, 2023 presented below includes 88 properties totaling 17.8 million square feet owned as of January 1, 2023, which represented 72.4% of total rentable square feet as of December 31, 2024.

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Table of Contents The following table reconciles GAAP net income (loss) to same store portfolio property NOI for the years ended December 31, 2024 and 2023:

​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	​	2024		****	2023
Net loss attributable to common stockholders	​	$	(37,135)	​	$	(62,427)
Debt-related income	​		(46,642)	​		(31,175)
Real estate-related depreciation and amortization	​		152,777	​		149,985
General and administrative expenses	​		12,808	​		11,824
Advisory fees	​		40,786	​		38,645
Acquisition costs and reimbursements	​		7,034	​		7,034
Valuation allowance on debt-related investment	​	​	—	​		(1,799)
(Income) loss from unconsolidated joint venture partnerships	​	​	(14,531)	​	​	3,578
Interest expense	​		188,318	​		148,517
Gain on sale of real estate property	​		(12,913)	​		(36,884)
Unrealized loss on DST Program Loans	​	​	17	​	​	—
Unrealized loss (gain) on financing obligations	​	​	2,034	​	​	(932)
(Gain) loss on extinguishment of debt and financing obligations, net	​		(41,050)	​		700
Gain on derivative instruments	​	​	(402)	​	​	(126)
Provision for current expected credit losses	​	​	(1,533)	​	​	1,997
Other income and expenses	​	​	(6,583)	​	​	(4,950)
Income tax expense	​	​	11,842	​	​	—
Net loss attributable to redeemable noncontrolling interests	​	​	(273)	​	​	(597)
Net loss attributable to noncontrolling interests	​		(19,935)	​		(20,189)
Property net operating income	​	$	234,619	​	$	203,201
Less: Non-same store property NOI	​	​	27,311	​	​	4,848
Same store property NOI	​	$	207,308	​	$	198,353

Our real property markets are aggregated into five reportable property segments: residential, industrial, retail, office, and other. Our property segments are based on our internal reporting of operating results used to assess performance based on the type of our properties. These property segments are comprised of the markets by which management and its operating teams conduct and monitor business. See “Note 17 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for further information on our segments. Management considers rental revenues and property NOI aggregated by property segment to be an appropriate way to analyze performance. 95

Table of Contents The following table includes a breakout of results for our same store portfolio by property segment for rental revenues, rental expenses and property NOI for the year ended December 31, 2024 as compared to the year ended December 31, 2023:

​	​	​	​	​	​	​	​	​	​	​	​
($ in thousands,	​	For the Year Ended December 31,					​	Change			​
except per square foot data)	​	2024			2023					%	​
Rental revenues:	​	​		​	​		​	​	​		​
Residential	​	$	116,217	​	$	116,304	​		​	(0.1)	%
Industrial	​		96,448	​		87,755	​		​	9.9	​
Retail	​		60,818	​		58,006	​		​	4.8	​
Office	​		50,102	​		51,149	​		​	(2.0)	​
Other	​		—	​		—	​		​	—	​
Total same store rental revenues	​		323,585	​		313,214	​		​	3.3	​
Non-same store properties	​		47,266	​		8,781	​		​	NM	​
Total rental revenues	​	$	370,851	​	$	321,995	​		​	15.2	%
Rental expenses:	​	​		​	​		​	​	​		​
Residential	​	$	(53,729)	​	$	(56,023)	​		​	4.1	%
Industrial	​		(23,836)	​		(19,384)	​		​	(23.0)	​
Retail	​		(15,847)	​		(15,301)	​		​	(3.6)	​
Office	​		(22,865)	​		(24,153)	​		​	5.3	​
Other	​		—	​		—	​		​	—	​
Total same store rental expenses	​		(116,277)	​		(114,861)	​		​	(1.2)	​
Non-same store properties	​		(19,955)	​		(3,933)	​		​	NM	​
Total rental expenses	​	$	(136,232)	​	$	(118,794)	​		​	(14.7)	%
Property NOI:	​			​			​		​		​
Residential	​	$	62,488	​	$	60,281	​		​	3.7	%
Industrial	​		72,612	​		68,371	​		​	6.2	​
Retail	​		44,971	​		42,705	​		​	5.3	​
Office	​		27,237	​		26,996	​		​	0.9	​
Other	​		—	​		—	​		​	—	​
Total same store property NOI	​		207,308	​		198,353	​		​	4.5	​
Non-same store properties	​		27,311	​		4,848	​		​	NM	​
Total property NOI	​	$	234,619	​	$	203,201	​		​	15.5	%
Same store average percentage leased:	​	​	​	​	​	​	​	​	​	​	​
Residential	​		92.0	%		93.5	%	​	​		​
Industrial	​		98.2	​		99.7	​	​	​		​
Retail	​		96.9	​		96.8	​	​	​		​
Office	​		79.9	​		81.4	​	​	​	​	​
Other	​		—	​		—	​	​	​	​	​
Same store average annualized base rent per square foot:	​	​	​	​	​	​	​	​	​	​	​
Residential	​	$	28.37	​	$	27.47	​	​	​		​
Industrial	​		7.28	​		6.89	​	​	​		​
Retail	​		20.15	​		19.94	​	​	​		​
Office	​		37.68	​		35.46	​	​	​	​	​
Other	​		—	​		—	​	​	​		​

All values are in US Dollars.

NM = Not meaningful

Residential Segment. Our residential segment same store property NOI increased by approximately $2.2 million for the year ended December 31, 2024 compared to the same period in 2023, primarily due to decreased operating expenses due in part to reduced real estate taxes and non-recurring expenses at certain of our residential properties.

Industrial Segment. Our industrial segment same store property NOI increased by approximately $4.2 million for the year ended December 31, 2024 compared to the same period in 2023, primarily due to increased rental rates at various industrial properties, partially offset by reduced occupancy at Orlando V and North 5th Street.

Retail Segment. Our retail segment same store property NOI increased by approximately $2.3 million for the year ended December 31, 2024 compared to the same period in 2023, primarily due to increased occupancy at various properties and an early termination fee at Beaver Creek.

Office Segment. Our office segment same store property NOI remained constant for the year ended December 31, 2024 compared to the same period in 2023.

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Table of Contents Results for the Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022

See “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 13, 2024, which is incorporated herein by reference, for a comparison of our results of operations for the years ended December 31, 2023 and December 31, 2022.

ADDITIONAL MEASURES OF PERFORMANCE

Funds From Operations (“FFO”) and Adjusted Funds From Operations (“AFFO”)

We believe that FFO and AFFO, in addition to net income (loss) and cash flows from operating activities as defined by GAAP, are useful supplemental performance measures that our management uses to evaluate our consolidated operating performance. However, these supplemental, non-GAAP measures should not be considered as alternatives to net income (loss) or to cash flows from operating activities as indications of our performance and are not intended to be used as liquidity measures indicative of cash flow available to fund our cash needs, including our ability to make distributions to our stockholders. No single measure can provide users of financial information with sufficient information and only our disclosures read as a whole can be relied upon to adequately portray our financial position, liquidity and results of operations. In addition, other REITs may define FFO, AFFO and similar measures differently and choose to treat certain accounting line items in a manner different from us due to specific differences in investment and operating strategy or for other reasons.

FFO. As defined by the National Association of Real Estate Investment Trusts (“NAREIT”), FFO is a non-GAAP measure that excludes certain items such as real estate-related depreciation and amortization. We believe FFO is a meaningful supplemental measure of our operating performance that is useful to investors because depreciation and amortization in accordance with GAAP implicitly assumes that the value of real estate assets diminishes predictably over time. By excluding gains or losses on the sale of assets, we believe FFO provides a helpful additional measure of our consolidated operating performance on a comparative basis. We use FFO as an indication of our consolidated operating performance and as a guide to making decisions about future investments.

AFFO. AFFO further adjusts FFO to reflect the performance of our portfolio by adjusting for items we believe are not directly attributable to our operations. Our adjustments to FFO to arrive at AFFO include removing the impact of (i) our performance participation allocation, (ii) unrealized (gain) loss from changes in fair value of financial instruments and (iii) increase (decrease) in financing obligation liability appreciation, as applicable.

Although some REITs may present certain performance measures differently, we believe FFO and AFFO generally facilitate a comparison to other REITs that have similar operating characteristics to us. We believe investors are best served if the information that is made available to them allows them to align their analyses and evaluation with the same performance metrics used by management in planning and executing our business strategy. Neither the SEC, NAREIT, nor any regulatory body has passed judgment on the acceptability of the adjustments used to calculate AFFO. In the future, the SEC, NAREIT, or a regulatory body may decide to standardize the allowable adjustments across the non-traded REIT industry at which point we may adjust our calculations and characterizations of AFFO. 97

Table of Contents The following unaudited table presents a reconciliation of GAAP net income (loss) to FFO and AFFO:

​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands, except per share data)	​	2024			2023			2022
GAAP net loss	​	$	(57,343)	​	$	(83,213)	​	$	(49,663)
Weighted-average shares outstanding—diluted	​		305,179	​		267,556	​		233,304
GAAP net loss per common share—diluted	​	$	(0.20)	​	$	(0.31)	​	$	(0.21)
Adjustments to arrive at FFO:	​	​	​	​	​	​	​	​	​
Real estate-related depreciation and amortization	​	$	152,777	​	$	149,985	​	$	134,617
Gain on sale of real estate property	​	​	(12,913)	​	​	(36,884)	​	​	(94,827)
Our share of adjustments from joint venture partnerships	​		6,595	​		7,114	​		3,434
FFO	​		89,116	​		37,002	​		(6,439)
FFO per common share—diluted	​	​	0.29	​	​	0.14	​	​	(0.03)
Adjustments to arrive at AFFO:	​		​	​		​	​	​	​
Performance participation allocation	​	​	—	​	​	—	​	​	23,747
Unrealized (gain) loss on financial instruments (1)	​		(40,796)	​		3,435	​		(2,252)
(Decrease) increase in financing obligation liability appreciation	​	​	(69)	​	​	(459)	​	​	31,737
Our share of adjustments from joint venture partnerships	​		(8,709)	​		733	​		(1,612)
AFFO	​	$	39,542	​	$	40,711	​	$	45,181
(1)	Unrealized (gain) loss on financial instruments primarily relates to mark-to-market changes on our derivatives not designated as cash flow hedges, mark-to-market changes on our DST Program Loans and financing obligations for which we have elected the fair value option, valuation allowance and changes to our provision for current expected credit losses on our debt related investments and gains or losses on extinguishment of our financing obligations.
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LIQUIDITY AND CAPITAL RESOURCES

Liquidity

Our primary sources of capital for meeting our cash requirements include debt financings, cash generated from operating activities, net proceeds from our securities offerings, asset sales and repayments from investments in real estate debt and securities. Our principal uses of funds are distributions to our stockholders, payments under our debt obligations and payments pursuant to the master lease agreements related to properties in our DST Program, redemption payments, acquisition of properties and other investments, and capital expenditures. Over time, we intend to fund a majority of our cash needs, including the repayment of debt and capital expenditures, from operating cash flows and refinancings. As of December 31, 2024, we had approximately $659.2 million of borrowings, including scheduled amortization payments, becoming payable within the next 12 months, though the terms of the associated loan agreements for $548.2 million of these borrowings can be extended pursuant to two six-month extension options, subject to certain conditions. As of December 31, 2024, we had approximately $65.8 million of future minimum lease payments related to the properties in our DST Program coming due in the next 12 months. In addition, we have $256.6 million in unfunded commitments related to our investments in unconsolidated joint venture partnerships and our investments in real estate debt and securities as of December 31, 2024. We expect to be able to repay our principal and interest obligations and fund our capital commitments over the next 12 months and beyond through operating cash flows, refinancings, borrowings under our line of credit, proceeds from capital raise and/or disposition proceeds. Additionally, given the increase in market volatility, increased interest rates and high inflation, we have experienced a decreased pace of net proceeds raised from our securities offerings, reducing our ability to purchase assets, which may similarly delay the returns generated from our investments and affect our NAV.

Our Advisor, subject to the oversight of our board of directors and, under certain circumstances, the investment committee or other committees established by our board of directors, will evaluate potential acquisitions or dispositions and will engage in negotiations with buyers, sellers and lenders on our behalf. Pending investment in property, debt, or other investments, we may decide to temporarily invest any unused proceeds from our securities offerings in certain investments that are expected to yield lower returns than those earned on real estate assets. These lower returns may affect our NAV and our ability to make distributions to our stockholders. Potential future sources of capital include proceeds from secured or unsecured financings from banks or other lenders, proceeds from our securities offerings, proceeds from the sale of assets and undistributed funds from operations. 98

Table of Contents As of December 31, 2024, our financial position was strong with 41.2% leverage, calculated as outstanding principal balance of our borrowings less cash and cash equivalents divided by the fair value of our real property, net investments in our unconsolidated joint venture partnerships, investments in real estate-related securities and debt-related investments not associated with the DST Program (determined in accordance with our valuation procedures). In addition, our consolidated portfolio was 94.7% occupied (94.8% leased) as of December 31, 2024 and is diversified across 124 properties totaling 24.6 million square feet across 37 geographic markets. Our properties contain a diverse roster of 444 commercial customers, large and small, and has an allocation based on fair value of real properties as determined by our NAV calculation of 40.5% residential, 36.5% industrial, 12.1% retail, which is primarily grocery-anchored, 8.1% office and 2.8% other properties in adjacent sectors.

We believe that our cash on-hand, anticipated net offering proceeds, proceeds from our line of credit, and other financing and disposition activities should be sufficient to meet our anticipated future acquisition, operating, debt service, distribution and redemption requirements.

Cash Flows. The following table summarizes our cash flows for the following periods:

​	​	​	​	​	​	​	​	​	​
​		For the Year Ended December 31,					​	​	​
(in thousands)		2024			2023			Change	​
Total cash provided by (used in):	​	​		​	​		​	​	​
Operating activities	​	$	(169,493)	​	$	15,958	​		​
Investing activities	​		(919,127)	​		(521,553)	​		​
Financing activities	​		1,096,352	​		508,075	​		​
Effect of exchange rate changes on cash, cash equivalents and restricted cash	​	​	21	​	​	—	​	​	​
Net increase in cash, cash equivalents and restricted cash	​	$	7,753	​	$	2,480	​		​

All values are in US Dollars.

2024 Cash Flows Compared to 2023 Cash Flows

Net cash provided by operating activities decreased by $185.5 million for the year ended December 31, 2024, compared to the same period in 2023, primarily due to an origination of a held for sale debt-related investment, with a carrying value of $193.9 million as of December 31, 2024, partially offset by a $23.7 million settlement of the 2022 performance participation allocation in cash in January 2023.

Net cash used in investing activities increased by $397.6 million for the year ended December 31, 2024, compared to the same period in 2023, primarily due to an increase in real estate property acquisition activity of $469.9 million, partially offset by a decrease in investments in available-for-sale debt securities of $99.2 million.

Net cash provided by financing activities increased by $588.3 million for the year ended December 31, 2024, compared to the same period in 2023, primarily due to an increase in net borrowing activity of $348.0 million and an increase in net offering activity from our DST Program and public offering of $239.1 million.

2023 Cash Flows Compared to 2022 Cash Flows

See “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 13, 2024, which is incorporated herein by reference, for a comparison of our cash flows for the years ended December 31, 2023 and December 31, 2022.

Capital Resources and Uses of Liquidity

In addition to our cash and cash equivalents balances available, our capital resources and uses of liquidity are as follows:

Line of Credit and Term Loans. As of December 31, 2024, we had an aggregate of $1.70 billion of commitments under our unsecured credit agreement, including $900.0 million under our line of credit and $800.0 million under our two term loans. As of that date, we had: (i) $548.2 million outstanding under our line of credit; and (ii) $800.0 million outstanding under our term loans. The weighted-average effective interest rate across all of our unsecured borrowings is 4.71%, which includes the effect of the interest rate swap and cap agreements related to $725.0 million in borrowings under our line of credit and our term loans.

99

Table of Contents As of December 31, 2024, the unused and available portions under our line of credit were $351.8 million and $297.1 million, respectively. Our $900.0 million line of credit matures in November 2025, and may be extended pursuant to two six-month extension options, subject to certain conditions, including the payment of extension fees. One $400.0 million term loan matures in November 2026, with no extension option available. Our other $400.0 million term loan matures in January 2027, with no extension option available. Our line of credit borrowings are available for general corporate purposes, including but not limited to the refinancing of other debt, payment of redemptions, acquisition and operation of permitted investments. Refer to “Note 6 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for additional information regarding our line of credit and term loans.

Mortgage Notes. As of December 31, 2024, we had property-level borrowings of $1.37 billion outstanding with a weighted-average remaining term of approximately 2.7 years. These borrowings are secured by mortgages or deeds of trust and related assignments and security interests in the collateralized properties, and had a weighted-average interest rate of 5.31%. Refer to “Note 6 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for additional information regarding the mortgage notes.

Debt Covenants. Our line of credit, term loan and mortgage note agreements contain various property-level covenants, including customary affirmative and negative covenants. In addition, our line of credit and term loan agreements contain certain corporate level financial covenants, including leverage ratio, fixed charge coverage ratio, and tangible net worth thresholds. These covenants may limit our ability to incur additional debt, or to pay distributions. We were in compliance with our debt covenants as of December 31, 2024.

Leverage. We use financial leverage to provide additional funds to support our investment activities. We may finance a portion of the purchase price of any real estate asset that we acquire with borrowings on a short or long-term basis from banks, life insurance companies and other lenders. We calculate our leverage for reporting purposes as the outstanding principal balance of our borrowings less cash and cash equivalents divided by the fair value of our real property, net investments in our unconsolidated joint venture partnerships, investments in real estate-related securities and debt-related investments not associated with the DST Program (determined in accordance with our valuation procedures). We had leverage of 41.2% as of December 31, 2024. Our current target leverage ratio is between 40-60%. Although we will generally work to maintain our targeted leverage ratio, there are no assurances that we will maintain the targeted range disclosed above or achieve any other leverage ratio that we may target in the future. Due to higher interest rates and increased market volatility, the cost of financing or refinancing our assets may affect returns generated by our investments. Additionally, these factors may cause our borrowing capacity to be reduced, which could similarly delay or reduce benefits to our stockholders.

Future Minimum Lease Payments Related to the DST Program. As of December 31, 2024, we had $1.37 billion of future minimum lease payments related to the DST Program. The underlying interests of each property that is sold to investors pursuant to the DST Program are leased back by an indirect wholly-owned subsidiary of the Operating Partnership on a long-term basis of up to 29 years.

Offering Proceeds. For the year ended December 31, 2024, the amount of aggregate gross proceeds raised from our securities offerings (including shares issued pursuant to the distribution reinvestment plan) was $61.8 million ($59.2 million net of direct selling costs).

Distributions. To obtain the favorable tax treatment accorded to REITs, we normally will be required each year to distribute to our stockholders at least 90% of our real estate investment trust taxable income, determined without regard to the deduction for distributions paid and by excluding net capital gains. The payment of distributions is determined by our board of directors and may be adjusted at its discretion at any time. Distribution levels are set by our board of directors at a level it believes to be appropriate and sustainable based upon a review of a variety of factors including the current and anticipated market conditions, current and anticipated future performance and make-up of our investments, our overall financial projections and expected future cash needs. We intend to continue to make distributions on a monthly basis.

Beginning in the third quarter of 2023, our board of directors authorized an increase to the amount of monthly gross distributions for each class of our common stock, such that distributions in the amount of $0.03333 per share were paid to stockholders. The new monthly gross distribution per share reflects an increase to the amount of the previous monthly gross distribution of $0.03125 per share that had been paid since January 31, 2018. The distributions on Class T-R shares, Class S-R shares, Class D-R, Class S-PR and Class D-PR shares of our common stock are reduced by the respective distribution fees that are payable with respect to Class T-R shares, Class S-R shares, Class D-R, Class S-PR and Class D-PR shares. The distributions are paid on or about the last business day of each respective month to stockholders of record as of the close of business on the last business day of each respective month. There can be no assurances that this new distribution rate will be maintained in future periods. 100

Table of Contents The following table outlines sources used, as determined on a GAAP basis, to pay total gross distributions (which are paid in cash or reinvested in shares of our common stock through our distribution reinvestment plan (“DRIP”)) for the periods indicated below:

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31, 2024				​	​	For the Year Ended December 31, 2023				​
($ in thousands)	​	Amount		​	Percentage	​	​	Amount		​	Percentage	​
Distributions:	​	​	​	​	​	​	​	​	​	​	​	​
Paid in cash (1)	​	$	90,093	​	73.8	%	​	$	70,982	​	68.4	%
Reinvested in shares	​	​	31,926	​	26.2	​	​	​	32,731	​	31.6	​
Total (2)	​	$	122,019	​	100.0	%	​	$	103,713	​	100.0	%
Sources of Distributions:	​			​		​	​			​		​
Cash flows from operating activities (3)	​	$	—	​	—	%	​	$	15,958	​	15.4	%
Borrowings	​		90,093	​	73.8	​	​		55,024	​	53.0	​
DRIP (4)	​		31,926	​	26.2	​	​		32,731	​	31.6	​
Total (2)	​	$	122,019	​	100.0	%	​	$	103,713	​	100.0	%
(1)	Includes other cash distributions consisting of: (i) distributions paid to noncontrolling interest holders; and (ii) ongoing distribution fees paid to the Dealer Manager with respect to Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares, Class D-PR shares and OP Units. See “Note 13 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for further detail regarding the ongoing distribution fees.
---	---
(2)	Includes distributions paid to holders of OP Units for redeemable noncontrolling interests.
---	---
(3)	In the fourth quarter of 2024, we originated a held for sale debt-related investment, with a carrying value of $193.9 million as of December 31, 2024, which reduced our cash flows from operating activities for the year ended December 31, 2024 by the same amount. Subsequent to December 31, 2024, we sold this debt-related investment for a cash sale price of $194.5 million, which will be a cash inflow from operating activities in the first quarter of 2025.
---	---
(4)	Stockholders may elect to have their distributions reinvested in shares of our common stock through our DRIP.
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For the years ended December 31, 2024 and 2023, our FFO was $89.1 million, or 73.0% of our total distributions, and $37.0 million, or 35.7% of our total distributions, respectively. FFO is a non-GAAP operating metric and should not be used as a liquidity measure. However, management believes the relationship between FFO and distributions may be meaningful for investors to better understand the sustainability of our operating performance compared to distributions made. Refer to “Additional Measures of Performance” above for the definition of FFO, as well as a detailed reconciliation of our GAAP net income (loss) to FFO.

Refer to “Note 10 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for further detail on our distributions.

Redemptions. Below is a summary of redemptions and repurchases pursuant to our share redemption program for the years ended December 31, 2024, 2023 and 2022. All eligible redemption requests were fulfilled for the periods presented. Eligible redemption requests are requests submitted in good order by the request submission deadline set forth in the share redemption program. Our board of directors may make exceptions to, modify or suspend our current share redemption programs if it deems such action to be in the best interest of our stockholders. Refer to Part II, Item 5, “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchasers of Equity Securities and Use of Proceeds—Share Redemption Program” for detail regarding our share redemption program.

​	​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,								​
(in thousands, except for per share data)		2024			2023		​	2022		​
Number of shares redeemed or repurchased		​	24,937		​	22,815	​	​	8,466	​
Aggregate dollar amount of shares redeemed or repurchased	​	$	191,630	​	$	193,859	​	$	73,378	​
Average redemption or repurchase price per share	​	$	7.69	​	$	8.50	​	$	8.67	​

For the years ended December 31, 2024 and 2023, we received and redeemed 100% of eligible redemption requests for an aggregate amount of approximately $191.6 million and $193.9 million, respectively, which we redeemed using cash flows from operating activities in excess of our distributions paid in cash, cash on hand, proceeds from our securities offerings, proceeds from the disposition of properties, and borrowings under our line of credit. We generally repay funds borrowed from our line of credit from a variety of sources including: cash flows from operating activities in excess of our distributions; proceeds from our securities offerings; proceeds from the disposition of properties; and other longer-term borrowings. In addition, refer to “Note 10 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for detail regarding our redemption activity relating to OP Units. 101

Table of Contents For purposes of the share redemption program, redemption requests received in a month are included on the last day of such month because that is the last day the stockholders have rights in the Company. We record these redemptions in our financial statements as having occurred on the first day of the next month following receipt of the redemption request because shares redeemed in a given month are considered outstanding through the last day of the month.

SUBSEQUENT EVENTS

See “Note 18 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for information regarding subsequent events.

INFLATION

Increases in the costs of owning and operating our properties due to inflation could impact our results of operations and financial condition to the extent such increases are not paid or reimbursed by our customers. Substantially all of our commercial leases provide for separate real estate tax and operating expense reimbursement escalations over a base amount. In addition, our leases provide for fixed base rent increases or indexed increases. As a result, inflationary increases in costs may be offset in part or in full by the contractual rent increases and operating expense reimbursement provisions or escalations. Our residential leases typically have initial terms of 12 months or less, which generally enables us to compensate for inflationary effects by adjusting rental rates on our residential leases to the extent the market will bear such adjustment.

In the United States, inflation rates continue to be high, and inflation’s impact on the U.S. economy and the impact of any additional measures that may be taken by government officials to curb inflation remain uncertain. Periods of excessive or prolonged inflation may negatively impact our customers’ businesses, resulting in increased vacancy, concessions or bad debt expense, which may adversely and materially affect our results of operations, financial condition, NAV and cash flows.

CRITICAL ACCOUNTING ESTIMATES

Critical accounting estimates are those estimates that require management to make challenging, subjective, or complex judgments, often because they must estimate the effects of matters that are inherently uncertain and may change in subsequent periods. Critical accounting estimates involve judgments and uncertainties that are sufficiently sensitive and may result in materially different results under different assumptions and conditions and can have a material impact on the consolidated financial statements.

Investment in Real Estate Properties

We first determine whether an acquisition constitutes a business or asset acquisition. Upon determination of an asset acquisition, the purchase price of a property is allocated to land, building and improvements, and intangible lease assets and liabilities. Fair value determinations are based on estimated cash flow projections that utilize discount and/or capitalization rates, as well as certain available market information. The fair value of land, building and improvements considers the value of the property as if it were vacant. The fair value of intangible lease assets is based on our evaluation of the specific characteristics of each lease. Factors considered include estimates of carrying costs during hypothetical expected lease-up periods, current market conditions and market rates, the customer’s credit quality and costs to execute similar leases. The fair value of above- and below-market leases is calculated as the present value of the difference between the contractual amounts to be paid pursuant to each in-place lease and our estimate of fair market lease rates for each corresponding in-place lease, using a discount rate that reflects the risks associated with the leases acquired and measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed-rate renewal options for below-market leases. In estimating carrying costs, we include estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions. In estimating costs to execute similar leases, we consider tenant improvements, leasing commissions and legal and other related expenses.

Impairment of Real Estate Properties

We review our investment in real estate properties individually whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss is recorded for the difference between estimated fair value of the real estate property and the carrying amount when the estimated future cash flows and the estimated liquidation value of the real estate property are less than the real estate property carrying amount. Our estimates of future cash flows and liquidation values require us to make assumptions that are subject to economic and market uncertainties including, among others, demand for space, competition for customers, changes in market rental rates, costs to operate each property, and expected ownership periods that can be difficult to predict. 102

Table of Contents Fair Value of Financing Obligations

The underlying interests in real properties sold to investors pursuant to the DST Program are leased-back by a wholly owned subsidiary of the Operating Partnership on a long-term basis. These master lease agreements are fully guaranteed by the Operating Partnership and the Operating Partnership retains a fair market value purchase option giving it the right, but not the obligation, to acquire the DST Interests in the DST Program from the investors at a later time in exchange for OP Units, cash or a combination of OP Units and cash. This results in a failed sale and leaseback transaction for accounting purposes; therefore, we record DST Interests as financing obligation liabilities.

We have elected the fair value option for certain financing obligations and, as such, these financing obligations are carried at fair value. Unrealized gains and losses on financing obligations are recorded as a component of other income (expenses) on our consolidated statements of operations. Financing obligations are valued on a recurring basis using discounted cash flow models. We utilize discount rates and exit capitalization rates as inputs in our valuation models. Changes in these assumptions could materially change the valuation of our financing obligations and have an impact on our results of operations and financial position.

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Table of Contents

ITEM 7A.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We have been and may continue to be exposed to the impact of interest rate changes. Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings and cash flows, and optimize overall borrowing costs. To achieve these objectives, we plan to borrow on a fixed interest rate basis and utilize interest rate swap and cap agreements on certain variable interest rate debt in order to limit the effects of changes in interest rates on our results of operations. As of December 31, 2024, our consolidated debt outstanding consisted of borrowings under our line of credit, term loans and mortgage notes. In addition, we plan to purchase or originate variable rate debt investments, which can offset interest rate risk associated with our variable interest rate consolidated debt.

Fixed Interest Rate Debt. As of December 31, 2024, our fixed interest rate debt consisted of $654.8 million under our mortgage notes and $475.0 million of borrowings under our term loans that were effectively fixed through the use of interest rate swaps. In total, our fixed interest rate debt represented 41.6% of our total consolidated debt as of December 31, 2024. Interest rate fluctuations will generally not affect our future earnings or cash flows on our fixed interest rate debt unless such instruments mature or are otherwise terminated. However, interest rate changes could affect the fair value of our fixed interest rate debt. As of December 31, 2024, the fair value and the carrying value of our consolidated fixed interest rate debt, excluding the values of any associated hedges, was $1.10 billion and $1.13 billion, respectively. The fair value estimate of this debt was estimated using a discounted cash flow analysis utilizing rates we would expect to pay for debt of a similar type and remaining maturity if the loans were originated on December 31, 2024. Given we generally expect to hold our fixed interest rate debt instruments to maturity or when they otherwise open up for prepayment at par, and the amounts due under such debt instruments should be limited to the outstanding principal balance and any accrued and unpaid interest at such time, we do not expect that the resulting change in fair value of our fixed interest rate debt instruments due to market fluctuations in interest rates, would have a significant impact on our operating cash flows.

Variable Interest Rate Debt. As of December 31, 2024, our consolidated variable interest rate debt consisted of $548.2 million of borrowings under our line of credit, $325.0 million of borrowings under our term loans, and $714.2 million under our mortgage notes, which represented 58.4% of our total consolidated debt. Interest rate changes on the variable portion of our consolidated variable-rate debt could impact our future earnings and cash flows, but would not necessarily affect the fair value of such debt. As of December 31, 2024, we were exposed to market risks related to fluctuations in interest rates on $1.59 billion of consolidated borrowings; however, $966.3 million of these borrowings are capped through the use of nine interest rate cap agreements. A hypothetical 25 basis points increase in the all-in rate on the outstanding balance of our consolidated variable interest rate debt as of December 31, 2024, would increase our annual interest expense by approximately $1.6 million, including the effects of our interest rate cap agreements. In addition, we have originated and/or purchased variable rate debt-related investments with aggregate current commitments of $256.6 million and aggregate outstanding principal of $217.6 million as of December 31, 2024, which can offset the interest rate risk associated with our variable interest rate borrowings.

Derivative Instruments. As of December 31, 2024, we had 19 outstanding derivative instruments with a total current notional amount of $1.44 billion outstanding and effective. These derivative instruments were comprised of interest rate swaps and interest rate caps that were designed to mitigate the risk of future interest rate increases by either providing a fixed interest rate or capping the variable interest rate for a limited, pre-determined period of time. See “Note 6 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for further detail on our derivative instruments. We are exposed to credit risk of the counterparty to our interest rate cap and swap agreements in the event of non-performance under the terms of the agreements. If we were not able to replace these caps or swaps in the event of non-performance by the counterparty, we would be subject to variability of the interest rate on the amount outstanding under our debt that is fixed or capped through the use of the swaps or caps, respectively.

Variable Interest Rate Debt Investments. In the case of a significant increase in interest rates, additional debt service payments due from our borrowers may strain the operating cash flows of the real estate assets underlying our mortgages and, potentially, contribute to non-performance or, in severe cases, default, which may be mitigated by borrower purchased interest rate caps. Alternatively, in the case of a significant decrease in interest rates, our debt-related investments could be adversely impacted and interest income from our debt-related investments could decrease substantially, which could reduce the effectiveness of our interest rate risk strategy described above. 104

Table of Contents Foreign Currency Risk

We currently have investments in unconsolidated joint venture partnerships that invest in assets and properties located in countries outside of the U.S. that are subject to the effects of exchange rate movements between the foreign currency of each real estate investment and the U.S. dollar, which may affect future costs and cash flows as well as amounts remeasured into U.S. dollars for inclusion in our consolidated financial statements. We execute borrowings in the same foreign currencies as our foreign investments to protect against the foreign currency exchange rate risk inherent in transactions denominated in foreign currencies. We estimate that as of December 31, 2024, a hypothetical 10% decline in the exchange rates of foreign currencies against the U.S. dollar would not result in a material change to our investment balances and would be largely offset by the currency conversions of our borrowings in the same foreign currencies.

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Table of Contents

ITEM 8.FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

Ares Real Estate Income Trust Inc.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Ares Real Estate Income Trust Inc. and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, 2024, and the related notes and financial statement schedule III (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Evaluation of financing obligations carried at fair value

As discussed in Notes 2, 7, and 8 to the consolidated financial statements, the Company has $878,386 thousand of financing obligations carried at fair value under the fair value option as of December 31, 2024. The Company measures the fair value of these financing obligations on a recurring basis using a discounted cash flow valuation technique. 106

Table of Contents We identified the evaluation of certain financing obligations carried at fair value as a critical audit matter. Challenging auditor judgment and specialized skills and knowledge were required to evaluate the method and certain significant assumptions used to estimate the fair value of the financing obligation. We performed a sensitivity analysis to determine the significant assumptions used to value certain financing obligations and identified the discount rates and exit capitalization rates as the significant assumptions. Changes in the significant assumptions or the use of a different valuation method could have a significant impact on the fair value of financing obligations.

The following are the primary procedures we performed to address this critical audit matter. For a selection of financing obligations, we involved valuation professionals with specialized skills and knowledge, who assisted in:

●	assessing the appropriateness of the valuation method utilized
●	comparing the discount rates for a selection of financing obligations to ranges of discount rates obtained from market data and relevant industry guides
---	---
●	comparing the exit capitalization rates for a selection of financing obligations to ranges of exit capitalization rates obtained from market data and relevant industry guides.
---	---

Assessment of the expected hold periods for investments in real estate properties

As described in Note 3 to the consolidated financial statements, the Company has $4,731,403 thousand of net investment in real estate properties as of December 31, 2024. The Company evaluates properties for impairment whenever events or changes in circumstances, including shortening the expected hold periods of such properties, indicate that the carrying amount of an asset may not be recoverable.

We identified the assessment of the expected hold periods for investments in real estate properties as a critical audit matter. A high degree of subjective auditor judgment was required in assessing the events or changes in circumstances used by the Company to evaluate the expected hold periods for investments in real estate assets.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the Company’s hold periods by inquiring of management, reading minutes of the meetings of the Company’s Board of Directors, and analyzing documents prepared by the Company regarding proposed real estate transactions and potential triggering events. We inquired of management and inspected documentation from the Company regarding the status and evaluation of any potential disposal of properties, which we corroborated with others in the organization who are responsible for, and have authority over, disposition activities

​	​	​
​	/s/ KPMG LLP	​

​

We have served as the Company’s auditor since 2005.

Denver, Colorado

March 6, 2025

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Table of Contents ARES REAL ESTATE INCOME TRUST INC.

CONSOLIDATED BALANCE SHEETS

​

​	​	​	​	​	​	​
​	​	As of
(in thousands, except per share data)	​	December 31, 2024			December 31, 2023
ASSETS	​	​		​	​
Net investment in real estate properties	​	$	4,731,403	​	$	3,889,314
Investments in real estate debt and securities (includes $165,401 and $122,375 at fair value as of December 31, 2024 and December 31, 2023, respectively)	​		353,258	​		370,176
Debt-related investments, held for sale	​	​	193,902	​	​	—
Investments in unconsolidated joint venture partnerships (includes $38,386 and $0 at fair value as of December 31, 2024 and December 31, 2023, respectively)	​		212,296	​		153,305
Cash and cash equivalents	​		19,554	​		15,052
Restricted cash	​		7,865	​		4,614
DST Program Loans (includes $71,068 and $7,753 at fair value as of December 31, 2024 and December 31, 2023, respectively)	​		120,853	​		117,019
Other assets	​	​	92,118	​	​	89,926
Total assets	​	$	5,731,249	​	$	4,639,406
LIABILITIES AND EQUITY	​		​	​
Liabilities	​		​	​
Accounts payable and accrued expenses	​	$	74,814	​	$	66,386
Debt, net	​		2,700,468	​		1,961,120
Intangible lease liabilities, net	​		46,098	​		37,079
Financing obligations, net (includes $878,386 and $102,045 at fair value as of December 31, 2024 and December 31, 2023, respectively)	​		1,385,620	​		1,351,090
Distribution fees payable to affiliates	​	​	69,922	​	​	66,656
Other liabilities	​	​	38,975	​	​	33,913
Total liabilities	​		4,315,897	​		3,516,244
Commitments and contingencies (Note 16)	​		​	​
Redeemable noncontrolling interests	​		9,381	​		11,746
Equity	​		​	​		​
Stockholders’ equity:	​		​	​		​
Preferred stock, $0.01 par value per share—200,000 shares authorized, none issued and outstanding	​		—	​		—
Common stock, $0.01 par value per share (Note 10)	​		1,803	​		1,972
Additional paid-in capital	​		1,956,646	​		1,895,789
Distributions in excess of earnings	​		(1,216,344)	​		(1,108,823)
Accumulated other comprehensive income	​		3,719	​		6,359
Total stockholders’ equity	​		745,824	​		795,297
Noncontrolling interests	​		660,147	​		316,119
Total equity	​	​	1,405,971	​	​	1,111,416
Total liabilities and equity	​	$	5,731,249	​	$	4,639,406

​

See accompanying Notes to Consolidated Financial Statements.

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CONSOLIDATED STATEMENTS OF OPERATIONS

​

​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands, except per share data)	​	2024			2023			2022
Revenues:	​	​		​	​		​	​
Rental revenues	​	$	370,851	​	$	321,995	​	$	289,234
Debt-related income	​		46,642	​		31,175	​		9,989
Total revenues	​		417,493	​		353,170	​		299,223
Operating expenses:	​			​			​
Rental expenses	​		136,232	​		118,794	​		103,953
Real estate-related depreciation and amortization	​		152,777	​		149,985	​		134,617
General and administrative expenses	​		12,808	​		11,824	​		10,570
Advisory fees	​		40,786	​		38,645	​		33,747
Performance participation allocation	​		—	​		—	​		23,747
Acquisition costs and reimbursements	​		7,034	​		7,034	​		5,427
Valuation allowance on debt-related investment	​		—	​		(1,799)	​		1,799
Total operating expenses	​		349,637	​		324,483	​		313,860
Other income (expenses):	​			​			​
Income (loss) from unconsolidated joint venture partnerships	​		14,531	​		(3,578)	​		2,970
Interest expense	​		(188,318)	​		(148,517)	​		(140,406)
Gain on sale of real estate property	​		12,913	​		36,884	​		94,827
Unrealized loss on DST Program Loans	​	​	(17)	​	​	—	​	​	—
Unrealized (loss) gain on financing obligations	​		(2,034)	​		932	​		—
Gain (loss) on extinguishment of debt and financing obligations, net	​		41,050	​		(700)	​		—
Gain on derivative instruments	​	​	402	​	​	126	​	​	4,723
Provision for current expected credit losses	​	​	1,533	​	​	(1,997)	​	​	—
Other income and expenses	​		6,583	​		4,950	​		2,860
Total other income (expenses)	​		(113,357)	​		(111,900)	​		(35,026)
Net loss before income tax expense	​	​	(45,501)	​	​	(83,213)	​	​	(49,663)
Income tax expense	​	​	(11,842)	​	​	—	​	​	—
Net loss	​		(57,343)	​		(83,213)	​		(49,663)
Net loss attributable to redeemable noncontrolling interests	​	​	273	​	​	597	​	​	370
Net loss attributable to noncontrolling interests	​		19,935	​		20,189	​		9,314
Net loss attributable to common stockholders	​	$	(37,135)	​	$	(62,427)	​	$	(39,979)
Weighted-average shares outstanding—basic	​		188,336	​		203,291	​		194,039
Weighted-average shares outstanding—diluted	​		305,179	​		267,556	​		233,304
Net loss attributable to common stockholders per common share—basic and diluted	​	$	(0.20)	​	$	(0.31)	​	$	(0.21)

​

See accompanying Notes to Consolidated Financial Statements.

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Table of Contents ARES REAL ESTATE INCOME TRUST INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

​

​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	​	2024			2023			2022
Net loss	​	$	(57,343)	​	$	(83,213)	​	$	(49,663)
Change from cash flow hedging activities	​		(1,850)	​		(11,589)	​		31,398
Change from activities related to available-for-sale debt securities	​		(46)	​		132	​		26
Comprehensive loss	​		(59,239)	​		(94,670)	​		(18,239)
Comprehensive loss attributable to redeemable noncontrolling interests	​	​	280	​	​	666	​	​	86
Comprehensive loss attributable to noncontrolling interests	​		20,934	​		23,830	​		4,740
Comprehensive loss attributable to common stockholders	​	$	(38,025)	​	$	(70,174)	​	$	(13,413)

​

See accompanying Notes to Consolidated Financial Statements.

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CONSOLIDATED STATEMENTS OF EQUITY

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	Stockholders’ Equity														​	​		​	​
​	​	​	​	​	​	​	​	​	​		​	Accumulated		​	​	​	​	​	​
​	​	​	​	​		Additional			Distributions			Other			​	​		​	​
​	Common Stock					Paid-in			in Excess of			Comprehensive		​	Noncontrolling		​	Total
(in thousands)	Shares		Amount			Capital			Earnings			Income (Loss)			Interests			Equity
Balance as of December 31, 2021	169,665	​	$	1,696	​	$	1,542,617	​	$	(865,844)	​	$	(9,563)	​	$	107,520	​	$	776,426
Net loss (excludes 370 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		(39,979)	​		—	​		(9,314)	​		(49,293)
Change from securities and cash flow hedging activities (excludes 284 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		—	​		26,566	​		4,574	​		31,140
Issuance of common stock	44,882	​		450	​		388,484	​		—	​		—	​		—	​		388,934
Share-based compensation	27	​		—	​		292	​		—	​		—	​		—	​		292
Upfront offering costs, including selling commissions, dealer manager fees, and offering costs	—	​	​	—	​	​	(8,918)	​	​	—	​	​	—	​	​	—	​	​	(8,918)
Trailing distribution fees	—	​	​	—	​	​	(15,240)	​	​	5,166	​	​	—	​	​	(16,776)	​	​	(26,850)
Redemptions of common stock	(8,466)	​		(85)	​		(73,293)	​		—	​		—	​		—	​		(73,378)
Issuances of OP Units for DST Interests	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	252,578	​	​	252,578
Other noncontrolling interests net distributions	—	​		—	​		—	​		—	​		—	​		(65)	​		(65)
Distributions declared (excludes 735 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		(72,738)	​		—	​		(13,971)	​		(86,709)
Redemption value allocation adjustment to redeemable noncontrolling interests	—	​	​	—	​	​	(2,354)	​	​	—	​	​	—	​	​	—	​		(2,354)
Redemptions of noncontrolling interests	—	​	​	—	​	​	(2,245)	​	​	—	​	​	—	​	​	(5,691)	​		(7,936)
Reallocation of stockholders' equity and noncontrolling interests	—	​	​	—	​	​	69,167	​	​	—	​	​	(920)	​	​	(68,247)	​	​	—
Balance as of December 31, 2022	206,108	​	$	2,061	​	$	1,898,510	​	$	(973,395)	​	$	16,083	​	$	250,608	​	$	1,193,867
Net loss (excludes 597 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		(62,427)	​		—	​		(20,189)	​		(82,616)
Change from securities and cash flow hedging activities (excludes 69 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		—	​		(7,747)	​		(3,641)	​		(11,388)
Issuance of common stock	13,900	​		139	​		120,604	​		—	​		—	​		—	​		120,743
Share-based compensation	35	​		—	​		271	​		—	​		—	​		—	​	​	271
Upfront offering costs, including selling commissions, dealer manager fees, and offering costs	—	​	​	—	​	​	(4,314)	​	​	—	​	​	—	​	​	—	​	​	(4,314)
Trailing distribution fees	—	​	​	—	​	​	(232)	​	​	5,741	​	​	—	​	​	(11,246)	​		(5,737)
Redemptions of common stock	(22,815)	​		(228)	​		(193,631)	​		—	​		—	​		—	​	​	(193,859)
Issuances of OP Units for DST Interests	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	228,301	​		228,301
Other noncontrolling interests net distributions	—	​		—	​		—	​		—	​		—	​		(14)	​	​	(14)
Distributions declared (excludes 764 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		(78,742)	​		—	​		(24,207)	​		(102,949)
Redemption value allocation adjustment to redeemable noncontrolling interests	—	​	​	—	​	​	14	​	​	—	​	​	—	​	​	—	​	​	14
Redemptions of noncontrolling interests (excludes 4,940 attributable to redeemable noncontrolling interests)	—	​	​	—	​	​	(3,354)	​	​	—	​	​	—	​	​	(27,549)	​	​	(30,903)
Reallocation of stockholders' equity and noncontrolling interests	—	​	​	—	​	​	77,921	​	​	—	​	​	(1,977)	​	​	(75,944)	​	​	—
Balance as of December 31, 2023	197,228	​	$	1,972	​	$	1,895,789	​	$	(1,108,823)	​	$	6,359	​	$	316,119	​	$	1,111,416
Net loss (excludes 273 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		(37,135)	​		—	​		(19,935)	​		(57,070)
Change from securities and cash flow hedging activities (excludes 7 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		—	​		(890)	​		(999)	​		(1,889)
Issuance of common stock	7,982	​		80	​		61,767	​		—	​		—	​		—	​		61,847
Share-based compensation	38	​		—	​		281	​		—	​		—	​		—	​		281
Upfront offering costs, including selling commissions, dealer manager fees, and offering costs	—	​	​	—	​	​	(4,436)	​	​	—	​	​	—	​	​	—	​	​	(4,436)
Trailing distribution fees	—	​	​	—	​	​	1,768	​	​	4,959	​	​	—	​	​	(9,993)	​	​	(3,266)
Redemptions of common stock	(24,937)	​		(249)	​		(191,381)	​		—	​		—	​		—	​		(191,630)
Issuances of OP Units for DST Interests	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	639,102	​	​	639,102
Consolidation of joint venture partnership	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	4,033	​	​	4,033
Other noncontrolling interests net contributions	—	​		—	​		—	​		—	​		—	​		385	​		385
Distributions declared (excludes 544 attributable to redeemable noncontrolling interests)	—	​		—	​		—	​		(75,345)	​		—	​		(46,130)	​		(121,475)
Redemption value allocation adjustment to redeemable noncontrolling interests	—	​	​	—	​	​	41	​	​	—	​	​	—	​	​	—	​	​	41
Redemptions of noncontrolling interests (excludes 1,500 attributable to redeemable noncontrolling interests)	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	(31,368)	​	​	(31,368)
Reallocation of stockholders' equity and noncontrolling interests	—	​	​	—	​	​	192,817	​	​	—	​	​	(1,750)	​	​	(191,067)	​	​	—
Balance as of December 31, 2024	180,311	​	$	1,803	​	$	1,956,646	​	$	(1,216,344)	​	$	3,719	​	$	660,147	​	$	1,405,971

All values are in US Dollars.

​

See accompanying Notes to Consolidated Financial Statements.

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Table of Contents ARES REAL ESTATE INCOME TRUST INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

​

​	​	​	​	​	​	​	​	​	​
​		For the Year Ended December 31,
(in thousands)		2024			2023			2022
Operating activities:	​	​		​	​		​	​
Net loss	​	$	(57,343)	​	$	(83,213)	​	$	(49,663)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:	​		​	​		​	​		​
Real estate-related depreciation and amortization	​		152,777	​		149,985	​		134,617
Straight-line rent and amortization of above- and below-market leases	​		(10,712)	​		(6,959)	​		(7,513)
Gain on sale of real estate property	​		(12,913)	​		(36,884)	​		(94,827)
Unrealized loss on DST Program Loans	​		17	​		—	​	​	—
Performance participation allocation	​	​	—	​	​	—	​	​	23,747
Valuation allowance on debt-related investment	​	​	—	​	​	(1,799)	​	​	1,799
(Income) loss from unconsolidated joint venture partnerships	​	​	(14,531)	​	​	3,578	​	​	(2,970)
(Gain) loss on extinguishment of debt and financing obligations, net	​		(41,050)	​		700	​		—
Provision for current expected credit losses	​	​	(1,533)	​	​	1,997	​	​	—
Amortization of deferred financing costs	​	​	10,035	​	​	7,380	​	​	7,364
(Decrease) increase in financing obligation liability appreciation	​	​	(69)	​	​	(459)	​	​	31,737
Unrealized loss (gain) on financing obligations	​	​	2,034	​	​	(932)	​	​	—
Unrealized (gain) loss on derivative instruments not designated as cash flow hedges	​	​	(264)	​	​	4,169	​	​	(4,051)
Paid-in-kind interest on investments in real estate debt and securities	​	​	(26,361)	​	​	(7,946)	​	​	(1,850)
Distributions of earnings from unconsolidated joint venture partnerships	​	​	4,463	​	​	3,369	​	​	2,828
Amortization of interest rate cap premiums	​	​	14,143	​	​	5,746	​	​	—
Other	​		(451)	​		(1,295)	​		(353)
Changes in operating assets and liabilities	​	​	​	​	​	​	​	​	​
Other assets, accounts payable and accrued expenses and other liabilities	​	​	6,167	​	​	2,268	​	​	21,663
Debt-related investments, held for sale	​	​	(193,902)	​	​	—	​	​	—
Cash settlement of accrued performance participation allocation	​		—	​		(23,747)	​		—
Net cash (used in) provided by operating activities	​		(169,493)	​		15,958	​		62,528
Investing activities:	​		​	​			​
Real estate acquisitions	​		(871,709)	​		(401,840)	​		(1,193,994)
Capital expenditures	​		(55,573)	​		(48,329)	​		(33,936)
Proceeds from disposition of real estate property	​		31,170	​		53,735	​		274,816
Investments in debt-related investments	​		(62,344)	​		(52,021)	​		(158,364)
Principal collections on debt-related investments	​		106,768	​		66,680	​		4,084
Investments in unconsolidated joint venture partnerships	​	​	(72,127)	​	​	(39,881)	​	​	(62,805)
Consolidation of equity method investment	​	​	2,649	​	​	—	​	​	—
Investments in available-for-sale debt securities	​		(2,992)	​		(102,160)	​		(14,888)
Principal collections on available-for-sale debt securities	​	​	4,586	​	​	—	​	​	—
Other	​		445	​		2,263	​		173
Net cash used in investing activities	​		(919,127)	​		(521,553)	​		(1,184,914)
Financing activities:	​		​	​			​
Proceeds from mortgage notes	​		535,843	​		287,339	​		—
Repayments of mortgage notes	​		(22,238)	​		(72,164)	​		(1,638)
Proceeds from line of credit	​		1,384,555	​		1,220,000	​		1,250,000
Repayments of line of credit	​	​	(1,203,000)	​	​	(1,088,000)	​	​	(1,271,000)
Proceeds from term loan	​	​	—	​	​	—	​	​	275,000
Redemptions of common stock	​		(191,630)	​		(193,859)	​		(73,378)
Distributions paid to common stockholders, redeemable noncontrolling interest holders and noncontrolling interest holders	​		(78,322)	​		(61,227)	​		(49,601)
Proceeds from issuance of common stock	​		29,732	​		88,125	​		359,737
Proceeds from financing obligations, net	​		712,273	​		412,874	​		669,577
Offering costs for issuance of common stock and private placements	​		(17,253)	​		(15,355)	​		(15,953)
Cash payout of DST Interests	​	​	(3,898)	​	​	—	​	​	—
Redemption of noncontrolling interests	​		(31,368)	​		(30,903)	​		(7,936)
Redemption of redeemable noncontrolling interests	​	​	(3,454)	​	​	(2,985)	​	​	(7,724)
Debt issuance costs paid	​	​	(11,904)	​	​	(6,449)	​	​	(1,864)
Interest rate cap premiums	​	​	(3,379)	​	​	(29,321)	​	​	—
Other	​		395	​		—	​		—
Net cash provided by financing activities	​		1,096,352	​		508,075	​		1,125,220
Effect of exchange rate changes on cash, cash equivalents and restricted cash	​	​	21	​	​	—	​	​	—
Net increase in cash, cash equivalents and restricted cash	​		7,753	​		2,480	​		2,834
Cash, cash equivalents and restricted cash, at beginning of period	​		19,666	​		17,186	​		14,352
Cash, cash equivalents and restricted cash, at end of period	​	$	27,419	​	$	19,666	​	$	17,186

​

See accompanying Notes to Consolidated Financial Statements. 112

Table of Contents ARES REAL ESTATE INCOME TRUST INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. DESCRIPTION OF BUSINESS

Unless the context otherwise requires, the “Company,” “we,” “our” or “us” refers to Ares Real Estate Income Trust Inc. and its consolidated subsidiaries. We are externally managed by Ares Commercial Real Estate Management LLC (the “Advisor”) and consider Ares real estate to be our sponsor (the “Sponsor”).

Ares Real Estate Income Trust Inc. is a Maryland corporation formed on April 11, 2005. We are primarily focused on investing in and operating a diverse portfolio of real property and investing in other real estate-related assets. We currently focus our investment activities primarily across the major U.S. property sectors (residential (which includes and/or may include multi-family and other types of rental housing such as manufactured, student, and single family rental housing), industrial, retail and office (which includes and/or may include medical office and life science laboratories)) and investments in real estate debt and securities. To a lesser extent, we intend to strategically invest in geographies outside of the U.S., which may include Canada, Mexico, the United Kingdom, Europe and other foreign jurisdictions, and in other sectors such as credit lease and self-storage, properties in sectors adjacent to our primary investment sectors and/or infrastructure, to create a diversified blend of current income and long-term value appreciation. As of December 31, 2024, our consolidated real property portfolio consisted of 124 properties. We operate six reportable segments: residential properties, industrial properties, retail properties, office properties, other properties and real estate debt and securities. As used herein, the term “commercial” refers to our office, retail and industrial properties or customers, as applicable. See “Note 17” for information regarding the financial results by segment.

We believe we have operated in such a manner as to qualify as a real estate investment trust (“REIT”) for U.S. federal income tax purposes, and we intend to continue to operate in accordance with the requirements for qualification as a REIT. We utilize an Umbrella Partnership Real Estate Investment Trust (“UPREIT”) organizational structure to hold all or substantially all of our assets through an operating partnership, AREIT Operating Partnership LP (the “Operating Partnership”), of which we are the sole general partner and a limited partner.

We are currently offering shares pursuant to a securities offering and intend to operate as a perpetual-life REIT, which means that we intend to offer shares of our common stock on a continuous basis through our ongoing primary offerings and our distribution reinvestment plan. See “Note 10” for detail regarding our securities offerings.

​

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements included herein have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Global macroeconomic conditions, including heightened inflation, changes to fiscal and monetary policy, higher interest rates and challenges in the supply chain, coupled with the conflicts in Ukraine and in the Middle East, have the potential to negatively impact us. These current macroeconomic conditions may continue or aggravate and could cause the United States to experience an economic slowdown or recession. We anticipate our business and operations could be materially adversely affected by a prolonged recession in the United States. In the opinion of management, the accompanying consolidated financial statements contain all adjustments and eliminations, consisting only of normal recurring adjustments necessary for a fair presentation in conformity with GAAP.

Basis of Consolidation

The consolidated financial statements include the accounts of Ares Real Estate Income Trust Inc., the Operating Partnership, their wholly-owned subsidiaries, including a taxable REIT subsidiary, and their consolidated joint ventures, as well as amounts related to noncontrolling interests. See “Noncontrolling Interests” and “Redeemable Noncontrolling Interests” below for further detail concerning the accounting policies regarding noncontrolling interests. All material intercompany accounts and transactions have been eliminated. 113

Table of Contents We consolidate all entities in which we have a controlling financial interest through majority ownership or voting rights and variable interest entities for which we are the primary beneficiary. In determining whether we have a controlling financial interest in a partially owned entity and the requirement to consolidate the accounts of that entity, we consider whether the entity is a variable interest entity (“VIE”) and whether we are the primary beneficiary. We are the primary beneficiary of a VIE when we have (i) the power to direct the most significant activities impacting the economic performance of the VIE and (ii) the obligation to absorb losses or receive benefits significant to the VIE. Entities that do not qualify as VIEs are generally considered voting interest entities (“VOEs”) and are evaluated for consolidation under the voting interest model. VOEs are consolidated when we control the entity through a majority voting interest or other means. When the requirements for consolidation are not met and we have significant influence over the operations of the entity, the investment is accounted for under the equity method of accounting. Equity method investments are initially recorded at cost and subsequently adjusted for our pro-rata share of net income, contributions and distributions.

The Operating Partnership meets the criteria of a VIE as the Operating Partnership’s limited partners do not have the right to remove the general partner and do not have substantive participating rights in the operations of the Operating Partnership. Pursuant to the operating partnership agreement, we are the primary beneficiary of the Operating Partnership as we have the obligation to absorb losses and receive benefits, and the power to control substantially all of the activities which most significantly impact the economic performance of the Operating Partnership. As such, the Operating Partnership continues to be consolidated within our consolidated financial statements.

Use of Estimates

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Actual results could differ from these estimates. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period they are determined to be necessary.

Reclassifications

Certain items in our consolidated balance sheets as of December 31, 2023, our consolidated statements of operations for the years ended December 31, 2023 and 2022 and our consolidated statements of cash flows for the years ended December 31, 2023 and 2022 have been reclassified to conform to the 2024 presentation.

Investment in Real Estate Properties

We first determine whether an acquisition constitutes a business or asset acquisition. Upon determination of an asset acquisition, the purchase price of a property is allocated to land, building and improvements and intangible lease assets and liabilities. The allocation of the purchase price to building is based on management’s estimate of the property’s “as-if” vacant fair value. The “as-if” vacant fair value is determined by using all available information such as the replacement cost of such asset, appraisals, property condition reports, market data and other related information. The allocation of the purchase price to intangible lease assets represents the value associated with the in-place leases, which may include lost rent, leasing commissions, tenant improvements, legal and other related costs. The allocation of the purchase price to above-market lease assets and below-market lease liabilities results from in-place leases being above or below management’s estimate of fair market rental rates at the acquisition date and are measured over a period equal to the remaining term of the lease for above-market leases and the remaining term of the lease, plus the term of any below-market fixed-rate renewal option periods, if applicable, for below-market leases. Intangible lease assets, above-market lease assets, and below-market lease liabilities are collectively referred to as “intangible lease assets and liabilities.”

If any debt is assumed in an acquisition, the difference between the fair value and the face value of debt is recorded as a premium or discount and amortized to interest expense over the life of the debt assumed. See “Note 3” for additional information regarding debt assumed in connection with our 2024 and 2023 acquisitions, if any. Transaction costs associated with the acquisition of a property are capitalized as incurred in an asset acquisition and are allocated to land, building and intangible lease assets on a relative fair value basis. Transaction costs associated with business combinations are expensed as they are incurred. Properties that are probable to be sold are to be designated as “held for sale” on the consolidated balance sheets when certain criteria are met. 114

Table of Contents The results of operations for acquired businesses and properties are included in the consolidated statements of operations from their respective acquisition dates. Intangible lease assets are amortized to real estate-related depreciation and amortization over the remaining lease term. Above-market lease assets are amortized as a reduction in rental revenues over the remaining lease term and below-market lease liabilities are amortized as an increase in rental revenues over the remaining lease term, plus any applicable fixed-rate renewal option periods. We expense any unamortized intangible lease asset or record an adjustment to rental revenue for any unamortized above-market lease asset or below-market lease liability when a customer terminates a lease before the stated lease expiration date. During the years ended December 31, 2024, 2023 and 2022, we recorded $1.4 million, $0.3 million and $0.2 million, respectively, related to write-offs of unamortized intangible lease assets and liabilities due to early lease terminations.

Land, building, building improvements, tenant improvements, lease commissions, and intangible lease assets and liabilities, which are collectively referred to as “real estate assets,” are stated at historical cost less accumulated depreciation and amortization. Costs associated with the development and improvement of our real estate assets are capitalized as incurred. These costs include capitalized interest, insurance, real estate taxes and certain general and administrative expenses if such costs are incremental and identifiable to a specific activity to prepare the real estate asset for its intended use. Costs incurred in making repairs and maintaining real estate assets are expensed as incurred.

Real estate-related depreciation and amortization are computed on a straight-line basis over the estimated useful lives as described in the following table:

​	​	​
Land		Not depreciated
Building and improvements		5 to 40 years
Tenant improvements		Lesser of useful life or lease term
Lease commissions		Over lease term
Intangible lease assets		Over lease term
Above-market lease assets		Over lease term
Below-market lease liabilities		Over lease term, including below-market fixed-rate renewal options

​

Certain of our investments in real estate are subject to ground leases, for which a lease liability and corresponding right of use asset are recognized. We calculate the amount of the lease liability and right of use asset by taking the present value of the remaining lease payments and adjusting the right of use asset for any existing straight-line ground rent liability and acquired ground lease intangibles. An estimated incremental borrowing rate of a loan with a similar term as the ground lease is used as the discount rate. The lease liability is included as a component of other liabilities, and the related right of use asset is recorded as a component of net investments in real estate properties on our consolidated balance sheets. The amortization of the below-market ground lease is recorded as an adjustment to real estate-related depreciation and amortization on our consolidated statements of operations.

Real estate assets that are determined to be held and used will be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable, and we will evaluate the recoverability of such real estate assets based on estimated future cash flows and the estimated liquidation value of such real estate assets, and provide for impairment if such undiscounted cash flows are insufficient to recover the carrying amount of the real estate asset. If impaired, the real estate asset will be written down to its estimated fair value. There were no impairment charges during the years ended December 31, 2024, 2023 and 2022. 115

Table of Contents Investments in Unconsolidated Joint Venture Partnerships

We hold investments in unconsolidated joint venture partnerships that are accounted for under the equity method of accounting or the fair value option. Our investments in unconsolidated joint venture partnerships are initially recorded at cost (including direct acquisition costs) and subsequently adjusted to reflect our proportionate share of equity in the joint venture’s net income (loss), distributions received, contributions made and certain other adjustments made, as appropriate, which is included in investments in unconsolidated joint venture partnerships on our consolidated balance sheets. The proportionate share of ongoing income or loss of the unconsolidated joint venture partnerships is recognized in income (loss) from unconsolidated joint venture partnerships on the consolidated statements of operations. The outside basis portion of our unconsolidated joint venture partnerships (if applicable) is amortized over the anticipated useful lives of the joint ventures’ tangible and intangible assets acquired and liabilities assumed.

For certain of our investments in unconsolidated joint venture partnerships, we have elected the fair value option and account for these investments at fair value with the associated unrealized gains and losses recorded as a component of income (loss) from unconsolidated joint venture partnerships on our consolidated statements of operations.

When circumstances indicate there may have been a reduction in the value of an equity investment for which we account for under the equity method of accounting, we evaluate whether the loss is other than temporary. If we conclude it is other than temporary, an impairment charge is recognized to reflect the equity investment at fair value. No impairment losses were recorded related to our investments in unconsolidated joint venture partnerships for the years ended December 31, 2024, 2023 and 2022.

Debt-Related Investments

Debt-related investments that we originated or acquired prior to the third quarter of 2024 are considered to be held for investment, as we have both the intent and ability to hold these investments until maturity. Accordingly, these assets are carried at cost, net of unamortized loan origination costs and fees, discounts and a credit loss reserve, if applicable. Interest income is recorded on an accrual basis and is recorded as a component of debt-related income.

Beginning in the third quarter of 2024, we have elected the fair value option for our new debt-related investments and as such, these investments are carried at fair value. These assets are valued on a recurring basis and any unrealized gains and losses will be recorded as a component of other income and expenses on our consolidated statements of operations. Upfront fees and origination costs related to our debt-related investments for which the fair value option is elected are recognized in earnings as incurred. Such items are recorded as components of debt-related income on our consolidated statements of operations. Interest income is recorded on an accrual basis and is recorded as a component of debt-related income.

We classify debt-related investments as held for sale if there is a reasonable expectation to sell them in the short-term following the reporting date. Debt-related investments classified as held for sale are carried at the lower of carrying value or fair value, with changes in value recorded through earnings. If a debt-related investment is determined to be held for sale at the time of origination, upfront fees and origination costs are deferred and any portion retained will be recognized into interest income at the time of sale.

Debt-related investments are placed on non-accrual status at the earlier of when principal or interest payments are 90 days past due or when management has determined there is reasonable doubt that principal or interest will be collected in full. Accrued and unpaid interest is reversed against interest income in the period the investment is placed on non-accrual status. Interest payments received on non-accrual investments may be recognized as income or applied to principal depending upon management’s judgment regarding collectability of the investment based on the facts and circumstances regarding the payment received. Non-accrual investments are restored to accrual status when past due principal and interest are paid and, in management’s judgment, are likely to remain current. 116

Table of Contents Current Expected Credit Losses

We record a reserve for current expected credit losses (“CECL Reserve”) on both the outstanding balances and unfunded commitments on loans held for investment. The development of the CECL Reserve requires the consideration of a broad range of historical experience adjusted for current conditions and reasonable and supportable forecast information to inform credit loss estimates. Increases and decreases to expected credit losses impact earnings and are recorded within the provision for current expected credit losses in our consolidated statements of operations. The CECL Reserve related to outstanding balances on loans held for investment is a valuation account that is deducted from the amortized cost basis of our loans held for investment in our consolidated balance sheets. The CECL Reserve related to unfunded commitments on loans held for investment is recorded within other liabilities in our consolidated balance sheets. The CECL Reserve for unfunded commitments is based on the unfunded portion of the loan commitment over the full contractual period over which we are exposed to credit risk through a current obligation to extend credit and is recorded as an other liability on the consolidated balance sheets.

We estimate our CECL Reserve primarily using a probability-weighted model that considers the likelihood of default and expected loss given default for each individual loan. Calculation of the CECL Reserve requires loan specific data, which includes capital senior to us when we are the subordinate lender, changes in net operating income, debt service coverage ratio, loan-to-value, occupancy, property type and geographic location. Estimating the CECL Reserve also requires significant judgment with respect to various factors, including (i) the appropriate historical loan loss reference data, (ii) the expected timing of loan repayments, (iii) calibration of the likelihood of default to reflect the risk characteristics of our floating rate loan portfolio and (iv) our current and future view of the macroeconomic environment. We may consider loan-specific qualitative factors on certain loans to estimate our CECL Reserve. In order to estimate the future expected loan losses relevant to our portfolio, we utilize historical market loan loss data licensed from a third-party data service. For periods beyond the reasonable and supportable forecast period, we revert back to historical loss data.

Available-for-Sale Debt Securities

We acquire debt securities that are collateralized by mortgages on commercial real estate properties primarily for cash management and investment purposes. Additionally, we acquire or originate preferred equity investments that are recognized as debt securities as they have mandatory redemption features and meet the definition of securities under FASB ASC Topic 320, Investments—Debt Securities. On the acquisition date, we designate investments in real estate debt securities as available-for-sale. Investments in debt securities that are classified as available-for-sale are carried at fair value. These assets are valued on a recurring basis and any unrealized holding gains and losses other than those associated with a credit loss are recorded each period in other comprehensive income.

As applicable, available-for-sale debt securities that are in an unrealized loss position are evaluated quarterly on an individual security basis to determine whether a credit loss exists. In the assessment, we consider the extent of the difference between fair value and amortized cost, changes in credit rating, and any other adverse factors directly impacting the security. If we determine a credit loss exists, the extent of the credit loss is recognized in the consolidated statements of operations and any additional loss not attributable to credit loss is recognized in other comprehensive income. There was no credit loss recognized during the years ended December 31, 2024, 2023 or 2022.

Available-for-sale debt securities will be on non-accrual status at the earlier of (i) principal or interest payments becoming 90 days past due or (ii) management’s determination that there is reasonable doubt that principal or interest will be collected in full. Accrued and unpaid interest is reversed against interest income in the period the debt security is placed on non-accrual status. Interest payments received on non-accrual securities may be recognized as income or applied to principal depending upon management’s judgment regarding collectability of the debt security based on the facts and circumstances regarding the payment received. Non-accrual debt securities are restored to accrual status when past due principal and interest are paid and, in management’s judgment, are likely to remain current. There were no securities on non-accrual status as of December 31, 2024 or 2023. 117

Table of Contents DST Program

We have a program to raise capital through private placement offerings by selling beneficial interests (the “DST Interests”) in specific Delaware statutory trusts holding real properties (the “DST Program”). Under the DST Program, each private placement offers interests in one or more real properties placed into one or more Delaware statutory trusts by the Operating Partnership or its affiliates (each, a “DST Property” and collectively, the “DST Properties”). DST Properties may be sourced from properties currently owned by the Operating Partnership or newly acquired properties. The underlying interests of real properties sold to investors pursuant to such private placements are leased-back by a wholly owned subsidiary of the Operating Partnership on a long-term basis. These master lease agreements are fully guaranteed by the Operating Partnership. Additionally, the Operating Partnership retains a fair market value purchase option giving it the right, but not the obligation, to acquire the interests in the Delaware statutory trusts from the investors at a later time in exchange for OP Units, cash or a combination of OP Units and cash. This results in a failed sale and leaseback transaction for accounting purposes. Therefore, we record DST Interests as financing obligation liabilities and the associated property and its operations remain fully consolidated. If we exercise our option to reacquire a DST Property by settling in cash or issuing OP units in exchange for DST Interests, we extinguish the financing obligation liability and record the settlement of cash or the issuance of the OP Units as an issuance of equity.

Rental payments made to the Delaware statutory trusts pursuant to the master lease agreements are accounted for as interest expense related to the financing obligation liability. For DST Program offerings for which our option to reacquire a DST Property has not been elected, increases in the fair value of the repurchase option are recognized as interest expense ratably through the estimated period in which the repurchase option is expected to be exercised, resulting in a corresponding accretion of the financial obligation liability balance. Decreases in fair value of the repurchase option below the initial financing obligation liability balance are not recognized unless the repurchase option is exercised, at which point a gain on extinguishment of debt would be recognized for the difference between the financing obligation liability balance and value of OP Units issued. All upfront costs incurred for services provided by the Advisor and its affiliates related to the DST Program offerings for which the fair value option has not been elected are accounted for as deferred financing costs and are netted against the financing obligation liability.

For DST Program offerings commencing on or after October 1, 2023, we have elected the fair value option for the associated financing obligations and as such, they will be carried at fair value. These liabilities are valued on a recurring basis and any unrealized gains and losses will be recorded as in unrealized gain (loss) on financial obligations on our consolidated statements of operations. Costs incurred for services provided by the Advisor and its affiliates related to our DST Program offerings for which the fair value option has been elected are recognized in earnings as incurred.

In order to facilitate additional capital raise through the DST Program, we have made and may continue to offer loans (“DST Program Loans”) to finance a portion of the sale of DST Interests in the trusts holding DST Properties to potential investors. We include our investments in DST Program Loans separately on our balance sheets in the DST Program Loans line item and we include income earned from DST Program Loans in other income and expenses on our consolidated statements of operations. For DST Program offerings commencing on or after October 1, 2023, we have elected the fair value option for the associated DST Program Loans and as such, they will be carried at fair value. These assets are valued on a recurring basis and any unrealized gains and losses will be recorded as a component of other income and expenses on our consolidated statements of operations. For all DST Program Loans related to DST Program offerings for which the fair value option has not been elected, these instruments are carried at amortized cost. Credit loss reserves associated with our DST Program Loans for which the fair value option has not been elected were immaterial as of and for the years ended December 31, 2024, 2023 and 2022.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash on hand and highly liquid investments with original maturities of three months or less, such as money market mutual funds or certificates of deposit. We may have bank balances in excess of federally insured amounts; however, we deposit our cash and cash equivalents with high credit-quality institutions to minimize credit risk.

Restricted Cash

Restricted cash consists primarily of lender and property-related escrow accounts. 118

Table of Contents Derivative Instruments

Our derivative instruments are used to manage exposure to variability in expected future interest payments and are recorded at fair value. The accounting for changes in fair value of derivative instruments depends on whether it has been designated and qualifies as a hedge and, if so, the type of hedge. The change in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income (loss) on the consolidated balance sheets and is subsequently reclassified into earnings as interest expense for the period that the hedged forecasted transaction affects earnings, which is when the interest expense is recognized on the related debt.

For derivatives that are not designated and do not qualify as hedges, we present changes in the fair value as gain (loss) on derivative instruments on the consolidated statements of operations. We do not use derivative instruments for trading or speculative purposes.

Deferred Financing Costs

Deferred financing costs include: (i) debt issuance costs incurred to obtain long-term financing and cash flow hedges; and (ii) financing costs associated with financing obligations for DST Program offerings for which we have not elected the fair value option. These costs are amortized to interest expense over the expected terms of the related credit facilities or financing obligations. Unamortized deferred financing costs are written off if debt is retired before its expected maturity date.

Accumulated amortization of debt issuance costs was approximately $14.5 million and $8.3 million as of December 31, 2024 and 2023, respectively. Our interest expense for the years ended December 31, 2024, 2023 and 2022 included $6.0 million, $4.3 million and $3.8 million, respectively, of amortization of debt issuance costs.

Accumulated amortization of financing costs associated with financing obligations was approximately $0.4 million and $2.5 million as of December 31, 2024 and 2023, respectively. Our interest expense for the years ended December 31, 2024, 2023 and 2022 included $4.0 million, $3.1 million and $3.6 million, respectively, of amortization of financing costs and expensed financing costs associated with financing obligations.

Distribution Fees

Distribution fees are paid monthly. Distribution fees are accrued upon the issuance of Class T-R, Class S-R, Class D-R, Class S-PR and Class D-PR shares and OP Units. As of the balance sheet date, we accrue for: (i) the monthly amount payable, and (ii) the estimated amount of distribution fees that we may pay in future periods. The accrued distribution fees for common shares are reflected in additional paid-in capital in stockholders’ equity and the accrued distribution fees for OP Units are reflected in noncontrolling interests. See “Note 13” for additional information regarding when distribution fees become payable.

Noncontrolling Interests

Due to our control of the Operating Partnership through our sole general partner interest and our limited partner interest, we consolidate the Operating Partnership. The limited partner interests not owned by us are presented as noncontrolling interests in the consolidated financial statements. The noncontrolling interests are reported on the consolidated balance sheets within permanent equity, separate from stockholders’ equity.

Transactions that change our ownership interest in the Operating Partnership are accounted for as equity transactions if we retain our controlling financial interest in the Operating Partnership. Therefore, we adjust the net equity balances in the Operating Partnership to reflect the changes in ownership of the Operating Partnership between us and the other limited partners. These adjustments are based on the respective ownership at the end of each period and are reflected as a reallocation between additional paid-in capital and accumulated other comprehensive income within stockholders’ equity and noncontrolling interests within our equity section on our consolidated balance sheets and our consolidated statements of equity.

For consolidated joint venture partnerships, the non-controlling partner’s share of the assets, liabilities and operations of the joint venture is included in noncontrolling interests as equity. The noncontrolling partner’s interest is generally computed as the joint venture partner’s ownership percentage. 119

Table of Contents Redeemable Noncontrolling Interests

The Operating Partnership issued units in the Operating Partnership (“OP Units”) to the Advisor and Black Creek Diversified Property Advisors LLC (the “Former Advisor”) as payment for the performance participation allocation (also referred to as the performance component of the advisory fee) pursuant to the terms of the second amended and restated advisory agreement (2024), effective as of August 2, 2024 (the “Advisory Agreement”), by and among us, the Operating Partnership and the Advisor. The Advisor and Former Advisor subsequently transferred these OP Units to its members or their affiliates or redeemed for cash. We have classified these OP Units as redeemable noncontrolling interests in mezzanine equity on the consolidated balance sheets due to the fact that, as provided in the agreement of limited partnership of the Operating Partnership (the “Partnership Agreement”), the limited partners who hold these OP Units generally have the ability to request transfer or redeem their OP Units at any time irrespective of the period that they have held such OP Units, and the Operating Partnership is required to satisfy such redemption for cash unless such cash redemption would be prohibited by applicable law or the Partnership Agreement, in which case such OP Units will be redeemed for shares of our common stock of the class corresponding to the class of such OP Units. The redeemable noncontrolling interests are recorded at the greater of the carrying amount, adjusted for the share of the allocation of income or loss and dividends, or the redemption value, which is equivalent to fair value, of such OP Units at the end of each measurement period. See “Note 11” for additional information regarding redeemable noncontrolling interests.

Revenue Recognition

When a lease is entered into, we first determine if the collectability from the customer is probable. If the collectability is not probable, we recognize revenue when the payment has been received. If the collectability is determined to be probable, we record rental revenue on a straight-line basis over the lease term. Revenues associated with operating expense recoveries are recognized in the period in which the expenses are incurred based upon the tenant lease provisions, in accordance with FASB ASC Topic 842, Leases. Certain properties have leases that offer the customer a period of time where no rent is due or where rent payments change during the term of the lease. Accordingly, we record receivables from customers for rent that we expect to collect over the remaining lease term rather than currently, which are recorded as a straight-line rent receivable. We analyze accounts receivable by considering customer creditworthiness and current economic trends on customers’ businesses, and customers’ ability to make payments on time and in full when evaluating the adequacy of the allowance for doubtful accounts receivable. We evaluate collectability from our customers on an ongoing basis. If the assessment of collectability changes during the lease term, any difference between the revenue that would have been recognized under the straight-line method and the lease payments that have been collected will be recognized as a current period adjustment to rental revenues. When we acquire a property, the term of each existing lease is considered to commence as of the acquisition date for purposes of this calculation. As of December 31, 2024 and 2023, our allowance for doubtful accounts was approximately $1.0 million and $0.7 million, respectively. These amounts are included in our other assets on the consolidated balance sheets.

In connection with property acquisitions, we may acquire leases with rental rates above or below estimated market rental rates. Above-market lease assets are amortized as a reduction to rental revenue over the remaining lease term, and below-market lease liabilities are amortized as an increase to rental revenue over the remaining lease term, plus any applicable fixed-rate renewal option periods.

We expense any unamortized intangible lease asset or record an adjustment to rental revenue for any unamortized above-market lease asset or below-market lease liability by reassessing the estimated remaining useful life of such intangible lease asset or liability when it becomes probable a customer will terminate a lease before the stated lease expiration date.

Upon disposition of a real estate asset, we will evaluate the transaction to determine if control of the asset, as well as other specified criteria, has been transferred to the buyer to determine proper timing of recognizing gains or losses.

Debt-related income is accrued based on the outstanding principal amount and the contractual terms of each debt-related investment or debt security. For debt-related investments carried at cost, the origination fees, contractual exit fees and direct loan origination costs are also recognized in interest income over the initial loan term as a yield adjustment using the effective interest method. For debt-related investments carried at fair value, upfront fees and origination costs are recognized in earnings as incurred. For debt-related investments deemed to be held for sale, upfront fees and origination costs are deferred and any portion retained will be recognized into interest income at the time of sale. For available-for-sale debt securities, premiums or discounts are amortized or accreted into interest income as a yield adjustment using the effective interest method. 120

Table of Contents Income Taxes

We elected under the Internal Revenue Code of 1986, as amended, to be taxed as a REIT beginning with the tax year ended December 31, 2006. As a REIT, we generally are not subject to U.S. federal income taxes on net income we distribute to our stockholders. We intend to make timely distributions sufficient to satisfy the annual distribution requirements. If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income tax on our taxable income at regular corporate tax rates. Even if we qualify for taxation as a REIT, we may be subject to certain state and local taxes on our income and property and federal income and excise taxes on our undistributed income or from the operations of our taxable REIT subsidiaries.

Net Income (Loss) Per Share

Basic net income (loss) per common share is determined by dividing net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net income (loss) per common share includes the effects of potentially issuable common stock, but only if dilutive, including the presumed exchange of OP Units. See “Note 14” for additional information regarding net income (loss) per share.

Foreign Currency

The U.S. dollar is the functional and reporting currency of the Company. All foreign currency asset and liability amounts are monetary assets and liabilities and therefore are remeasured into U.S. dollars based on the spot rate at the end of each period.

We have executed borrowings in the same foreign currency as our foreign investments to protect against the foreign currency exchange rate risk inherent in transactions denominated in foreign currencies. As our foreign currency asset and liability amounts are associated with a foreign currency denominated investment in unconsolidated joint venture partnership, we have included all foreign currency unrealized gains and losses within income from investments in unconsolidated joint venture partnerships on the consolidated statements of operations.

Fair Value Measurements

Fair value measurements are determined based on assumptions that market participants would use in pricing of assets or estimating liabilities. Fair value measurements are categorized into one of three levels of the fair value hierarchy based on the lowest level of significant input used. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability. Considerable judgment and a high degree of subjectivity are involved in developing these estimates. These estimates may differ from the actual amounts that we could realize upon settlement.

The fair value hierarchy is as follows:

Level 1—Quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2—Other observable inputs, either directly or indirectly, other than quoted prices included in Level 1, including:

●	Quoted prices for similar assets/liabilities in active markets;
●	Quoted prices for identical or similar assets/liabilities in non-active markets (e.g., few transactions, limited information, non-current prices, high variability over time);
---	---
●	Inputs other than quoted prices that are observable for the asset/liability (e.g., interest rates, yield curves, volatilities, default rates); and
---	---
●	Inputs that are derived principally from or corroborated by other observable market data.
---	---

Level 3—Unobservable inputs that cannot be corroborated by observable market data. 121

Table of Contents Concentration of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents. At times, balances with any one financial institution may exceed the Federal Deposit Insurance Corporation insurance limits. We believe this risk is mitigated by investing our cash with high-credit quality financial institutions.

As our revenues predominately consist of rental payments, we are dependent on our customers for our source of revenues. Concentration of credit risk arises when our source of revenue is highly concentrated from certain of our customers. As of December 31, 2024, no customers represented more than 10.0% of our total annualized base rent of our properties.

Recently Adopted Accounting Standards

Effective November 27, 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which enhances disclosure requirements to segment reporting. ASU No. 2023-07 will improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis to develop more useful financial analysis and includes the following changes: (i) single segment entities must follow segment guidance, (ii) must name the title and position of the chief operating decision maker and (iii) the ability to elect more than one performance measure. ASU No. 2023-07 does not change how a public entity identifies its operating segments, aggregates those operating segments, or applies quantitative thresholds to determine its reportable segments. ASU No. 2023-07 is effective beginning in annual periods after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. We adopted this standard as of the annual reporting period beginning January 1, 2024. The adoption did not have a material effect on our consolidated financial statements.

Recently Issued Accounting Standards

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes, which provides improvements to income tax disclosures by enhancing the transparency around rate reconciliation and income taxes paid by jurisdiction. The standard will be effective for annual periods beginning after December 15, 2024. We are currently evaluating the impact that the adoption of the new standard will have on our consolidated financial statements.

In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses, which is intended to improve the disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion) included in expense captions on the statements of operations. ASU No. 2024-03 is effective on a prospective basis, with the option for retrospective application, for annual reporting periods beginning after December 15, 2026 and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. We are currently assessing this guidance and determining the impact on our consolidated financial statements.

​

3. INVESTMENTS IN REAL ESTATE PROPERTIES

The following table summarizes our consolidated investments in real estate properties:

​

​	​	​	​	​	​	​
​		As of December 31,
(in thousands)		2024 (1)			2023
Land	​	$	860,990	​	$	754,149
Buildings and improvements	​		4,323,688	​		3,505,921
Intangible lease assets	​		365,132	​		330,291
Right of use asset	​		13,637	​		13,637
Investment in real estate properties	​		5,563,447	​		4,603,998
Accumulated depreciation and amortization	​		(832,044)	​		(714,684)
Net investment in real estate properties	​	$	4,731,403	​	$	3,889,314
(1)	Includes three properties with an aggregate accounting basis of $16.0 million that has met the criteria of held for sale as of December 31, 2024.
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122

Table of Contents Acquisitions

During the years ended December 31, 2024 **** and 2023, we acquired 100% of the following properties through asset acquisitions:

​	​	​	​	​	​	​	​
(in thousands)		Property Type		Acquisition Date		Total Purchase Price (1)
2024 Acquisitions:	​	​	​	​	​	​	​
Metro North IC	​	Industrial	​	5/8/2024	​	$	54,485
CERU Boca Raton	​	Residential	​	5/15/2024	​	​	139,718
Sugar Land CC	​	Industrial	​	6/28/2024	​	​	35,903
Metro Storage Sharon Hill	​	Self-Storage	​	7/31/2024	​	​	16,761
Metro Storage Newtown Square	​	Self-Storage	​	7/31/2024	​	​	24,724
Metro Storage Trevose	​	Self-Storage	​	7/31/2024	​	​	21,151
Metro Storage Sarasota	​	Self-Storage	​	7/31/2024	​	​	15,532
Metro Storage Fort Myers	​	Self-Storage	​	7/31/2024	​	​	12,766
Metro Storage Pinellas Park	​	Self-Storage	​	7/31/2024	​	​	6,765
Pima Street Logistics Center	​	Industrial	​	10/1/2024	​	​	18,044
Mercury NoDa	​	Residential	​	11/13/2024	​	​	72,614
The Artizia at Loso	​	Residential	​	11/19/2024	​	​	95,731
Everlight	​	Residential	​	12/4/2024	​	​	123,370
Southpark Logistics Center I	​	Industrial	​	12/20/2024	​	​	28,139
Southpark Logistics Center II	​	Industrial	​	12/20/2024	​	​	28,744
Southpark Logistics Center III	​	Industrial	​	12/20/2024	​	​	16,034
Grove City Logistics Center	​	Industrial	​	12/20/2024	​	​	20,405
Whitestown Distribution Center I	​	Industrial	​	12/20/2024	​	​	12,384
Whitestown Distribution Center II	​	Industrial	​	12/20/2024	​	​	22,808
Whitestown Distribution Center III	​	Industrial	​	12/20/2024	​	​	8,023
Greensfield Distribution Center	​	Industrial	​	12/20/2024	​	​	7,773
Fairfield Commerce Center	​	Industrial	​	12/20/2024	​	​	15,074
Ohio Logistics Center	​	Industrial	​	12/20/2024	​	​	7,542
Richmond Airport Logistics Center I	​	Industrial	​	12/20/2024	​	​	25,671
Richmond Airport Logistics Center II	​	Industrial	​	12/20/2024	​	​	25,093
Richmond Airport Logistics Center III	​	Industrial	​	12/20/2024	​	​	16,587
Total 2024 acquisitions					​	$	871,841
2023 Acquisitions:	​	​	​	​	​	​	​
VM8 Logistics Center	​	Industrial	​	1/19/2023	​	$	17,511
Moreno Valley Distribution Center	​	Industrial	​	5/2/2023	​	​	33,421
SLC Logistics Center	​	Industrial	​	9/26/2023	​	​	77,085
Cindel Drive Business Park	​	Industrial	​	12/19/2023	​	​	25,409
Arabelle Lincoln Station	​	Residential	​	8/16/2023	​	​	80,086
BLVD Dallas	​	Residential	​	9/15/2023	​	​	58,050
Regency at Johns Creek Walk	​	Residential	​	11/6/2023	​	​	59,815
Aventura Storage	​	Self-Storage	​	12/18/2023	​	​	31,043
Norwood Storage	​	Self-Storage	​	12/20/2023	​	​	23,903
Total 2023 acquisitions					​	$	406,323
(1)	Total purchase price is equal to the total consideration paid plus any debt assumed at fair value. There was no debt assumed in connection with the 2024 and 2023 acquisitions.
---	---

​ 123

Table of Contents During the years ended December 31, 2024 **** and 2023, we allocated the purchase price of our acquisitions to land, building and improvements and intangible lease assets and liabilities as follows:

​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)		2024			2023
Land	​	$	109,264	​	$	67,173
Building and improvements	​		736,575	​		322,409
Intangible lease assets	​		38,581	​		15,973
Above-market lease assets	​		1,777	​		993
Below-market lease liabilities	​		(14,356)	​		(225)
Total purchase price (1)	​	$	871,841	​	$	406,323
(1)	Total purchase price is equal to the total consideration paid plus any debt assumed at fair value. There was no debt assumed in connection with the 2024 and 2023 acquisitions.
---	---

The weighted-average amortization period for the intangible lease assets and liabilities acquired in connection with our acquisitions during the years ended December 31, 2024 **** and 2023, as of the respective date of each acquisition, were 4.8 years and 3.9 years, respectively.

Consolidation of Joint Venture Partnership

In December 2024, we consolidated an entity that was previously accounted for as an investment in unconsolidated joint venture partnership as on the third anniversary of the joint venture formation we obtained the equivalent to kick-out rights that provided us a controlling financial interest without any additional investment. Because the entity does not meet the definition of a business, we consolidated the entity based on a cost accumulation model with the noncontrolling interest recognized at carryover basis equal to 15.0% of the entity’s net assets. No gain or loss was recognized upon consolidation. We have an 85.0% ownership in the entity, which owns one residential property. Prior to consolidation, the carrying value of the investment in the joint venture partnership was $22.9 million. The assets, liabilities and noncontrolling interests assumed upon consolidation were as follows:

​

​	​	​	​
​	​	Carrying Value
(in thousands)		Upon Consolidation
Net investment in real estate properties	​	$	75,506
Cash and cash equivalents	​		2,322
Restricted cash	​		327
Other assets	​		1,052
Accounts payable and accrued expenses	​	​	(550)
Debt, net	​	​	(51,471)
Other liabilities	​	​	(297)
Noncontrolling interests	​		(4,033)

​

Dispositions

During the year ended December 31, 2024, we sold one industrial property, one parcel of land and two partial retail properties for net proceeds of approximately $31.2 million. We recorded a net gain on sale of $12.9 million.

During the year ended December 31, 2023, we sold one partial retail property for net proceeds of approximately $53.7 million. We recorded a net gain on sale of $36.9 million.

During the year ended December 31, 2022, we sold six retail properties, one office property and a land parcel for net proceeds of approximately $274.8 million. We recorded a net gain on sale of $94.8 million. 124

Table of Contents Intangible Lease Assets and Liabilities

Intangible lease assets and liabilities as of December 31, 2024 and 2023 included the following:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​		As of December 31, 2024									As of December 31, 2023
​		​	​		Accumulated			​	​		​	​		Accumulated			​	​
(in thousands)		Gross			Amortization			Net			Gross		​	Amortization			Net
Intangible lease assets (1)	​	$	339,800	​	$	(253,545)	​	$	86,255	​	$	306,365	​	$	(234,172)	​	$	72,193
Above-market lease assets (1)	​		25,332	​		(21,168)	​		4,164	​		23,926	​		(20,525)	​		3,401
Below-market lease liabilities	​		(84,910)	​		38,812	​		(46,098)	​		(73,556)	​		36,477	​		(37,079)
(1)	Included in net investment in real estate properties on the consolidated balance sheets.
---	---

The following table details the estimated net amortization of such intangible lease assets and liabilities as of December 31, 2024 for the next five years and thereafter:

​	​	​	​	​	​	​	​	​	​
​		Estimated Net Amortization
(in thousands)		Intangible Lease Assets			Above-Market Lease Assets			Below-Market Lease Liabilities
Year 1	​	$	26,822	​	$	1,201	​	$	(6,299)
Year 2	​		17,763	​		993	​		(5,927)
Year 3	​		13,951	​		847	​		(5,071)
Year 4	​	​	9,378	​	​	627	​	​	(4,301)
Year 5	​	​	6,260	​	​	385	​	​	(3,551)
Thereafter	​	​	12,081	​	​	111	​	​	(20,949)
Total	​	$	86,255	​	$	4,164	​	$	(46,098)

​

Rental Revenue Adjustments and Depreciation and Amortization Expense

The following table summarizes straight-line rent adjustments, amortization recognized as an increase (decrease) to rental revenues from above-and below-market lease assets and liabilities and real estate-related depreciation and amortization expense:

​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)		2024			2023			2022
Increase (decrease) to rental revenue:	​	​		​	​		​	​
Straight-line rent adjustments	​	$	6,823	​	$	3,384	​	$	3,414
Above-market lease amortization	​		(1,014)	​		(818)	​		(724)
Below-market lease amortization	​		4,903	​		4,393	​		4,823
Real estate-related depreciation and amortization:	​		​	​		​	​
Depreciation expense	​	$	128,163	​	$	126,102	​	$	97,418
Intangible lease asset amortization	​		24,614	​		23,883	​		37,199

​ 125

Table of Contents Future Minimum Rentals

Future minimum base rental payments, which equal the cash basis of monthly contractual rent, owed to us from our commercial customers under the terms of non-cancelable operating leases in effect as of December 31, 2024 were as follows for the next five years and thereafter:

​	​	​	​	​
​		As of December 31,		​
(in thousands)		2024
Year 1	​	$	177,915	​
Year 2	​		164,483	​
Year 3	​		141,196	​
Year 4	​		114,495	​
Year 5	​		85,592	​
Thereafter	​		208,270	​
Total	​	$	891,951	​

​

The amounts above do not reflect future rental revenue from the renewal or replacement of existing leases and exclude reimbursements of operating expenses along with rental increases that are not fixed. Leases for our residential and self-storage customers are generally 12 months or less and are therefore excluded from the table above.

​

4. INVESTMENTS IN UNCONSOLIDATED JOINT VENTURE PARTNERSHIPS

We hold investments in unconsolidated joint venture partnerships that are accounted for under the equity method of accounting or the fair value option. We made our first investment in unconsolidated joint venture partnerships for which we have elected the fair value option during the first quarter of 2024. We account for these investments at fair value with the associated unrealized gains and losses recorded as a component of income from unconsolidated joint venture partnerships on our consolidated statements of operations.

The following table summarizes our investments in unconsolidated joint venture partnerships as of December 31, 2024 and 2023:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	Number of Joint Venture			​	​	​	​	​	​	​	Investments in Unconsolidated
​	Partnerships as of			​	Ownership Percentage as of				​	​	Joint Venture Partnerships as of
​	December 31,	​	December 31,	​	December 31,	​	​	December 31,	​	​	December 31,		​	December 31,
( in thousands)	2024	​	2023	****	2024	​	​	2023	​	​	2024		****	2023
Investments in unconsolidated joint venture partnerships, carried at cost:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Residential joint venture partnerships (1)	—	​	1	​	—	%	​	85.0	%	​	$	—	​	$	23,932
Credit Lease joint venture partnerships	3	​	3	​	50.0	%	​	50.0	%	​	​	101,569	​	​	104,232
Data Center joint venture partnerships	2	​	2	​	10.0 - 10.2	%	​	10.0	%	​	​	42,663	​	​	24,977
Real Estate Debt joint venture partnerships (2)	2	​	1	​	19.9 - 20.0	%	​	19.9	%	​	​	29,678	​	​	164
Total investments in unconsolidated joint venture partnerships, carried at cost	​	​	​	​	​	​	​	​	​	​	​	173,910	​	​	153,305
Investments in unconsolidated joint venture partnerships, carried at fair value:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Industrial joint venture partnerships (2)	1	​	—	​	27.4	%	​	N/A	​	​	​	38,386	​	​	—
Total investments in unconsolidated joint venture partnerships, carried at fair value	​	​	​	​	​	​	​	​	​	​	​	38,386	​	​	—
Total	​	​	​	​	​	​	​	​	​	​	$	212,296	​	$	153,305

All values are in US Dollars.

(1)	In December 2024, we consolidated the residential joint venture partnership, which was previously unconsolidated. See “Note 3” for further disclosure of the consolidation of this joint venture partnership.
(2)	Includes joint venture partnerships that invest in assets and properties in Europe.
---	---

​

​ 126

Table of Contents As of December 31, 2024, we had unfunded commitments of $217.6 million, in aggregate, related to our investments in unconsolidated joint venture partnerships.

​

​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	​	2024			2023			2022
Income (loss) from unconsolidated joint venture partnerships, carried at cost:	​	​		​	​		​	​
Equity in income (loss) from unconsolidated joint venture partnerships	​	$	9,621	​	$	(3,578)	​	$	2,970
Total income (loss) from unconsolidated joint venture partnerships, carried at cost	​		9,621	​		(3,578)	​		2,970
Income (loss) from unconsolidated joint venture partnerships, carried at fair value:	​		​	​	​	​	​	​	​
Gain on investment	​	​	5,220	​	​	—	​	​	—
Foreign currency loss on investment	​	​	(658)	​	​	—	​	​	—
Total income from unconsolidated joint venture partnerships, carried at fair value	​	​	4,562	​	​	—	​	​	—
Other foreign currency gain:	​	​	​	​	​	​	​	​	​
Foreign currency gain on debt held in foreign currencies	​	​	327	​	​	—	​	​	—
Foreign currency gain on remeasurement of cash and cash equivalents	​	​	21	​	​	—	​	​	—
Total other foreign currency gain	​	​	348	​	​	—	​	​	—
Total	​	$	14,531	​	$	(3,578)	​	$	2,970

​

​

​

5. INVESTMENTS IN REAL ESTATE DEBT AND SECURITIES

Debt-Related Investments

The following table summarizes our debt-related investments, excluding debt-related investments classified as held for sale, as of December 31, 2024 and 2023:

​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​		​	​		​	Weighted-Average		​	Weighted-Average
($ in thousands)	​	Carrying Amount (1)		​	Outstanding Principal (1)		​	Interest Rate		​	Remaining Life (Years)
As of December 31, 2024	​	​	​	​	​	​	​	​	​	​	​	​
Senior loans, carried at cost (2)	​	$	187,857	​	$	188,759	​	​	8.6	%	​	0.8
Senior loans, carried at fair value	​	​	28,844	​	​	28,844	​	​	7.8	​	​	2.3
Total debt-related investments	​	$	216,701	​	$	217,603	​	​	8.5	%	​	1.0
As of December 31, 2023	​	​	​	​	​	​	​	​	​	​	​	​
Senior loans, carried at cost	​	$	141,737	​	$	143,550	​	​	9.8	%	​	2.2
Mezzanine loans, carried at cost	​	​	106,064	​	​	106,768	​	​	11.4	​	​	0.9
Total debt-related investments	​	$	247,801	​	$	250,318	​	​	10.5	%	​	1.6
(1)	The difference between the carrying amount and the outstanding principal amount of our debt-related investments carried at cost consists of unamortized purchase discount, deferred financing costs, loan origination costs, and any recorded credit loss reserves, if applicable. For our debt-related investments carried at fair value, the difference between the carrying amount and the outstanding principal amount is cumulative unrealized gains or losses.
---	---
(2)	As of December 31, 2024, we had one senior loan that was in default and on non-accrual status with a carrying value of $46.6 million. During the year ended December 31, 2024, we recognized $4.6 million in debt-related income, of which $1.8 million was received in cash and $2.8 million was capitalized to the principal balance. Weighted-average interest rate and weighted-average remaining life exclude this senior loan from its calculations as of December 31, 2024. During the year ended December 31, 2023, we had agreed to a modification of this senior loan agreement extending the maturity date.
---	---

127

Table of Contents During the year ended December 31, 2024, we received $106.8 million of principal repayments on one mezzanine loan debt-related investment. During the year ended December 31, 2023, we received full repayment of $64.9 million outstanding principal on one senior loan debt-related investment and $1.8 million of partial principal repayments on one mezzanine loan debt-related investment.

​

As of December 31, 2024, we had one debt-related investment for which we have elected the fair value option and which is carried at fair value. The carrying amount and the outstanding principal amount was $28.8 million, with a total current commitment of $29.4 million as of December 31, 2024. During the year ended December 31, 2024, we did not recognize any gains or losses on this investment. We had no debt-related investments carried at fair value as of December 31, 2023.

Current Expected Credit Losses

As of December 31, 2024, our CECL Reserve for our debt-related investment carried at cost portfolio was $0.5 million or 0.2% of our debt-related investment carried at cost total current commitment balance of $227.2 million. During the year ended December 31, 2024, we recognized a decrease in provision for current expected credit losses of $1.5 million. The debt-related investment carried at cost total current commitment balance is comprised of $188.8 million of funded commitments and $38.4 million of unfunded commitments with associated CECL Reserves of $0.4 million and $0.1 million, respectively. Our $46.6 million loan on non-accrual status is a loan in which repayment is expected to be provided substantially through the operation or sale of the collateral and the borrower is experiencing financial difficulty, therefore we have adopted the practical expedient to measure the allowance for credit loss based on the fair value of collateral resulting in no allowance for this loan as of December 31, 2024.

As of December 31, 2023, our CECL Reserve for our debt-related investment carried at cost portfolio was $2.0 million or 0.6% of our debt-related investment carried at cost total current commitment balance of $331.2 million. During the year ended December 31, 2023, we recognized an increase in provision for current expected credit losses of $2.0 million. The debt-related investment carried at cost total current commitment balance is comprised of $250.3 million of funded commitments and $80.9 million of unfunded commitments with associated CECL Reserves of $1.3 million and $0.7 million, respectively. We had elected the fair value of collateral expedient for the one senior loan debt-related investment that was modified during the year ended December 31, 2023, as the balance is fully secured against the underlying collateral comprising unsold condo units, repayment is based on the sale of underlying collateral, and the borrower is experiencing financial difficulties. There was no CECL Reserve associated with this investment as of December 31, 2023, as the estimate fair value of collateral exceeds the amortized cost balance.

There have been no write-offs or recoveries related to any of our existing debt-related investments.

The following table summarizes activity related to our CECL Reserve on funded commitments for the years ended December 31, 2024 and 2023:

​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	**** ​	2024		​	2023
Balance at beginning of the year	​	$	1,327	​	$	—
Provision for current expected credit losses	​	​	(986)	​	​	1,327
Write-offs	​	​	—	​	​	—
Recoveries	​	​	—	​	​	—
Ending balance (1)	​	$	341	​	$	1,327
(1)	The CECL Reserve related to funded commitments is included in investments in real estate debt and securities on the consolidated balance sheets.
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128

Table of Contents The following table summarizes activity related to our CECL Reserve on unfunded commitments for the years ended December 31, 2024 and 2023:

​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	**** ​	2024		​	2023
Balance at beginning of the year	​	$	670	​	$	—
Provision for current expected credit losses	​	​	(547)	​	​	670
Write-offs	​	​	—	​	​	—
Recoveries	​	​	—	​	​	—
Ending balance (1)	​	$	123	​	$	670
(1)	The CECL Reserve related to unfunded commitments is included in other liabilities on the consolidated balance sheets.
---	---

Debt-Related Investments, Held For Sale

As of December 31, 2024, we had one debt-related investment classified as held for sale. The carrying amount was $193.9 million and the outstanding principal amount was $196.0 million, with an interest rate of 7.0% and maturity date of January 2027 as of December 31, 2024. See Note 18 “Subsequent Events” for additional information on the sale of the debt-related investment subsequent to our reporting date. We had no debt-related investments classified as held for sale as of December 31, 2023.

Available-for-Sale Debt Securities

As of December 31, 2024 we had one preferred equity investment, one commercial real estate collateralized loan obligation (“CRE CLO” or multiple “CRE CLOs”) and one commercial mortgage backed-security (“CMBS”) designated as available-for-sale debt securities. As of December 31, 2023, we had one preferred equity investment and one CRE CLO designated as available-for-sale debt securities. As of December 31, 2024 and 2023, the weighted-average remaining term of our CRE CLOs and CMBS, which is based on the estimated fully extended maturity dates of the underlying loans of the debt security, was 2.5 years and 3.1 years, respectively, and the remaining term of our preferred equity investment was 2.1 years and 3.1 years, respectively. We had no unfunded commitments related to our preferred equity investment as of December 31, 2024 or 2023. There were no credit losses associated with our available-for-sale debt securities as of December 31, 2024 or 2023. The following table summarizes our investments in available-for-sale debt securities as of December 31, 2024 and 2023:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
(in thousands)	​	Face Amount		​	Amortized Cost		​	Unamortized Discount		​	Unamortized Fees (1)		​	Unrealized Gain, Net (2)		​	Fair Value
As of December 31, 2024				​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
CRE CLOs & CMBS	​	$	13,325	​	$	13,258	​	$	67	​	$	—	​	$	112	​	$	13,370
Preferred equity	​	​	123,767	​	​	123,187	​	​	—	​	​	580	​	​	—	​	​	123,187
Total debt securities	​	$	137,092	​	$	136,445	​	$	67	​	$	580	​	$	112	​	$	136,557
As of December 31, 2023				​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
CRE CLOs	​	$	14,910	​	$	14,825	​	$	85	​	$	—	​	$	158	​	$	14,983
Preferred equity	​	​	108,250	​	​	107,392	​	​	—	​	​	858	​	​	—	​	​	107,392
Total debt securities	​	$	123,160	​	$	122,217	​	$	85	​	$	858	​	$	158	​	$	122,375
(1)	Includes unamortized loan origination fees received on debt securities.
---	---
(2)	Represents cumulative unrealized gain beginning from acquisition date.
---	---

​

​

​

​

​ 129

Table of Contents 6. DEBT

Our consolidated indebtedness is currently comprised of borrowings under our line of credit, term loans and mortgage notes. Borrowings under our non-recourse mortgage notes are secured by mortgages or deeds of trust and related assignments and security interests in collateralized and certain cross-collateralized properties, which are generally owned by single purpose entities. One of our mortgage notes is currently partial recourse to us, for which we provide $12.8 million in limited guarantees until we meet certain lender-specified thresholds at the collateralized property. Other than this limited guarantee, the assets and credit of each of our consolidated properties pledged as collateral for our mortgage notes are not available to satisfy our debt and obligations, unless we first satisfy the mortgages note payable on the respective underlying properties. A summary of our debt is as follows:

​

​	​	​	​	​	​	​	​	​	​	​	​
​	Weighted-Average			​	​	​	​	​	​	​	​
​	Effective Interest Rate as of			​	​	​	Balance as of
​	December 31,	​	December 31,	​	​	​	December 31,		​	December 31,
( in thousands)	2024		2023		Current Maturity Date		2024			2023
Line of credit (1)	5.82	%	5.35	%	November 2025	​	$	548,228	​	$	367,000
Term loan (2)	3.36	​	3.31	​	November 2026	​	​	400,000		​	400,000
Term loan (3)	4.53	​	4.26	​	January 2027	​		400,000			400,000
Fixed-rate mortgage notes	4.52	​	4.46	​	January 2027 - May 2031	​		654,795			596,191
Floating-rate mortgage notes (4)	6.05	​	5.25	​	October 2025 - October 2026	​		714,151			207,600
Total principal amount / weighted-average (5)	5.01	%	4.43	%		​	$	2,717,174		$	1,970,791
Less: unamortized debt issuance costs						​	$	(23,034)		$	(17,038)
Add: unamortized mark-to-market adjustment on assumed debt						​		6,328			7,367
Total debt, net						​	$	2,700,468		$	1,961,120
Gross book value of properties encumbered by debt	​	​	​	​	​	​	$	2,309,100	​	$	1,391,173

All values are in US Dollars.

(1)	The effective interest rate for our borrowings in U.S. dollars, which was $513.0 million as of December 31, 2024, is calculated based on the Term Secured Overnight Financing Rate (“Term SOFR”) plus an 11.448 basis point adjustment (“Adjusted Term SOFR”), plus a margin ranging from 1.25% to 2.00% depending on our consolidated leverage ratio. The effective interest rate for our borrowings in pound sterling, which was $35.2 million as of December 31, 2024 when converted to U.S. dollars, is calculated based on the Sterling Overnight Index Average Reference Rate (“SONIA”) plus a 3.26 basis point adjustment, plus a margin ranging from 1.25% to 2.00% depending on our consolidated leverage ratio. As of December 31, 2024, the unused and available portions under the line of credit were approximately $351.8 million and $297.1 million, respectively. The weighted-average interest rate is the all-in interest rate. The line of credit is available for general business purposes including, but not limited to, refinancing of existing indebtedness and financing the acquisition of permitted investments, including commercial properties.
(2)	The effective interest rate is calculated based on Adjusted Term SOFR, plus a margin ranging from 1.20% to 1.90% depending on our consolidated leverage ratio. Total commitments for this term loan are $400.0 million. The weighted-average interest rate is the all-in interest rate, including the effects of interest rate swap agreements relating to $200.0 million in borrowings under this term loan and interest rate cap agreements relating to $200.0 million in borrowings under this term loan.
---	---
(3)	The effective interest rate is calculated based on Adjusted Term SOFR, plus a margin ranging from 1.20% to 1.90% depending on our consolidated leverage ratio. Total commitments for this term loan are $400.0 million. The weighted-average interest rate is the all-in interest rate, including the effects of interest rate swap agreements relating to $275.0 million in borrowings under this term loan and interest rate cap agreements relating to $50.0 million in borrowings under this term loan.
---	---
(4)	The effective interest rate is calculated based on Adjusted Term SOFR plus a margin. As of both December 31, 2024 and 2023, our floating-rate mortgage notes were subject to interest rate spreads ranging from 1.55% to 2.50%. The weighted-average interest rate is the all-in interest rate, including the effects of interest rate cap agreements which capped the effective interest rates of our four floating-rate mortgage notes ranging from 4.45% to 6.55% as of December 31, 2024.
---	---
(5)	The weighted-average remaining term of our consolidated borrowings was 2.1 years as of December 31, 2024, excluding the impact of certain extension options.
---	---

130

Table of Contents For the years ended December 31, 2024, 2023 and 2022, the amount of interest incurred related to our consolidated indebtedness, excluding amortization of debt issuance costs, was $116.9 million, $85.9 million and $55.4 million, respectively. For the years ended December 31, 2024 and 2023 the amount of interest incurred related to our consolidated indebtedness includes $14.1 million, $5.7 million, respectively, related to the amortization of our interest rate cap premiums. For the year ended December 31, 2022, we had no amount related to the amortization of our interest rate cap premiums. See “Note 7” for the amount of interest incurred related to the DST Program (as defined below).

As of December 31, 2024, the principal payments due on our consolidated debt during each of the next five years and thereafter were as follows:

​	​	​	​	​	​	​	​	​	​	​	​	​
(in thousands)	****	Line of Credit (1)		****	Term Loans		****	Mortgage Notes (2)		****	Total
2025	​	$	548,228	​	$	—	​	$	110,928	​	$	659,156
2026	​		—	​		400,000	​		610,665	​		1,010,665
2027	​		—	​		400,000	​		177,034	​		577,034
2028	​		—	​		—	​		90,477	​		90,477
2029	​		—	​		—	​		270,385	​		270,385
Thereafter	​		—	​		—	​		109,457	​		109,457
Total principal payments	​	$	548,228	​	$	800,000	​	$	1,368,946	​	$	2,717,174
(1)	The term of the line of credit may be extended pursuant to two six-month extension options, subject to certain conditions.
---	---
(2)	A $115.0 million mortgage note matures in January 2027 and may be extended pursuant to two one-year extension options, subject to certain conditions. A $51.6 million mortgage note matures in January 2026 and may be extended pursuant to one one-year extension options, subject to certain conditions. A $475.0 million mortgage note matures in October 2026 and may be extended pursuant to three one-year extension options, subject to certain conditions.
---	---

Debt Covenants

Our line of credit, term loans and mortgage note agreements contain various property-level covenants, including customary affirmative and negative covenants. In addition, the line of credit and term loan agreements contain certain corporate-level financial covenants, including leverage ratio, fixed charge coverage ratio, and tangible net worth thresholds. We were in compliance with our debt covenants as of December 31, 2024.

Derivative Instruments

To manage interest rate risk for certain of our variable-rate debt, we use interest rate derivative instruments as part of our risk management strategy. These derivatives are designed to mitigate the risk of future interest rate increases by either providing a fixed interest rate or capping the variable interest rate for a limited, pre-determined period of time. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for us making fixed-rate payments over the life of the interest rate swap agreements without exchange of the underlying notional amount. Interest rate caps involve the receipt of variable amounts from a counterparty at the end of each period in which the interest rate exceeds the agreed fixed price.

For derivative instruments that are designated and qualify as cash flow hedges, the gain or loss is recorded as a component of accumulated other comprehensive income (loss) (“AOCI”) on the consolidated balance sheets and is reclassified into earnings as interest expense for the same period that the hedged transaction affects earnings, which is when the interest expense is recognized on the related debt.  During the next 12 months, we estimate that $2.9 million will be reclassified as a decrease to interest expense related to active effective hedges of existing floating-rate debt. For derivatives that are not designated and do not qualify as hedges, changes in fair value are recognized through income. As a result, in periods with high interest rate volatility, we may experience significant fluctuations in our net income (loss).

​ 131

Table of Contents The following table summarizes the location and fair value of our consolidated derivative instruments on our consolidated balance sheets:

​

​	​	​	​	​	​	​	​	​	​	​
​	Number of		Current Notional		​	Fair Value
( in thousands)	Contracts		Amount			​	Other Assets		Other Liabilities
As of December 31, 2024	​	​	​	​	​	​	​	​	​	​
Interest rate swaps designated as cash flow hedges	10	​	$	475,000	​	$	6,866	​	$	—
Interest rate caps designated as cash flow hedges	8	​	​	912,600	​	​	13,824	​	​	—
Interest rate caps not designated as cash flow hedges	1	​	​	53,700	​	​	3	​	​	—
Total derivative instruments	19	​	$	1,441,300	​	$	20,693	​	$	—
As of December 31, 2023	​	​	​	​	​	​	​	​	​	​
Interest rate swaps designated as cash flow hedges	12	​	$	650,000	​	$	10,510	​	$	—
Interest rate caps designated as cash flow hedges	8	​		507,600	​		21,746	​		—
Total derivative instruments	20	​	$	1,157,600	​	$	32,256	​	$	—

All values are in US Dollars.

​

The following table presents the effect of our consolidated derivative instruments on our consolidated financial statements:

​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	​	2024			2023			2022
Derivative instruments designated as cash flow hedges:	​	​		​	​		​	​
Gain recognized in AOCI	​	$	14,800	​	$	6,259	​	$	29,852
Amount reclassified from AOCI as a decrease into interest expense	​		(16,650)	​		(17,848)	​		1,546
Total interest expense presented in the consolidated statements of operations in which the effects of cash flow hedges are recorded	​		188,318	​		148,517	​		140,406
Derivative instruments not designated as cash flow hedges:	​			​			​
Unrealized gain (loss) on derivative instruments recognized in other income (expenses) (1)	​	$	264	​	$	(4,169)	​	$	4,051
Realized gain on derivative instruments recognized in other income (expenses) (2)	​	​	138	​	​	4,295	​	​	672
(1)	Unrealized loss on changes in fair value of derivative instruments relates to mark-to-market changes on our derivatives not designated as cash flow hedges.
---	---
(2)	Realized gain on derivative instruments relates to interim settlements for our derivatives not designated as cash flow hedges.
---	---

​

7. DST PROGRAM

The following table summarizes our DST Program Loans as of December 31, 2024 and 2023:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​		​	​		​	​		​	Weighted-Average		​	Weighted-Average
($ in thousands)	​	Outstanding Principal		​	Unrealized Loss, Net (1)		​	Book Value		​	Interest Rate		​	Remaining Life (Years)
As of December 31, 2024	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
DST Program Loans, carried at cost	​	$	49,785	​	$	N/A	​	$	49,785	​	​	6.0	%	​	8.5
DST Program Loans, carried at fair value	​	​	71,085	​	​	(17)	​	​	71,068	​	​	7.0	%	​	9.6
Total	​	$	120,870	​	$	(17)	​	$	120,853	​	​	6.6	%	​	9.1
As of December 31, 2023	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
DST Program Loans, carried at cost	​	$	109,266	​	$	N/A	​	$	109,266	​	​	5.1	%	​	8.4
DST Program Loans, carried at fair value	​	​	7,753	​	​	—	​	​	7,753	​	​	6.4	%	​	10.0
Total	​	$	117,019	​	$	—	​	$	117,019	​	​	5.2	%	​	8.5
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
(1)	Represents cumulative unrealized gain or loss on DST Program Loans carried at fair value.
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132

Table of Contents The following table summarizes our financing obligations, net as of December 31, 2024 and 2023:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	DST Interests		​	Unamortized		​	Total		​	Unrealized		​	Book
(in thousands)	​	Sold (1)		​	Program Costs		​	Appreciation (2)		​	Gain, Net (3)		​	Value
As of December 31, 2024	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Financing obligations, carried at cost	​	$	507,607	​	$	(373)	​	$	—	​	$	N/A	​	$	507,234
Financing obligations, carried at fair value	​	​	877,284	​	​	N/A	​	​	N/A	​	​	1,102	​	​	878,386
Total	​	$	1,384,891	​	$	(373)	​	$	—	​	$	1,102	​	$	1,385,620
As of December 31, 2023	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Financing obligations, carried at cost	​	$	1,238,639	​	$	(863)	​	$	11,269	​	$	N/A	​	$	1,249,045
Financing obligations, carried at fair value	​	​	102,977	​	​	N/A	​	​	N/A	​	​	(932)	​	​	102,045
Total	​	$	1,341,616	​	$	(863)	​	$	11,269	​	$	(932)	​	$	1,351,090
(1)	DST Interests sold are presented net of upfront fees.
---	---
(2)	Represents cumulative financing obligation liability appreciation on financing obligations carried at cost.
---	---
(3)	Represents cumulative unrealized gain or loss on financing obligations carried at fair value.
---	---

The following table presents our DST Program activity for the years ended December 31, 2024, 2023, and 2022:

​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	​	2024		​	2023		**** ​	2022
DST Interests sold	​	$	797,022	​	$	479,155	​	$	758,995
DST Interests financed by DST Program Loans	​	​	63,332	​	​	51,360	​	​	51,496
Income earned from DST Program Loans (1)	​	​	6,793	​	​	5,155	​	​	3,420
Unrealized loss on DST Program Loans	​	​	(17)	​	​	—	​	​	—
Unrealized (loss) gain on financing obligations	​	​	(2,034)	​	​	932	​	​	—
Gain on extinguishment of financing obligations (2)	​	​	41,050	​	​	—	​	​	—
(Decrease) increase in financing obligation liability appreciation (3)	​	​	(69)	​	​	(459)	​	​	31,737
Rent obligation incurred under master lease agreements (3)	​	​	62,549	​	​	57,916	​	​	47,021
(1)	Included in other income and expenses on the consolidated statements of operations.
---	---
(2)	Included in gain (loss) on extinguishment of debt and financing obligations, net on the consolidated statements of operations and recorded upon extinguishment of our financing obligations in accordance with our UPREIT structure.
---	---
(3)	Included in interest expense on the consolidated statements of operations
---	---

We record DST Interests as financing obligation liabilities for accounting purposes. If we exercise our option to reacquire a DST Property by issuing OP Units, cash or a combination of OP Units and cash in exchange for DST Interests, we relieve the related financing obligation liability and DST Program Loans and record the issuance of the OP Units as an issuance of equity. During the years ended December 31, 2024, 2023, and 2022, 83.6 million OP Units, 27.3 million OP Units and 28.8 million OP units, respectively, were issued in exchange for DST Interests for a net investment of $639.1 million, $228.3 million and $252.6 million, respectively, in accordance with our UPREIT structure. In addition, we paid $3.9 million in cash in exchange for DST Interests during the year ended December 31, 2024. There was no cash paid in exchange for DST Interests during the years ended December 31, 2023 or 2022.

Refer to “Note 13” for detail relating to the fees paid to the Advisor and its affiliates for raising capital through the DST Program.

​ 133

Table of Contents 8. FAIR VALUE

We estimate the fair value of our financial assets and liabilities using available market information and valuation methodologies we believe to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they are not necessarily indicative of amounts that we would realize upon disposition of our financial assets and liabilities.

Fair Value Measurements on a Recurring Basis

The following table presents our financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2024 and 2023:

​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​	​	****	​	​	****	​	​	****	Total
(in thousands)	​	Level 1		​	Level 2		​	Level 3		​	Fair Value
As of December 31, 2024	​	​	​	​	​	​	​	​	​	​	​	​
Assets:	​	​	​	​	​	​	​	​	​	​	​	​
Derivative instruments	​	$	—	​	$	20,693	​	$	—	​	$	20,693
Investments in unconsolidated joint venture partnerships	​	​	—	​	​	—	​	​	38,386	​	​	38,386
Debt-related investments	​	​	—	​	​	—	​	​	28,844	​	​	28,844
Available-for-sale debt securities	​	​	—	​	​	13,370	​	​	123,187	​	​	136,557
DST Program Loans	​	​	—	​	​	—	​	​	71,068	​	​	71,068
Total assets measured at fair value	​	$	—	​	$	34,063	​	$	261,485	​	$	295,548
Liabilities:	​			​			​			​
Financing obligations	​	$	—	​	$	—	​	$	878,386	​	$	878,386
Total liabilities measured at fair value	​	$	—	​	$	—	​	$	878,386	​	$	878,386
As of December 31, 2023	​			​			​			​
Assets:	​			​			​			​
Derivative instruments	​	$	—	​	$	32,256	​	$	—	​	$	32,256
Available-for-sale debt securities	​	​	—	​	​	14,983	​	​	107,392	​	​	122,375
DST Program Loans	​	​	—	​	​	—	​	​	7,753	​	​	7,753
Total assets measured at fair value	​	$	—	​	$	47,239	​	$	115,145	​	$	162,384
Liabilities:	​			​			​			​
Financing obligations	​	$	—	​	$	—	​	$	102,045	​	$	102,045
Total liabilities measured at fair value	​	$	—	​	$	—	​	$	102,045	​	$	102,045

​

The following methods and assumptions were used to estimate the fair value of each class of financial assets and liabilities:

Derivative Instruments. The derivative instruments are interest rate swaps and interest rate caps whose fair value is estimated using market-standard valuation models. Such models involve using market-based observable inputs, including interest rate curves. We incorporate credit valuation adjustments to appropriately reflect both our nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements, which we have concluded are not material to the valuation. Due to these derivative instruments being unique and not actively traded, the fair value is classified as Level 2. See “Note 6” above for further discussion of our derivative instruments.

Investments in Unconsolidated Joint Venture Partnerships. We have elected the fair value option on certain investments in unconsolidated joint venture partnerships. We separately value the real estate assets held by the unconsolidated joint venture partnerships to arrive at a fair value for our investments in unconsolidated joint venture partnerships. The fair value of real estate assets held by the unconsolidated joint venture partnerships is estimated using a direct capitalization methodology that is based on applying a capitalization rate to the estimated rental income to be generated by the real estate assets of the unconsolidated joint venture partnerships. The capitalization rate used in estimating the fair value of these investments is considered Level 3. 134

Table of Contents Debt-Related Investments. Our debt-related investments are unlikely to have readily available market quotations. In such cases, we will generally determine the initial value based on the acquisition price of such investments, if we acquire the investment, or the par value of such investment, if we originate the investment. Following the initial measurement, fair value is estimated by utilizing or reviewing certain of the following: (i) market yield data, (ii) discounted cash flow modeling, (iii) collateral asset performance, (iv) local or macro real estate performance, (v) capital market conditions, (vi) debt yield, debt-service coverage and/or loan-to-value ratios, and (vii) borrower financial condition and performance. These inputs are generally considered Level 3.

Available-for-Sale Debt Securities. The available-for-sale debt securities are either preferred equity investments in real estate properties, CRE CLOs or CMBS. The fair value for CRE CLOs and CMBS are estimated using third-party broker quotes, which provide valuation estimates based upon contractual cash flows, observable inputs comprising credit spreads and market liquidity. We incorporate credit valuation adjustments to appropriately reflect both our nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements, which we have concluded are not material to the valuation. Due to these CRE CLOs and CMBS being unique and not actively traded, the fair value is classified as Level 2. The preferred equity investments are unlikely to have readily available market quotations. In such cases, the initial value will generally be determined using the acquisition price of such investment if acquired, or the par value of such investment if originated. Following the initial measurement, fair value is estimated by utilizing or reviewing certain of the following: (i) market yield data, (ii) discounted cash flow modeling, (iii) collateral asset performance, (iv) local or macro real estate performance, (v) capital market conditions, (vi) debt yield, debt-service coverage and/or loan-to-value ratios, and (vii) borrower financial condition and performance. The inputs used in estimating the fair value of these preferred equity investments are generally considered Level 3.

DST Program Loans. The estimate of fair value of DST Program Loans takes into consideration various factors including current market rates and conditions and similar agreements with comparable loan-to-value ratios and credit profiles, as applicable. DST Program Loans with near-term maturities are generally valued at par. The inputs used in estimating the fair value of these financial assets are generally considered Level 3.

Financing Obligations. The estimate of fair value of financing obligations takes into consideration various factors including current market rates and conditions, leasing and other activity at the underlying DST Program investments, remaining master lease payments to DST investors, and the current portion of DST Program offerings sold to DST investors. The inputs used in estimating the fair value of these financial liabilities are generally considered Level 3.

The following table presents our financial assets measured at fair value on a recurring basis using Level 3 inputs:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Investments in		​	​		​	​	​	​	​	​	​	​
​	​	Unconsolidated Joint		​	Debt-Related		​	Available-For-Sale		​	DST Program		​	​	​
(in thousands)	**** ​	Venture Partnerships		​	Investments		​	Debt Securities		**** ​	Loans		​	Total
Balance as of December 31, 2022	​	$	—	​	$	—	​	$	—	​	$	—	​	$	—
Purchases and contributions	​	​	—	​	​	—	​	​	102,160	​	​	7,753	​	​	109,913
Paid-in-kind interest	​	​	—	​	​	—	​	​	6,090	​	​	—	​	​	6,090
Loan origination fees received	​	​	—	​	​	—	​	​	(1,022)	​	​	—	​	​	(1,022)
Amortization of loan origination fees (1)	​	​	—	​	​	—	​	​	164	​	​	—	​	​	164
Balance as of December 31, 2023	​	$	—	​	$	—	​	$	107,392	​	$	7,753	​	$	115,145
Purchases and contributions	​	​	33,952	​	​	27,974	​	​	—	​	​	63,332	​	​	125,258
Paid-in-kind interest	​	​	—	​	​	870	​	​	15,517	​	​	—	​	​	16,387
Distributions received	​	​	(128)	​	​	—	​	​	—	​	​	—	​	​	(128)
Gain (loss) on financial assets	​	​	5,220	​	​	—	​	​	—	​	​	(17)	​	​	5,203
Foreign currency loss on investment	​	​	(658)	​	​	—	​	​	—	​	​	—	​	​	(658)
Amortization of loan origination fees (1)	​	​	—	​	​	—	​	​	278	​	​	—	​	​	278
Balance as of December 31, 2024	​	$	38,386	​	$	28,844	​	$	123,187	​	$	71,068	​	$	261,485
(1)	Included in debt-related income on the consolidated statements of operations.
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​ 135

Table of Contents The following table presents our financial liabilities measured at fair value on a recurring basis using Level 3 inputs:

​

​	​	​	​
​	​	Financing
(in thousands)	​	Obligations
Balance as of December 31, 2022	​	$	—
DST Interests sold, net of upfront fees	​	​	102,977
Unrealized gain on financing obligations	​	​	(932)
Balance as of December 31, 2023	​	$	102,045
DST Interests sold, net of upfront fees	​	​	774,307
Unrealized gain on financing obligations	​	​	2,034
Balance as of December 31, 2024	​	$	878,386

​

The following table presents the quantitative inputs and assumptions used for items categorized in Level 3 of the fair value hierarchy as of December 31, 2024:

​	​	​	​	​	​	​	​	​	​	​
​		​	​		Valuation		Unobservable		Impact to Valuation from
(in thousands)	​	​	Fair Value		Technique		Inputs		an Increase to Input
Assets:	​	​	​	​	​	​	​	​	​	​
Investments in unconsolidated joint venture partnerships	​	$	38,386	​	Direct Capitalization	​	Capitalization Rate	​	​	Decrease
Debt-related investments	​	​	28,844	​	Yield Method	​	Market Yield	​	​	Decrease
Available-for-sale debt securities (1)	​	​	123,187	​	Yield Method	​	Market Yield	​	​	Decrease
DST Program Loans	​	​	71,068	​	Yield Method	​	Market Yield	​	​	Decrease
Liabilities:	​	​	​	​	​	​	​	​	​	​
Financing obligations	​	$	878,386	​	Discounted Cash Flow	​	Discount Rate<br>Exit Capitalization Rate	​	​	Decrease<br>Decrease
(1)	As of December 31, 2024, the market yield used in determining the fair value of our available-for sale debt security was 13.3%.
---	---

The following table presents the quantitative inputs and assumptions used for items categorized in Level 3 of the fair value hierarchy as of December 31, 2023:

​	​	​	​	​	​	​	​	​	​	​
​		​	​		Valuation		Unobservable		Impact to Valuation from
(in thousands)	​	​	Fair Value		Technique		Inputs		an Increase to Input
Assets:	​	​	​	​	​	​	​	​	​	​
Available-for-sale debt securities (1)	​	$	107,392	​	Yield Method	​	Market Yield	​	​	Decrease
DST Program Loans	​	​	7,753	​	Yield Method	​	Market Yield	​	​	Decrease
Liabilities:	​	​	​	​	​	​	​	​	​	​
Financing obligations	​	$	102,045	​	Discounted Cash Flow	​	Discount Rate<br>Exit Capitalization Rate	​	​	Decrease<br>Decrease
(1)	As of December 31, 2023, the market yield used in determining the fair value of our available-for sale debt security was 13.3%.
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​ 136

Table of Contents Financial Assets and Liabilities Not Measured at Fair Value

As of December 31, 2024 and 2023, the fair values of cash and cash equivalents, restricted cash, tenant receivables, accounts payable and accrued expenses and distribution fees payable approximate their carrying values because of the short-term nature of these instruments. The table below includes fair values for certain of our financial instruments for which it is practicable to estimate fair value. The carrying values and fair values of these financial instruments were as follows:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	As of December 31, 2024					​	As of December 31, 2023
​	****	Level in Fair	​	Carrying		****	Fair		​	Carrying		****	Fair
(in thousands)	​	Value Hierarchy	​	Value (1)		​	Value		​	Value (1)		​	Value
Assets:	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Debt-related investments (2)	​	3	​	$	384,759	​	$	383,490	​	$	250,318	​	$	250,215
DST Program Loans (2)	​	3	​		49,785	​		49,583	​		109,266	​		107,297
Liabilities:	​		​			​			​			​
Line of credit	​	3	​	$	548,228	​	$	548,228	​	$	367,000	​	$	367,000
Term loans	​	3	​		800,000	​		800,000	​		800,000	​		800,000
Mortgage notes	​	3	​		1,368,946	​		1,340,398	​		803,791	​		778,235
(1)	The carrying value reflects the principal amount outstanding.
---	---
(2)	Only includes instruments for which we have not elected the fair value option and do not record at fair value on the consolidated balance sheets.
---	---

The initial value of debt-related investments will generally be determined using the acquisition price of such investment if acquired, or the par value of such investment if originated. Following the initial measurement, fair value is estimated by utilizing or reviewing certain of the following: (i) market yield data, (ii) discounted cash flow modeling, (iii) collateral asset performance, (iv) local or macro real estate performance, (v) capital market conditions, (vi) debt yield, debt-service coverage and/or loan-to-value ratios, and (vii) borrower financial condition and performance. The estimate of fair value of DST Program Loans, line of credit, term loans and mortgage notes takes into consideration various factors including current market rates and conditions and similar agreements with comparable loan-to-value ratios and credit profiles, as applicable. Debt instruments with near-term maturities are generally valued at par.

​

​

9. INCOME TAXES

We have concluded that there was no impact related to uncertain tax positions from our results of operations for the years ended December 31, 2024, 2023 and 2022. We had a net deferred tax liability of approximately $0.1 million as of December 31, 2024. We had a net deferred tax asset of approximately $0.5 million as of December 31, 2023, which was offset by a full valuation allowance. During the year ended December 31, 2024, we recorded $11.8 million of income tax expense on our consolidated statements of operations related to the activities of our taxable REIT subsidiaries associated with our DST Program. During the years ended December 31, 2023 and 2022, we recorded no income tax expense. The U.S. is the major tax jurisdiction for us and the earliest tax year subject to examination by the taxing authority is 2021.

Distributions

Distributions to stockholders are characterized for U.S. federal income tax purposes as: (i) ordinary income; (ii) non-taxable return of capital; or (iii) long-term capital gain. Distributions that exceed our current and accumulated tax earnings and profits constitute a return of capital and reduce the stockholders’ basis in the common shares. To the extent that a distribution exceeds both current and accumulated earnings and profits and the stockholders’ basis in the common shares, the distributions will generally be treated as a gain from the sale or exchange of such stockholders’ common shares. Under the new tax laws effective January 1, 2018, all distributions (other than distributions designated as capital gain distributions and distributions traceable to distributions from a taxable REIT subsidiary) which are received by a pass-through entity or an individual, are eligible for a 20% deduction from gross income. This eligibility for a 20% deduction will expire before January 1, 2026. At the beginning of each year, we notify our stockholders of the taxability of the distributions paid during the preceding year. In any given year, the overall taxability of distributions could be higher or lower than the preceding year. 137

Table of Contents The following unaudited table summarizes the annual information reported to investors regarding the taxability of distributions on common stock, as a percentage of total distributions, for the years ended December 31, 2024, 2023 and 2022. This information assumes that an investor owned shares of our common stock for the full 2024 calendar year.

​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,					****
​	****	2024	****	2023	****	2022	****
Ordinary income		5.79	%	—	%	—	%
Non-taxable return of capital		94.21		100.00		100.00	​
Capital gain		—		—		—	​
Total distributions		100.00	%	100.00	%	100.00	%

​

The increase in taxable income in 2024 compared to 2023 is primarily due to a tax gain related to the activities of our taxable REIT subsidiaries associated with our DST Program. The taxability of distributions remained unchanged in 2023 as compared to 2022.

10. STOCKHOLDERS’ EQUITY

Securities Offerings

We may conduct continuous securities offerings that will not have a predetermined duration, subject to continued compliance with the rules and regulations of the SEC and applicable state laws. On May 3, 2022, the SEC declared our registration statement on Form S-11 with respect to our fourth public offering of up to $10.0 billion of shares of its common stock effective, and the fourth public offering commenced the same day. We ceased selling shares of our common stock under our third public offering of up to $3.0 billion of shares immediately upon the effectiveness of the registration statement for the fourth public offering. Under the fourth public offering, we offered up to $8.5 billion of shares of our common stock in the primary offering and up to $1.5 billion of shares of our common stock pursuant to our distribution reinvestment plan, in any combination of Class T-R shares, Class S-R shares, Class D-R shares and Class I-R shares. On May 16, 2024, we announced our decision to close the fourth primary public offering effective July 2, 2024. We accepted subscriptions for primary shares in the public offering through the July 1, 2024 purchase date. On August 22, 2024, we amended our registration statement on Form S-11 with respect to our fourth public offering to make it a distribution reinvestment plan only registration statement on Form S-3 pursuant to Rule 415(a)(1)(ii) under the Securities Act of 1933, as amended (the “Securities Act”) and we expect to continue making monthly distributions and the distribution reinvestment plan (“DRIP”) offering, which investors can continue to elect to participate in. On August 2, 2024, we initiated a private offering exempt from registration under the Securities Act (the “Private Offering”), which offers Class S-PR shares, Class D-PR shares and Class I-PR shares.

The Class T-R shares, Class S-R shares, Class D-R shares, Class I-R shares, Class E shares, Class S-PR shares, Class D-PR shares, and Class I-PR shares, all of which are collectively referred to herein as shares of common stock, have identical rights and privileges, including identical voting rights, but have differing fees that are payable on a class-specific basis. The per share amount of distributions paid on Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares, and Class D-PR shares will be lower than the per share amount of distributions paid on Class E shares, Class I-R shares and Class I-PR shares because of the distribution fees payable with respect to Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares and Class D-PR shares sold in our securities offerings.

Pursuant to our securities offerings, we have offered and continue to offer shares of our common stock at the “transaction price,” plus applicable selling commissions and dealer manager fees. The “transaction price” generally is equal to the net asset value (“NAV”) per share of our common stock most recently disclosed. Our NAV per share is calculated as of the last calendar day of each month for each of our outstanding classes of stock, and will be available generally within 15 calendar days after the end of the applicable month. Shares issued pursuant to our DRIP are offered at the transaction price, as indicated above, in effect on the distribution date. We may update a previously disclosed transaction price in cases where we believe there has been a material change (positive or negative) to our NAV per share relative to the most recently disclosed monthly NAV per share.

During the year ended December 31, 2024, we raised gross proceeds of approximately $61.8 million from the sale of approximately 8.0 million shares of our common stock in our securities offerings, including proceeds from our DRIP of approximately $32.1 million. 138

Table of Contents Common Stock

The following table describes the number of shares of each class of our common stock authorized and issued and outstanding as of December 31, 2024 and 2023:

​

​	​	​	​	​	​	​	​	​
​	​	December 31, 2024			​	December 31, 2023
(in thousands)	​	Shares Authorized	​	Shares Issued and Outstanding	​	Shares Authorized	​	Shares Issued and Outstanding
Class T-R, $0.01 par value per share	​	100,000	​	26,972	​	500,000	​	28,432
Class S-R, $0.01 par value per share	​	100,000	​	43,761	​	500,000	​	48,145
Class D-R, $0.01 par value per share	​	100,000	​	6,110	​	500,000	​	6,930
Class I-R, $0.01 par value per share	​	600,000	​	58,998	​	500,000	​	65,511
Class E, $0.01 par value per share	​	100,000	​	43,190	​	500,000	​	48,210
Class S-PR, $0.01 par value per share	​	400,000	​	660	​	—	​	—
Class D-PR, $0.01 par value per share	​	400,000	​	13	​	—	​	—
Class I-PR, $0.01 par value per share	​	700,000	​	607	​	—	​	—

​

The following table describes the changes in each class of common shares during each of the years ended December 31, 2024, 2023 and 2022:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	Class T-R	****	Class S-R	****	Class D-R	****	Class I-R	****	Class E	​	Class S-PR	​	Class D-PR	​	Class I-PR	****	Total
(in thousands)	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares	​	Shares
Balance as of December 31, 2021 (1)		16,425		35,757		6,749		54,406		56,328	​	—	​	—	​	—		169,665
Issuance of common stock:											​	​	​	​	​	​
Primary shares		10,443		14,348		1,688		15,000		—	​	—	​	—	​	—		41,479
Distribution reinvestment plan		426		823		153		1,256		745	​	—	​	—	​	—		3,403
Share-based compensation		—		—		—		27		—	​	—	​	—	​	—		27
Redemptions of common stock		(198)		(1,691)		(719)		(1,759)		(4,099)	​	—	​	—	​	—		(8,466)
Conversions	​	(212)	​	—	​	—	​	212	​	—	​	—	​	—	​	—	​	—
Balance as of December 31, 2022 (1)		26,884		49,237		7,871		69,142		52,974	​	—	​	—	​	—		206,108
Issuance of common stock:											​	​	​	​	​	​
Primary shares		3,103		2,672		192	​	4,098	​	—	​	—	​	—	​	—		10,065
Distribution reinvestment plan		579		974		156	​	1,398	​	728	​	—	​	—	​	—		3,835
Share-based compensation		—		—		—	​	35	​	—	​	—	​	—	​	—		35
Redemptions of common stock		(1,753)		(4,793)		(907)	​	(9,881)	​	(5,481)	​	—	​	—	​	—		(22,815)
Conversions	​	(381)	​	55	​	(382)	​	719	​	(11)	​	—	​	—	​	—	​	—
Balance as of December 31, 2023 (1)		28,432		48,145		6,930		65,511		48,210	​	—	​	—	​	—		197,228
Issuance of common stock:											​	​	​	​	​	​
Primary shares		610		578		70	​	1,277	​	—	​	657	​	13	​	606		3,811
Distribution reinvestment plan		661		1,107		160	​	1,508	​	731	​	3	​	—	​	1		4,171
Share-based compensation		—		—		—	​	38	​	—	​	—	​	—	​	—		38
Redemptions of common stock		(1,989)		(5,520)		(1,035)	​	(10,642)	​	(5,751)	​	—	​	—	​	—		(24,937)
Conversions	​	(742)	​	(549)	​	(15)	​	1,306	​	—	​	—	​	—	​	—	​	—
Balance as of December 31, 2024		26,972		43,761		6,110		58,998		43,190	​	660	​	13	​	607		180,311
(1)	There is no data presented for Class S-PR shares, Class D-PR shares and Class I-PR shares as of this date because there were no shares of such share classes outstanding.
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139

Table of Contents Distributions

The following table summarizes our distribution activity (including distributions to noncontrolling interests and distributions reinvested in shares of our common stock) for the periods below:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Amount
​	****	​	​	****	Common Stock		****	​	​	****	​	​	****	​	​	​	​	​
​	​	Declared per		​	Distributions		​	Other Cash		​	Reinvested in		​	Distribution		​	Gross
(in thousands, except per share data)	​	Common Share (1)		​	Paid in Cash		​	Distributions (2)		​	Shares		​	Fees (3)		​	Distributions (4)
2024		​			​			​			​			​		​	​
March 31	​	$	0.10000	​	$	10,013	​	$	8,577	​	$	8,238	​	$	1,317	​	$	28,145
June 30	​		0.10000	​		9,787	​		9,865	​		8,046	​		1,254	​		28,952
September 30	​		0.10000	​		9,449	​		13,214	​		7,888	​		1,204	​		31,755
December 31	​		0.10000	​		9,211	​		15,018	​		7,754	​		1,184	​		33,167
Total	​	$	0.40000	​	$	38,460	​	$	46,674	​	$	31,926	​	$	4,959	​	$	122,019
2023	​			​			​			​			​			​
March 31	​	$	0.09375	​	$	9,912	​	$	5,271	​	$	8,009	​	$	1,461	​	$	24,653
June 30	​		0.09375	​		9,896	​		5,510	​		7,974	​		1,463	​		24,843
September 30	​		0.10000	​		10,335	​		6,451	​		8,431	​		1,430	​		26,647
December 31	​		0.10000	​		10,127	​		7,739	​		8,317	​		1,387	​		27,570
Total	​	$	0.38750	​	$	40,270	​	$	24,971	​	$	32,731	​	$	5,741	​	$	103,713
2022	​			​			​			​			​			​
March 31	​	$	0.09375	​	$	8,837	​	$	3,018	​	$	6,876	​	$	1,030	​	$	19,761
June 30	​		0.09375	​		9,299	​		3,157	​		7,362	​		1,259	​		21,077
September 30	​		0.09375	​		9,684	​		3,972	​		7,732	​		1,399	​		22,787
December 31	​		0.09375	​		9,859	​		4,559	​		7,923	​		1,478	​		23,819
Total	​	$	0.37500	​	$	37,679	​	$	14,706	​	$	29,893	​	$	5,166	​	$	87,444
(1)	Amount reflects the total gross quarterly distribution rate authorized by our board of directors per Class T-R share, per Class S-R share, per Class D-R share, per Class I-R share, per Class E share, per Class S-PR share, per Class D-PR share and per Class I-PR share of common stock. Distributions were declared and paid as of monthly record dates. These monthly distributions have been aggregated and presented on a quarterly basis. The distributions on Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares and Class D-PR shares of common stock are reduced by the respective distribution fees that are payable with respect to Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares and Class D-PR shares.
---	---
(2)	Consists of distribution fees paid to Ares Wealth Management Solutions, LLC (the “Dealer Manager”) with respect to OP Units and distributions paid to holders of OP Units and other noncontrolling interest holders.
---	---
(3)	Distribution fees are paid monthly to the Dealer Manager, with respect to Class T-R shares, Class S-R shares and Class D-R shares, Class S-PR shares and Class D-PR shares. All or a portion of these amounts will be retained by, or reallowed (paid) to, participating broker-dealers and servicing broker-dealers.
---	---
(4)	Gross distributions are total distributions before the deduction of any distribution fees relating to Class T-R shares, Class S-R shares, Class D-R shares, Class S-PR shares and Class D-PR shares.
---	---

Redemptions and Repurchases

Below is a summary of redemptions and repurchases pursuant to our share redemption program for the years ended December 31, 2024, 2023 and 2022. All eligible redemption requests were fulfilled for the periods presented. Eligible redemption requests are requests submitted in good order by the request submission deadline set forth in the share redemption program. Our board of directors may make exceptions to, modify or suspend our current share redemption programs if it deems such action to be in the best interest of our stockholders.

​	​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,								​
(in thousands, except for per share data)	​	2024		****	2023		****	2022		****
Number of shares redeemed or repurchased	​	​	24,937		​	22,815		​	8,466	​
Aggregate dollar amount of shares redeemed or repurchased	​	$	191,630	​	$	193,859	​	$	73,378	​
Average redemption or repurchase price per share	​	$	7.69	​	$	8.50	​	$	8.67	​

​

​ 140

Table of Contents 11. REDEEMABLE NONCONTROLLING INTERESTS

The Operating Partnership’s net income and loss will generally be allocated to the general partner and the limited partners in accordance with the respective percentage interest in the OP Units issued by the Operating Partnership.

The Operating Partnership issued OP Units to the Advisor and Former Sponsor as payment of the performance participation allocation (also referred to as the performance component of the advisory fee) pursuant to the Advisory Agreement. The Advisor and Former Sponsor subsequently transferred these OP Units to its members or their affiliates or redeemed for cash. We have classified these OP Units as redeemable noncontrolling interests in mezzanine equity on the consolidated balance sheets. The redeemable noncontrolling interests are recorded at the greater of the carrying amount, adjusted for its share of the allocation of income or loss and dividends, or the redemption value, which is equivalent to fair value, of such OP Units at the end of each measurement period. As of December 31, 2024 and 2023, we had redeemable OP Units outstanding of 1.2 million and 1.4 million, respectively.

The following table summarizes the redeemable noncontrolling interests activity for the years ended December 31, 2024 and 2023:

​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	**** ​	2024		​	2023
Balance at beginning of the year	​	$	11,746	​	$	18,130
Distributions to redeemable noncontrolling interests	​	​	(544)	​	​	(764)
Redemptions of redeemable noncontrolling interests	​	​	(1,500)	​	​	(4,940)
Net loss attributable to redeemable noncontrolling interests	​	​	(273)	​	​	(597)
Change from securities and cash flow hedging activities attributable to redeemable noncontrolling interests	​	​	(7)	​	​	(69)
Redemption value allocation adjustment to redeemable noncontrolling interests (1)	​	​	(41)	​	​	(14)
Ending balance	​	$	9,381	​	$	11,746
(1)	Represents the adjustment recorded in order to mark to the redemption value, which is equivalent to fair value, at the end of the measurement period.
---	---

​

​

12. NONCONTROLLING INTERESTS

OP Units

As of December 31, 2024 and 2023, the Operating Partnership had issued OP Units to third-party investors, representing 46.6% and 28.4%, respectively, of limited partnership interests (excludes interests held by redeemable noncontrolling interest holders). OP Units held by third-party investors are made up of Class E, Class T-R, Class S-R, and Class I-R OP Units.

The following table summarizes the number of OP Units issued and outstanding to third-party investors (excludes interests held by redeemable noncontrolling interest holders):

​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	****	2024	****	2023	****	2022
Balance at beginning of period		78,737	​	55,079		27,180
Issuance of units		83,572		27,274		28,821
Redemption of units		(4,070)	​	(3,616)		(922)
Balance at end of period	​	158,239	​	78,737	​	55,079

​

Subject to certain restrictions and limitations, the holders of OP Units may redeem all or a portion of their OP Units for either: shares of the equivalent class of common stock, cash or a combination of both. If we elect to redeem OP Units for shares of our common stock, we will generally deliver one share of our common stock for each such OP Unit redeemed (subject to any redemption fees withheld), and such shares may, subsequently, only be redeemed for cash in accordance with the terms of our share redemption program. If we elect to redeem OP Units for cash, the cash delivered per unit will equal the then-current NAV per unit of the applicable class of OP Units (subject to any redemption fees withheld), which will equal the then-current NAV per share of our corresponding class of shares. During the years ended December 31, 2024, 2023 and 2022, the aggregate amount of OP Units redeemed was $31.4 million, $30.9 million, and $7.9 million, respectively. The estimated maximum redemption value (unaudited) of the aggregate outstanding OP Units issued to third party investors as of December 31, 2024 and 2023 was $1.19 billion and $641.1 million, respectively. 141

Table of Contents 13. RELATED PARTY TRANSACTIONS

We rely on the Advisor, a related party, to manage our day-to-day activities and to implement our investment strategy pursuant to the terms of the Advisory Agreement, by and among us, the Operating Partnership and the Advisor. The current term of the Advisory Agreement ends April 30, 2025, subject to renewals by our board of directors for an unlimited number of successive one-year periods. The Dealer Manager, which is also a related party, provides dealer manager services in connection with our securities offerings pursuant to the terms of the fourth amended and restated dealer manager agreement, effective December 1, 2021 (the “Dealer Manager Agreement”) by and among us, the Advisor and the Dealer Manager. On July 1, 2021, Ares closed on the acquisition of Black Creek Group’s U.S. real estate investment advisory and distribution business, including our Former Advisor (the “Transaction”). On the same date, our Former Advisor assigned the advisory agreement to our Advisor. Ares did not acquire the Former Sponsor, and we now consider Ares real estate to be our sponsor. Prior to the Transaction, the Former Sponsor, which owned the Former Advisor, was majority owned by the founders of the Former Sponsor and/or their affiliates. The Dealer Manager was also directly or indirectly majority owned, controlled and/or managed by the founders of the Former Sponsor and/or their affiliates. Presently, following the Transaction, the Advisor and the Dealer Manager are directly or indirectly majority owned, controlled and/or managed by Ares. The Advisor, the Sponsor and the Dealer Manager receive compensation from us in the form of fees and expense reimbursements for certain services relating to our securities offerings and for the investment and management of our assets and our other activities and operations.

Advisory Agreement, Dealer Manager Agreement and Operating Partnership Agreement

The following is a description of the fees and expense reimbursements payable to the Advisor and the Dealer Manager. This summary does not purport to be a complete summary of the Advisory Agreement; the Dealer Manager Agreement; and the Partnership Agreement, and is qualified in its entirety by reference to such agreements, which are incorporated by reference as exhibits to this Annual Report on Form 10-K.

Selling Commissions, Dealer Manager Fees and Distribution Fees (Class T-R, Class S-R, Class D-R and Class I-R Shares). We closed our fourth primary public offering effective July 2, 2024, pursuant to which we had offered Class T-R shares, Class S-R shares, Class D-R shares and Class I-R shares. We had paid the Dealer Manager upfront selling commissions with respect to Class T-R shares and Class S-R shares sold in the primary portion of our public offering and dealer manager fees with respect to Class T-R shares sold in the primary portion of our public offering. The upfront selling commissions and dealer manager fees are calculated as a percentage of the transaction price (generally equal to the most recent monthly NAV per share) at the time of purchase of such shares. All or a portion of the upfront selling commissions and dealer manager fees will be retained by, or reallowed to, participating broker dealers. In addition, the Dealer Manager is entitled to receive ongoing distribution fees based on the NAV of all outstanding Class T-R shares, Class S-R shares and Class D-R shares including shares issued under our distribution reinvestment plan. The distribution fees will be payable monthly in arrears and will be paid on a continuous basis from year to year. The Dealer Manager will reallow all or a portion of the distribution fees to broker dealers whose clients own Class T-R shares, Class S-R shares and/or Class D-R shares. The following table details the selling commissions, dealer manager fees and distribution fees applicable for each share class.

​

​	​	​	​	​	​	​	​	​	​
​	****	Class T-R	****	Class S-R	****	Class D-R	****	Class I-R	****
Selling commissions (as % of transaction price)		up to 3.00	%*	up to 3.50	%	—	%	—	%
Dealer manager fees (as % of transaction price)		up to 1.50	%*	—	%	—	%	—	%
Distribution fees (as % of NAV per annum)		0.85	%	0.85	%	0.25	%	—	%
*	The sum of upfront selling commissions and upfront dealer manager fees on Class T-R shares may not exceed 3.50% of the offering price.
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We will cease paying the distribution fees with respect to individual Class T-R shares, Class S-R shares and Class D-R shares when they are no longer outstanding, including as a result of a conversion to Class I-R shares, as applicable. Each Class T-R shares, Class S-R shares and Class D-R shares held within a stockholder’s account shall automatically and without any action on the part of the holder thereof convert into a number of Class I-R shares at the applicable conversion rate on the earliest of: (i) a listing of any shares of our common stock on a national securities exchange; (ii) our merger or consolidation with or into another entity, or the sale or other disposition of all or substantially all of our assets; and (iii) the end of the month in which the Dealer Manager, in conjunction with our transfer agent, determines that the total upfront selling commissions, upfront dealer manager fees and ongoing distribution fees paid with respect to all shares of such class held by such stockholder within such account (including shares purchased through the DRIP or received as stock dividends) equals or exceeds 8.75% (or a lower limit set forth in any applicable agreement between the Dealer Manager and a participating broker dealer, provided that the Dealer Manager advises our transfer agent of the lower limit in writing) of the aggregate purchase price of all shares of such class held by such stockholder within such account and purchased in a primary offering. 142

Table of Contents Selling Commissions, Dealer Manager Fees and Distribution Fees (Class S-PR, Class D-PR and Class I-PR Shares). On August 2, 2024, we initiated the Private Offering of Class S-PR shares, Class D-PR shares and Class I-PR shares. We pay the Dealer Manager upfront selling commissions with respect to S-PR shares and D-PR shares sold in the primary portion of our Private Offering and dealer manager fees with respect to S-PR shares sold in the primary portion of our Private Offering. The upfront selling commissions and dealer manager fees are calculated as a percentage of the transaction price (generally equal to the most recent monthly NAV per share) at the time of purchase of such shares. All or a portion of the upfront selling commissions and dealer manager fees will be retained by, or reallowed to, participating broker dealers. In addition, the Dealer Manager is entitled to receive ongoing distribution fees based on the NAV of all outstanding Class S-PR shares and Class D-PR shares including shares issued under our DRIP. The distribution fees will be payable monthly in arrears and will be paid on a continuous basis from year to year. The Dealer Manager will reallow all or a portion of the distribution fees to participating broker dealers and broker dealers servicing accounts of investors who own Class S-PR shares and/or Class D-PR shares. The following table details the selling commissions, dealer manager fees and distribution fees applicable for each share class.

​

​	​	​	​	​	​	​	​
​	****	Class S-PR	****	Class D-PR	****	Class I-PR	****
Selling commissions (as % of transaction price)		up to 3.00	%*	up to 1.50	%	—	%
Dealer manager fees (as % of transaction price)		up to 1.50	%*	—	%	—	%
Distribution fees (as % of NAV per annum)		0.85	%	0.25	%	—	%
*	The sum of upfront selling commissions and upfront dealer manager fees on Class S-PR shares may not exceed 3.50% of the offering price.
---	---

We will cease paying the distribution fees with respect to individual Class S-PR shares and Class D-PR shares when they are no longer outstanding, including as a result of a conversion to Class I-PR shares. Class S-PR shares or Class D-PR shares held within a stockholder’s account shall automatically and without any action on the part of the holder thereof convert into a number of Class I-PR shares, at the applicable conversion rate on the earliest of: (i) a listing of any shares of our common stock on a national securities exchange; (ii) our merger or consolidation with or into another entity, or the sale or other disposition of all or substantially all of our assets; and (iii) the end of the month in which the Dealer Manager, in conjunction with our transfer agent, determines that the total upfront selling commissions, upfront dealer manager fees and ongoing distribution fees paid with respect to all shares of such class held by such stockholder within such account (including shares purchased through the DRIP or received as stock dividends) equals or exceeds the limit, if any, set forth in any applicable agreement between the Dealer Manager and a participating broker dealer, provided that the Dealer Manager advises our transfer agent of the lower limit in writing of the aggregate purchase price of all shares of such class held by such stockholder within such account and purchased in a primary offering.

Additional Underwriting Compensation and Primary Dealer Fee. We pay directly, or reimburse the Advisor and the Dealer Manager if they pay on our behalf, certain additional items of underwriting compensation, including legal fees of the Dealer Manager, costs reimbursement for registered representatives of participating broker-dealers to attend educational conferences sponsored by us or the Dealer Manager, attendance fees for registered persons associated with the Dealer Manager to attend seminars conducted by participating broker-dealers, and promotional items. In addition to this additional underwriting compensation, the Advisor may also pay the Dealer Manager additional amounts to fund certain of the Dealer Manager’s costs and expenses related to the distribution of our securities offering, which will not be reimbursed by us. Also, the Dealer Manager may pay supplemental fees or commissions to participating broker-dealers and servicing broker-dealers with respect to certain shares sold in the primary portions of our securities offerings, which will not be reimbursed by us. Through June 30, 2017, we paid to the Dealer Manager primary dealer fees in the amount of 5.0% of the gross proceeds raised from certain sales of Class I-R shares in the primary portion of our prior public offering. We currently do not intend to pay additional primary dealer fees in our securities offerings.

Organization and Offering Expense Reimbursement. We pay directly or reimburse the Advisor and the Dealer Manager if they pay on our behalf, any issuer organization and offering expenses (meaning organization and offering expenses other than underwriting compensation) as and when incurred. After the termination of the primary offering and again after termination of the offering under our distribution reinvestment plan, the Advisor has agreed to reimburse us to the extent that total cumulative organization and offering expenses (including underwriting compensation) that we incur exceed 15% of our gross proceeds from the applicable offering.

143

Table of Contents

Advisory Fee and Operating Expense Reimbursement. The advisory fee consists of a fixed component and a performance participation allocation. The fixed component of the advisory fee includes a fee that will be paid monthly to the Advisor for asset management services provided to on our behalf. The following table details the fixed component of the advisory fee:

​

​	​	​	​
​	****	Fixed Component	****
% of applicable monthly NAV per Fund Interest (as defined below) x the weighted-average number of Fund Interests for such month (per annum)		1.10	%
% of consideration received by us or our affiliates for selling interests in DST Properties (as defined in “Note 7”) to third-party investors, net of up-front fees and expense reimbursements payable out of gross sale proceeds from the sale of such interests		1.10	%

​

The performance participation allocation is a performance-based amount that will be paid to the Advisor. This amount is calculated on the basis of the overall investment return provided to holders of Fund Interests (i.e., our outstanding shares and OP Units held by third-party investors) in any calendar year such that the Advisor will receive the lesser of (1) 12.5% of (a) the annual total return amount less (b) any loss carryforward, and (2) the amount equal to (x) the annual total return amount, less (y) any loss carryforward, less (z) the amount needed to achieve an annual total return amount equal to 5% of the NAV per Fund Interest at the beginning of such year (the “Hurdle Amount”). The foregoing calculations are calculated on a per Fund Interest basis and multiplied by the weighted-average Fund Interests outstanding during the year. In no event will the performance participation allocation be less than zero. Accordingly, if the annual total return amount exceeds the Hurdle Amount plus the amount of any loss carryforward, then the Advisor will earn a performance participation allocation equal to 100% of such excess, but limited to 12.5% of the annual total return amount that is in excess of the loss carryforward. The “annual total return amount” referred to above means all distributions paid or accrued per Fund Interest plus any change in NAV per Fund Interest since the end of the prior calendar year, adjusted to exclude the negative impact on annual total return resulting from our payment or obligation to pay, or distribute, as applicable, the performance participation allocation as well as ongoing distribution fees (i.e., our ongoing class-specific fees). The “loss carryforward” referred to above tracks any negative annual total return amounts from prior years and offsets the positive annual total return amount for purposes of the calculation of the performance participation allocation. We completed the 2024 calendar year with a cumulative loss carryforward that will apply to future performance participation allocations. The cumulative loss carryforward as of December 31, 2024 is approximately $0.45 per Fund Interest (unaudited), which takes into account a $0.41 per Fund Interest loss carryforward (unaudited) generated in the 2023 calendar year. Realization of the loss carryforward is contingent on future performance. As such, the loss carryforward is not included in the consolidated balance sheet as of December 31, 2024. Even after the offset of the loss carryforward, future performance participation allocations will be subject to the Hurdle Amount. Additionally, the Advisor will provide us with a waiver of a portion of its fees generally equal to the amount of the performance participation allocation that would have been payable with respect to the Class E shares and the Series 1 Class E OP Units held by third parties until the NAV of such shares or units exceeds $10.00 a share or unit, the benefit of which will be shared among all holders of Fund Interests. As of December 31, 2024, all of the Class E OP Units issued and outstanding to third-party investors are Series 1 Class E OP Units. Refer to “Note 12” for detail regarding the Class E OP Units.

The allocation of the performance participation interest is ultimately determined at the end of each calendar year and will be paid in Class I-R OP units or cash, at the election of the Advisor. The performance hurdle was not achieved as of December 31, 2024 and 2023, therefore no performance participation allocation expense was recognized in our consolidated statements of operations for the years ended December 31, 2024 and 2023. As the performance hurdle was achieved as of December 31, 2022, we recognized approximately $23.7 million of performance participation allocation expense in our consolidated statements of operations.

On January 1, 2019, we, our Operating Partnership, and the Advisor amended the advisory agreement and limited partnership agreement of the Operating Partnership. The Operating Partnership also issued to Black Creek Diversified Property Advisors Group LLC (“BCDPAG”), for $1,000 in consideration, 100 partnership units in the Operating Partnership constituting a separate series of partnership interests with special distribution rights, or the “Special Units.” On July 1, 2021, these Special Units were transferred from BCDPAG to our New Advisor. Subsequently, these Special Units were transferred from our New Advisor to an affiliate of the New Advisor. 144

Table of Contents These agreements were amended, and the Special Units were issued, so that, at the election of the holder, the performance participation allocation previously payable to the Advisor may be paid instead to the holder of the Special Units as a performance participation allocation with respect to the Special Units. If the holder does not elect on or before the first day of a calendar year to have the performance participation allocation paid as a fee to the Advisor, then it will be paid as a distribution on the performance participation interest to the holder of the Special Units. In such case, the performance participation allocation will be payable in cash or Class I-R OP Units, at the election of the holder. If the holder elects to receive such distributions in Class I-R OP Units, the number of Class I-R OP Units to be issued to the holder will be determined by dividing an amount equal to the value of the performance participation allocation by the net asset value per Class I-R OP Unit as of the date of the distribution. The holder of the Special Units may request the Operating Partnership to repurchase such OP Units from the holder at a later date. Any such repurchase requests will normally not be subject to any holding period, early redemption deduction, volume limitations or other restrictions that apply to other holders of OP Units under the limited partnership agreement of the Operating Partnership or to our stockholders under our share redemption program. However, certain restrictions on redemption may apply if certain liquidity requirements are not met. In addition, in the event the Operating Partnership commences a liquidation of its assets during any calendar year, the holder of the Special Units will be distributed the performance participation allocation as its liquidation distribution, or the Advisor will receive payment of the performance participation allocation, as applicable, prior to the distribution of the remaining liquidation proceeds to the holders of OP Units.

The Special Units do not receive Operating Partnership distributions or allocations except as described above. Holders of Special Units do not share in distributions paid to holders of common OP Units and are not allocated income or losses of the Operating Partnership except to the extent of taxable income allocated to them in their capacity as holders of the Special Units.

Subject to certain limitations, we reimburse the Advisor or its affiliates for all of the costs they incur in connection with the services they provide to us under the Advisory Agreement, including, without limitation, our allocable share of the Advisor’s overhead, which includes but is not limited to the Advisor’s rent paid to both third parties and affiliates of the Advisor, utilities and personnel costs; provided, that we will not reimburse the Advisor or its affiliates for services for which the Advisor or its affiliates are entitled to compensation in the form of a separate fee, and commencing as of September 1, 2017, we will not reimburse the Advisor for compensation it pays to our named executive officers, unless the named executive officer is providing stockholder services.

Acquisition Expense Reimbursements. Pursuant to the Advisory Agreement, subject to certain limitations, we agreed to reimburse the Advisor for all acquisition expenses incurred on our behalf in connection with the selection and acquisition of properties, real estate-related assets, and other investments, whether or not such investments are acquired. As these expense reimbursements were not directly attributable to a specified property, they were expensed as incurred on the consolidated statements of operations.

Fees from Other Services. We retain certain of the Advisor’s affiliates, from time to time, for services relating to our investments or our operations, which may include property management services, leasing services, corporate services, statutory services, transaction support services, construction and development management, and loan management and servicing, and within one or more such categories, providing services in respect of asset and/or investment administration, accounting, technology, tax preparation, finance, treasury, operational coordination, risk management, insurance placement, human resources, legal and compliance, valuation and reporting-related services, as well as services related to mortgage servicing, group purchasing, healthcare, consulting/brokerage, capital markets/credit origination, property, title and/or other types of insurance, management consulting and other similar operational matters. Any fees paid to the Advisor’s affiliates for any such services will not reduce the advisory fees. Per the terms of the agreement, any such arrangements will be at market rates or a reimbursement of costs incurred by the affiliate in providing the services.

Property-Level Accounting Services. Pursuant to the Advisory Agreement effective as of May 1, 2022, we have agreed to pay the Advisor a property accounting fee in connection with providing services related to accounting for real property operations, including the maintenance of the real property’s books and records in accordance with GAAP and our policies, procedures, and internal controls, in a timely manner, and the processing of real property-related cash receipts and disbursements. The property accounting fee is equal to the difference between: (i) the property management fee charged with respect to each real property, which reflects the market rate for all real property management services, including property-level accounting services, based on rates charged for similar properties within the region or market in which the real property is located, and (ii) the amount paid to third-party property management firms for property management services, which fee is based on an arm’s length negotiation with a third-party property management service provider (the difference between (i) and (ii), the “property accounting fee”).

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Table of Contents DST Program

DST Program Dealer Manager Fees. In connection with the DST Program, as described in “Note 7,” Ares Diversified Real Estate Exchange LLC (“ADREX,” formerly known as Black Creek Exchange LLC), a wholly-owned subsidiary of our taxable REIT subsidiary that is wholly-owned by the Operating Partnership, entered into a dealer manager agreement with the Dealer Manager, pursuant to which the Dealer Manager agreed to conduct the private placements for interests reflecting an indirect ownership of up to $3.50 billion of interests. The Advisor, Dealer Manager and certain of their affiliates receive fees and reimbursements in connection with their roles in the DST Program, which costs are substantially funded by the private investors in that program, through fees and expenses paid by the investors at the time of investment, or deductions from distributions paid to such investors.

ADREX will pay certain up-front fees and reimburse certain related expenses to the Dealer Manager with respect to capital raised through the DST Program. ADREX is obligated to pay the Dealer Manager a dealer manager fee of up to 1.5% of gross equity proceeds raised and a commission of up to 5.0% of gross equity proceeds raised through the private placements. In addition, with respect to certain classes of interests (or the corresponding classes of OP Units or shares for which they may be exchanged in certain circumstances) we, the Operating Partnership or ADREX will pay the Dealer Manager ongoing fees in amounts up to 0.85% of the equity investment or net asset value thereof per year for Class T, Class S, and Class D OP Units. The Dealer Manager may re-allow such commissions, ongoing fees and a portion of such dealer manager fees to participating broker dealers. In addition, pursuant to the dealer manager agreement for the DST Program, we, or our subsidiaries, are obligated to reimburse the Dealer Manager for (a) customary travel, lodging, meals and reasonable entertainment expenses incurred in connection with the private placements; (b) costs and expenses of conducting educational conferences and seminars, attending broker-dealer sponsored conferences, or educational conferences sponsored by ADREX; (c) customary promotional items; and (d) legal fees of the Dealer Manager.

Pursuant to the Advisory Agreement, DST Properties are included when calculating the fixed advisory fee and the performance participation allocation due to the Advisor. Furthermore, because the Advisor funds certain Dealer Manager personnel costs that are not reimbursed under the DST Program dealer manager agreement, we have also agreed to pay the Advisor a fee equal to the fee paid by DST Program investors for these costs, which is up to 1.5% of the total equity amount paid for the interests.

DST Manager Fees. ADREX Manager LLC (formerly known as BC Exchange Manager LLC, the “DST Manager”), a wholly owned subsidiary of the Operating Partnership, acts, directly or through a wholly-owned subsidiary, as the manager of each Delaware statutory trust holding a DST Property, but has assigned all of its rights and obligations as manager (including fees and reimbursements received) to BC Exchange Advisor LLC (“DST Advisor”), an affiliate of the Advisor. While the intention is to sell 100% of the interests to third parties, ADREX may hold an interest for a period of time and therefore could be subject to the following description of fees and reimbursements paid to the DST Manager. The DST Manager will have primary responsibility for performing administrative actions in connection with the trust and any DST Property and has the sole power to determine when it is appropriate for a trust to sell a DST Property. For its services, DST Advisor will receive, through the DST Manager, (i) a management fee equal to a stated percentage (e.g., 1.0%) of the gross rents payable to the trust, with such amount to be set on a deal-by-deal basis, (ii) a loan fee of up to 1.0% for any financing provided by us in connection with the DST Program (in which case a subsidiary of ours would provide the debt financing and earn interest thereon, as discussed further below), (iii) reimbursement of certain expenses associated with the establishment, maintenance and operation of the trust and DST Properties and the sale of any DST Property to a third party, and (iv) up to 1.0% of the gross equity proceeds as compensation for developing and maintaining the DST Program technology and intellectual property. Furthermore, to the extent that the Operating Partnership exercises its fair market value purchase option to acquire the interests from the investors at a later time in exchange for OP Units, cash, or a combination of OP Units and cash, and such investors subsequently submit such OP Units for redemption pursuant to the terms of the Operating Partnership, a redemption fee of up to 1.0% of the amount otherwise payable to a limited partner upon redemption will be paid to DST Manager (or such other amount as may be set forth in the applicable DST Program offering documents).

In connection with the DST Program, ADREX maintains a loan program and may, upon request, provide DST Program Loans to certain purchasers of the interests in the Delaware statutory trusts to finance a portion of the purchase price payable upon their acquisition of such DST Interests (the “Purchase Price”). The DST Program Loans are made by a subsidiary of ours (the “DST Lender”). The DST Program Loans may differ in original principal amounts. The original principal amount of the DST Program Loans expressed as a percentage of the total Purchase Price for the applicable DST Interests may also vary, but no DST Program Loan to any purchaser will exceed 50% of the Purchase Price paid by such purchaser for its DST Interest in the Trust, excluding the amount of the Origination Fee, as hereinafter defined. Each purchaser that elects to obtain a DST Program Loan, will pay an origination fee to the DST Manager equal to up to 1.0% of the original principal amount of its DST Program Loan (the “Origination Fee”) upon origination of such DST Program Loan, which Origination Fee will be assigned by the DST Manager to an affiliate of the Advisor. 146

Table of Contents The purchaser will be required to represent, among other things, that no portion of the Purchase Price for its DST Interest and no fee paid in connection with the acquisition of its DST Interest (including, without limitation, the Origination Fee) has been or will be funded with any nonrecourse indebtedness other than the DST Program Loan.

Summary of Fees and Expenses

The table below summarizes the fees and expenses incurred by us for services provided by the Advisor and its affiliates, and by the Dealer Manager related to the services described above, and any related amounts payable:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,									Payable as of December 31,
(in thousands)	​	2024		****	2023		****	2022		****	2024		****	2023
Selling commissions and dealer manager fees (1)	​	$	282	​	$	1,189	​	$	4,289	​	$	—	​	$	—
Ongoing distribution fees (1)(2)	​	​	9,631	​	​	8,896	​	​	6,800	​	​	906	​	​	804
Advisory fees—fixed component	​	​	40,786	​	​	38,645	​	​	33,747	​	​	3,646	​	​	3,281
Performance participation allocation (3)	​		—	​		—	​		23,747	​		—	​		—
Other fees and expense reimbursements—Advisor (4)(5)	​		13,831	​		13,788	​		11,346	​		6,074	​		3,909
Other expense reimbursements—Dealer Manager	​		281	​		335	​		372	​		125	​		84
Property accounting fee (6)	​	​	2,070	​	​	1,884	​	​	1,289	​	​	187	​	​	170
DST Program selling commissions, dealer manager and distribution fees (1)	​		12,468	​		9,693	​		22,467	​		501	​		308
Other DST Program related costs—Advisor (5)	​		11,992	​		8,114	​		14,860	​		179	​		171
Total	​	$	91,341	​	$	82,544	​	$	118,917	​	$	11,618	​	$	8,727
(1)	All or a portion of these amounts will be retained by, or reallowed (paid) to, participating broker-dealers and servicing broker-dealers.
---	---
(2)	The distribution fees are payable monthly in arrears. Additionally, we accrue for future estimated amounts payable related to ongoing distribution fees. The future estimated amounts payable were approximately $69.9 million and $66.7 million as of December 31, 2024 and 2023, respectively.
---	---
(3)	The performance hurdle was not met for the years ended December 31, 2024 and 2023 and no performance participation allocation expense was recognized. The 2022 performance participation allocation in the amount of $23.7 million became payable on December 31, 2022, and the Advisor elected to settle the amounts owed in cash in January 2023.
---	---
(4)	Other expense reimbursements include certain expenses incurred for organization and offering, acquisition and general administrative services provided to us under the Advisory Agreement, including, but not limited to, certain expenses described below after footnote 6, allocated rent paid to both third parties and affiliates of our Advisor, equipment, utilities, insurance, travel and entertainment.
---	---
(5)	Includes costs reimbursed to the Advisor related to the DST Program.
---	---
(6)	The cost of the property management fee, including the property accounting fee, is generally borne by the tenant or tenants at each real property, either via a direct reimbursement to us or, in the case of tenants subject to a gross lease, as part of the lease cost. In certain circumstances, we may pay for a portion of the property management fee, including the property accounting fee, without reimbursement from the tenant or tenants at a real property.
---	---

Certain of the expense reimbursements described in the table above include a portion of the compensation expenses of officers and employees of the Advisor or its affiliates related to activities for which the Advisor did not otherwise receive a separate fee. Amounts incurred related to these compensation expenses for the years ended December 31, 2024, 2023 and 2022, were approximately $12.5 million, $12.6 million and $10.7 million, respectively. No reimbursement is made for compensation of our named executive officers unless the named executive officer is providing stockholder services, as outlined in the Advisory Agreement.

On December 31, 2023, an affiliate of our Sponsor acquired and internalized the activities of 3RE Partners, which provided construction supervision services related to our preferred equity investment. As of December 31, 2023, we had approximately $0.2 million of fees payable to 3RE Partners on our consolidated balance sheet for services provided during 2023 prior to the acquisition. 147

Table of Contents Advisory Agreement

Ares Real Estate Income Trust Inc., the Operating Partnership and the Advisor previously entered into that certain Second Amended and Restated Advisory Agreement (2023), effective as of June 3, 2023 (the “2023 Advisory Agreement”). The term of the 2023 Advisory Agreement continued through April 30, 2024, subject to an unlimited number of successive one-year renewals. Ares Real Estate Income Trust Inc., the Operating Partnership and the Advisor renewed the 2023 Advisory Agreement on substantially the same terms through April 30, 2025, by entering into the Amended and Restated Advisory Agreement (2024) (the “2024 Advisory Agreement”), effective as of April 30, 2024.

In addition to the renewal, the 2024 Advisory Agreement amended the 2023 Advisory Agreement by clarifying that the property accounting services provided by the Advisor do not include financial systems and software and consultants related thereto, and that the Advisor may be reimbursed for expenses related to such financial systems and software and consultants related thereto.

On August 2, 2024, Ares Real Estate Income Trust Inc., the Operating Partnership and the Advisor amended and restated the 2024 Advisory Agreement by entering into the Second Amended and Restated Advisory Agreement (2024) (the “Amended Advisory Agreement”). The Amended Advisory Agreement amends the 2024 Advisory Agreement to make immaterial changes regarding the Private Offering and related matters.

Limited Partnership Agreement

On August 2, 2024, Ares Real Estate Income Trust Inc. and AREIT Incentive Fee LP, an affiliate of our Advisor, replaced the then-current limited partnership agreement of the Operating Partnership by entering into a Thirteenth Amended and Restated Limited Partnership Agreement (the “Amended OP Agreement”). The Amended OP Agreement reflects revised classes of limited partnership units that correspond to the revisions to our share classes described below and other immaterial changes regarding the Private Offering and related matters.

Transactions with Affiliates

We initially contributed $2,000 into the Operating Partnership in exchange for 200 OP Units, representing the sole general partner interest in the Operating Partnership. Subsequently, we contributed 100% of the gross proceeds received from our securities offerings of common stock to the Operating Partnership in exchange for OP Units representing our interest as a limited partner of the Operating Partnership. As of December 31, 2024 and 2023, we held a 53.1% and 71.1%, respectively, limited partnership interest in the Operating Partnership. The remaining limited partnership interests in the Operating Partnership are held by third-party investors, which are classified as noncontrolling interests on the consolidated balance sheets. See “Note 12” for detail regarding our noncontrolling interests.

Student Housing Investment Arrangement

The changes in the Amended Advisory Agreement and Amended OP Agreement described above were made in contemplation of a Project Specialist arrangement in student housing investments. Under this arrangement, affiliates of Timberline Real Estate Ventures (“Timberline”), a fully integrated, operationally focused privately held real estate operator and investment manager specializing in the development, acquisition and operation of student housing, multifamily, and mixed-use retail/residential communities, will enter into a joint venture with affiliates of the Advisor to create a Product Specialist (collectively, with its affiliated entities, the “Student Housing Product Specialist”). For each student housing investment by the Company made through the Student Housing Product Specialist, the Student Housing Product Specialist will be retained under a management services agreement, engaged as property manager under a property management agreement and receive a profits interest through the Operating Partnership in such investment. The Student Housing Product Specialist will be paid fees for the services it provides. The Advisor or its affiliates will have an economic interest in these agreements except the profits interests, with respect to which the Advisor and its affiliates will have no economic interest. With respect to each student housing investment made under this arrangement, an affiliate of the Student Housing Project Specialist will receive a profits interest through the Operating Partnership. As of and for the year ended December 31, 2024, there have been no student housing investments made through this arrangement nor have any fees been incurred with the Student Housing Product Specialist. 148

Table of Contents Mortgage Loan Origination Program

On November 15, 2024, our board of directors approved a mortgage origination program (the “Origination Program”), pursuant to which our Advisor has been delegated authority to originate and sell mortgage loans. The purpose of the Origination Program is to allow us to earn origination fees for originating mortgage loans. Our intention is to sell such mortgage loans to another party within a short period. When sold, a portion of the origination fees earned may be passed onto the subsequent purchaser of the loan. Under the terms of the Origination Program, loans may be sold to affiliates of the Advisor, including joint venture partnerships in which we have an interest, provided each party is responsible for their own expenses and there are no transaction, management or other fees paid by us (apart from fees and expenses it pays pursuant to the Advisory Agreement with our Advisor). We may have a direct or indirect interest in an Ares-managed fund or investment program that acquires such loans. The Origination Program authorizes the Advisor to approve co-lending arrangements for mortgage loans originated under the program, including with affiliates of the Advisor, pursuant to which we may originate a portion of a larger mortgage loan. Each co-lender must be responsible for their own expenses and there may be no transaction, management or other fees paid by us to the other co-lenders (apart from fees and expenses it pays pursuant to the Advisory Agreement with our Advisor). As of December 31, 2024, we had originated one mortgage loan for which there was a co-lending arrangement with an affiliate of our Advisor. The carrying amount and outstanding principal amount was $193.9 million and $196.0 million, respectively, as of December 31, 2024. During the year ended December 31, 2024, we had not sold any mortgage loans originated under the Origination Program to any affiliates of our Advisor.

14. NET INCOME (LOSS) PER COMMON SHARE

The computation of our basic and diluted net income (loss) per share attributable to common stockholders is as follows:

​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands, except per share data)	​	2024		****	2023		****	2022
Net loss attributable to common stockholders—basic	​	$	(37,135)	​	$	(62,427)	​	$	(39,979)
Net loss attributable to redeemable noncontrolling interests	​	​	(273)	​	​	(597)	​	​	(370)
Net loss attributable to noncontrolling interests	​		(19,935)	​		(20,189)	​		(9,314)
Net loss attributable to common stockholders—diluted	​	$	(57,343)	​	$	(83,213)	​	$	(49,663)
Weighted-average shares outstanding—basic	​		188,336	​		203,291	​		194,039
Incremental weighted-average shares effect of conversion of noncontrolling interests	​		116,843	​		64,265	​		39,265
Weighted-average shares outstanding—diluted	​		305,179	​		267,556	​		233,304
Net loss per share attributable to common stockholders:	​			​			​
Basic	​	$	(0.20)	​	$	(0.31)	​	$	(0.21)
Diluted	​	$	(0.20)	​	$	(0.31)	​	$	(0.21)

​

​ 149

Table of Contents 15. SUPPLEMENTAL CASH FLOW INFORMATION

Supplemental cash flow information and disclosure of non-cash investing and financing activities is as follows:

​

​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	****	2024		****	2023		****	2022
Supplemental disclosure of cash activities:	​	​	​	​	​	​	​	​	​
Interest paid related to consolidated indebtedness	​	$	99,434	​	$	78,260	​	$	53,889
Interest paid related to DST Program	​	​	62,618	​	​	55,586	​	​	42,008
Cash paid for income taxes	​	​	8,225	​	​	—	​	​	—
Supplemental disclosure of non-cash investing and financing activities:	​	​	​	​	​	​	​	​	​
Distributions reinvested in common stock	​		32,112	​		32,618	​		29,442
Increase in accrued future ongoing distribution fees	​		3,266	​		5,737	​		26,855
Increase in DST Program Loans receivable through DST Program capital raising	​	​	63,332	​	​	51,360	​	​	51,496
Redeemable noncontrolling interests issued as settlement of performance participation allocation	​	​	—	​	​	—	​	​	15,327
Issuances of OP Units for DST Interests	​	​	639,102	​	​	228,301	​	​	252,578
Changes in assets, liabilities and noncontrolling interests from consolidation of joint venture partnership:	​	​	​	​	​	​	​	​	​
Net investment in real estate properties	​	​	75,506	​	​	—	​	​	—
Other assets	​	​	1,052	​	​	—	​	​	—
Accounts payable and accrued expenses	​	​	(550)	​	​	—	​	​	—
Debt, net	​	​	(51,471)	​	​	—	​	​	—
Other liabilities	​	​	(297)	​	​	—	​	​	—
Noncontrolling interests	​	​	(4,033)	​	​	—	​	​	—

​

Restricted Cash

Restricted cash consists of lender and property-related escrow accounts. The following table presents the components of the beginning of period and end of period cash, cash equivalents and restricted cash reported within the consolidated statements of cash flows:

​

​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	​	2024		****	2023		****	2022
Beginning of period:	​	​	​	​	​	​	​	​	​
Cash and cash equivalents	​	$	15,052	​	$	13,336	​	$	10,605
Restricted cash	​		4,614	​		3,850	​		3,747
Cash, cash equivalents and restricted cash	​	$	19,666	​	$	17,186	​	$	14,352
End of period:	​	​	​	​	​	​	​	​	​
Cash and cash equivalents	​	$	19,554	​	$	15,052	​	$	13,336
Restricted cash	​		7,865	​		4,614	​		3,850
Cash, cash equivalents and restricted cash	​	$	27,419	​	$	19,666	​	$	17,186

​

​

​

​ 150

Table of Contents 16. COMMITMENTS AND CONTINGENCIES

Litigation

From time to time, we and our subsidiaries may be involved in various claims and legal actions arising in the ordinary course of business. As of December 31, 2024, we and our subsidiaries were not involved in any material legal proceedings.

Environmental Matters

A majority of the properties we acquire have been or will be subject to environmental reviews either by us or the previous owners. In addition, we may incur environmental remediation costs associated with certain land parcels we may acquire in connection with the development of land. We have acquired or may in the future acquire certain properties in urban and industrial areas that may have been leased to or previously owned by commercial and industrial companies that discharged hazardous materials. We may purchase various environmental insurance policies to mitigate our exposure to environmental liabilities. We are not aware of any unmitigated environmental liabilities that we believe would have a material adverse effect on our business, financial condition, or results of operations as of December 31, 2024.

Unfunded Commitments

As of December 31, 2024, we had unfunded commitments of $256.6 million to fund various investments in real estate debt and securities and investments in unconsolidated joint venture partnerships.

17. SEGMENT FINANCIAL INFORMATION

Our six reportable segments are residential properties, industrial properties, retail properties, office properties, other properties and investments in real estate debt and securities. Factors used to determine our reportable segments include the physical and economic characteristics of our properties and/or investments and the related operating activities. Our chief operating decision maker (“CODM”) is Jay W. Glaubach, Partner and Co-President.

Our CODM relies on net operating income, among other factors, to make decisions about allocating resources and assessing segment performance. Net operating income is the key performance metric that captures the unique operating characteristics of each segment. Net investment in real estate properties, investments in real estate debt and securities, restricted cash, tenant receivables, straight-line rent receivables and other assets directly assignable to a property or investment are allocated to the segment groupings. Corporate items that are not directly assignable to a property, such as investments in unconsolidated joint venture partnerships and DST Program Loans, are not allocated to segment groupings, but are reflected as reconciling items.

The following table reflects our total consolidated assets by segment as of December 31, 2024 and 2023:

​	​	​	​	​	​	​
​	​	As of
(in thousands)	****	December 31, 2024 (1)		​	December 31, 2023
Assets:	​	​	​	​	​	​
Residential properties	​	$	2,126,453	​	$	1,658,945
Industrial properties	​		1,664,506	​		1,353,331
Retail properties	​		497,184	​		509,307
Office properties	​	​	367,025	​	​	373,467
Other properties (2)	​	​	149,847	​	​	55,130
Investments in real estate debt and securities	​	​	353,258	​	​	370,176
Total segment assets	​	​	5,158,273	​	​	4,320,356
Corporate	​		572,976	​		319,050
Total assets	​	$	5,731,249	​	$	4,639,406
(1)	As of December 31, 2024, our debt-related investment classified as held for sale is included in the corporate grouping.
---	---
(2)	Includes self-storage properties.
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​ 151

Table of Contents We consider net operating income, a non-GAAP financial measure, to be an appropriate supplemental performance measure and believe net operating income provides useful information regarding our financial condition and results of operations because net operating income reflects the operating performance of our investments and excludes certain items that are not considered to be controllable in connection with the management of the investments, such as real estate-related depreciation and amortization, general and administrative expenses, advisory fees, impairment charges, interest expense, gains on sale of properties, other income and expenses, gains and losses on the extinguishment of debt and noncontrolling interests. However, net operating income should not be viewed as an alternative measure of our financial performance since it excludes such items, which could materially impact our results of operations. Further, our net operating income may not be comparable to that of other real estate companies, as they may use different methodologies for calculating net operating income. Therefore, we believe net income, as defined by GAAP, to be the most appropriate measure to evaluate our overall financial performance.

The following table is a reconciliation of our reported net income (loss) attributable to common stockholders to our net operating income for the years ended December 31, 2024, 2023 and 2022.

​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
(in thousands)	​	2024		****	2023		****	2022
Net loss attributable to common stockholders	​	$	(37,135)	​	$	(62,427)	​	$	(39,979)
Real estate-related depreciation and amortization	​		152,777	​		149,985	​		134,617
General and administrative expenses	​		12,808	​		11,824	​		10,570
Advisory fees	​		40,786	​		38,645	​		33,747
Performance participation allocation	​		—	​		—	​		23,747
Acquisition costs and reimbursements	​		7,034	​		7,034	​		5,427
Valuation allowance on debt-related investment	​		—	​		(1,799)	​		1,799
(Income) loss from unconsolidated joint venture partnerships	​	​	(14,531)	​	​	3,578	​	​	(2,970)
Interest expense	​		188,318	​		148,517	​		140,406
Gain on sale of real estate property	​		(12,913)	​		(36,884)	​		(94,827)
Unrealized loss on DST Program Loans	​	​	17	​	​	—	​	​	—
Unrealized loss (gain) on financing obligations	​	​	2,034	​		(932)	​		—
(Gain) loss on extinguishment of debt and financing obligations, net	​		(41,050)	​		700	​		—
Gain on derivative instruments	​	​	(402)	​	​	(126)	​	​	(4,723)
Provision for current expected credit losses	​	​	(1,533)	​	​	1,997	​	​	—
Other income and expenses	​	​	(6,583)	​	​	(4,950)	​	​	(2,860)
Income tax expense	​	​	11,842	​	​	—	​	​	—
Net loss attributable to redeemable noncontrolling interests	​	​	(273)	​	​	(597)	​	​	(370)
Net loss attributable to noncontrolling interests	​		(19,935)	​		(20,189)	​		(9,314)
Net operating income	​	$	281,261	​	$	234,376	​	$	195,270

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Table of Contents The following table sets forth consolidated financial results by segment for the years ended December 31, 2024, 2023 and 2022:

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	​		****	​		****	​		****	​		****	Other		****	Debt and		****	​
(in thousands)	****	Residential		****	Industrial		****	Retail		****	Office		****	Properties		****	Securities		****	Consolidated
2024	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Rental revenues	​	$	140,014	​	$	112,376	​	$	61,206	​	$	50,103	​	$	7,152	​	$	—	​	$	370,851
Debt-related income	​	​	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	46,642	​	​	46,642
Rental expenses		​	(66,268)		​	(27,817)		​	(15,880)		​	(23,422)		​	(2,845)		​	—		​	(136,232)
Net operating income	​	$	73,746	​	$	84,559	​	$	45,326	​	$	26,681	​	$	4,307	​	$	46,642	​	$	281,261
2023	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Rental revenues	​	$	120,706	​	$	91,145	​	$	58,916	​	$	51,096	​	$	132	​	$	—	​	$	321,995
Debt-related income	​	​	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	31,175	​	​	31,175
Rental expenses	​	​	(57,923)		​	(20,083)		​	(15,575)		​	(25,165)		​	(48)		​	—	​	​	(118,794)
Net operating income	​	$	62,783	​	$	71,062	​	$	43,341	​	$	25,931	​	$	84	​	$	31,175	​	$	234,376
2022	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Rental revenues	​	$	98,524	​	$	74,244	​	$	64,039	​	$	52,427	​	$	—	​	$	—	​	$	289,234
Debt-related income	​	​	—	​	​	—	​	​	—	​	​	—	​	​	—	​	​	9,989	​	​	9,989
Rental expenses	​	​	(44,292)	​	​	(17,308)	​	​	(17,080)	​	​	(25,273)	​	​	—	​	​	—	​	​	(103,953)
Net operating income	​	$	54,232	​	$	56,936	​	$	46,959	​	$	27,154	​	$	—	​	$	9,989	​	$	195,270
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​

​

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1

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18. SUBSEQUENT EVENTS

Disposition of Real Property

Subsequent to December 31, 2024, we sold three industrial properties for an aggregate contractual sale price of $27.6 million. Our total accounting basis, which is inclusive of straight-line rent receivables and net of accumulated depreciation and amortization, for these properties as of the closing dates was approximately $16.1 million.

Disposition of Debt-Related Investment

Subsequent to December 31, 2024, we sold one debt-related investment, which was classified as held for sale as of December 31, 2024, to a joint venture partnership in which we have an ownership interest for a sale price of $194.5 million, equal to the carrying cost of the debt-related investment on the date of sale.

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Table of Contents ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

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ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Under the direction of our principal executive officer and principal financial officer, we evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of December 31, 2024. Based on this evaluation, our principal executive officer and principal financial officer have concluded that, as of December 31, 2024, our disclosure controls and procedures were effective.

Internal Control Over Financial Reporting

Management’s Annual Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2024, based upon criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013). Based on that evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2024.

Changes in Internal Control Over Financial Reporting

There have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the year ended December 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

​

ITEM 9B.OTHER INFORMATION

Distribution Reinvestment Plan Suitability Requirement

Pursuant to the terms of our distribution reinvestment plan (“DRIP”), participants in the DRIP must promptly notify us if at any time they fail to meet the current suitability requirements for making an investment in us.

The current suitability standards for Class E stockholders participating in the DRIP are listed in the section entitled “Suitability Standards” in our current Class E prospectus on file at www.sec.gov.

The current suitability standards for Class T-R, Class S-R, Class D-R and Class I-R stockholders participating in the DRIP are listed in the section entitled “Suitability Standards” in our current Class T-R, Class S-R, Class D-R and Class I-R fourth public offering prospectus on file at www.sec.gov.

Stockholders can notify us of any changes to their ability to meet the suitability requirements or change their DRIP election by contacting us at Ares Real Estate Income Trust Inc., Investor Relations, One Tabor Center, 1200 Seventeenth Street, Suite 2900, Denver, Colorado 80202, Telephone: (303) 228-2200.

Rule 10b5-1 Trading Plans

During the year ended December 31, 2024, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of the Company’s securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.” 154

Table of Contents

Unregistered Sales of Equity Securities

From February 3, 2025 through March 3, 2025, the Company issued the following shares in transactions exempt from the registration provisions of the Securities Act of 1933, as amended, pursuant to Regulation D.

The following table details the shares issued and gross proceeds:

​	​	​	​	​	​
​	​	Number of	​	​	​
​		Shares Issued	​	Gross Proceeds
Class S-PR Shares (1)(2)	​	625,179	​	$	4,798,007
Class I-PR Shares (1)	​	780,227	​	$	5,930,510
(1)	Number of shares issued and gross proceeds include activity from shares issued pursuant to our distribution reinvestment plan.
---	---
(2)	Gross proceeds for Class S-PR shares include upfront selling commissions and dealer manager fees, in aggregate, of $38,975.
---	---

​

​

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

​

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this item will be included under the headings “Board of Directors,” “Executive Officers,” “Section 16(a) Beneficial Ownership Reporting Compliance” and “Corporate Governance” in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, and such required information is incorporated herein by reference.

​

ITEM 11. EXECUTIVE COMPENSATION

The information required by this item will be included under the heading “Compensation of Directors and Executive Officers” in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, and such required information is incorporated herein by reference.

​

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by this item will be included under the heading “Security Ownership of Certain Beneficial Owners and Management” in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, and such required information is incorporated herein by reference.

​

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this item will be included under the heading “Certain Relationships and Related Transactions” in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, and such required information is incorporated herein by reference.

​

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item will be included under the heading “Principal Accountant Fees and Services” in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, and such required information is incorporated herein by reference.

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Table of Contents ​

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a)	1. Financial Statements—The financial statements are included under Item 8 of this report.

2. Financial Statement Schedule—The following financial statement schedule is included in Item 15(c):

Schedule III—Real Estate and Accumulated Depreciation.

All other financial statement schedules are not required under the related instructions or because the required information has been disclosed in the consolidated financial statements and the notes related thereto.

(b)	Exhibits

The following exhibits are filed as part of this Annual Report on Form 10-K:

Exhibit<br><br>Number		Description
​	​	​
3.1	​	Second Articles of Restatement. Incorporated by reference to Exhibit 3.3 to the Current Report on Form 8-K filed with the SEC on August 6, 2024.
​	​	​
3.2	​	Tenth Amended and Restated Bylaws. Incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC on March 3, 2023.
​	​	​
4.1	​	Sixth Amended and Restated Distribution Reinvestment Plan. Incorporated by reference to Exhibit 99.2 to the Current Report filed with the SEC on August 6, 2024.
​	​	​
4.2	​	Private Offering Distribution Reinvestment Plan. Incorporated by reference to Exhibit 4.2 to the Quarterly Report on Form 10-Q filed with the SEC on November 12, 2024.
​	​	​
4.3	​	Fourth Amended and Restated Share Redemption Program, effective as of August 2, 2024. Incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed with the SEC on August 6, 2024.
​	​	​
4.4	​	Statement regarding transfer restrictions, preferences, limitations and rights of holders of shares of common stock (to appear on stock certificate or to be sent upon request and without charge to stockholders issued shares without certificates). Incorporated by reference to Exhibit 4.3 to the Post-Effective Amendment No. 30 to Registration Statement on Form S-11 (File No. 333-252212) filed with the SEC on August 22, 2024.
​	​	​
4.5	​	Multiple Class Plan. Incorporated by reference to Exhibit 99.4 to the Current Report on Form 8-K filed with the SEC on August 6, 2024.
​	​	​
4.6*	​	Description of Securities Registered Pursuant to Section 12(g) of the Securities Exchange Act of 1934.
​	​	​
10.1	​	Second Amended and Restated Advisory Agreement (2024), effective as of August 2, 2024. Incorporated by reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q filed with the SEC on November 12, 2024.
​	​	​
10.2	​	Form of Indemnification Agreement for officers and directors. Incorporated by reference to Exhibit 10.4 to Amendment No. 5 to the Registration Statement on Form S-11 (File No. 333-125338) filed with the SEC on January 13, 2006.
​	​	​
10.3	​	Second Amended and Restated Equity Incentive Plan. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on June 24, 2015.
​	​	​
10.4	​	Amended and Restated Secondary Equity Incentive Plan. Incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed with the SEC on June 24, 2015.

156

Table of Contents	Exhibit<br><br>Number		Description
​	​	​
​	​	​
10.5	​	Form of Independent Director Restricted Stock Unit Agreement. Incorporated by reference to Exhibit 10.17 to the Annual Report on Form 10-K filed with the SEC on March 10, 2014.
​	​	​
10.6	​	Facilitation Fee Agreement between Ares Diversified Real Estate Exchange LLC (formerly Black Creek Exchange LLC) and Ares Commercial Real Estate Management as successor in interest to Black Creek Diversified Property Advisors LLC. Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K, filed August 17, 2018.
​	​	​
10.7	​	Side Letter between ADREX Manager LLC (formerly BC Exchange Manager LLC) and BC Exchange Advisor LLC. Incorporated by reference to Exhibit 10.30 to the Post-Effective Amendment No. 10 to Registration Statement on Form S-11 (File No. 333-197767) filed with the SEC on September 1, 2017.
​	​	​
10.8	​	Amendment to Agreement between ADREX Manager LLC (formerly BC Exchange Manager LLC) and BC Exchange Advisor LLC. Incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K filed with the SEC on August 17, 2018.
​	​	​
10.9	​	Second Amendment to Agreement between ADREX Manager (formerly BC Exchange Manager LLC) and BC Exchange Advisor LLC. Incorporated by reference to Exhibit 10.6 to the Current Report on Form 8-K filed with the SEC on August 17, 2018.
​	​	​
10.10	​	Selected Dealer Agreement with Morgan Stanley Smith Barney LLC. Incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on October 13, 2017.
​	​	​
10.11	​	Fourth Amended and Restated Dealer Manager Agreement, including Form of Selected Dealer Agreement. Incorporated by reference to Exhibit 1.1 to the Post-Effective Amendment No. 1 to Registration Statement on Form S-11A (File No. 333-252212) filed with the SEC on January 11, 2022.
​	​	​
10.12	​	Third Amendment to Agreement between ADREX Manager LLC (formerly BC Exchange Manager LLC) and BC Exchange Advisor LLC. Incorporated by reference to Exhibit 10.38 of the Company’s Annual Report on Form 10-K filed with the SEC on March 6, 2019.
​	​	​
10.13	​	Form of Trust Agreement. Incorporated by reference to Exhibit 10.21 to the Annual Report on Form 10-K filed with the SEC on March 5, 2020.
​	​	​
10.14	​	Form of Master Lease. Incorporated by reference to Exhibit 10.22 to the Annual Report on Form 10-K filed with the SEC on March 5, 2020.
​	​	​
10.15	​	Form of Guaranty. Incorporated by reference to Exhibit 10.23 to the Annual Report on Form 10-K filed with the SEC on March 5, 2020.
​	​	​
10.16	​	First Amendment to Facilitation Fee Agreement between Ares Diversified Real Estate Exchange LLC (formerly Black Creek Exchange LLC) and Ares Commercial Real Estate Management as successor in interest to Black Creek Diversified Property Advisors LLC. Incorporated by reference to Exhibit 10.24 to the Annual Report on Form 10-K filed with the SEC on March 5, 2020.
​	​	​
10.17	​	Thirteenth Amended and Restated Limited Partnership Agreement of AREIT Operating Partnership LP dated as of August 2, 2024. Incorporated by reference to Exhibit 10.4 to the Quarterly Report on Form 10-Q filed with the SEC on November 12, 2024.
​	​	​	157

Table of Contents	Exhibit<br><br>Number		Description
​	​	​
10.18	​	Second Amended and Restated Dealer Manager Agreement between Ares Diversified Real Estate Exchange LLC (formerly Black Creek Exchange LLC) and Ares Wealth Management Solutions LLC (formerly Black Creek Capital Markets, LLC). Incorporated by reference to Exhibit 10.26 to the Annual Report on Form 10-K filed with the SEC on March 5, 2020.
​	​	​
10.19	​	Third Amended and Restated Credit and Term Loan Agreement by and among AREIT Operating Partnership LP (f/k/a Black Creek Diversified Property Operating Partnership LP) and Bank of America, N.A and the lenders thereto. Incorporated by reference to Exhibit 10.20 to the Post-Effective Amendment No. 1 to Registration Statement on Form S-11A (File No. 333-252212) filed with the SEC on January 11, 2022.
​	​	​
10.20	​	Real Estate Purchase and Sale Agreement, dated April 7, 2022, for the purchase of the Sherman Portfolio. Incorporated by reference to Exhibit 10.21 to the Post-Effective Amendment No. 48 to Registration Statement on Form S-11 (File No. 333-222630) filed with the SEC on April 14, 2022.
​	​	​
10.21	​	First Amendment to Credit Agreement, dated as of July 18, 2022, among AREIT Operating Partnership LP (f/k/a Black Creek Diversified Property Operating Partnership LP), the Guarantors party thereto, the Lenders party thereto, and Bank of America, N.A. Incorporated by reference to Exhibit 10.21 to the Annual Report on Form 10-K filed with the SEC on March 20, 2023.
​	​	​
10.22	​	Second Amendment to Credit Agreement, dated as of October 14, 2022, among AREIT Operating Partnership LP (f/k/a Black Creek Diversified Property Operating Partnership LP), the Guarantors party thereto, the Lenders party thereto, and Bank of America, N.A. Incorporated by reference to Exhibit 10.22 to the Annual Report on Form 10-K filed with the SEC on March 20, 2023.
​	​	​
10.23	​	Form of Profit Interest Grant Letter. Incorporated by reference to Exhibit 10.23 to the Annual Report on Form 10-K filed with the SEC on March 13, 2024.
​	​	​
10.24	​	Form of Property Management Agreement. Incorporated by reference to Exhibit 10.4 to the Quarterly Report on Form 10-Q filed with the SEC on August 11, 2023.
​	​	​
10.25	​	Form of Management Services Agreement. Incorporated by reference to Exhibit 10.5 to the Quarterly Report on Form 10-Q filed with the SEC on August 11, 2023.
​	​	​
10.26	​	Third Amendment to Third Amended and Restated Credit and Term Loan Agreement, dated August 18, 2023, among AREIT Operating Partnership LP (f/k/a Black Creek Diversified Property Operating Partnership LP), the Guarantors party thereto, the Lenders party thereto, and Bank of America, N.A. Incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed with the SEC on November 13, 2023.
​	​	​
10.27	​	Dealer Manager Agreement, dated August 2, 2024, by and between Ares Real Estate Income Trust Inc. and Ares Wealth Management Solutions, LLC. Incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q filed with the SEC on November 12, 2024.
​	​	​
10.28	​	Form of Selected Dealer Agreement. Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q filed with the SEC on November 12, 2024.
​	​	​
10.29	​	Fourth Amendment to Third Amended and Restated Credit and Term Loan Agreement, dated as of June 27, 2024, among AREIT Operating Partnership LP (f/k/a Black Creek Diversified Property Operating Partnership LP) and Bank of America, N.A, as Administrative Agent. Incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q filed with the SEC on August 12, 2024.
​	​	​	158

Table of Contents

Exhibit<br><br>Number		Description
​	​	​
10.30	​	Fifth Amendment to Third Amended and Restated Credit and Term Loan Agreement, dated as of September 24, 2024, among AREIT Operating Partnership LP (f/k/a Black Creek Diversified Property Operating Partnership LP), the Guarantors party hereto, the Lenders party hereto, and Bank of America, N.A, as Administrative Agent. Incorporated by reference to Exhibit 10.5 to the Quarterly Report on Form 10-Q filed with the SEC on November 12, 2024.
​	​	​
10.31*	​	Loan Agreement, dated as of October 1, 2024, between JPMorgan Chase Bank, National Association, Morgan Stanley Bank, N.A., and Natixis Real Estate Capital LLC, as lenders, and each of certain subsidiaries of AREIT Operating Partnership LP, as borrowers.
​	​	​
19.1*	​	Insider Trading Policy.
​	​	​
21.1*	​	List of Subsidiaries of Ares Real Estate Income Trust Inc.
​	​	​
23.1*	​	Consent of KPMG LLP.
​	​	​
31.1*	​	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
​	​	​
31.2*	​	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
​	​	​
32.1*	​	Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
​	​	​
99.1*	​	Consent of Altus Group U.S., Inc.
​	​	​
99.2	​	Net Asset Value Calculation and Valuation Procedures. Incorporated by reference to Exhibit 99.3 to the Current Report on Form 8-K filed with the SEC on August 6, 2024.
​	​	​
101	​	The following materials from Ares Real Estate Income Trust Inc.’s Annual Report on Form 10-K for the year ended December 31, 2024, filed on March 6, 2025, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements of Comprehensive Income (Loss); (iv) Consolidated Statements of Equity; (v) Consolidated Statements of Cash Flows; and (vi) Notes to Consolidated Financial Statements.
​	​	​
104	​	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
*	Filed or furnished herewith.
---	---

​

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Table of Contents ARES REAL ESTATE INCOME TRUST INC.

SCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATION

As of December 31, 2024

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	Initial Cost to Company								​	​	​	​	​	Gross Amount Carried at December 31, 2024							​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	Cost		​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	Capitalized or		​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	Buildings and		​	​	​	​	Adjustments		​	​	​	​	Buildings and		​	​	​	​	Accumulated		​	​
​	​	​	No. of	​	​	​	​	​	​	​	Improvements		​	​	​	​	Subsequent to		​	​	​	​	Improvements		​	Total Costs		​	Depreciation		​	​
( in thousands)	Location	****	Buildings	****	Debt (1)		****	Land		****	(2)		****	Total Costs		****	Acquisition (4)		****	Land		****	(2)		****	(3, 4)		****	(4, 5, 6)		****	Acquisition Date
Residential properties:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
The Daley	Rockville, MD	​	4	​	$	60,215	​	$	15,139	​	$	80,500	​	$	95,639	​	$	1,034	​	$	15,139	​	$	81,534	​	$	96,673	​	$	(14,070)	​	7/2/2019
Juno Winter Park	Winter Park, FL	​	1	​	​	46,306	​	​	9,129	​	​	75,420	​	​	84,549	​	​	1,147	​	​	9,129	​	​	76,567	​	​	85,696	​	​	(12,163)	​	7/9/2019
Perimeter	Sandy Springs, GA	​	1	​	​	67,682	​	​	17,407	​	​	99,763	​	​	117,170	​	​	709	​	​	17,407	​	​	100,472	​	​	117,879	​	​	(16,242)	​	12/19/2019
The Palms	Davie, FL	​	15	​	​	62,154	​	​	18,737	​	​	60,475	​	​	79,212	​	​	3,736	​	​	18,737	​	​	64,211	​	​	82,948	​	​	(9,737)	​	11/3/2020
oLiv Tucson	Tucson, AZ	​	1	​	​	80,600	​	​	—	​	​	125,003	​	​	125,003	​	​	692	​	​	—	​	​	125,695	​	​	125,695	​	​	(11,798)	​	10/20/2021
Arabelle Clearwater	Clearwater, FL	​	10	​	​	60,843	​	​	11,633	​	​	104,719	​	​	116,352	​	​	178	​	​	11,633	​	​	104,897	​	​	116,530	​	​	(10,179)	​	11/30/2021
Vue 1400	West Palm Beach, FL	​	1	​	​	51,551	​	​	12,835	​	​	69,800	​	​	82,635	​	​	—	​	​	12,835	​	​	69,800	​	​	82,635	​	​	(7,129)	​	12/21/2021 (7)
Arabelle Riverwalk	Tampa Bay, FL	​	1	​	​	117,063	​	​	20,005	​	​	214,045	​	​	234,050	​	​	714	​	​	20,005	​	​	214,759	​	​	234,764	​	​	(19,574)	​	12/28/2021
Skye 750	King of Prussia, PA	​	1	​	​	—	​	​	12,535	​	​	80,310	​	​	92,845	​	​	431	​	​	12,535	​	​	80,741	​	​	93,276	​	​	(7,719)	​	1/5/2022
Arabelle City Center	Pembroke, FL	​	11	​	​	—	​	​	15,776	​	​	141,006	​	​	156,782	​	​	2,482	​	​	15,776	​	​	143,488	​	​	159,264	​	​	(12,530)	​	4/12/2022
Dallas Cityline	Richardson, TX	​	1	​	​	—	​	​	6,281	​	​	104,812	​	​	111,093	​	​	913	​	​	6,281	​	​	105,725	​	​	112,006	​	​	(9,522)	​	4/13/2022
Dallas Wycliff	Dallas, TX	​	3	​	​	—	​	​	14,021	​	​	80,062	​	​	94,083	​	​	1,688	​	​	14,021	​	​	81,750	​	​	95,771	​	​	(7,571)	​	4/13/2022
Dallas Maple District	Dallas, TX	​	2	​	​	—	​	​	14,725	​	​	78,364	​	​	93,089	​	​	1,106	​	​	14,725	​	​	79,470	​	​	94,195	​	​	(7,203)	​	4/13/2022
San Vance	San Antonio, TX	​	14	​	​	—	​	​	8,860	​	​	68,726	​	​	77,586	​	​	528	​	​	8,860	​	​	69,254	​	​	78,114	​	​	(6,800)	​	4/13/2022
San Stone Oak	San Antonio, TX	​	15	​	​	27,697	​	​	4,569	​	​	68,036	​	​	72,605	​	​	871	​	​	4,569	​	​	68,907	​	​	73,476	​	​	(6,575)	​	4/13/2022
Arabelle Lincoln Station	Denver, CO	​	1	​	​	—	​	​	5,798	​	​	74,288	​	​	80,086	​	​	886	​	​	5,798	​	​	75,174	​	​	80,972	​	​	(3,646)	​	8/16/2023
BLVD Dallas	Dallas, TX	​	7	​	​	—	​	​	7,752	​	​	50,298	​	​	58,050	​	​	774	​	​	7,752	​	​	51,072	​	​	58,824	​	​	(2,694)	​	9/15/2023
Regency at Johns Creek Walk	Atlanta, GA	​	5	​	​	—	​	​	9,150	​	​	50,665	​	​	59,815	​	​	973	​	​	9,150	​	​	51,638	​	​	60,788	​	​	(2,513)	​	11/6/2023
CERU Boca Raton	Boca Raton, FL	​	1	​	​	—	​	​	12,766	​	​	126,952	​	​	139,718	​	​	375	​	​	12,766	​	​	127,327	​	​	140,093	​	​	(4,036)	​	5/15/2024
Mercury NoDa	Charlotte, NC	​	1	​	​	—	​	​	8,465	​	​	64,149	​	​	72,614	​	​	75	​	​	8,465	​	​	64,224	​	​	72,689	​	​	(466)	​	11/13/2024
The Artizia at Loso	Charlotte, NC	​	1	​	​	—	​	​	12,471	​	​	83,260	​	​	95,731	​	​	46	​	​	12,471	​	​	83,306	​	​	95,777	​	​	(527)	​	11/19/2024
Everlight	Redmond, WA	​	1	​	​	—	​	​	19,352	​	​	104,018	​	​	123,370	​	​	8	​	​	19,352	​	​	104,026	​	​	123,378	​	​	(416)	​	12/4/2024
Total residential properties	​	​	98	​	$	574,111	​	$	257,406	​	$	2,004,671	​	$	2,262,077	​	$	19,366	​	$	257,406	​	$	2,024,037	​	$	2,281,443	​	$	(173,110)	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Industrial properties:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Vasco Road	Livermore, CA	​	1	​	$	17,435	​	$	4,880	​	$	12,019	​	$	16,899	​	$	(29)	​	$	4,880	​	$	11,990	​	$	16,870	​	$	(3,945)	​	7/21/2017
Northgate	North Las Vegas, NV	​	1	​	​	22,605	​	​	3,940	​	​	20,715	​	​	24,655	​	​	115	​	​	3,943	​	​	20,827	​	​	24,770	​	​	(5,889)	​	7/26/2017
Stafford Grove	Stafford, TX	​	3	​	​	28,525	​	​	8,540	​	​	28,879	​	​	37,419	​	​	3,153	​	​	8,586	​	​	31,986	​	​	40,572	​	​	(8,907)	​	4/9/2018
Kaiser Business Center	Folcroft, PA	​	2	​	​	17,800	​	​	6,140	​	​	12,730	​	​	18,870	​	​	2,138	​	​	6,140	​	​	14,868	​	​	21,008	​	​	(4,293)	​	12/10/2018
Tri-County DC	Schertz, TX	​	1	​	​	16,819	​	​	2,346	​	​	18,400	​	​	20,746	​	​	1,189	​	​	2,346	​	​	19,589	​	​	21,935	​	​	(4,586)	​	2/13/2019
Florence Logistics Center	Florence, KY	​	1	​	​	14,358	​	​	1,791	​	​	16,968	​	​	18,759	​	​	206	​	​	1,791	​	​	17,174	​	​	18,965	​	​	(4,133)	​	5/14/2019
World Connect Logistics Center	Indianapolis, IN	​	1	​	​	32,386	​	​	4,983	​	​	39,172	​	​	44,155	​	​	583	​	​	4,983	​	​	39,755	​	​	44,738	​	​	(8,817)	​	9/27/2019
Tri-County DC II A	Schertz, TX	​	1	​	​	9,004	​	​	1,280	​	​	8,562	​	​	9,842	​	​	527	​	​	1,280	​	​	9,089	​	​	10,369	​	​	(2,271)	​	10/1/2019
Aurora DC	Aurora, IL	​	1	​	​	7,562	​	​	1,681	​	​	6,887	​	​	8,568	​	​	912	​	​	1,681	​	​	7,799	​	​	9,480	​	​	(2,286)	​	12/13/2019
Railhead DC	Dallas/Fort Worth, TX	​	1	​	​	7,774	​	​	2,102	​	​	17,475	​	​	19,577	​	​	187	​	​	2,102	​	​	17,662	​	​	19,764	​	​	(3,821)	​	2/4/2020
Tri-County DC II B	Schertz, TX	​	1	​	​	2,393	​	​	455	​	​	2,429	​	​	2,884	​	​	166	​	​	455	​	​	2,595	​	​	3,050	​	​	(636)	​	2/14/2020
Sterling IC	Washington, DC	​	1	​	​	3,500	​	​	1,976	​	​	3,369	​	​	5,345	​	​	14	​	​	1,976	​	​	3,383	​	​	5,359	​	​	(753)	​	3/25/2020
Clayton Commerce Center	Atlanta, GA	​	1	​	​	48,013	​	​	7,403	​	​	51,886	​	​	59,289	​	​	7,181	​	​	7,403	​	​	59,067	​	​	66,470	​	​	(13,728)	​	6/26/2020
Bay Area Commerce Center	East Bay, CA	​	1	​	​	30,984	​	​	10,135	​	​	38,672	​	​	48,807	​	​	1,700	​	​	10,135	​	​	40,372	​	​	50,507	​	​	(6,431)	​	8/27/2020
Air Tech DC	Louisville, KY	​	2	​	​	3,118	​	​	615	​	​	18,471	​	​	19,086	​	​	307	​	​	616	​	​	18,777	​	​	19,393	​	​	(3,652)	​	10/16/2020
East Columbia IC	Portland, OR	​	2	​	​	11,620	​	​	3,352	​	​	11,726	​	​	15,078	​	​	644	​	​	3,352	​	​	12,370	​	​	15,722	​	​	(3,596)	​	12/2/2020
Plainfield LC	Indianapolis, IN	​	1	​	​	11,711	​	​	2,514	​	​	17,260	​	​	19,774	​	​	17	​	​	2,514	​	​	17,277	​	​	19,791	​	​	(2,594)	​	12/16/2020
395 LC	Reno, NV	​	1	​	​	54,407	​	​	6,752	​	​	61,784	​	​	68,536	​	​	348	​	​	6,752	​	​	62,132	​	​	68,884	​	​	(10,762)	​	12/21/2020
Radar Distribution Center	Northampton, PA	​	1	​	​	26,000	​	​	7,167	​	​	42,373	​	​	49,540	​	​	700	​	​	7,167	​	​	43,073	​	​	50,240	​	​	(5,236)	​	3/31/2021
Intermountain Space Center	Salt Lake City, UT	​	1	​	​	44,509	​	​	14,786	​	​	48,645	​	​	63,431	​	​	3,421	​	​	14,786	​	​	52,066	​	​	66,852	​	​	(12,211)	​	6/30/2021
Airway Industrial Park	San Diego, CA	​	1	​	​	22,439	​	​	5,740	​	​	18,616	​	​	24,356	​	​	2,096	​	​	5,740	​	​	20,712	​	​	26,452	​	​	(2,522)	​	7/9/2021

All values are in US Dollars. 160

Table of Contents ​

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	Initial Cost to Company								​	​	​	​	​	Gross Amount Carried at December 31, 2024							​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	Cost		​	​	​	****	​	​	****	​	​	****	​	​	****	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	Capitalized or		​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	Buildings and		​	​	​	​	Adjustments		​	​	​	​	Buildings and		​	​	​	​	Accumulated		​	​
​	​	​	No. of	​	​	​	​	​	​	​	Improvements		​	​	​	​	Subsequent to		​	​	​	​	Improvements		​	Total Costs		​	Depreciation		​	​
( in thousands)	Location	****	Buildings	****	Debt (1)		****	Land		****	(2)		****	Total Costs		****	Acquisition (4)		****	Land		****	(2)		****	(3, 4)		****	(4, 5, 6)		****	Acquisition Date
Industrial properties (cont.):		​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Greenwood Business Center	Greenwood, IN	​	1	​	​	—	​	​	858	​	​	16,251	​	​	17,109	​	​	(30)	​	​	858	​	​	16,221	​	​	17,079	​	​	(2,782)	​	8/2/2021
25 Linden Industrial Center	Jersey City, NJ	​	1	​	​	16,722	​	​	7,764	​	​	9,576	​	​	17,340	​	​	265	​	​	7,764	​	​	9,841	​	​	17,605	​	​	(2,945)	​	8/31/2021
Little Orchard Business Park	San Jose, CA	​	4	​	​	50,472	​	​	51,265	​	​	48,147	​	​	99,412	​	​	1,479	​	​	51,265	​	​	49,626	​	​	100,891	​	​	(13,273)	​	9/8/2021
Tustin Business Center	Tustin, CA	​	2	​	​	22,070	​	​	22,734	​	​	12,233	​	​	34,967	​	​	94	​	​	22,734	​	​	12,327	​	​	35,061	​	​	(2,712)	​	9/22/2021
Campus Drive IC	Burlington, NJ	​	1	​	​	4,100	​	​	2,364	​	​	4,288	​	​	6,652	​	​	45	​	​	2,364	​	​	4,333	​	​	6,697	​	​	(954)	​	10/7/2021
Long Island Logistics Center	Islandia, NY	​	1	​	​	13,200	​	​	4,927	​	​	16,198	​	​	21,125	​	​	277	​	​	4,927	​	​	16,475	​	​	21,402	​	​	(3,113)	​	12/9/2021
Phoenix IC	Phoenix, AZ	​	1	​	​	11,619	​	​	4,709	​	​	12,895	​	​	17,604	​	​	344	​	​	4,709	​	​	13,239	​	​	17,948	​	​	(3,077)	​	12/13/2021
Tempe IC	Tempe, AZ	​	1	​	​	18,259	​	​	3,628	​	​	24,857	​	​	28,485	​	​	395	​	​	3,628	​	​	25,252	​	​	28,880	​	​	(4,910)	​	12/13/2021
Las Vegas IC	Las Vegas, NV	​	2	​	​	6,148	​	​	2,623	​	​	6,186	​	​	8,809	​	​	212	​	​	2,623	​	​	6,398	​	​	9,021	​	​	(1,156)	​	12/13/2021
General Washington IC	Alexandria, VA	​	1	​	​	7,100	​	​	2,452	​	​	8,599	​	​	11,051	​	​	841	​	​	2,452	​	​	9,440	​	​	11,892	​	​	(1,518)	​	1/7/2022
Western Food Center	Denver, CO	​	2	​	​	21,332	​	​	10,399	​	​	28,989	​	​	39,388	​	​	280	​	​	10,399	​	​	29,269	​	​	39,668	​	​	(5,656)	​	1/14/2022
Orlando LC I & II	Orlando, FL	​	2	​	​	—	​	​	8,975	​	​	88,020	​	​	96,995	​	​	3,004	​	​	8,975	​	​	91,024	​	​	99,999	​	​	(10,153)	​	2/17/2022
Orlando LC III & IV	Orlando, FL	​	2	​	​	24,099	​	​	3,198	​	​	40,505	​	​	43,703	​	​	991	​	​	3,198	​	​	41,496	​	​	44,694	​	​	(4,681)	​	2/17/2022
Orlando LC V	Orlando, FL	​	1	​	​	—	​	​	1,939	​	​	33,219	​	​	35,158	​	​	828	​	​	1,939	​	​	34,047	​	​	35,986	​	​	(6,033)	​	2/17/2022
Orlando LC VI	Orlando, FL	​	1	​	​	—	​	​	3,405	​	​	26,043	​	​	29,448	​	​	49	​	​	3,405	​	​	26,092	​	​	29,497	​	​	(3,361)	​	2/17/2022
Orlando LC VII	Orlando, FL	​	1	​	​	—	​	​	3,156	​	​	20,404	​	​	23,560	​	​	683	​	​	3,156	​	​	21,087	​	​	24,243	​	​	(4,275)	​	2/17/2022
Gillingham IC	Sugarland, TX	​	1	​	​	11,988	​	​	2,283	​	​	18,268	​	​	20,551	​	​	51	​	​	2,283	​	​	18,319	​	​	20,602	​	​	(2,142)	​	6/10/2022
Maplewood Drive IC	Minneapolis, MN	​	1	​	​	—	​	​	1,026	​	​	4,488	​	​	5,514	​	​	679	​	​	1,026	​	​	5,167	​	​	6,193	​	​	(1,387)	​	6/17/2022
Glen Afton IC	Charlotte, NC	​	1	​	​	—	​	​	2,294	​	​	19,742	​	​	22,036	​	​	589	​	​	2,294	​	​	20,331	​	​	22,625	​	​	(2,995)	​	6/17/2022
East 56th Ave IC	Denver, CO	​	1	​	​	—	​	​	4,724	​	​	14,317	​	​	19,041	​	​	421	​	​	4,724	​	​	14,738	​	​	19,462	​	​	(2,913)	​	6/17/2022
Brockton IC	Grand Rapids, MI	​	1	​	​	—	​	​	1,250	​	​	5,272	​	​	6,522	​	​	487	​	​	1,250	​	​	5,759	​	​	7,009	​	​	(1,543)	​	6/17/2022
Pine Vista IC	Houston, TX	​	1	​	​	—	​	​	2,952	​	​	15,838	​	​	18,790	​	​	593	​	​	2,952	​	​	16,431	​	​	19,383	​	​	(3,020)	​	6/17/2022
Tri-County Parkway IC	San Antonio, TX	​	1	​	​	—	​	​	1,579	​	​	11,205	​	​	12,784	​	​	2,003	​	​	1,579	​	​	13,208	​	​	14,787	​	​	(2,345)	​	6/17/2022
Miami NW 114th IC	Miami, FL	​	1	​	​	—	​	​	5,533	​	​	6,489	​	​	12,022	​	​	2,175	​	​	5,533	​	​	8,664	​	​	14,197	​	​	(1,419)	​	6/17/2022
North Harney IC	Tampa, FL	​	1	​	​	—	​	​	3,586	​	​	4,439	​	​	8,025	​	​	941	​	​	3,586	​	​	5,380	​	​	8,966	​	​	(1,083)	​	6/17/2022
Wes Warren Drive IC	New York, NY	​	1	​	​	—	​	​	1,537	​	​	5,978	​	​	7,515	​	​	881	​	​	1,537	​	​	6,859	​	​	8,396	​	​	(1,421)	​	6/17/2022
Enterprise Way IC	Oklahoma City, OK	​	1	​	​	—	​	​	537	​	​	5,982	​	​	6,519	​	​	343	​	​	537	​	​	6,325	​	​	6,862	​	​	(1,092)	​	6/17/2022
New Albany IC	Moorestown, NJ	​	1	​	​	—	​	​	5,630	​	​	11,914	​	​	17,544	​	​	611	​	​	5,630	​	​	12,525	​	​	18,155	​	​	(2,516)	​	6/17/2022
North 5th Street CC	Philadelphia, PA	​	1	​	​	11,800	​	​	4,359	​	​	18,945	​	​	23,304	​	​	418	​	​	4,359	​	​	19,363	​	​	23,722	​	​	(4,069)	​	6/24/2022
VM8 Logistics Center	Houston, TX	​	1	​	​	11,865	​	​	2,166	​	​	15,345	​	​	17,511	​	​	4,577	​	​	2,166	​	​	19,922	​	​	22,088	​	​	(597)	​	1/19/2023
Moreno Valley Distribution Center	Moreno Valley, CA	​	1	​	​	20,656	​	​	3,955	​	​	29,466	​	​	33,421	​	​	95	​	​	3,955	​	​	29,561	​	​	33,516	​	​	(2,397)	​	5/2/2023
SLC Logistics Center	Salt Lake City, UT	​	2	​	​	—	​	​	17,224	​	​	59,861	​	​	77,085	​	​	130	​	​	17,224	​	​	59,991	​	​	77,215	​	​	(3,914)	​	9/26/2023
Cindel Drive Business Park	Delran, NJ	​	2	​	​	—	​	​	6,282	​	​	19,352	​	​	25,634	​	​	370	​	​	6,282	​	​	19,722	​	​	26,004	​	​	(1,639)	​	12/19/2023
Metro North IC	Methuen, MA	​	1	​	​	—	​	​	6,908	​	​	49,604	​	​	56,512	​	​	332	​	​	6,908	​	​	49,936	​	​	56,844	​	​	(2,219)	​	5/8/2024
Sugar Land CC	Sugarland, TX	​	2	​	​	—	​	​	7,336	​	​	28,568	​	​	35,904	​	​	61	​	​	7,336	​	​	28,629	​	​	35,965	​	​	(983)	​	6/28/2024
Pima Street Logistics Center	Phoenix, AZ	​	1	​	​	—	​	​	3,793	​	​	15,165	​	​	18,958	​	​	59	​	​	3,793	​	​	15,224	​	​	19,017	​	​	(307)	​	10/1/2024
Southpark Logistics Center I	Grove City, OH	​	1	​	​	—	​	​	2,199	​	​	26,714	​	​	28,913	​	​	—	​	​	2,199	​	​	26,714	​	​	28,913	​	​	(40)	​	12/20/2024
Southpark Logistics Center II	Grove City, OH	​	1	​	​	—	​	​	2,589	​	​	26,495	​	​	29,084	​	​	—	​	​	2,589	​	​	26,495	​	​	29,084	​	​	(43)	​	12/20/2024
Southpark Logistics Center III	Grove City, OH	​	1	​	​	—	​	​	1,503	​	​	15,385	​	​	16,888	​	​	—	​	​	1,503	​	​	15,385	​	​	16,888	​	​	(21)	​	12/20/2024
Grove City Logistics Center	Grove City, OH	​	1	​	​	—	​	​	2,515	​	​	17,889	​	​	20,404	​	​	—	​	​	2,515	​	​	17,889	​	​	20,404	​	​	(35)	​	12/20/2024
Whitestown Distribution Center I	Whitestown, IN	​	1	​	​	—	​	​	1,451	​	​	11,137	​	​	12,588	​	​	—	​	​	1,451	​	​	11,137	​	​	12,588	​	​	(22)	​	12/20/2024
Whitestown Distribution Center II	Whitestown, IN	​	1	​	​	—	​	​	2,449	​	​	21,406	​	​	23,855	​	​	—	​	​	2,449	​	​	21,406	​	​	23,855	​	​	(42)	​	12/20/2024
Whitestown Distribution Center III	Whitestown, IN	​	1	​	​	—	​	​	815	​	​	8,491	​	​	9,306	​	​	—	​	​	815	​	​	8,491	​	​	9,306	​	​	(10)	​	12/20/2024
Greenfield Distribution Center	Greenfield, IN	​	1	​	​	—	​	​	828	​	​	7,073	​	​	7,901	​	​	—	​	​	828	​	​	7,073	​	​	7,901	​	​	(16)	​	12/20/2024
Fairfield Commerce Center	Fairfield, OH	​	1	​	​	—	​	​	967	​	​	14,107	​	​	15,074	​	​	—	​	​	967	​	​	14,107	​	​	15,074	​	​	(59)	​	12/20/2024

All values are in US Dollars. 161

Table of Contents ​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	Initial Cost to Company								​	​	​	​	​	Gross Amount Carried at December 31, 2024							​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	Cost		​	​	​	****	​	​	****	​	​	****	​	​	****	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	Capitalized or		​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	Buildings and		​	​	​	​	Adjustments		​	​	​	​	Buildings and		​	​	​	​	Accumulated		​	​
​	​	​	No. of	​	​	​	​	​	​	​	Improvements		​	​	​	​	Subsequent to		​	​	​	​	Improvements		​	Total Costs		​	Depreciation		​	​
( in thousands)	Location	****	Buildings	****	Debt (1)		****	Land		****	(2)		****	Total Costs		****	Acquisition (4)		****	Land		****	(2)		****	(3, 4)		****	(4, 5, 6)		****	Acquisition Date
Industrial properties (cont.):		​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Ohio Logistics Center	Streetsboro, OH	​	1	​	​	—	​	​	827	​	​	6,741	​	​	7,568	​	​	—	​	​	827	​	​	6,741	​	​	7,568	​	​	(10)	​	12/20/2024
Richmond Airport Logistics I	Henrico, VA	​	1	​	​	—	​	​	1,876	​	​	26,418	​	​	28,294	​	​	—	​	​	1,876	​	​	26,418	​	​	28,294	​	​	(34)	​	12/20/2024
Richmond Airport Logistics II	Henrico, VA	​	1	​	​	—	​	​	1,648	​	​	27,222	​	​	28,870	​	​	—	​	​	1,648	​	​	27,222	​	​	28,870	​	​	(30)	​	12/20/2024
Richmond Airport Logistics III	Henrico, VA	​	1	​	​	—	​	​	1,451	​	​	15,496	​	​	16,947	​	​	—	​	​	1,451	​	​	15,496	​	​	16,947	​	​	(27)	​	12/20/2024
Total industrial properties	​	​	86	​	$	684,392	​	$	339,046	​	$	1,478,260	​	$	1,817,306	​	$	51,148	​	$	339,096	​	$	1,529,358	​	$	1,868,454	​	$	(222,058)	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Retail properties:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Beaver Creek	Apex, NC	​	1	​	$	—	​	$	12,426	​	$	31,375	​	$	43,801	​	$	1,466	​	$	9,955	​	$	35,312	​	$	45,267	​	$	(17,033)	​	5/11/2007
Sandwich	Sandwich, MA	​	1	​	​	—	​	​	7,380	​	​	25,778	​	​	33,158	​	​	1,322	​	​	7,380	​	​	27,100	​	​	34,480	​	​	(13,431)	​	8/1/2007
Wareham	Wareham, MA	​	1	​	​	—	​	​	10,694	​	​	26,241	​	​	36,935	​	​	3,075	​	​	9,049	​	​	30,961	​	​	40,010	​	​	(16,086)	​	8/1/2007
Hyannis	Hyannis, MA	​	1	​	​	—	​	​	10,405	​	​	917	​	​	11,322	​	​	—	​	​	10,405	​	​	917	​	​	11,322	​	​	(867)	​	8/1/2007
Meriden	Meriden, CT	​	1	​	​	—	​	​	6,560	​	​	22,014	​	​	28,574	​	​	(1)	​	​	6,560	​	​	22,013	​	​	28,573	​	​	(11,262)	​	8/1/2007
Whitman 475 Bedford Street	Whitman, MA	​	1	​	​	—	​	​	3,610	​	​	11,682	​	​	15,292	​	​	—	​	​	3,610	​	​	11,682	​	​	15,292	​	​	(6,298)	​	8/1/2007
New Bedford	New Bedford, MA	​	1	​	​	3,443	​	​	3,790	​	​	11,152	​	​	14,942	​	​	—	​	​	3,790	​	​	11,152	​	​	14,942	​	​	(6,656)	​	10/18/2007
270 Center	Washington, DC	​	1	​	​	—	​	​	11,759	​	​	24,061	​	​	35,820	​	​	5,106	​	​	11,759	​	​	29,167	​	​	40,926	​	​	(14,368)	​	4/6/2009
Springdale	Springfield, MA	​	1	​	​	—	​	​	11,866	​	​	723	​	​	12,589	​	​	9	​	​	11,866	​	​	732	​	​	12,598	​	​	(727)	​	2/18/2011
Saugus	Saugus, MA	​	1	​	​	—	​	​	3,783	​	​	9,713	​	​	13,496	​	​	1,806	​	​	3,783	​	​	11,519	​	​	15,302	​	​	(6,164)	​	3/17/2011
Salt Pond	Narragansett, RI	​	2	​	​	—	​	​	8,759	​	​	40,233	​	​	48,992	​	​	2,489	​	​	8,759	​	​	42,722	​	​	51,481	​	​	(15,081)	​	11/4/2014
South Cape	Mashpee, MA	​	6	​	​	—	​	​	9,936	​	​	27,552	​	​	37,488	​	​	5,457	​	​	10,307	​	​	32,638	​	​	42,945	​	​	(11,004)	​	3/18/2015
Shenandoah	Davie, FL	​	3	​	​	—	​	​	10,501	​	​	27,397	​	​	37,898	​	​	1,356	​	​	10,501	​	​	28,753	​	​	39,254	​	​	(9,067)	​	8/6/2015
Chester Springs	Chester, NJ	​	4	​	​	—	​	​	7,376	​	​	51,155	​	​	58,531	​	​	8,538	​	​	7,376	​	​	59,693	​	​	67,069	​	​	(19,912)	​	10/8/2015
Yale Village	Tulsa, OK	​	4	​	​	—	​	​	3,492	​	​	30,655	​	​	34,147	​	​	1,963	​	​	3,492	​	​	32,618	​	​	36,110	​	​	(10,391)	​	12/9/2015
Suniland Shopping Center	Pinecrest, FL	​	4	​	​	—	​	​	34,804	​	​	33,902	​	​	68,706	​	​	6,996	​	​	34,804	​	​	40,898	​	​	75,702	​	​	(12,044)	​	5/27/2016
Village at Lee Branch	Birmingham, AL	​	2	​	​	—	​	​	10,476	​	​	32,461	​	​	42,937	​	​	2,512	​	​	10,476	​	​	34,973	​	​	45,449	​	​	(8,329)	​	1/29/2020
Barrow Crossing	Bethlehem, GA	​	5	​	​	—	​	​	5,539	​	​	50,208	​	​	55,747	​	​	2,557	​	​	5,539	​	​	52,765	​	​	58,304	​	​	(11,087)	​	6/22/2021
Total retail properties	​	​	40	​	$	3,443	​	$	173,156	​	$	457,219	​	$	630,375	​	$	44,651	​	$	169,411	​	$	505,615	​	$	675,026	​	$	(189,807)	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Office properties:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
1300 Connecticut	Washington, DC	​	1	​	$	—	​	$	25,177	​	$	41,250	​	$	66,427	​	$	25,873	​	$	25,177	​	$	67,123	​	$	92,300	​	$	(35,240)	​	3/10/2009
CityView	Austin, TX	​	4	​	​	—	​	​	4,606	​	​	65,250	​	​	69,856	​	​	14,933	​	​	4,606	​	​	80,183	​	​	84,789	​	​	(29,882)	​	4/24/2015
Eden Prairie	Eden Prairie, MN	​	1	​	​	—	​	​	3,538	​	​	25,865	​	​	29,403	​	​	8,799	​	​	3,538	​	​	34,664	​	​	38,202	​	​	(15,375)	​	10/3/2008
Preston Sherry Plaza	Dallas, TX	​	1	​	​	—	​	​	7,500	​	​	22,303	​	​	29,803	​	​	22,920	​	​	7,500	​	​	45,223	​	​	52,723	​	​	(23,378)	​	12/16/2009
3 Second Street	Jersey City, NJ	​	1	​	​	107,000	​	​	16,800	​	​	193,742	​	​	210,542	​	​	58,982	​	​	16,800	​	​	252,724	​	​	269,524	​	​	(134,298)	​	6/25/2010
350 Carter Road	Princeton, NJ	​	1	​	​	—	​	​	3,966	​	​	28,670	​	​	32,636	​	​	2,368	​	​	3,966	​	​	31,038	​	​	35,004	​	​	(3,039)	​	4/27/2022
107 Morgan Lane	Plainsboro, NJ	​	1	​	​	—	​	​	1,589	​	​	10,680	​	​	12,269	​	​	131	​	​	1,589	​	​	10,811	​	​	12,400	​	​	(1,047)	​	10/28/2022
Total office properties	​	​	10	​	$	107,000	​	$	63,176	​	$	387,760	​	$	450,936	​	$	134,006	​	$	63,176	​	$	521,766	​	$	584,942	​	$	(242,259)	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Other properties:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Aventura Storage	Aventura, FL	​	1	​	$	—	​	$	12,538	​	$	18,505	​	$	31,043	​	$	121	​	$	12,538	​	$	18,626	​	$	31,164	​	$	(1,122)	​	12/18/2023
Norwood Storage	Norwood, NJ	​	1	​	​	—	​	​	2,308	​	​	21,595	​	​	23,903	​	​	37	​	​	2,308	​	​	21,632	​	​	23,940	​	​	(1,049)	​	12/20/2023
Metro Storage Sharon Hill	Philadelphia, PA	​	1	​	​	—	​	​	2,664	​	​	14,097	​	​	16,761	​	​	115	​	​	2,664	​	​	14,212	​	​	16,876	​	​	(416)	​	7/31/2024
Metro Storage Newtown Square	Philadelphia, PA	​	1	​	​	—	​	​	2,741	​	​	21,983	​	​	24,724	​	​	170	​	​	2,741	​	​	22,153	​	​	24,894	​	​	(594)	​	7/31/2024
Metro Storage Trevose	Philadelphia, PA	​	1	​	​	—	​	​	3,263	​	​	17,888	​	​	21,151	​	​	145	​	​	3,263	​	​	18,033	​	​	21,296	​	​	(614)	​	7/31/2024
Metro Storage Sarasota	Sarasota, FL	​	1	​	​	—	​	​	3,149	​	​	12,382	​	​	15,531	​	​	161	​	​	3,149	​	​	12,543	​	​	15,692	​	​	(442)	​	7/31/2024
Metro Storage Fort Myers	Fort Myers, FL	​	1	​	​	—	​	​	3,868	​	​	8,898	​	​	12,766	​	​	100	​	​	3,868	​	​	8,998	​	​	12,866	​	​	(356)	​	7/31/2024
Metro Storage Pinellas Park	Tampa, FL	​	1	​	​	—	​	​	1,370	​	​	5,395	​	​	6,765	​	​	89	​	​	1,370	​	​	5,484	​	​	6,854	​	​	(217)	​	7/31/2024
Total other properties	​	​	8	​	$	—	​	$	31,901	​	$	120,743	​	$	152,644	​	$	938	​	$	31,901	​	$	121,681	​	$	153,582	​	$	(4,810)	​	​
Grand total	​	​	242	​	$	1,368,946	​	$	864,685	​	$	4,448,653	​	$	5,313,338	​	$	250,109	​	$	860,990	​	$	4,702,457	​	$	5,563,447	​	$	(832,044)	​	​

All values are in US Dollars. 162

Table of Contents

(1)	These properties are encumbered by mortgage notes. Amounts reflects principal amount outstanding as of December 31, 2024. See “Note 6 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for more detail regarding our borrowings.
(2)	Includes gross intangible lease assets.
---	---
(3)	As of December 31, 2024, the aggregate cost for U.S. federal income tax purposes of investments in property was approximately $2.28 billion (unaudited).
---	---
(4)	Amount is presented net of impairments and other write-offs of tenant-related assets that were recorded at acquisition as part of our purchase price accounting. Such write-offs are the result of lease expirations and terminations.
---	---
(5)	Includes intangible lease asset amortization.
---	---
(6)	See “Note 2 to the Consolidated Financial Statements” in Item 8, “Financial Statements and Supplementary Data” for details of depreciable lives.
---	---
(7)	Acquisition date for this property represents the date in which the joint venture partnership, for which we have an interest, acquired the property. The initial cost to Company amounts represent the carrying values of the property when we first consolidated the joint venture partnership in December 2024.
---	---

The following table summarizes investment in real estate properties and accumulated depreciation and amortization activity for the periods presented below:

​

​	​	​	​	​	​	​	​	​	​
​	​	For the Year Ended December 31,
​	****	2024		****	2023		****	2022
Investments in real estate properties:	​	​	​	​	​	​	​	​	​
Balance at the beginning of period	​	$	4,603,998	​	$	4,178,329	​	$	3,061,851
Acquisitions of properties	​		886,197	​		406,548	​		1,206,476
Improvements	​		52,328	​		45,694	​		30,842
Consolidation of joint venture partnership	​	​	82,635	​	​	—	​	​	—
Property dispositions	​		(61,711)	​		(26,573)	​		(120,840)
Balance at the end of period	​	$	5,563,447	​	$	4,603,998	​	$	4,178,329
Accumulated depreciation and amortization:	​	​	​	​	​	​	​	​	​
Balance at the beginning of period	​	$	714,684	​	$	572,751	​	$	472,025
Real estate depreciation and amortization expense	​		152,777	​		149,985	​		134,617
Above-market lease assets amortization expenses	​		1,014	​		818	​		724
Right of use asset amortization expense	​	​	7	​	​	7	​	​	102
Consolidation of joint venture partnership	​	​	7,129	​	​	—	​	​	—
Property dispositions	​		(43,567)	​		(8,877)	​		(34,717)
Balance at the end of period	​	$	832,044	​	$	714,684	​	$	572,751

​

​

​ 163

Table of Contents ​

ITEM 16. SUMMARY OF FORM 10-K

See the “Table of Contents” for a summary of information included in this Form 10-K. The information required by this Part III will be included in our definitive proxy statement for our 2025 Annual Meeting of Stockholders, and such required information is incorporated herein by reference.

​ 164

Table of Contents ​

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on March 6, 2025:

​	ARES REAL ESTATE INCOME TRUST INC.
​	​	​
​	By:	/s/ JEFFREY W. TAYLOR
​	​	Jeffrey W. Taylor<br><br>Partner, Co-President<br><br>(Principal Executive Officer)
​	​	​
​	By:	/s/ TAYLOR M. PAUL
​	​	Taylor M. Paul<br><br>Managing Director, Chief Financial Officer and Treasurer<br><br>(Principal Financial Officer and<br><br>Principal Accounting Officer)

​

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Jeffrey W. Taylor, Taylor M. Paul and Joshua J. Widoff (with full power to act alone), as his true and lawful attorneys-in-fact and agents, with full powers of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K and to file the same, with all exhibits thereto, and other documents in connection therewith, with the SEC, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated and on the dates indicated.

Signature		Title		Date
​<br><br>/s/ DAVID A. ROTH	​	​<br><br>Chairman of the Board and Director	​	​<br><br>March 6, 2025
David A. Roth	​	​	​	​
​	​	​	​	​
/s/ RAJAT DHANDA	​	Director	​	March 6, 2025
Rajat Dhanda	​	​	​	​
​	​	​	​	​
/s/ CHARLES B. DUKE	​	Director	​	March 6, 2025
Charles B. Duke	​	​	​	​
​	​	​	​	​
/s/ JAY W. GLAUBACH	​	Director and Partner, Co-President	​	March 6, 2025
Jay W. Glaubach	​	​	​	​
​	​	​	​	​
/s/ BRIAN P. MATHIS	​	Director	​	March 6, 2025
Brian P. Mathis	​	​	​	​
​	​	​	​	​
/s/ DANIEL J. SULLIVAN	​	Director	​	March 6, 2025
Daniel J. Sullivan	​	​	​	​
​	​	​	​	​
/s/ JOHN P. WOODBERRY	​	Director	​	March 6, 2025
John P. Woodberry	​	​	​	​
​	​	​	​	​
/s/ JEFFREY W. TAYLOR	​	Partner, Co-President	​	March 6, 2025
Jeffrey W. Taylor	​	(Principal Executive Officer)	​	​
​	​	​	​	​
/s/ TAYLOR M. PAUL	​	Managing Director, Chief Financial Officer and Treasurer	​	March 6, 2025
Taylor M. Paul	​	(Principal Financial Officer and<br><br>Principal Accounting Officer)	​	​

​

​

​ 165

Exhibit 4.6

DESCRIPTION OF ARES REAL ESTATE INCOME TRUST INC. SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934

The following is a summary of the material terms of shares of common stock of Ares Real Estate Income Trust Inc. registered pursuant to Section 12(g) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as set forth in our charter and bylaws, as amended and supplemented from time to time. This summary is qualified in its entirety by reference to our charter and bylaws. References herein to “us,” “we,” “our,” or the “Company” refer to Ares Real Estate Income Trust Inc. Under our charter, we have authority to issue a total of 2,700,000,000 shares of capital stock. Of the total number of shares of capital stock authorized (a) 2,500,000,000 shares are designated as common stock with a par value of $0.01 per share, 500,000,000 of which are classified as Class D shares (100,000,000 of which are designated as a series of Class D shares named Class D-R shares and 400,000,000 of which are designated as a series of Class D shares named Class D-PR shares), 100,000,000 of which are classified as Class E shares, 1,300,000,000 of which are classified as Class I shares (600,000,000 of which are designated as a series of Class I shares named Class I-R shares and 700,000,000 of which are designated as a series of Class I shares named Class I-PR shares), 500,000,000 of which are classified as Class S shares (100,000,000 of which are designated as a series of Class S shares named Class S-R shares and 400,000,000 of which are designated as a series of Class S shares named Class S-PR shares) and 100,000,000 of which are classified as Class T shares (all of which are designated as a series of Class T shares), and (b) 200,000,000 shares are designated as preferred stock with a par value of $0.01 per share. Our board of directors, with the approval of a majority of the full board and without any action by our stockholders, may amend our charter from time to time to increase or decrease the aggregate number of shares of capital stock or the number of shares of capital stock of any class or series that we have authority to issue.

Common Stock

The holders of shares of our common stock are entitled to one vote per share on all matters voted on by stockholders, including election of our directors. Our charter does not provide for cumulative voting in the election of directors. Therefore, the holders of a majority of the outstanding shares of our common stock can elect our full board of directors. Subject to any preferential rights of any outstanding series of preferred stock and the provisions of our charter regarding restriction on ownership and transfer of our common stock, the holders of shares of our common stock are entitled to such distributions as may be authorized from time to time by our board of directors out of legally available funds and declared by us and, upon liquidation, are entitled to receive all assets available for distribution to stockholders. All shares of our common stock issued in our offerings are fully paid and non-assessable shares of common stock. Holders of shares of our common stock do not have preemptive rights, which means that stockholders do not have an option to purchase any new shares of common stock that we issue, and generally do not have appraisal rights unless our board of directors determines that appraisal rights apply, with respect to all or any classes or series of shares, to one or more transactions occurring after the date of such determination in connection with which holders of such shares would otherwise be entitled to exercise appraisal rights. Stockholders are not liable for the acts or obligations of the Company.

We do not issue certificates for shares of our common stock. Shares of our common stock are held in “uncertificated” form which eliminates the physical handling and safekeeping responsibilities inherent in owning transferable share certificates and eliminates the need to return a duly executed share certificate to effect a transfer. SS&C GIDS, Inc. acts as our registrar and as the transfer agent for shares of our common stock. Transfers can be effected simply by mailing a transfer and assignment form, which we will provide to stockholders at no charge, to:

​

**For regular mail:**For overnight deliveries: SS&C GIDS, Inc. SS&C GIDS, Inc. PO Box 219079430 West 7th Street, Suite 219079 Kansas City, Missouri 64121-9079 Kansas City, Missouri 64105

Class E, Class T-R, Class S-R, Class D-R and Class I-R Shares

Substantially all of our outstanding Class E, Class T-R, Class S-R, Class D-R and Class I-R shares were sold by us in prior public primary offerings or pursuant to our distribution reinvestment plan. No Class E, Class T-R, Class S-R, Class D-R or Class I-R shares will be issued in our private offering. We pay Ares Wealth Management Solutions, Inc. (the “Dealer Manager”) distribution fees with respect to our Class T-R, Class S-R and Class D-R shares. These distribution fees are allocated on a class-specific basis and therefore do not affect holders of other classes of our shares.

Class S-PR Shares

Each Class S-PR share issued in the primary portion of our private offering will be subject to an upfront selling commission of up to 3.0%, and a dealer manager fee of up to 1.5%, of the offering price of each Class S-PR share sold in the offering on the date of the purchase; provided, however, that the sum of upfront selling commissions and upfront dealer manager fees will not exceed 3.5% of the offering price. The Dealer Manager anticipates that all or a portion of the upfront selling commissions and dealer manager fees will be retained by, or reallowed (paid) to, participating broker-dealers.

We will pay the Dealer Manager a distribution fee with respect to our outstanding Class S-PR shares equal to 0.85% per annum of the aggregate net asset value (“NAV”) of our outstanding Class S-PR shares, consisting of an advisor distribution fee of 0.65% per annum, and a dealer distribution fee of 0.20% per annum, of the aggregate NAV for the Class S-PR shares; however, with respect to certain Class S-PR shares, the advisor distribution fee and the dealer distribution fee may be other amounts, provided that the sum of such fees will always equal 0.85% per annum of the NAV of such shares. The distribution fee will be paid monthly in arrears. The Dealer Manager will reallow (pay) or advance all or a portion of the distribution fee to participating broker-dealers and servicing broker-dealers and will rebate to us the distribution fee to the extent a broker-dealer is not eligible to receive it unless the Dealer Manager has not recouped the total amount of distribution fees it advanced or the Dealer Manager is serving as the broker of record with respect to such shares. We will cease paying the distribution fees with respect to individual Class S-PR shares when they are no longer outstanding, including as a result of conversion to Class I-PR shares as described below under “—Conversion.”

The upfront selling commission and dealer manager fee will not be payable in respect of any Class S-PR shares sold pursuant to our distribution reinvestment plan, but such shares will be charged the distribution fee payable with respect to all our outstanding Class S-PR shares.

Class S-PR shares are available to all investors for purchase in our private offering.

Class D-PR Shares

Each Class D-PR share issued in the primary portion of our private offering will be subject to an upfront selling commission of up to 1.5% of the offering price of each Class D-PR share sold in the offering on the date of the purchase. The Dealer Manager anticipates that all or a portion of the upfront selling commissions will be retained by, or reallowed (paid) to, participating broker-dealers. No dealer manager fee will be paid for sales of any Class D-PR shares.

We will pay the Dealer Manager a distribution fee with respect to our outstanding Class D-PR shares equal to 0.25% per annum of the aggregate NAV of our outstanding Class D-PR shares. The distribution fee will be paid monthly in arrears. The Dealer Manager will reallow (pay) or advance all or a portion of the distribution fee to

within such account and purchased in a primary offering (i.e., an offering other than a distribution reinvestment plan) (collectively, the “Distribution Fee Limit”).

Each Class T-R, Class S-R or Class D-R share held within a stockholder’s account shall automatically and without any action on the part of the holder thereof convert into a number of Class I-R shares at the Applicable Conversion Rate (as defined below) on the earliest of (a) a listing of any shares of our common stock on a national securities exchange, (b) our merger or consolidation with or into another entity, or the sale or other disposition of all or substantially all of our assets and (c) the end of the month in which the Dealer Manager in conjunction with our transfer agent determines that the total upfront selling commissions, upfront dealer manager fees and ongoing distribution fees paid with respect to all shares of such class held by such stockholder within such account (including shares purchased through a distribution reinvestment plan or received as stock dividends) equals or exceeds applicable limits pursuant to our charter (or a lower limit set forth in any applicable agreement between the Dealer Manager and a participating broker-dealer, provided that the Dealer Manager advises our transfer agent of the lower limit in writing) of the aggregate purchase price of all shares of such class held by such stockholder within such account and purchased in a primary offering (i.e., an offering other than a distribution reinvestment plan).

As used above, the “Applicable Conversion Rate” means (a) with respect to Class T-R shares, a ratio whereby the numerator is the most recently disclosed monthly Class T-R NAV per share and the denominator is the most recently disclosed monthly Class I-R NAV per share, (b) with respect to Class S-PR shares, a ratio whereby the numerator is the most recently disclosed monthly Class S-PR NAV per share and the denominator is the most recently disclosed monthly Class I-PR NAV per share, (c) with respect to Class S-R shares, a ratio whereby the numerator is the most recently disclosed monthly Class S-R NAV per share and the denominator is the most recently disclosed monthly Class I-R NAV per share, (d) with respect to Class D-R shares, a ratio whereby the numerator is the most recently disclosed monthly Class D-R NAV per share and the denominator is the most recently disclosed monthly Class I-R NAV per share and (e) with respect to Class D-PR shares, a ratio whereby the numerator is the most recently disclosed monthly Class D-PR NAV per share and the denominator is the most recently disclosed monthly Class I-PR NAV per share. For each class of shares, the NAV per share shall be calculated as described in the most recent valuation procedures approved by our board of directors. Because we currently expect to allocate ongoing distribution fee expenses to our Class T-R, Class S-R, Class S-PR, Class D-R and Class D-PR shares through their distributions, and not through their NAV per share, we currently expect the Applicable Conversion Rate to remain 1:1 for our Class T-R, Class S-R, Class S-PR, Class D-R and Class D-PR shares.

Rights Upon Liquidation

Immediately before any liquidation, dissolution or winding up, or any distribution of our assets pursuant to a plan of liquidation, dissolution or winding up, our Class T-R, Class S-R, and Class D-R shares will automatically convert to Class I-R shares at the Applicable Conversion Rate, and our Class S-PR and Class D-PR shares will automatically convert to Class I-PR shares at the Applicable Conversion Rate. Following such conversion, each holder of shares of a particular class of common stock will be entitled to receive, ratably with each other holder of shares of such class, that portion of such aggregate assets available for distribution as the number of outstanding shares of such class held by such holder bears to the total number of outstanding shares of such class then outstanding.

Preferred Stock

Our charter authorizes our board of directors to classify and reclassify any unissued shares of our common stock and preferred stock into other classes or series of stock. A majority of our independent directors who do not have an interest in the transaction must approve any offering of preferred stock and have access to counsel at the Company’s expense. Prior to issuance of shares of each class or series, the board of directors is required by the Maryland General Corporation Law and by our charter to set, subject to our charter restrictions on transfer of our stock, the terms, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or

other distributions, qualifications and terms or conditions of redemption for each class or series. Thus, the board of directors could authorize the issuance of shares of common stock or preferred stock with terms and conditions which could have the effect of delaying, deferring or preventing a transaction or change in control that might involve a premium price for holders of our common stock or otherwise be in their best interest. Our board of directors has no present plans to issue preferred stock, but may do so at any time in the future without stockholder approval. We will not offer preferred stock to our Advisor, our Dealer Manager, our officers and directors, or any of their affiliates except on the same terms as preferred stock is offered to all other investors.

Meetings, Special Voting Requirements and Access to Records

An annual meeting of the stockholders is held each year on a date specified by our board of directors that is not less than 30 days after delivery of our annual report. Special meetings of stockholders may be called only upon the request of a majority of the directors, a majority of the independent directors, the chief executive officer or upon the written request of stockholders holding at least 10% of the outstanding shares of our common stock. Upon receiving a written request, either by person or by mail, our secretary will provide all stockholders with written notice, either by person or by mail, of such meeting and the purpose of such meeting. The special meeting must be held not less than 15 nor more than 60 days after the distribution of the notice, at a time and place specified in the stockholder request, or if none is specified, at a time and place convenient to the stockholders. The presence of 50% of the outstanding shares of our common stock either in person or by proxy shall constitute a quorum. Generally, the affirmative vote of a majority of the votes cast on a matter is necessary to take stockholder action, except that a majority of the votes represented in person or by proxy at a meeting at which a quorum is present is required to elect a director and except for the matters described in the next paragraph, which must be approved by the affirmative vote of stockholders entitled to cast a majority of all the votes entitled to be cast on the matter.

Under the Maryland General Corporation Law and our charter, stockholders are generally entitled to vote at a duly held meeting at which a quorum is present on (1) the amendment of our charter, (2) our dissolution, (3) our merger into another entity, our consolidation or the sale or other disposition of all or substantially all of our assets and (4) the election or removal of our directors.

The advisory agreement, including the selection of the Advisor, is approved annually by our directors including a majority of the independent directors. While the stockholders do not have the ability to vote to replace the Advisor or to select a new advisor, stockholders do have the ability, by the affirmative vote of a majority of the shares of our common stock entitled to vote on such matter, to remove a director from our board of directors. Any stockholder shall be permitted access to all our records at all reasonable times, and may inspect and copy any of them for a reasonable copying charge. An alphabetical list of the names, addresses and telephone numbers of our stockholders, along with the number of shares of our common stock held by each of them, shall be maintained as part of our books and records and shall be available for inspection by any stockholder or the stockholder’s designated agent at our office. The stockholder list will be updated at least quarterly to reflect changes in the information contained therein. A copy of the list shall be mailed to any stockholder who requests the list within 10 days of the request. A stockholder may request a copy of the stockholder list in connection with matters relating to voting rights and the exercise of stockholder rights under federal proxy laws. A stockholder requesting a list will be required to pay reasonable costs of postage and duplication. We have the right to request that a requesting stockholder represent to us that the list will not be used to pursue commercial interests. In addition to the foregoing, stockholders have rights under Rule 14a-7 under the Exchange Act, which provides that, upon the request of investors and the payment of the expenses of the distribution, we are required to distribute specific materials to stockholders in the context of the solicitation of proxies for voting on matters presented to stockholders or, at our option, provide requesting stockholders with a copy of the list of stockholders so that the requesting stockholders may make the distribution of proxies themselves. If a proper request for the stockholder list is not honored, then the requesting stockholder shall be entitled to recover certain costs incurred in compelling the production of the list as well as actual damages suffered by reason of the refusal or failure to produce the list. However, a stockholder shall not have the right to, and we may require a requesting stockholder to represent that it will not, secure the stockholder list or other information for the purpose of selling or using the list for a commercial purpose (such as to acquire our

shares in a tender offer for investment purposes) not related to the requesting stockholder’s interest in the affairs of the Company.

Tender Offers

Our charter provides that any person making a tender offer that is not otherwise subject to Regulation 14D of the Exchange Act, including any “mini-tender” offer, must comply with most of the provisions of Regulation 14D of the Exchange Act, including the notice and disclosure requirements. In addition, the offeror must provide us notice of such tender offer at least 10 business days before initiating the tender offer. If the offeror does not comply with the provisions set forth above, we will have the right to redeem that offeror’s shares, if any, and any shares acquired in such tender offer. In addition, the non-complying offeror will be responsible for all of our expenses in connection with that offeror’s noncompliance. This provision of our charter may discourage a stockholder from initiating a tender offer for our shares.

Restriction On Ownership of Shares of Capital Stock

In order for us to qualify as a real estate investment trust (“REIT”), no more than 50% in value of the outstanding shares of our common stock may be owned, directly or indirectly, through the application of certain attribution rules under the U.S. Internal Revenue Code of 1986, as amended (the “Code”), by any five or fewer individuals, as defined in the Code to include specified entities, during the last half of any taxable year. In addition, the outstanding shares of our common stock must be owned by 100 or more persons independent of us and each other during at least 335 days of a 12-month taxable year or during a proportionate part of a shorter taxable year, excluding our first taxable year ending December 31, 2006. In addition, we must meet requirements regarding the nature of our gross income in order to qualify as a REIT. One of these requirements is that at least 75% of our gross income for each calendar year must consist of rents from real property and income from other real property investments. The rents received by our operating partnership, AREIT Operating Partnership LP, a Delaware limited partnership (the “Operating Partnership”) from any customer will not qualify as rents from real property, which could result in our loss of REIT status, if we own, actually or constructively within the meaning of certain provisions of the Code, 10% or more of the ownership interests in that customer. In order to assist us in preserving our status as a REIT, among other purposes, our charter contains limitations on the ownership and transfer of shares of common stock which prohibit any person or entity from owning or acquiring, directly or indirectly, more than 9.8% of the value of our then outstanding capital stock or more than 9.8% of the value or number of shares, whichever is more restrictive, of our then outstanding common stock, prohibit the beneficial ownership of the outstanding shares of our capital stock by fewer than 100 persons and prohibit any transfer of or other event or transaction with respect to shares of capital stock that would result in the beneficial ownership of our outstanding shares of capital stock by fewer than 100 persons. In addition, our charter prohibits any transfer of or other event with respect to shares of our capital stock that would result in us being “closely held” within the meaning of Section 856(h) of the Code, that would cause us to own, actually or constructively, more than 9.9% of the ownership interests in a customer of our real property or the real property of the Operating Partnership or any direct or indirect subsidiary of the Operating Partnership or that would otherwise cause us to fail to qualify as a REIT.

Our charter provides that the shares of our capital stock that, if transferred, would result in a violation of the 9.8% ownership limit, would result in us being “closely held” within the meaning of Section 856(h) of the Code, would cause us to own more than 9.9% of the ownership interests in a customer of our real property or the real property of the Operating Partnership or any direct or indirect subsidiary of the Operating Partnership or would otherwise cause us to fail to qualify as a REIT will be transferred automatically to a trust effective on the day before the purported transfer of such shares of our capital stock. We will designate a trustee of the share trust that will not be affiliated with us or the purported transferee or record holder. We will also name a charitable organization as beneficiary of the share trust. The trustee will receive all distributions on the shares of our capital stock in the same trust and will hold such distributions or distributions in trust for the benefit of the beneficiary. The trustee also will vote the shares of capital stock in the same trust. The intended transferee will acquire no rights in such shares of capital stock, unless, in the case of a transfer that would cause a violation of the 9.8% ownership limit, the transfer is exempted by the board of directors from the ownership limit based upon receipt of information (including certain

representations and undertakings from the intended transferee) that such transfer would not violate the provisions of the Code for our qualification as a REIT. In addition, our charter provides that any transfer of shares of our capital stock that would result in shares of our capital stock being owned by fewer than 100 persons will be null and void and the intended transferee will acquire no rights in such shares of our capital stock.

The trustee will transfer the shares of our capital stock to a person whose ownership of shares of our capital stock will not violate the ownership limits. The transfer shall be made no earlier than 20 days after the later of our receipt of notice that shares of our capital stock have been transferred to the trust or the date we determine that a purported transfer of shares of stock has occurred. During this 20-day period, we will have the option of redeeming such shares of our capital stock. Upon any such transfer or redemption, the purported transferee or holder shall receive a per share price equal to the lesser of (a) the price per share in the transaction that resulted in the transfer of such shares to the trust (or, in the case of a gift or devise, the price per share on the date of redemption at the time of the gift or devise) or (b) the price per share on the date of the redemption, in the case of a purchase by us, or the price received by the trustee net of any sales commission and expenses, in the case of a sale by the trustee. The charitable beneficiary will receive any excess amounts. In the case of a liquidation, holders of such shares will receive a ratable amount of our remaining assets available for distribution to shares of the applicable class or series taking into account all shares of such class or series. The trustee will distribute to the purported transferee or holder an amount equal to the lesser of the amounts received with respect to such shares or the price per share in the transaction that resulted in the transfer of such shares to the trust (or, in the case of a gift or devise, the price at the time of the gift or devise) and shall distribute any remaining amounts to the charitable beneficiary.

Any person who (1) acquires or attempts to acquire shares of our capital stock in violation of the foregoing restrictions or who owns shares of our capital stock that were transferred to any such trust is required to give immediate written notice to us of such event or (2) purports to transfer or receive shares of our capital stock subject to such limitations is required to give us 15 days written notice prior to such purported transaction. In both cases, such persons shall provide to us such other information as we may request in order to determine the effect, if any, of such event on our status as a REIT. The foregoing restrictions will continue to apply until the board of directors determines it is no longer in our best interest to continue to qualify as a REIT.

The ownership limits do not apply to a person or persons which the directors exempt from the ownership limit upon appropriate assurances that our qualification as a REIT is not jeopardized. Any person who owns 5% or more (or such lower percentage applicable under Treasury Regulations) of the outstanding shares of our capital stock during any taxable year will be asked to deliver a statement or affidavit setting forth the number of shares of our capital stock beneficially owned.

Distributions

We intend to make distributions on a monthly basis following the end of each calendar month. We intend to use monthly record dates and, thus, monthly distribution accruals. However, we reserve the right to adjust the periods during which distributions accrue and are paid.

We may fund our monthly regular distributions from sources other than cash flow from operations. Our long term strategy is to strive to fund the payment of regular distributions to you entirely from our operations, but there may be quarters or even years when that is not the case. It will be up to the board of directors to determine the distribution level taking many factors into consideration beyond just cash flow from operations. If we are unsuccessful in investing the capital we raise from our securities offerings or decide to invest our capital in lower yielding assets, we may be required to fund our distributions to you from a combination of our operating, investing and financing activities, which include net proceeds of our securities offerings, dispositions and borrowings (including borrowings secured by our assets), or to reduce the level of our distributions. Using certain of these sources may result in a liability to us, which would require a future repayment. The use of these sources for distributions and the ultimate repayment of any liabilities incurred could adversely impact our ability to pay distributions in future periods, decrease the amount of cash we have available for new investments, repayment of debt, share redemptions and other corporate purposes, and potentially reduce your overall return and adversely

impact and dilute the value of their investment in shares of our common stock. We may pay distributions from sources other than cash flow from operations, including, without limitation, the sale of assets, borrowings or offering proceeds. Our ability to pay distributions solely from cash flows from operations has been impacted by certain factors, including the current yield environment. All distributions result in a decrease to our NAV while cash flow generated from our operations results in an increase to NAV. While we strive to fund our distributions solely from our cash flow from operations in the long run, we also focus on total stockholder return as a metric for evaluating our distribution level in the event that it is not being fully covered by cash flow from operations. Any cash flow from operations in excess of our distributions results in a net increase to NAV (ignoring other factors). Conversely, if and when our distributions exceed our cash flow from operations, the net effect would be and has been a decrease to NAV (ignoring other factors). We have not established a limit on the amount of our distributions that may be paid from any of these sources.

Each quarter our board of directors determines the level of our distributions for each month in that quarter. In determining the appropriate level of a distribution, our board of directors considers a number of factors, including the current and anticipated market conditions, current and anticipated future performance and make-up of our investments, our overall financial projections and expected future cash needs. We can give no assurance that the board of directors will continue to set distributions at current levels and our distribution levels may change from time to time.

In connection with a distribution to our stockholders, our board intends to authorize a monthly distribution of a certain dollar amount per share of our common stock before or on the first day of each calendar quarter for the months in such quarter. We will then calculate each stockholder’s specific distribution amount for the month using monthly record dates and each stockholder’s distributions will accrue on the first record date after the stockholder becomes a record owner of our common stock, subject to our board of directors declaring a distribution for record owners as of such date. We accrue the amount of declared distributions as a liability on the record date, and such liability is accounted for in determining the NAV.

The per share amount of any distributions for any class of common stock relative to the other classes of common stock shall be determined as described in the most recent multiple class plan approved by our board of directors. Under our multiple class plan in effect, distributions are made on all classes of our common stock at the same time. The per share amount of distributions on our shares of common stock differs because of different allocations of class-specific fees. We use the record share method of determining the per share amount of distributions on each class of shares, although our board of directors may choose other methods. The record share method is one of several distribution calculation methods for multiple-class funds recommended, but not required, by the American Institute of Certified Public Accountants (“AICPA”). Under this method, the amount to be distributed on shares of our common stock is increased by the sum of all class-specific fees accrued for such period. Such amount is divided by the number of shares of our common stock outstanding on the record date. Such per share amount is reduced for each class of common stock by the per share amount of any class-specific fees allocable to such class.

We are required to make distributions sufficient to satisfy the requirements for qualification as a REIT for federal income tax purposes. Generally, income distributed will not be taxable to us under the Code if we distribute at least 90% of our taxable income each year (computed without regard to the distributions paid deduction and our net capital gain). In addition, if we fail to distribute during each calendar year at least the sum of (a) 85% of our ordinary income for such year, (b) 95% of our capital gain net income for such year, and (c) any undistributed taxable income from prior periods, we will be subject to a 4% excise tax on the excess of the required distribution over the sum of (i) the amounts actually distributed by us, plus (ii) retained amounts on which we pay income tax at the corporate level. Distributions are authorized at the discretion of the board of directors, in accordance with our earnings, cash flow and general financial condition. The board’s discretion is directed, in substantial part, by its obligation to cause us to comply with the REIT requirements. Because we may receive income from interest or rents at various times during our fiscal year, distributions may not reflect our income earned in that particular distribution period and may be made in advance of actual receipt of funds in an attempt to make distributions relatively uniform.

We are authorized to borrow money, issue new securities or sell assets in order to make distributions. There are no restrictions on the ability of our Operating Partnership to transfer funds to us.

We are prohibited from making distributions in kind, except for distributions of readily marketable securities, distributions of beneficial interests in a liquidating trust established for the dissolution of the Company and the liquidation of assets in accordance with the terms of our charter, or distributions in which (i) the board of directors advises each stockholder of the risks associated with direct ownership of the property, (ii) the board of directors offers each stockholder the election of receiving such in-kind distributions and (iii) in-kind distributions are made only to those stockholders that accept such offer. We are not prohibited from distributing our own securities in lieu of making cash distributions to stockholders, provided that the securities so distributed to stockholders are readily marketable. Stockholders who receive marketable securities in lieu of cash distributions may incur transaction expenses in liquidating the securities.

Liquidity Events

The purchase of our shares of common stock is intended to be a long-term investment and we do not anticipate that a secondary trading market will develop. Therefore, it will be very difficult for stockholders to sell their shares promptly or at all, and any such sales may be made at a loss. On a limited basis, stockholders may be able to have their shares redeemed through our share redemption program. In addition, we do not intend to pursue a “Liquidity Event” within any period of time. A “Liquidity Event” includes, but is not limited to, (a) a listing of our common stock on a national securities exchange (or the receipt by our stockholders of securities that are listed on a national securities exchange in exchange for our common stock); (b) our sale, merger or other transaction in which our stockholders either receive, or have the option to receive, cash, securities redeemable for cash, and/or securities of a publicly traded company; or (c) the sale of all or substantially all of our assets where our stockholders either receive, or have the option to receive, cash or other consideration. Although we will not be precluded from pursuing a Liquidity Event (or series thereof) if our board of directors determines that is in the best interest of our stockholders, we intend to operate as a perpetual-life REIT.

Subsequent Offerings

Apart from our private offering, our ongoing distribution reinvestment plan offerings and our program through the Operating Partnership to raise capital in private placements exempt from registration under Section 506(b) of the Securities Act through the sale of beneficial interests in specific Delaware statutory trusts holding real properties, including properties currently indirectly owned by the Operating Partnership, we may in the future conduct offerings of common stock (whether existing or new classes), preferred stock, debt securities or interests in our Operating Partnership or other subsidiaries. We may structure such offerings to attract institutional investors or other sources of capital.

Business Combinations

Under the Maryland General Corporation Law, business combinations between a Maryland corporation and an interested stockholder or the interested stockholder’s affiliate are prohibited for five years after the most recent date on which the stockholder becomes an interested stockholder. For this purpose, the term “business combinations” includes mergers, consolidations, share exchanges, asset transfers and issuances or reclassifications of equity securities. An “interested stockholder” is defined for this purpose as: (1) any person who beneficially owns 10 percent or more of the voting power of the corporation’s shares or (2) an affiliate or associate of the corporation who, at any time within the two-year period prior to the date in question, was the beneficial owner of 10 percent or more of the voting power of the then outstanding voting shares of the corporation. A person is not an interested stockholder under the Maryland General Corporation Law if the board of directors approved in advance the transaction by which he otherwise would become an interested stockholder. However, in approving the transaction, the board of directors may provide that its approval is subject to compliance, at or after the time of approval, with any terms and conditions determined by the board.

After the five-year prohibition, any business combination between the corporation and an interested stockholder generally must be recommended by the board of directors of the corporation and approved by the affirmative vote of at least: (1) 80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation and (2) two-thirds of the votes entitled to be cast by holders of voting stock of the corporation other than shares of stock held by the interested stockholder or its affiliate with whom the business combination is to be effected, or held by an affiliate or associate of the interested stockholder, voting together as a single voting group.

These super majority vote requirements do not apply if the corporation’s common stockholders receive a minimum price, as defined under the Maryland General Corporation Law, for their shares of common stock in the form of cash or other consideration in the same form as previously paid by the interested stockholder for its shares of common stock.

None of these provisions of the Maryland General Corporation Law will apply, however, to business combinations that are approved or exempted by the board of directors of the corporation prior to the time that the interested stockholder becomes an interested stockholder. Pursuant to the business combination statute, our board of directors has exempted any business combination involving us and any person. Consequently, the five-year prohibition and the super majority vote requirements will not apply to business combinations between us and any person. As a result, any person may be able to enter into business combinations with us that may not be in the best interest of our stockholders, without compliance with the super majority vote requirements and other provisions of the statute.

Should our board of directors opt in to the business combination statute, it may discourage others from trying to acquire control of us and increase the difficulty of consummating any offer.

Business Combination with the Advisor

Many REITs that are listed on a national securities exchange or included for quotation on an over-the-counter market are considered self-administered, which means that they employ persons or agents to perform all significant management functions. The costs to perform these management functions are “internalized,” rather than external, and no third-party fees, such as advisory fees, are paid by the REIT. We may consider becoming a self-administered REIT if we determine that internalizing some or all of the management functions performed by the Advisor is in our best interests and in the best interests of our stockholders.

Control Share Acquisitions

The Maryland General Corporation Law provides that Control Shares of a Maryland corporation acquired in a Control Share acquisition have no voting rights except to the extent approved by a vote of two-thirds of the votes entitled to be cast on the matter. Shares of common stock owned by the acquirer, by officers or by employees who are directors of the corporation are not entitled to vote on the matter. “Control Shares” are voting shares of stock which, if aggregated with all other shares of stock owned by the acquirer or with respect to which the acquirer has the right to vote or to direct the voting of, other than solely by virtue of revocable proxy, would entitle the acquirer to exercise voting power in electing directors within one of the following ranges of voting powers:

●	one-tenth or more but less than one-third;
●	one-third or more but less than a majority; or
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●	a majority or more of all voting power.
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Control Shares do not include shares of stock the acquiring person is then entitled to vote as a result of having previously obtained stockholder approval. Except as otherwise specified in the statute, a “Control Share acquisition” means the acquisition of Control Shares. Once a person who has made or proposes to make a Control Share acquisition has undertaken to pay expenses and has satisfied other required conditions, the person may compel the board of directors to call a special meeting of stockholders to be held within 50 days of demand to consider the

voting rights of the shares of stock. If no request for a meeting is made, the corporation may itself present the question at any stockholders meeting. If voting rights are not approved for the Control Shares at the meeting or if the acquiring person does not deliver an “Acquiring Person Statement” for the Control Shares as required by the statute, the corporation may redeem any or all of the Control Shares for their fair value, except for Control Shares for which voting rights have previously been approved. Fair value is to be determined for this purpose without regard to the absence of voting rights for the Control Shares, and is to be determined as of the date of the last Control Share acquisition or of any meeting of stockholders at which the voting rights for Control Shares are considered and not approved.

If voting rights for Control Shares are approved at a stockholders’ meeting and the acquirer becomes entitled to vote a majority of the shares of stock entitled to vote, all other stockholders may exercise appraisal rights. The fair value of the shares of stock as determined for purposes of these appraisal rights may not be less than the highest price per share paid in the Control Share acquisition. Some of the limitations and restrictions otherwise applicable to the exercise of dissenters’ rights do not apply in the context of a Control Share acquisition.

The Control Share acquisition statute does not apply to shares of stock acquired in a merger, consolidation or share exchange if the corporation is a party to the transaction or to acquisitions approved or exempted by the charter or bylaws of the corporation. As permitted by the Maryland General Corporation Law, we have provided in our bylaws that the Control Share provisions of the Maryland General Corporation Law will not apply to any acquisition by any person of shares of our stock, but the board of directors retains the discretion to change this provision in the future.

Subtitle 8

Subtitle 8 of Title 3 of the Maryland General Corporation Law, which we refer to as “Subtitle 8,” permits a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three independent directors to elect to be subject, by a provision in its charter or bylaws or a resolution of its board of directors and notwithstanding any contrary provision in our charter, to any or all of the following five provisions:

●	a classified board;
●	a two-thirds vote requirement for removing a director;
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●	a requirement that the number of directors be fixed only by vote of the directors;
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●	a requirement that a vacancy on the board be filled only by the remaining directors and for the remainder of the full term of the class of directors in which the vacancy occurred; and
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●	a majority requirement for the calling of a special meeting of stockholders.
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Pursuant to Subtitle 8, we have elected to provide that vacancies on our board of directors be filled only by the remaining directors and for the remainder of the full term of the directorship in which the vacancy occurred. Through provisions in our charter and bylaws unrelated to Subtitle 8, we vest in the board of directors the exclusive power to fix the number of directorships. We have not elected to be subject to the other provisions of Subtitle 8.

Restrictions on Roll-Up Transactions

Under our charter, the term “roll-up transaction” means a transaction involving the acquisition, merger, conversion or consolidation either directly or indirectly of our Company and the issuance of securities of an entity that would be created or would survive after the successful completion of a proposed roll-up transaction to our stockholders. A roll-up transaction does not include (a) a transaction that occurs at least twelve months after our securities have been listed on a national securities exchange, or (b) a transaction involving the conversion to corporate, trust or association form of only us, if, as a consequence of the transaction, there will be no significant adverse change in any of the following: (i) voting rights of our stockholders, (ii) the term of our existence, (iii) the

compensation of Ares Management Corporation real estate (the “Sponsor”) or the Advisor, or (iv) our investment objectives.

Our charter provides that we must obtain an appraisal of all of our assets from an independent expert in connection with a proposed “roll-up transaction.” In order to qualify as an independent expert for this purpose, the person or entity must have no material current or prior business or personal relationship with our Advisor or directors and must be engaged to a substantial extent in the business of rendering opinions regarding the value of real property and/or other assets of the type held by us. Our charter provides that if the appraisal is included in a prospectus used to offer the securities of the entity that would be created or would survive after the successful completion of the roll-up transaction, the appraisal shall be filed with the Commission and the states in which the securities are being registered as an exhibit to the registration statement for the offering. As set forth in our charter, our assets would be appraised on a consistent basis, and the appraisal would be based on the evaluation of all relevant information and would indicate the value of our assets as of a date immediately prior to the announcement of the proposed roll-up transaction. Our charter requires that the appraisal assume an orderly liquidation of assets over a 12-month period and that the terms of the engagement of such independent expert clearly state that the engagement is for our benefit and the benefit of our stockholders. Our charter also requires that we include a summary of the independent appraisal, indicating all material assumptions underlying the appraisal, in a report to the stockholders in connection with a proposed roll-up transaction.

Our charter requires the person sponsoring the roll-up transaction to offer to common stockholders who vote against the proposal a choice of:

●	accepting the securities of the entity that would be created or would survive after the successful completion of the roll-up transaction offered in the proposed roll-up transaction; or
●	one of the following:
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●remaining stockholders and preserving their interests in us on the same terms and conditions as existed previously; or

●receiving cash in an amount equal to their pro rata share of the appraised value of our net assets.

Our charter prohibits us from participating in any proposed roll-up transaction:

●	that would result in common stockholders having voting rights in the entity that would be created or would survive after the successful completion of the roll-up transaction that are less than those provided in our charter, including rights with respect to the election and removal of directors, annual and special meetings, amendment of the charter and our dissolution;
●	that includes provisions that would operate as a material impediment to, or frustration of, the accumulation of shares by any purchaser of the securities of the entity that would be created or would survive after the successful completion of the roll-up transaction, except to the minimum extent necessary to preserve the tax status of such entity, or which would limit the ability of an investor to exercise the voting rights of its securities of the entity that would be created or would survive after the successful completion of the roll-up transaction on the basis of the number of shares held by that investor;
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●	in which our common stockholders’ rights to access records of the entity that would be created or would survive after the successful completion of the roll-up transaction will be less than those provided in our charter and described in “-Meetings, Special Voting Requirements and Access To Records” above; or
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●	in which we would bear any of the costs of the roll-up transaction if our common stockholders reject the roll-up transaction.
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Forum for Certain Litigation

Our bylaws provide that the Circuit Court for Baltimore City, Maryland, shall be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of any duty owed by any director or officer or employee of the Company to us or to our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Maryland General Corporation Law or our charter or bylaws, or (iv) any action asserting a claim that is governed by the internal affairs doctrine, and any record or beneficial stockholder of the Company who commences such an action shall cooperate in a request that the action be assigned to the court’s Business and Technology Case Management Program. This exclusive forum provision does not apply to claims under the Securities Act, the Exchange Act, any other claim for which the federal courts have exclusive jurisdiction or any action or proceeding against us arising out of, or in connection with, the sale of securities or out of violation of state securities laws.

Reports to Stockholders

Our charter requires that we prepare an annual report and deliver it to our stockholders within 120 days after the end of each fiscal year. Among the matters that must be included in the annual report are:

●	financial statements which are prepared in accordance with U.S. Generally Accepted Accounting Principles and are audited by our independent registered public accounting firm;
●	the ratio of the costs of raising capital during the year to the capital raised;
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●	the aggregate amount of advisory fees and the aggregate amount of other fees paid to the Advisor and any affiliate of the Advisor by us or third parties doing business with us during the year;
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●	our total operating expenses for the year, stated as a percentage of our average invested assets and as a percentage of our net income;
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●	a report from the independent directors that our policies are in the best interests of our stockholders and the basis for such determination; and
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●	separately stated, full disclosure of all material terms, factors and circumstances surrounding any and all transactions involving us and the Advisor, our Sponsor, a director or any affiliate thereof during the year; and the independent directors are specifically charged with a duty to examine and comment in the report on the fairness of the transactions.
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Restrictions on Transfer

Each investor who becomes a holder of S-PR, D-PR and I-PR shares will be required to represent that he, she or it is acquiring the shares for investment purposes and not with a view to distribution or resale, and he, she or it can bear the economic risk of investment for an indefinite period of time. The S-PR, D-PR and I-PR shares are being offered and sold pursuant to exemptions from the registration provisions of federal and state law. Accordingly, such shares will be subject to restrictions on transfer. Even if these transfer restrictions expire or are not applicable to a particular investor, there is no public market for the shares, and no expectation that one will develop. An investor cannot expect to be able to liquidate his or her investment in case of an emergency.

Subsequent purchasers, i.e., potential purchasers of a stockholder’s shares, must also meet the net worth or income standards of our charter, and unless stockholders are transferring all of their shares, stockholders may not transfer their shares in a manner that causes stockholders or their transferee to own less than $2,000 in our shares. Apart from the foregoing potential transfer restrictions and the potential restrictions described above in “—Restriction On Ownership of Shares of Capital Stock,” the shares purchased in our public offering are freely transferable.

​

Vacancies on Board of Directors; Removal of Directors

Any vacancy on our board of directors may be filled only by a vote of a majority of the remaining directors, even if the remaining directors do not constitute a quorum. Any director elected to fill a vacancy will serve for the remainder of the full term of the directorship in which the vacancy occurred and until a successor is duly elected and qualifies. Our independent directors will choose the nominees to fill vacancies in our independent director positions.

Any director may resign at any time and may be removed with or without cause by our stockholders upon the affirmative vote of stockholders entitled to cast at least a majority of all the votes entitled to be cast generally in the election of directors. The notice of any special meeting called for the purpose of the proposed removal shall indicate that the purpose, or one of the purposes, of the meeting is to determine if the director shall be removed.

Advance Notice of Director Nominations and New Business

Our bylaws provide that with respect to an annual meeting of stockholders, nominations of individuals for election to the board of directors and the proposal of business to be considered by our stockholders may be made only (1) pursuant to our notice of the meeting, (2) by or at the direction of our board of directors or (3) by a stockholder who is a stockholder of record at the record date set by our board of directors for the purpose of determining stockholders entitled to vote at the annual meeting, at the time of giving the advance notice required by the bylaws and at the time of the meeting (and any postponement or adjournment thereof), who is entitled to vote at the meeting in the election of each individual nominated or on such other business and who has complied with the advance notice procedures of the bylaws. With respect to special meetings of stockholders, only the business specified in our notice of the meeting may be brought before the meeting. Nominations of individuals for election to our board of directors at a special meeting may be made only (1) pursuant to our notice of meeting, (2) by or at the direction of our board of directors or (3) provided that the meeting has been called for the purpose of electing directors, by a stockholder who is a stockholder of record at the record date set by our board of directors for the purpose of determining stockholders entitled to vote at the special meeting, at the time of giving the advance notice required by the bylaws and at the time of the meeting (and any postponement or adjournment thereof), who is entitled to vote at the meeting in the election of each individual nominated and who has complied with the advance notice provisions of the bylaws.

Exhibit 10.31 ​

​

​

________________________________________________________

LOAN AGREEMENT

________________________________________________________

Dated as of October 1, 2024

Between

EACH OF THE BORROWERS IDENTIFIED ON SCHEDULE I ATTACHED HERETO,

individually or collectively, as the context may require, as Borrower

and

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, MORGAN STANLEY BANK, N.A. and NATIXIS REAL ESTATE CAPITAL LLC, collectively, as Lender

Property: Project Alpha Portfolio

​

​

Table of Contents

​

​

​

ARTICLE 1	DEFINITIONS; PRINCIPLES OF CONSTRUCTION
Section 1.1.	Definitions
---	---
Section 1.2.	Principles of Construction
---	---
ARTICLE 2	GENERAL TERMS
---	---
Section 2.1.	Loan Commitment; Disbursement to Borrower
---	---
Section 2.2.	The Loan
---	---
Section 2.3.	Disbursement to Borrower
---	---
Section 2.4.	The Note and the Other Loan Documents
---	---
Section 2.5.	Interest Rate
---	---
Section 2.6.	Loan Payments
---	---
Section 2.7.	Prepayments
---	---
Section 2.8.	Interest Rate Cap Agreement
---	---
Section 2.9.	Extension of the Maturity Date
---	---
ARTICLE 3	REPRESENTATIONS AND WARRANTIES
---	---
Section 3.1.	Legal Status and Authority
---	---
Section 3.2.	Validity of Documents
---	---
Section 3.3.	Litigation
---	---
Section 3.4.	Agreements
---	---
Section 3.5.	Financial Condition
---	---
Section 3.6.	Disclosure
---	---
Section 3.7.	No Plan Assets; FIRRMA
---	---
Section 3.8.	Not a Foreign Person
---	---
Section 3.9.	Intentionally Omitted
---	---
Section 3.10.	Business Purposes
---	---
Section 3.11.	Borrower’s Principal Place of Business
---	---
Section 3.12.	Status of Property
---	---
Section 3.13.	Financial Information
---	---
Section 3.14.	Condemnation
---	---
Section 3.15.	Separate Lots
---	---
Section 3.16.	Insurance
---	---
Section 3.17.	Use of Property
---	---
Section 3.18.	Leases and Rent Roll
---	---
Section 3.19.	Filing and Recording Taxes
---	---
Section 3.20.	Management Agreement
---	---
Section 3.21.	Illegal Activity/Forfeiture
---	---
Section 3.22.	Taxes
---	---
Section 3.23.	Permitted Encumbrances
---	---
Section 3.24.	Third Party Representations
---	---
Section 3.25.	Non-Consolidation Opinion Assumptions
---	---
Section 3.26.	Federal Reserve Regulations
---	---
Section 3.27.	Investment Company Act
---	---
​	​	​
---	---	---
​	-i-	​

​

​

Table of Contents

(continued)

​

​

Section 3.28.	Fraudulent Conveyance
Section 3.29.	Intentionally Omitted
---	---
Section 3.30.	Anti-Money Laundering and Economic Sanctions
---	---
Section 3.31.	Organizational Chart
---	---
Section 3.32.	Bank Holding Company
---	---
Section 3.33.	Intentionally Omitted
---	---
Section 3.34.	Property Document Representations
---	---
Section 3.35.	No Change in Facts or Circumstances; Disclosure
---	---

Section 3.36 Plainfield Tax Incentive Program

​

ARTICLE 4	BORROWER COVENANTS
Section 4.1.	Existence
---	---
Section 4.2.	Legal Requirements
---	---
Section 4.3.	Maintenance and Use of Property
---	---
Section 4.4.	Waste
---	---
Section 4.5.	Taxes and Other Charges
---	---
Section 4.6.	Litigation
---	---
Section 4.7.	Access to Property
---	---
Section 4.8.	Notice of Default
---	---
Section 4.9.	Cooperate in Legal Proceedings
---	---
Section 4.10.	Performance by Borrower
---	---
Section 4.11.	Federal Reserve Regulations
---	---
Section 4.12.	Books and Records
---	---
Section 4.13.	Estoppel Certificates
---	---
Section 4.14.	Leases and Rents
---	---
Section 4.15.	Management Agreement
---	---
Section 4.16.	Payment for Labor and Materials
---	---
Section 4.17.	Performance of Other Agreements
---	---
Section 4.18.	Debt Cancellation
---	---
Section 4.19.	ERISA; FIRRMA
---	---
Section 4.20.	No Joint Assessment
---	---
Section 4.21.	Alterations
---	---
Section 4.22.	Property Document Covenants
---	---
Section 4.23.	PILOT Leases and PILOT Documents
---	---
Section 4.24.	Seismic Work
---	---
Section 4.25.	Immediate Repairs
---	---

Section 4.26 Plainfield Tax Incentive Documents

​

ARTICLE 5	ENTITY COVENANTS
Section 5.1.	Single Purpose Entity/Separateness
---	---
Section 5.2.	Independent Director
---	---
Section 5.3.	Change of Name, Identity or Structure
---	---
​	​	​
---	---	---
​	-ii-	​

​

​

Table of Contents

(continued)

​

​

Section 5.4.	Business and Operations
ARTICLE 6	NO SALE OR ENCUMBRANCE
---	---
Section 6.1.	Transfer Definitions
---	---
Section 6.2.	No Sale/Encumbrance
---	---
Section 6.3.	Permitted Equity Transfers
---	---
Section 6.4.	Permitted Property Transfer (Assumption)
---	---
Section 6.5.	Lender’s Rights
---	---
Section 6.6.	Economic Sanctions, Anti-Money Laundering and Transfers
---	---
ARTICLE 7	INSURANCE; CASUALTY; CONDEMNATION; RESTORATION
---	---
Section 7.1.	Insurance
---	---
Section 7.2.	Casualty
---	---
Section 7.3.	Condemnation
---	---
Section 7.4.	Restoration
---	---
ARTICLE 8	RESERVE FUNDS
---	---
Section 8.1.	Required Repairs
---	---
Section 8.2.	Intentionally Omitted
---	---
Section 8.3.	Leasing Reserve Funds
---	---
Section 8.4.	Operating Expense Funds
---	---
Section 8.5.	Excess Cash Flow Funds
---	---
Section 8.6.	Tax and Insurance Funds
---	---
Section 8.7.	The Accounts Generally
---	---
Section 8.8.	Letters of Credit
---	---

​

ARTICLE 9	CASH MANAGEMENT
Section 9.1.	Establishment of Certain Accounts
---	---
Section 9.2.	Deposits into the Restricted Account; Maintenance of Restricted Account
---	---
Section 9.3.	Disbursements from the Cash Management Account
---	---
Section 9.4.	Withdrawals from the Debt Service Account
---	---
Section 9.5.	Payments Received Under this Agreement
---	---
ARTICLE 10	EVENTS OF DEFAULT; REMEDIES
---	---
Section 10.1.	Event of Default
---	---
Section 10.2.	Remedies
---	---
ARTICLE 11	SECONDARY MARKET
---	---
Section 11.1.	Securitization
---	---
Section 11.2.	Disclosure
---	---
Section 11.3.	Reserves/Escrows
---	---
Section 11.4.	Servicer
---	---
​	​	​
---	---	---
​	-iii-	​

​

​

Table of Contents

(continued)

​

​

Section 11.5.	Rating Agency Costs and REMIC Savings Clause
Section 11.6.	Mezzanine Option
---	---
Section 11.7.	Conversion to Registered Form
---	---

Section 11.8. Syndication

​

ARTICLE 12	INDEMNIFICATIONS
Section 12.1.	General Indemnification
---	---
Section 12.2.	Mortgage and Intangible Tax Indemnification
---	---
Section 12.3.	ERISA and FIRRMA Indemnification
---	---
Section 12.4.	Duty to Defend, Legal Fees and Other Fees and Expenses
---	---
Section 12.5.	Survival
---	---
Section 12.6.	Environmental Indemnity
---	---
ARTICLE 13	EXCULPATION
---	---
Section 13.1.	Exculpation
---	---
ARTICLE 14	NOTICES
---	---
Section 14.1.	Notices
---	---
ARTICLE 15	FURTHER ASSURANCES
---	---
Section 15.1.	Replacement Documents
---	---
Section 15.2.	Recording of Security Instrument, etc.
---	---
Section 15.3.	Further Acts, etc.
---	---
Section 15.4.	Changes in Tax, Debt, Credit and Documentary Stamp Laws
---	---
ARTICLE 16	WAIVERS
---	---
Section 16.1.	Remedies Cumulative; Waivers
---	---
Section 16.2.	Modification, Waiver in Writing
---	---
Section 16.3.	Delay Not a Waiver
---	---
Section 16.4.	Waiver of Trial by Jury
---	---
Section 16.5.	Waiver of Notice
---	---
Section 16.6.	Remedies of Borrower
---	---
Section 16.7.	Marshalling and Other Matters
---	---
Section 16.8.	Waiver of Statute of Limitations
---	---
Section 16.9.	Waiver of Counterclaim
---	---
Section 16.10.	Sole Discretion of Lender
---	---
ARTICLE 17	MISCELLANEOUS
---	---
Section 17.1.	Survival
---	---
Section 17.2.	Governing Law
---	---
Section 17.3.	Headings
---	---
Section 17.4.	Severability
---	---
Section 17.5.	Preferences
---	---
​	​	​
---	---	---
​	-iv-	​

​

​

Table of Contents

(continued)

​

​

Section 17.6.	Expenses
Section 17.7.	Cost of Enforcement
---	---
Section 17.8.	Schedules Incorporated
---	---
Section 17.9.	Offsets, Counterclaims and Defenses
---	---
Section 17.10.	No Joint Venture or Partnership; No Third Party Beneficiaries
---	---
Section 17.11.	Publicity
---	---
Section 17.12.	Limitation of Liability
---	---
Section 17.13.	Conflict; Construction of Documents; Reliance
---	---
Section 17.14.	Entire Agreement
---	---
Section 17.15.	Liability
---	---
Section 17.16.	Duplicate Originals; Counterparts
---	---
Section 17.17.	Brokers
---	---
Section 17.18.	Set-Off
---	---
Section 17.19.	Unintended Payments
---	---
Section 17.20.	Contributions and Waivers
---	---

Section 17.21. Cross-Default, Cross Collateralization; Waiver of Marshalling of Assets

Section 17.22 Acknowledgement and Consent to Bail-In of Affected Financial Institutions

​

​

​

​

​	​	​
​	-v-	​

​

​

​ LOAN AGREEMENT

THIS LOAN AGREEMENT, dated as of October 1, 2024 (as amended, restated, replaced, supplemented or otherwise modified from time to time, this “Agreement”), between JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a banking association chartered under the laws of the United States of America, having an address at 383 Madison Avenue, New York, New York 10179 (“JPM”), MORGAN STANLEY BANK, N.A., a national banking association, having an address at 1585 Broadway, New York, New York 10036 (“MS”), and NATIXIS REAL ESTATE CAPITAL LLC, a Delaware limited liability company, having an address at 1251 Avenue of the Americas, New York, New York 10020 (“Natixis”; and together with JPM **** and MS and each of their respective successors and permitted assigns, individually and/or collectively, as the context may require, “Lender”), and EACH OF THE BORROWERS IDENTIFIED ON SCHEDULE I ATTACHED HERETO, each a Delaware limited liability company or Delaware limited partnership, as applicable, each having its principal place of business at 2000 Avenue of the Stars, 12^th^ Floor, Los Angeles, California 90067 (each, an “Individual Borrower” and, individually and/or collectively, as the context may require, “Borrower”).

RECITALS:

Borrower desires to obtain the Loan (defined below) from Lender.

Lender is willing to make the Loan to Borrower, subject to and in accordance with the terms of this Agreement and the other Loan Documents (defined below).

In consideration of the making of the Loan by Lender and the covenants, agreements, representations and warranties set forth in this Agreement, the parties hereto hereby covenant, agree, represent and warrant as follows:

ARTICLE 1​ ​ DEFINITIONS; PRINCIPLES OF CONSTRUCTION

Section 1.1.Definitions.

For all purposes of this Agreement, except as otherwise expressly required or unless the context clearly indicates a contrary intent:

“Acceptable LLC” shall mean a limited liability company formed under Delaware law which (i) has two Independent Directors, (ii) has organizational documents that require that, upon the dissolution of the last remaining member or the resignation or the disassociation of the last remaining member from such limited liability company, such Independent Directors shall immediately become Special Members of such limited liability company, (ii) meets all of the requirements of Section 5.1 hereof applicable to limited liability companies and (iii) otherwise meets the Rating Agency criteria then applicable to such entities.

“Account Collateral” shall mean (i) the Accounts, and all cash, checks, drafts, certificates and instruments, if any, from time to time deposited or held in the Accounts from time to time; (ii) any and all amounts invested in Permitted Investments; (iii) all interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise payable in respect of, or in exchange for, any or all of the foregoing; and (iv) to the extent not covered by clauses (i) - (iii) above, all “proceeds” (as defined under the UCC as in effect in the State in which the Accounts are located) of any or all of the foregoing.

​	​	​
​	-1-	​

​

​

​ “Accounts” shall mean the Cash Management Account, the Debt Service Account, the Restricted Account, the Tax Account, the Insurance Account, the Leasing Reserve Account, the Excess Cash Flow Account, the Operating Expense Account and any other account established by this Agreement or the other Loan Documents.

“Act” shall have the meaning set forth in Section 5.1 hereof.

“Affected Financial Institution” shall mean (a) any EEA Financial Institution or (b) any UK Financial Institution.

“Affiliate” shall mean, as to any Person, any other Person that, directly or indirectly, is in Control of, is Controlled by or is under common Control or ownership with such Person or is a director or officer of such Person or of an affiliate of such Person or, with respect to any natural Person, is a member of the Family Group of such Person.

“Affiliated Manager” shall mean any managing agent of any Property which is an Affiliate of Borrower, Guarantor, Sponsor, any SPE Component Entity (if any) or any Affiliate of such entities.

“Agent” shall have the meaning set forth in Section 11.8(a)(iv) hereof.

“Aggregate Material Adverse Effect” shall mean a material adverse effect on (i) the Properties, taken as a whole, (ii) the business, economic performance or financial condition of Borrower, Guarantor, Sponsor or the Properties, taken as a whole, (iii) the enforceability, validity, perfection or priority of the lien of the Security Instrument or the other Loan Documents, or (iv) the ability of Borrower and/or Guarantor to perform, in all material respects, its obligations under the Security Instrument or the other Loan Documents.

“AREIT” shall mean Ares Real Estate Income Trust Inc., a Maryland corporation.

“AREIT OP” shall mean AREIT Operating Partnership LP, a Delaware limited partnership.

“Allocated Loan Amount” shall mean the portion of the principal amount of the Loan allocated to any applicable Individual Property as set forth on Schedule V hereof.

“ALTA” shall mean American Land Title Association, or any successor thereto.

“Alteration Threshold” shall mean an amount equal to the lesser of (i) ten percent (10%) of the Allocated Loan Amount for the applicable Individual Property and (ii) five percent (5%) of the original principal amount of the Loan.

“Alternate Rate” shall mean, with respect to each Interest Accrual Period and Component, the per annum rate of interest of the applicable Benchmark Replacement, determined by Lender for such Interest Accrual Period, plus the Spread for such Component.

“Alternate Rate Loan” shall mean the Loan at such time as interest thereon accrues at a per annum floating rate of interest equal to the Alternate Rate.

“Applicable Contribution” **** shall have the meaning set forth in Section 17.20 hereof**.**

​	​	​
​	-2-	​

​

​

​ “Approved Accounting Method” shall mean GAAP, federal tax basis accounting (consistently applied) or such other method of accounting, consistently applied, as may be reasonably acceptable to Lender.

“Approved Annual Budget” shall have the meaning set forth in Section 4.12 hereof.

“Approved Bank” shall mean a bank or other financial institution, the long-term unsecured debt rating of which are at least “A+” by S&P, Fitch and DBRS Morningstar and “A1” by Moody’s and the short-term unsecured debt ratings of which are at least “A-1” by S&P, “F1” by Fitch, “R-1” by DBRS Morningstar and “P-1” by Moody’s.

“Approved Extraordinary Expense” shall mean an operating expense of the Property not set forth on the Approved Annual Budget but approved by Lender in writing (which such approval shall not be unreasonably withheld, conditioned or delayed).

“Approved ID Provider” shall mean each of CT Corporation, Corporation Service Company, National Registered Agents, Inc., Wilmington Trust Company, Stewart Management Company and Lord Securities Corporation; provided, that, (A) the foregoing shall be deemed Approved ID Providers unless and until disapproved by any Rating Agency and (B) additional national providers of Independent Directors may be deemed added to the foregoing hereunder to the extent approved by the Rating Agencies.

“Approved Operating Expense” shall mean an operating expense of the Property set forth on the Approved Annual Budget.

“Approved Replacement Guarantor” shall mean Sponsor or an Affiliate of Sponsor, provided, that, in each case, such Person, (a) satisfies the Eligibility Requirements, (b) is subject to service of process in the United States and is subject to jurisdiction in the courts of the United States, and (c) is not a Disqualified Person.

“Approved Replacement Guarantor Conditions” means that: (i) Approved Replacement Guarantor has duly executed and delivered to Lender a guaranty in substantially the same form and substance as the Guaranty, subject only to changes based on the identity of Approved Replacement Guarantor and to provide that the Approved Replacement Guarantor is only liable under the Guaranty for (A) liabilities as a result of an act, omission or occurrence first arising or accruing on or after the date of the execution of the Guaranty, (B) liabilities as a result of the Event of Default or other act, omission or occurrence for which such Guaranty is being delivered by the Approved Replacement Guarantor to cure, if any, and (C) liabilities for Losses or other expenses and/or damages first arising, accruing, suffered or realized on or after the date of the execution of the Guaranty, regardless of when the act, omission or occurrence giving rise to such Losses or other expense and/or damages occurred (or such other changes requested by the applicable replacement guarantor and approved by Lender in its sole discretion (exercised in good faith)); (ii) Approved Replacement Guarantor has delivered to Lender evidence reasonably acceptable to Lender that such Person is an Approved Replacement Guarantor; (iii) Approved Replacement Guarantor has delivered to Lender (x) such organizational documents, resolutions and consents as Lender reasonably requests or that are referenced in the opinion delivered pursuant to the following subclause (y) below, and (y) one or more legal opinions in form and substance reasonably satisfactory to Lender addressing the authority, execution and enforceability of any such Person and the applicable documents which such Person is executing in connection with the Loan, and such other opinions (including non-consolidation) as Lender may reasonably request; and (iv) Borrower and/or Guarantor have paid all of Lender’s reasonable out-of-pocket costs and expenses, including

​	​	​
​	-3-	​

​

​

​ reasonable attorneys’ fees, actually incurred in connection with such Approved Replacement Guarantor Conditions, even if same is not ultimately satisfied.

“Assignment and Assumption” shall have the meaning set forth in Section 11.8(a)(i) hereof.

“Assignment of Management Agreement” shall mean that certain Conditional Assignment of Management Agreement dated as of the date hereof among Lender, Borrower and Manager, as the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time.

“Award” shall mean any compensation paid by any Governmental Authority in connection with a Condemnation in respect of all or any part of the Property.

“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of any Affected Financial Institution.

“Bail-In Legislation” shall mean, (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).

“Bank” shall be deemed to refer to the bank or other institution maintaining the Restricted Account pursuant to the Restricted Account Agreement.

“Bankruptcy Code” shall mean Title 11 of the United States Code entitled “Bankruptcy”, as amended from time to time, and any successor statute or statutes and all rules and regulations from time to time promulgated thereunder, and any comparable foreign laws relating to bankruptcy, insolvency or creditors’ rights.

“Bankruptcy Event” shall mean the occurrence of any one or more the of the following: (i) Borrower or any SPE Component Entity shall commence any case, proceeding or other action (A) under the Bankruptcy Code and/or any Creditors Rights Laws seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, liquidation or dissolution or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets; (ii) Borrower or any SPE Component Entity shall make a general assignment for the benefit of its creditors; (iii) any Borrower Party or Affiliate Controlled by Guarantor files, or joins or colludes in the filing of, (A) an involuntary petition against Borrower or any SPE Component Entity under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited or colludes with petitioning creditors for any involuntary petition under the Bankruptcy Code or any other Creditors Rights Laws against Borrower or any SPE Component Entity or (B) any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of Borrower’s or any SPE Component Entity’s assets; (iv) Borrower or any SPE Component Entity files an answer consenting to or otherwise acquiescing in or joining in any involuntary petition filed against it, by any other Person under the Bankruptcy Code or any other Creditors Rights Laws, or solicits or causes to be solicited or colludes with

​	​	​
​	-4-	​

​

​

​ petitioning creditors for any involuntary petition from any Person; (v) any Borrower Party or Affiliate Controlled by Guarantor consents to or acquiesces in or joins in an application for the appointment of a custodian, receiver, trustee, or examiner for Borrower, any SPE Component Entity or any portion of the Property; (vi) Borrower or any SPE Component Entity makes an assignment for the benefit of creditors, or admits, in writing or in any legal proceeding, its insolvency or inability to pay its debts as they become due; (vii) any Borrower Party or Affiliate Controlled by Guarantor contesting or opposing any motion made by Lender to obtain relief from the automatic stay or seeking to reinstate the automatic stay in the event of any proceeding under the Bankruptcy Code or any other Creditors Rights Laws involving Sponsor or its subsidiaries; and (viii) any Borrower Party or Affiliate Controlled by Guarantor taking any action in furtherance of, in collusion with respect to or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in items (i) through (vii) above.

“Benchmark” shall mean, (i) initially, the Term SOFR Reference Rate; and (ii) if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to the Term SOFR Reference Rate or the then-current Benchmark, then the applicable Benchmark Replacement.

“Benchmark Replacement” shall mean, with respect to any Benchmark Transition Event, the sum of (a) the alternate benchmark rate that has been selected by Lender giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a rate of interest as a replacement for the then-current Benchmark for U.S. dollar-denominated floating rate balance sheet loans at such time and (b) the Benchmark Replacement Adjustment; provided that, in no event shall the Benchmark Replacement for any Interest Accrual Period be deemed to be less than zero.

“Benchmark Replacement Adjustment” shall mean, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment (which may be a positive or negative value or zero) that has been selected by Lender giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated floating rate balance sheet loans at such time.

“Benchmark Replacement Conditions” shall mean, with respect to any conversion of the Benchmark to a Benchmark Replacement if any portion of the Loan is or will be included in a REMIC Trust, either (i) receipt by Lender of an opinion of nationally recognized REMIC counsel, in form and substance reasonably acceptable to Lender, that such conversion complies with the applicable REMIC requirements, or (ii) formal guidance shall have been issued by the IRS to the effect that such conversion will comply with such REMIC requirements.

“Benchmark Replacement Date” shall mean the earliest to occur of the following events with respect to the then-current Benchmark:

(1)	in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced
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​ therein and (b) the date on which the administrator of the Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide the Benchmark (or such component thereof); and

(2)

in the case of clause (3) of the definition of “Benchmark Transition Event,” the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by or on behalf of the administrator of such Benchmark (or such component thereof) or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be non-representative or non-compliant with or non-aligned with the International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks; provided that such non-representativeness, non-compliance or non-alignment will be determined by reference to the most recent statement or publication referenced in such clause (3) and even if any available tenor of such Benchmark (or such component thereof) continues to be provided on such date.

Notwithstanding the foregoing, if any portion of the Loan is or will be included in a REMIC Trust, in no event shall the Benchmark Replacement Date occur prior to satisfaction of the Benchmark Replacement Conditions or waiver thereof by Lender.

“Benchmark Transition Event” shall mean the occurrence of one or more of the following events with respect to the then-current Benchmark:

(1)	a public statement or publication of information by or on behalf of the administrator of the Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide the Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark (or such component thereof);
(2)	a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark (or the published component used in the calculation thereof), the central bank for the currency of the Benchmark, an insolvency official with jurisdiction over the administrator for the Benchmark (or such component), a resolution authority with jurisdiction over the administrator for the Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for the Benchmark (or such component), which states that the administrator of the Benchmark (or such component) has ceased or will cease to provide the Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark (or such component thereof); or
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(3)	a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) announcing that the Benchmark (or such component thereof) is not, or as of a specified future date will not be, representative or in compliance with or aligned with the International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks.
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​ “Benchmark Unavailability Period” shall mean, unless and until a Benchmark Replacement is implemented with respect to the then-current Benchmark pursuant to Section 2.5(b)(v)(A) (rather than pursuant to Section 2.5(b)(iii)), each (if any) Interest Accrual Period for which the Lender determines that (a) adequate and reasonable means do not exist for ascertaining the component of the Interest Rate based on Term SOFR (or the then-current Benchmark if the Loan is then an Alternate Rate Loan) (including, if the Benchmark is the Term SOFR Reference Rate, that Term SOFR cannot be determined in accordance with the definition thereof) or (b) that it is unlawful to use the then-current Benchmark to determine the applicable Interest Rate for any Interest Accrual Period.

“Benefit Amount” shall have the meaning set forth in Section 17.20 hereof.

“Borrower Interest Rate Cap Party” shall mean Parent Borrower, or any other Individual Borrower selected by Borrower and party to any Interest Rate Cap Agreement, Replacement Interest Rate Cap Agreement, or Substitute Interest Rate Cap Agreement, as may be in effect from time to time, in accordance with the terms hereof.

“Borrower Party” **** and “Borrower Parties” shall mean each of Borrower, any SPE Component Entity, Sponsor, any Affiliated Manager and Guarantor.

“Breakage Costs” shall have the meaning set forth in Section 2.5(b)(viii) hereof.

“Business Day” shall mean any day, other than a Saturday, Sunday or any other day on which commercial banks are authorized or required by applicable Legal Requirements to close in New York, New York.

“Cash Management Account” shall have the meaning set forth in Section 9.1 hereof.

“Cash Management Provisions” shall mean the representations, covenants and other terms and conditions of this Agreement and the other Loan Documents (including, without limitation, the Restricted Account Agreement) related to, in each case, cash management and/or other related matters (including, without limitation, Article 9 hereof).

“Casualty” shall have the meaning set forth in Section 7.2 hereof.

“Casualty Consultant” shall have the meaning set forth in Section 7.4 hereof.

“Cause” means, with respect to an Independent Director, (i) intentional acts or omissions by such Independent Director that constitute willful disregard of, or bad faith with respect to, such Independent Director’s duties under this Agreement, (ii) that such Independent Director has engaged in or has been charged with, or has been convicted of, fraud or other acts constituting a crime under any law applicable to such Independent Director, (iii) that such Independent Director is unable to perform his or her duties as Independent Director due to death, disability, incapacity, its resignation or other cause or (iv) that such Independent Director no longer meets the definition of Independent Director.

“Closing Date” shall mean the date of the funding of the Loan.

“Closing Date Debt Yield” shall mean 7.4%.

“Closing Date Free Rent” shall have the meaning set forth in Section 8.2.

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​ “Co-Lender” shall have the meaning set forth in Section 11.8(a)(i) hereof.

“Co-Lending Agreement” shall mean the co-lending agreement entered into between Lender, individually as a Co-Lender and as Agent, and the other Co-Lenders in the event of a Syndication, as the same may be further supplemented modified, amended or restated.

“Collateral Assignment of Interest Rate Cap Agreement” shall mean that certain Collateral Assignment of Interest Rate Cap Agreement, dated as of the date hereof, executed by Borrower in connection with the Loan for the benefit of Lender, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“Collateral Cure Conditions” shall be deemed to exist if and for so long as Borrower shall deposit cash into an Account with Lender or shall deliver to Lender a Letter of Credit which, in either case, shall serve as additional collateral for the Loan, in an amount equal to Collateral Deposit Amount and, thereafter, for so long as Borrower elects to satisfy the Collateral Cure Conditions in order to avoid a Trigger Period (as set forth in clause (A)(ii) of the definition of Trigger Period hereunder), Borrower shall, from time to time deposit additional cash collateral or increase the amount of the Letter of Credit by any amount required to cause such cash collateral or Letter of Credit to equal to the Collateral Deposit Amount (as applicable), as of any date of determination. Lender acknowledges that the collateral referenced in this definition shall be returned to Borrower, provided that no Event of Default is ongoing, at such time as the Trigger Period that the Collateral Cure Conditions relate to would have been cured had Borrower not satisfied the Collateral Cure Conditions (i.e. at such time as the Debt Yield (without taking into account the cash deposit and/or Letter of Credit) shall equal or be greater than 6.50% for two (2) consecutive calendar quarters).

“Collateral Deposit Amount” shall mean an amount, which if applied as a voluntary prepayment of the Loan (together with payment of the applicable Prepayment Premium, if any), would be sufficient to result in a Debt Yield of at least 6.50%.

“Component” shall mean, individually, any one of Component A, Component B, Component C, Component D, Component E, Component F or Component HRR.

“Components” shall mean, collectively, Component A, Component B, Component C, Component D, Component E, Component F or Component HRR.

“Component A” shall mean the component of the Loan designated as “A” in Section 2.11 hereof.

“Component B” shall mean the component of the Loan designated as “B” in Section 2.11 hereof.

“Component C” shall mean the component of the Loan designated as “C” in Section 2.11 hereof.

“Component D” shall mean the component of the Loan designated as “D” in Section 2.11 hereof.

“Component E” shall mean the component of the Loan designated as “E” in Section 2.11 hereof.

“Component F” shall mean the component of the Loan designated as “F” in Section 2.11 hereof.

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​	-8-	​

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​ “Component HRR” shall mean the component of the Loan designated as “HRR” in Section 2.11 hereof.

“Condemnation” shall mean a temporary or permanent taking by any Governmental Authority as the result, in lieu or in anticipation, of the exercise of the right of condemnation or eminent domain, of all or any part of the Property, or any interest therein or right accruing thereto, including any right of access thereto or any change of grade affecting the Property or any part thereof.

“Conforming Changes” shall mean, with respect to either the use or administration of Term SOFR or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Business Day,” “Determination Date,” “Interest Accrual Period,” “Monthly Payment Date,” and “U.S. Government Securities Business Day,” timing and frequency of determining rates and making payments of interest, preceding and succeeding business day conventions and other administrative or operational matters) that the Lender determines are  necessary (after consultation with Borrower) to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by the Lender in a manner substantially consistent with market practice (or, if the Lender decides that adoption of any portion of such market practice is not administratively feasible or if the Lender determines that no market practice for the administration of any such rate exists, in such other manner of administration as the Lender decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents); provided, in each case, in no event shall Conforming Changes (a) result in an increase to (x) the number of days between the Monthly Payment Date and the end of the applicable Interest Accrual Period or (y) the Interest Rate in effect immediately prior to the adoption of such Conforming Changes other than a change due to the Benchmark Replacement Adjustment or (b) amend the Monthly Payment Date.

“Constituent Owner” shall mean, as to any Person, any Person that owns a direct or indirect interest in such Person.

“Contribution” shall have the meaning set forth in Section 17.20 hereof.

“Control” shall mean the power to direct the management and policies of an entity, directly or indirectly, whether through the ownership of voting securities or other beneficial interests, by contract or otherwise. The terms “Controlled” and “Controlling” shall have correlative meanings. A general partner, managing partner, managing member, manager or similarly empowered Person (each, a “Controlling Person”) with respect to a partnership, limited liability company or other entity shall have “Control” over such partnership, limited liability company or other entity even if one or more other Persons have customary major decision rights typically given to non-managing partners, members or other owners; provided that customary major decisions rights of holders of direct or indirect interests in any Individual Borrower shall not constitute “Control” by such holders nor shall such major decision rights negate “Control” by the party that is subject to such major decision rights; provided, further, that a change in Control shall not be deemed to have occurred as a result of any change in the composition of the board of directors (or similar management committee) or any officers managing any Person that is a direct or indirect owner of Borrower.  The terms “Controlled” and “Controlling” shall have correlative meanings.

“Counterparty” shall mean the counterparty under any Interest Rate Cap Agreement, Replacement Interest Rate Cap Agreement or Substitute Interest Rate Cap Agreement, which counterparty shall satisfy the Minimum Counterparty Rating. Notwithstanding anything to the

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​	-9-	​

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​ contrary, SMBC Capital Markets, Inc. shall qualify as a Counterparty subject to providing, if such entity does not itself satisfy the Minimum Counterparty Rating, a guaranty on SMBC’s then-customary form from an affiliate satisfying the Minimum Counterparty Rating.

“Covered Rating Agency Information” shall mean any Provided Information furnished to the Rating Agencies in connection with issuing, monitoring and/or maintaining the Securities.

“Creditors Rights Laws” shall mean any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization, conservatorship, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to its debts or debtors.

“Crowdfunded Person” **** shall mean a Person capitalized primarily by monetary contributions (A) of less than $35,000 each from more than 35 investors who are individuals and (B) which are funded primarily (I) in reliance upon Regulation Crowdfunding promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended and/or (II) through internet-mediated registries, platforms or similar portals, mail-order subscriptions, benefit events and/or other similar methods.

“DBRS Morningstar” shall mean DBRS, Inc. and its successor-in-interest.

“Debt” shall mean the outstanding principal amount set forth in, and evidenced by, this Agreement and the Note together with all interest accrued and unpaid thereon and all other sums due to Lender in respect of the Loan under the Note, this Agreement or the other Loan Documents (including, without limitation, all sums advanced and costs and expenses incurred (including unpaid or unreimbursed servicing and special servicing fees) by Lender in connection with the enforcement and/or collection of the Debt or any part thereof).

“Debt Service” shall mean, with respect to any particular period of time, scheduled principal (if applicable) and interest payments hereunder (including, as and to the extent applicable, interest accruing at the Default Rate).

“Debt Service Account” shall have the meaning set forth in Section 9.1 hereof.

“Debt Service Coverage Ratio” shall mean the ratio calculated by Lender on a monthly basis of (i) the Underwritten Net Operating Income to (ii) the aggregate amount of Debt Service which would be due for the twelve (12) month period immediately following the date of calculation, calculated assuming an amount of debt equal to the outstanding principal balance of the Loan on the date of calculation and an interest rate equal to the sum of the weighted average of the Spread plus the applicable Strike Rate, and assuming that the Loan will be in place for the entirety of said period at the then-outstanding principal balance of the Loan as of the date of calculation.

“Debt Yield” shall mean, as of any date of calculation, a ratio conveyed as a percentage in which: (i) the numerator is the Underwritten Net Operating Income; and (ii) the denominator is the then outstanding principal balance of the Loan.

“Default” shall mean the occurrence of any event hereunder or under the Note or the other Loan Documents which, but for the giving of notice or passage of time, or both, would be an Event of Default.

“Default Prepayment Premium” shall mean an amount equal to the greater of (i) five percent (5%) of the amount of Debt prepaid and (ii) the Prepayment Premium.

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​	-10-	​

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​ “Default Rate” shall mean, with respect to the Loan, a rate per annum equal to the lesser of (i) the Maximum Legal Rate, or (ii) the sum of (a) the Interest Rate and (b) five percent (5%).

“Default Release” shall have the meaning set forth in Section 2.10 hereof.

“Determination Date” shall mean, with respect to any Interest Accrual Period, (a) if the Loan is a SOFR Loan, the Periodic Term SOFR Determination Day for such Interest Accrual Period, (b) if the component of the Interest Rate based on Term SOFR (or the then-current Benchmark if the Loan is then an Alternate Rate Loan) is replaced with the Prime Index Rate pursuant to Section 2.5(b)(iii) hereof, the date that is two (2) Business Days prior to the commencement date of such Interest Accrual Period, or (c) if the Loan is an Alternate Rate Loan, the date and time determined by Lender in accordance with the Conforming Changes.

“Disclosure Documents” **** shall mean, collectively and as applicable, any structural and collateral term sheet (but excluding any pre-marketing term sheet), offering circular, prospectus, prospectus supplement, private placement memorandum or other offering document (but excluding any such similar offering documents delivered in connection with any pre-marketing), in each case, in preliminary or final form, used in connection with a Securitization, that has been (i) delivered to Borrower by Lender for Borrower’s review (which delivery may be by email) and (ii) designated as a “Disclosure Document” by Lender in its reasonable discretion in a written notice to Borrower (which notice may be by email).

“Disqualified Person” means any Person if, at the time as of which a determination is required under the terms of this Agreement:

(a)such Person is a Prohibited Person;

(b)such Person has the benefit of sovereign immunity (unless such Person has waived such sovereign immunity in writing);

(c)such Person is a Prohibited Entity;

(d)such Person, or any Person that Controls such Person, is, or has been within the last seven (7) years, a debtor in any case, proceeding or other action under any existing or future law of any jurisdiction relating to bankruptcy, insolvency, reorganization or relief of debtors; or

(e)such Person, or any Person that Controls such Person or is Controlled by such Person, to the knowledge of the Person seeking the applicable approval or as reasonably determined by Lender, has been, within the last seven (7) years, (i) convicted of, or pleaded guilty to, a felony relating to financial crimes involving dishonesty, fraud or moral turpitude, or (ii) subject to a material governmental or regulatory investigation which resolved in a final, non-appealable conviction for criminal activity involving moral turpitude, or to a material a civil proceeding in which such Person was found liable in a final non-appealable judgment to have attempted to hinder, delay or defraud creditors.

“Division” **** shall have the meaning set forth in Section 5.1 hereof.

“EEA Financial Institution” shall mean (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA

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​ Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” shall mean any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) which has authority to exercise any Write-Down and Conversion Powers.

“Eligibility Requirements” means, with respect to any Person, that such Person (a) either (1) has a Net Worth equal to or in excess of One Hundred Twenty Million and No/100 Dollars ($120,000,000.00) (exclusive of the Property) or (2) has otherwise been approved, in writing by Lender, and (b) is regularly engaged in the business of making or owning (or, in the case of a pension advisory firm, asset manager, registered investment advisor or manager or similar fiduciary, regularly engaged in managing investments in) commercial real estate loans (including participation interests in commercial real estate loans and mezzanine loans to direct or indirect owners of commercial properties, which loans are secured by pledges of direct or indirect ownership interests in the owners of such commercial properties), originating preferred equity investments, owning or operating commercial properties or making investments in commercial real estate.

“Eligible Account” shall mean a separate and identifiable account from all other funds (a) held by the holding institution that is either (i) an account or accounts maintained with a federal or state-chartered depository institution or trust company which complies with the definition of Eligible Institution or (ii) a segregated trust account or accounts maintained with a federal or state chartered depository institution or trust company acting in its fiduciary capacity which, in the case of a state chartered depository institution or trust company, is subject to regulations substantially similar to 12 C.F.R. § 9.10(b), having in either case a combined capital and surplus of at least $50,000,000.00 and subject to supervision or examination by federal and state authority, as applicable or (b) following a Securitization, held by a Servicer acceptable to the Rating Agencies, which complies with the definition of Eligible Institution. An Eligible Account will not be evidenced by a certificate of deposit, passbook or other instrument.

“Eligible Institution” shall mean either (a) other than its capacity as Bank or holder of any Reserve Account or Restricted Account that is subject to the immediately succeeding clause (b) or (c), a depository institution or trust company insured by the Federal Deposit Insurance Corporation, the short-term unsecured debt obligations or commercial paper of which are rated at least “A-1+” by S&P, “P-1” by Moody’s and “F-1+” by Fitch in the case of accounts in which funds are held for thirty (30) days or less (or, in the case of Letters of Credit and accounts in which funds are held for more than thirty (30) days, the long-term unsecured debt obligations of which are rated at least “AA-” by Fitch and S&P and “Aa3” by Moody’s), (b) if any of the Securities or any class thereof in any Securitization is rated by Moody’s, in its capacity as Servicer or holder of the Cash Management Account, Debt Service Account or any Reserve Account, a depository institution or trust company insured by the Federal Deposit Insurance Corporation the long-term deposit ratings of which are rated at least “A2” by Moody’s, (c) if any of the Securities or any class thereof in any Securitization is rated by Moody’s, in its capacity as Bank or holder of any Restricted Account, a depository institution or trust company insured by the Federal Deposit Insurance Corporation the long-term unsecured debt obligations of which are rated at least “Baa3” by Moody’s, (d) if any of the Securities or any class thereof in any Securitization is rated by S&P and/or Fitch, in its capacity as Servicer or Bank, and/or holder of any Reserve Account or Restricted Account, Bank of America, N.A., KeyBank National Association, Wells Fargo Bank, National Association, Capital One, N.A., PNC

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​ Bank, N.A. or U.S. Bank, N.A., provided, that, in each case the applicable ratings of such entity are not reduced below the lower of (i) the ratings for S&P and/or Fitch, as applicable, set forth in subsection (a) hereof and (ii) such entity’s ratings by S&P and/or Fitch, as applicable, in effect as of the Closing Date, or, with respect to each of the foregoing clauses (a), (b), (c) or (d), such other financial institution reasonably acceptable to Lender, which, to the extent any of the Securities or any class thereof in any Securitization is rated by Moody’s, shall be evidenced by a Rating Agency Confirmation.

“Environmental Indemnity” shall mean that certain Environmental Indemnity Agreement, dated as of the date hereof, executed by Borrower and Guarantor in connection with the Loan for the benefit of Lender and the Indemnified Parties (as defined therein), as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“Environmental Laws” shall have the meaning set forth in the Environmental Indemnity.

“Equity Collateral” shall have the meaning set forth in Section 11.6 hereof.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the same may heretofore have been or may hereafter be amended, restated, replaced or otherwise modified.

“Erroneous Payment” shall have the meaning set forth in Section 17.19 hereof.

“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“Event of Default” shall have the meaning set forth in Section 10.1 hereof.

“Excess Cash Flow” shall have the meaning set forth in Section 9.3 hereof.

“Excess Cash Flow Account” shall have the meaning set forth in Section 8.5 hereof.

“Excess Cash Flow Funds” shall have the meaning set forth in Section 8.5 hereof.

“Exchange Act” shall mean the Securities and Exchange Act of 1934, as amended.

“Exchange Act Filing” shall have the meaning set forth in Section 11.1 hereof.

“Excluded Taxes” shall mean any of the following taxes imposed on or with respect to Lender or required to be withheld or deducted from a payment to Lender: (i) any U.S. federal withholding taxes imposed under FATCA, (ii) income, franchise taxes, branch profit and other taxes of the United States of America imposed by the jurisdiction under the laws of which Lender is organized or any political subdivision or taxing authority thereof or therein or imposed by the jurisdiction of Lender’s applicable lending office where Lender is resident or engaged in business or any political subdivision or taking authority thereof or therein, or taxes that are imposed as a result of a present or former connection between Lender and the jurisdiction imposing such tax (other than connections arising from Lender having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document or sold or assigned an interest in the Loan or any Loan Document), and (iii) U.S. federal withholding taxes imposed on amounts payable to or for the account of Lender with respect to an applicable interest in the Loan or commitment pursuant to a law in effect on the date on which (a) Lender acquires such interest in the Loan or commitment or (b) Lender changes its lending office, except in each case to

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​ the extent that such amounts with respect to such taxes were payable either to Lender’s assignor immediately before Lender became a party hereto or to Lender immediately before it changed its lending office.

“Exculpated Parties” shall have the meaning set forth in Section 13.1 hereof.

“Extended Maturity Date” shall have the meaning set forth in Section 2.9 hereof.

“Extension Option” shall have the meaning set forth in Section 2.9 hereof.

“Extension Period” shall have the meaning set forth in Section 2.9 hereof.

“Extension Strike Rate” shall mean the lesser of (i) the Initial Strike Rate (as adjusted by the Benchmark Replacement Adjustment, if applicable) and (ii) a percentage rate equal to Term SOFR or the Unadjusted Benchmark Replacement, as applicable, which would yield a Debt Service Coverage Ratio of 1.10:1.00.

“Family Group” shall mean, as to any natural Person, the spouse, children and grandchildren (in each case, by birth or adoption) and other lineal descendants, in each case, of such natural Person and, in each case, family trusts and/or conservatorships for the benefit of any of the foregoing Persons.

“FATCA” **** shall mean Sections 1471 through 1474 of the IRS Code (as may be amended or replaced from time to time), and any requests, rules, regulations, guidelines, interpretations or directions promulgated by any Governmental Authority in connection therewith.

“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with member banks of the Federal Reserve System, as published by the Federal Reserve Bank of New York on the next succeeding Business Day or, if such rate is not so published for any Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upwards, if necessary, to the next 1/100 of 1%) charged to Citibank, N.A. on the applicable day, as determined by Lender.

“Federal Reserve Board” means the Board of Governors of the Federal Reserve System of the United States.

“FIRRMA” **** shall mean, collectively, (i) the Defense Production Act of 1950, as amended (50 U.S.C. § 4565), all laws and regulations related thereto and all mandates, requirements, powers and similar requirements imposed or exercised thereunder (including, without limitation, the Foreign Investment Risk Review Modernization Act and any of the foregoing implemented by and/or otherwise relating to the Committee on Foreign Investment in the United States) and (ii) as the foregoing may be amended from time to time, any successor statute or statutes and all rules and regulations from time to time promulgated in connection with the foregoing.

“FIRRMA Documents” **** shall mean any notice, correspondence, document, agreement, declaration, or other communication relating to or arising in connection with FIRRMA; provided, however, that if the communication is oral, “FIRRMA Document” shall mean a written summary thereof prepared by Borrower.

“FIRRMA Prohibited Filing Event” shall mean an event which shall be deemed to have occurred if (i) any mandatory filing or declaration relating to FIRRMA is required and/or (ii) any

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​ Governmental Authority requires (or recommends to the President of the United States) forfeiture, divestiture or abandonment of all or any portion of the Property and/or imposes any material mitigation measures on Borrower, the Constituent Owners of Borrower and/or the Property, in each case, related to FIRRMA.

“FIRRMA Prohibited Transfer” shall mean any Sale or Pledge of the Property or any part thereof or any legal or beneficial interest therein (including, without limitation, the Loan and/or Loan Documents) or any Sale or Pledge of an interest in any Restricted Party, in each case, which (i) triggers a mandatory filing or declaration requirement with respect to FIRRMA, (ii) makes advisable a voluntary filing or declaration with respect to FIRRMA or (iii) increases the likelihood of (A) forfeiture, divestiture or abandonment of all or any portion of the Property relating to FIRRMA or (B) any mitigation measures being imposed by any Governmental Authority on Borrower, the Constituent Owners of Borrower and/or the Property, in each case, related to FIRRMA.

“First Monthly Payment Date” shall mean November 9, 2024.

“Fitch” shall mean Fitch Ratings, Inc.

“Flood Insurance Acts” shall have the meaning set forth in Section 7.1 hereof.

“Foreign Taxes” shall have the meaning set forth in Section 2.5 hereof.

“Free Prepayment Amount” shall have the meaning specified in Section 2.7(a) hereof.

“Free Rent Reserve Account” shall have the meaning set forth in Section 8.2 hereof.

“Free Rent Reserve Funds” shall have the meaning set forth in Section 8.2 hereof.

“Funding Borrower” shall have the meaning set forth in Section 17.20 hereof.

“GAAP” shall mean generally accepted accounting principles in the United States of America as of the date of the applicable financial report.

“Governmental Authority” shall mean any court, board, agency, commission, office or other authority of any nature whatsoever for any governmental unit (federal, state, county, district, municipal, city or otherwise) whether now or hereafter in existence and having jurisdiction and authority over, as applicable, the Property, Borrower, or Guarantor.

“Gross Revenues” shall mean the sum of: (a) total annualized base rent in place as of the date of the determination based on executed and effective Leases entered into in accordance with the Loan Documents which are in full force and effect, including (i) executed Leases in place as of the Closing Date, or entered into in accordance with the Loan Documents which are in full force and effect with future term commencement dates within twelve (12) months, (ii) executed Leases with free rent periods currently in effect, not to exceed the greater of (x) twelve (12) months or (y) one (1) month for each year of the initial term of the Lease (unless the excess is reserved with Lender), and (iii) any contractual rent increases within the twelve months following the date of such calculation, which are not subject to any tenant contingencies, but excluding rent from any Tenants (A) that are in monetary default under their Lease with respect to the payment of base rent in excess of ninety (90) days or (B) in bankruptcy (unless the applicable Lease shall have been affirmed by the bankruptcy trustee, and in such event, rental revenue shall only be included for a maximum of six (6) months from the date such Lease was affirmed if the Tenant has not then emerged from

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​ bankruptcy), and (b) reimbursed expenses and/or reimbursements due by Tenants in addition to base rent (to the extent provided for in the underlying Lease), percentage and overage rent, and ancillary income (e.g. parking, tenant services, signage, etc.) for the twelve (12) month period immediately preceding the date of determination, provided that operating expense and tax reimbursements shall be adjusted in accordance with the Tax and Insurance Adjustment.

“Guarantor” shall mean AREIT OP and any successor to and/or replacement of any of the foregoing Person, including, without limitation, an Approved Replacement Guarantor, in each case, pursuant to and in accordance with the applicable terms and conditions of the Loan Documents.

“Guarantor Control Condition” shall mean a condition which shall be deemed satisfied to the extent that each Person that Controls (directly or indirectly) Borrower and, if applicable, each SPE Component Entity is, in each case, itself a current Guarantor (as distinguished from any prior Guarantor that has been replaced in accordance with the applicable terms and conditions of the Loan Documents) or Controlled (directly or indirectly) by one or more current Guarantors (as distinguished from any prior Guarantor that has been replaced in accordance with the applicable terms and conditions of the Loan Documents).

“Guaranty” shall mean that certain Limited Recourse Guaranty executed by Guarantor and dated as of the date hereof.

“Immediate Repairs” shall have the meaning set forth in Section 4.25 hereof.

“Improvements” shall have the meaning set forth in the granting clause of the Security Instrument.

“Indebtedness” shall mean, for any Person, without duplication: (i) all indebtedness of such Person for borrowed money, for amounts drawn under a letter of credit, or for the deferred purchase price of property for which such Person or its assets is liable, (ii) all unfunded amounts under a loan agreement, letter of credit, or other credit facility for which such Person would be liable if such amounts were advanced thereunder, (iii) all amounts required to be paid by such Person by contract and/or as a guaranteed payment (including, without limitation, any such amounts required to be paid to partners and/or as a preferred or special dividend, including any mandatory redemption of shares or interests), (iv) all indebtedness incurred and/or guaranteed by such Person, directly or indirectly (including, without limitation, contractual obligations of such Person), (v) all obligations under leases that constitute capital leases for which such Person is liable, (vi) all obligations of such Person under interest rate swaps, caps, floors, collars and other interest hedge agreements, in each case whether such Person is liable contingently or otherwise, as obligor, guarantor or otherwise, or in respect of which obligations such Person otherwise assures a creditor against loss and (vii) any property-assessed clean energy loans or similar indebtedness, including, without limitation, if such loans or indebtedness are made or otherwise provided by any Governmental Authority and/or secured or repaid (directly or indirectly) by any taxes or similar assessments.

“Indemnified Parties” shall mean (a) Lender, (b) any successor owner or holder of the Loan or participations in the Loan, (c) any Servicer or prior Servicer of the Loan, (d) any Investor or any prior Investor in any Securities, (e) any trustees, custodians or other fiduciaries who hold or who have held a full or partial interest in the Loan for the benefit of any Investor or other third party, (f) any receiver or other fiduciary appointed in a foreclosure or other Creditors Rights Laws proceeding, (g) any officers, directors, shareholders, partners, members, employees, agents, servants, representatives, Affiliates or subsidiaries of any and all of the foregoing, and (h) the heirs, legal representatives, successors and assigns of any and all of the foregoing (including, without limitation,

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​ any successors by merger, Division, consolidation or acquisition of all or a substantial portion of the Indemnified Parties’ assets and business), in all cases whether during the term of the Loan or as part of or following a foreclosure of the Loan.

“Independent Director” shall have the meaning set forth in Section 5.2 hereof.

“Index Rate Conversion” shall have the meaning set forth in Section 2.8(g) hereof.

“Individual Borrower” shall have the meaning set forth in the first paragraph hereof.

“Individual Material Adverse Effect” shall mean a material adverse effect on (i) any Individual Property, (ii) the business, economic performance or financial condition of any Individual Property or Individual Borrower, (iii) the enforceability, validity, perfection or priority of the lien of the Security Instrument or the other Loan Documents with respect to any Individual Property or Individual Borrower or (iv) the ability of any Individual Borrower to perform, in all material respects, its obligations under the Security Instrument or the other Loan Documents.

“Individual Property” shall mean each parcel of real property set forth on Schedule II attached hereto as “Property,” the Improvements thereon and all personal property owned (or leased pursuant to the PILOT Lease) by the applicable Borrower with respect to such Individual Property, together with all rights of Borrower pertaining to such property and Improvements.

“Information” shall have the meaning set forth in Section 11.8(b)(ii) hereof.

“Initial Strike Rate” shall mean 4.418%.

“Insurance Account” shall have the meaning set forth in Section 8.6 hereof.

“Insurance Payment Date” shall mean, with respect to any applicable Policies, the date occurring 30 days prior to the date the applicable Insurance Premiums associated therewith are due and payable.

“Insurance Premiums” shall have the meaning set forth in Section 7.1 hereof.

“Interest Accrual Period” shall mean the period beginning on (and including) the fifteenth (15^th^) day of each calendar month during the term of the Loan and ending on (and including) the fourteenth (14^th^) day of the next succeeding calendar month; provided, however, the first Interest Accrual Period shall be the period commencing on the Closing Date, and ending on and including October 14, 2024.

“Interest Bearing Accounts” shall mean the following Reserve Accounts: the Tax Account, the Insurance Account, the Leasing Reserve Account, the Excess Cash Flow Account, and any other Reserve Account established by this Agreement or the other Loan Documents.

“Interest Rate” shall mean, with respect to each Interest Accrual Period, the SOFR Rate (or the Alternate Rate or Prime Rate) determined by Lender as of the Determination Date for such Interest Accrual Period; provided that if the foregoing would result in an interest rate in excess of the maximum rate permitted by applicable Legal Requirements, the Interest Rate shall be limited to the maximum rate permitted by applicable Legal Requirements.

“Interest Rate Cap Agreement” shall mean, as applicable, any interest rate cap agreement (together with the confirmation and schedules relating thereto) and any guaranty or other credit

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​ support relating thereto, each in form and substance reasonably satisfactory to Lender between Borrower Interest Rate Cap Party and Counterparty, any Replacement Interest Rate Cap Agreement or any Substitute Interest Rate Cap Agreement, as applicable, in each case which also satisfies the requirements set forth in Section 2.8.

“Interest Shortfall” shall mean, with respect to any repayment or prepayment of the Loan (including a repayment on the Maturity Date), the interest which would have accrued on the amount of principal of the Loan being repaid or prepaid (absent such repayment or prepayment) from and including the date on which such repayment or prepayment occurs through and including the last day of the Interest Accrual Period related to the Monthly Payment Date next occurring following the date of such prepayment or, if such prepayment occurs on a Monthly Payment Date, interest which would have accrued on the prepayment amount through and including the last day of the Interest Accrual Period related to such Monthly Payment Date; provided that in the event that Borrower shall prepay the Loan during the period commencing on the first calendar day immediately following a Monthly Payment Date to, but not including, the Periodic Term SOFR Determination Day (or other determination date with respect to any other Benchmark) in such calendar month, the Interest Shortfall shall be estimated by Lender in connection with such prepayment and, once the applicable Interest Rate for the next occurring Interest Accrual Period can be determined, Lender shall calculate the actual Interest Shortfall required to be paid by Borrower for such prepayment and (a) if the Interest Shortfall paid to Lender is in excess of the amount required to be paid pursuant to such calculation, Lender shall promptly return to Borrower such excess amount and (b) if the Interest Shortfall paid to Lender is less than the amount required to be paid to Lender pursuant to such calculation, Borrower shall pay to Lender the amount of such deficiency within three (3) Business Days of notice to Borrower from Lender.

“Intermountain Space Center Property” shall have the meaning set forth in Section 3.14 hereof.

“Investor” shall mean any investor or potential investor in the Loan (or any portion thereof or interest therein) in connection with any Secondary Market Transaction.

“IRS Code” shall mean the Internal Revenue Code of 1986, as amended from time to time or any successor statute.

“JPM” shall have the meaning set forth in the introductory paragraph hereto, together with its successors and permitted assigns.

“Land” shall have the meaning set forth in the Security Instrument.

“Lease” shall have the meaning set forth in the Security Instrument (provided that in no event shall any PILOT Document or PILOT Lease constitute a Lease).

“Leasing Reserve Account” shall have the meaning set forth in Section 8.3 hereof.

“Leasing Reserve Funds” shall have the meaning set forth in Section 8.3 hereof.

“Legal Requirements” shall mean all applicable federal, state, county, municipal and other governmental statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and injunctions of Governmental Authorities governing Borrower or the Property or any part thereof, or the construction, use, alteration or operation thereof, or any part thereof, whether now or hereafter enacted and in force, including, without limitation, the Americans with Disabilities Act of 1990, and all Permits, authorizations and regulations relating thereto, and all covenants, agreements,

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​ restrictions and encumbrances contained in any instruments, either of record or known to Borrower, at any time in force governing Borrower or the Property or any part thereof, including, without limitation, any which may (i) require repairs, modifications or alterations in or to the Property or any part thereof, or (ii) in any way limit the use and enjoyment thereof.

“Lender Affiliate” shall have the meaning set forth in Section 11.2 hereof.

“Lender Group” shall have the meaning set forth in Section 11.2 hereof.

“Letter of Credit” shall mean an irrevocable, auto-renewing, unconditional, transferable, clean sight draft standby letter of credit having an initial term of not less than one (1) year and with automatic renewals for one (1) year periods (unless the obligation being secured by, or otherwise requiring the delivery of, such letter of credit is required to be performed at least thirty (30) days prior to the initial expiry date of such letter of credit), for which Borrower shall have no reimbursement obligation and which reimbursement obligation is not secured by the Property or any other property pledged to secure the Note, in favor of Lender and entitling Lender to draw thereon in New York, New York, based solely on a statement that Lender has the right to draw thereon executed by an officer or authorized signatory of Lender. A Letter of Credit must be issued by an Approved Bank.  Borrower’s delivery of any Letter of Credit hereunder shall, be conditioned upon Lender’s receipt of a New Non-Consolidation Opinion relating to such Letter of Credit, if the amount of such Letter of Credit, together with any payment guarantees and other Letters of Credit previously delivered hereunder exceed, in the aggregate, 15% of outstanding principal balance of the Loan.

“Liabilities” shall have the meaning set forth in Section 11.2 hereof.

“Loan” shall mean the mortgage loan in the original principal amount of $475,000,000 made by Lender to Borrower pursuant to this Agreement.

“Loan Bifurcation” shall have the meaning set forth in Section 11.1 hereof.

“Loan Documents” shall mean, collectively, this Agreement, the Note, the Security Instrument, the Environmental Indemnity, the Assignment of Management Agreement, the Collateral Assignment of Interest Rate Cap Agreement, the Restricted Account Agreement, the Guaranty and all other documents executed and/or delivered in connection with the Loan, as each of the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time.

“Losses” shall mean, with respect to any Person, any and all actual losses, damages, out-of-pocket costs, fees, expenses, claims, suits, judgments, awards, liabilities (including but not limited to strict liabilities), obligations, debts, fines, penalties, charges, amounts paid in settlement (including but not limited to reasonable out-of-pocket legal fees and other costs of defense reasonably incurred) that are imposed on, incurred by or asserted against such Person; but, excluding, (i) special, consequential, exemplary or punitive damages, except to the extent Lender is required in a final judgment to pay the same to a third party (without duplication), (ii) lost profits and diminution in value claims, and (iii) such Person’s Losses to the extent such Losses arose solely by reason of the gross negligence, illegal acts, fraud or willful misconduct of such Person otherwise entitled to indemnification or recourse for such Losses.

“Major Lease” shall mean as to the Property (i) any Lease which, individually or when aggregated with all other Leases with the same Tenant or its Affiliate, demises 150,000 square feet or more of the Property’s gross leasable area, (ii) any Lease which contains any option, offer, right

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​ of first refusal or other similar entitlement to acquire or encumber (other than an encumbrance as the result of a subordination, non-disturbance and attornment agreement, pursuant to an unrecorded Lease, or pursuant to any similar unrecorded lease document) all or any portion of the Property **** and (iii) any instrument guaranteeing or providing credit support for any Lease meeting the requirements of (i) **** and/or (ii) above.

“Management Agreement” shall mean, collectively, each management agreement entered into by and between the applicable Borrower and Manager, pursuant to which Manager is to provide management and other services with respect to the Property, as the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time.

“Manager” shall mean BCD Property Management LLC, a Delaware limited liability company, or such other entity selected as the manager of the Property in accordance with the terms of this Agreement or the other Loan Documents.

“Material Action” shall mean to file any insolvency or reorganization case or proceeding, or institute proceedings to have such Person be adjudicated bankrupt or insolvent, or institute proceedings under any applicable insolvency law, or seek any relief under any law relating to relief from debts or the protection of debtors, or consent to the filing or institution of bankruptcy or insolvency proceedings against such Person, or file a petition seeking, or consent to, reorganization or relief with respect to such Person under any applicable federal or state law relating to bankruptcy or insolvency, or seek or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator, custodian (or other similar official) of or for such Person or a substantial part of its property, or make any assignment for the benefit of creditors of such Person, or admit in writing such Person’s inability to pay its debts generally as they become due, or take action in furtherance of any such action.

“Maturity Date” shall mean the Stated Maturity Date, as such date may be extended pursuant to and in accordance with Section 2.9 hereof, or such other date on which the final payment of the principal amount of the Loan becomes due and payable as herein provided, whether at the Stated Maturity Date, by declaration of acceleration, or otherwise.

“Maximum Legal Rate” shall mean the maximum non-usurious interest rate, if any, that at any time or from time to time may be contracted for, taken, reserved, charged or received on the indebtedness evidenced by the Note and as provided for herein or the other Loan Documents, under the laws of such state or states whose laws are held by any court of competent jurisdiction to govern the interest rate provisions of the Loan.

“Member” is defined in Section 5.1 hereof.

“Mezzanine Borrower” shall have the meaning set forth in Section 11.6 hereof.

“Mezzanine Option” shall have the meaning set forth in Section 11.6 hereof.

“Minimum Counterparty Rating” shall mean (a) to the extent S&P rates any Securitization of the Loan, a long term credit rating from S&P of at least “A-”, (b) to the extent Moody’s rates any Securitization of the Loan, a long term credit rating from Moody’s of at least “A3”, which rating shall not include a “t” or otherwise reflect a termination risk, and (c) to the extent Fitch rates any Securitization of the Loan, a short term credit rating from Fitch of at least “F-2” or a long term credit rating from Fitch of at least “BBB”.

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​ “Minimum Disbursement Amount” shall mean Twenty-Five Thousand and No/100 Dollars ($25,000).

“Monthly Debt Service Payment Amount” shall mean (i) for the First Monthly Payment Date and for each Monthly Payment Date occurring thereafter, a payment equal to the amount of interest which has accrued and will accrue, in each case, on each Component of the Loan during the Interest Accrual Period in which such Monthly Payment Date occurs computed at the Interest Rate.

“Monthly Insurance Deposit” shall have the meaning set forth in Section 8.6 hereof.

“Monthly Payment Date” shall mean the First Monthly Payment Date and the ninth (9^th^) day of every calendar month occurring thereafter during the term of the Loan.

“Monthly Tax Deposit” shall have the meaning set forth in Section 8.6 hereof.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“MS” shall have the meaning set forth in the introductory paragraph hereto, together with its successors and permitted assigns.

“Natixis” shall have the meaning set forth in the introductory paragraph hereto, together with its successors and permitted assigns.

“Net Proceeds” shall mean: (i) the net amount of all insurance proceeds payable as a result of a Casualty to the Property, after deduction of reasonable costs and expenses (including, but not limited to, reasonable attorneys’ fees), if any, in collecting such insurance proceeds, or (ii) the net amount of the Award, after deduction of reasonable costs and expenses (including, but not limited to, reasonable attorneys’ fees), if any, in collecting such Award.

“Net Proceeds Deficiency” shall have the meaning set forth in Section 7.4 hereof.

“Net Worth” shall mean, as of any date of determination, an amount equal to the aggregate of:  (a) the total assets of the applicable entity (exclusive of the Properties) whose Net Worth is being calculated (including (x) Uncalled Capital Commitments (less the outstanding principal balance of any subscription line or other credit line that is secured directly or indirectly by all or a portion of such Uncalled Capital Commitments) and (y) any cash deposits made by such entity held by a seller of a property pursuant to a purchase and sale agreement with respect to such property until and unless such deposit is (i) forfeited or (ii) applied toward the applicable purchase price under such purchase and sale agreement and otherwise determined in accordance with GAAP (or such other method of accounting reasonably acceptable to Lender)), minus (b) the total liabilities of such entity (including under the Guaranty but excluding the Debt related to the Properties) determined in accordance with GAAP (or such other method of accounting reasonably acceptable to Lender).  As used in this definition of Net Worth, “Uncalled Capital Commitments” shall mean the amount of any available uncalled capital commitments of the applicable entity that are payable in cash, are required to be contributed to such entity and that are callable on a current basis from any direct or indirect investor (whether foreign or domestic) that (i) is not subject to a proceeding under the Bankruptcy Code and (ii) is not in default under a material provision of their respective subscription agreements, limited partnership agreement of such entity or any other agreement related to the making of such capital contributions.

“New Manager” shall mean any Person replacing or becoming the assignee of the then current Manager, in each case, in accordance with the applicable terms and conditions hereof.

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​ “New Non-Consolidation Opinion” shall mean a substantive non-consolidation opinion provided by outside counsel reasonably acceptable to Lender and the Rating Agencies (provided, that, the outside counsel that delivered the Non-Consolidation Opinion in connection with the initial closing shall be deemed reasonably acceptable) and otherwise in form and substance reasonably acceptable to Lender and the Rating Agencies (provided, that, an opinion in substantially the same form as the Non-Consolidation Opinion delivered in connection with the initial closing shall be deemed reasonably acceptable).

“New Sub-Manager” shall mean any Person replacing or becoming the assignee of the then current Sub-Manager, in each case, in accordance with the applicable terms and conditions hereof.

“Non-Conforming Policy” shall have the meaning set forth in Section 7.1 hereof.

“Non-Consolidation Opinion” shall mean that certain substantive non-consolidation opinion delivered to Lender by Neuberger, Quinn, Gielen, Rubin & Gibber, P.A. in connection with the closing of the Loan.

“Note” shall mean, individually and/or collectively, as the context may require, each of Note A-1, Note A-2, and Note A-3, as any of the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time.

“Note A-1” shall mean that certain Promissory Note A-1 dated the date hereof, in the original principal amount of $285,000,000.00 made by Borrower in favor of JPM, as the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time.

“Note A-2” shall mean that certain Promissory Note A-2 dated the date hereof, in the original principal amount of $142,500,000 made by Borrower in favor of MS, as the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time.

“Note A-3” shall mean that certain Promissory Note A-3 dated the date hereof, in the original principal amount of $47,500,000 made by Borrower in favor of Natixis, as the same may be amended, restated, replaced, extended, renewed, supplemented, severed, split, or otherwise modified from time to time.

“Obligations” shall have the meaning set forth in Section 17.20 hereof.

“OFAC” shall have the meaning set forth in Section 3.30 hereof.

“Officer’s Certificate” shall mean a certificate delivered to Lender by Borrower which is signed by Responsible Officer of Borrower.

“Op Ex Monthly Deposit” shall have the meaning set forth in Section 8.4 hereof.

“Operating Expense Account” shall have the meaning set forth in Section 8.4 hereof.

“Operating Expense Funds” shall have the meaning set forth in Section 8.4 hereof.

“Operating Expenses” shall mean without duplication, all ordinary costs and expenses actually incurred with respect to the operation, management, maintenance, repair and use of the Properties, insurance and property taxes, for the twelve (12) month period immediately preceding

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​ the date of determination (excluding any extraordinary expenses, extraordinary losses, non-cash items, non-recurring expenses, Debt Service on the Loan and other amounts due and payable on the Loan, leasing commissions, capital expenditures or capital reserves, deposits in any reserve accounts required to be maintained pursuant to the Loan Documents, expenses which are subject to reimbursement by any insurance policy or third party, and income taxes and other taxes in the nature of income taxes); provided, that the foregoing shall be adjusted as of the applicable date of determination for (i) for any changes in Taxes or Insurance Premiums known as of the time of determination (the “Tax and Insurance Adjustment”) and (ii) to reflect an assumed base property management fee equal to the greater of (x) 3.0% of (a) base rent payable under the underlying executed Leases or (b) Gross Revenues (as applicable, based on the method of calculation of property management fees under the applicable Lease and/or Management Agreement), and (y) the actual contractual property management fee payable pursuant to the Management Agreement.

“Organizational Chart” shall have the meaning set forth in Section 3.31 hereof.

“Other Charges” shall mean all maintenance charges, impositions other than Taxes, and any other charges, vault charges and license fees for the use of vaults, chutes and similar areas adjoining the Property, now or hereafter levied or assessed or imposed against the Property or any part thereof.

“Parent Borrower” shall mean AREIT 2024 P1 LLC, a Delaware limited liability company.

“Partial Release” shall have the meaning set forth in Section 2.10 hereof.

“Partial Release Test” shall have the meaning set forth in Section 2.10 hereof.

“Participant” shall have the meaning set forth in Section 11.8(a)(ix) hereof.

“Patriot Act” shall have the meaning set forth in Section 3.30 hereof.

“Payment Recipient” shall have the meaning set forth in Section 17.19 hereof.

“Payor Party” shall have the meaning set forth in Section 17.19 hereof.

“Periodic Term SOFR Determination Day” shall have the meaning set forth in the definition of “Term SOFR.”

“Permits” shall mean all necessary certificates, licenses, permits, franchises, trade names, certificates of occupancy, consents, and other approvals (governmental and otherwise) required under applicable Legal Requirements for the operation of the Property and the conduct of Borrower’s business (including, without limitation, all required zoning, building code, land use, environmental, public assembly and other similar permits or approvals).

“Permitted Assumption Party” shall mean (x) a Qualified Transferee and/or a Person at least 51% owned (in the aggregate, directly or indirectly) and Controlled by a Qualified Transferee and/or (y) any entity at least 51% owned (in the aggregate, directly or indirectly) and Controlled by Sponsor.

“Permitted Encumbrances” shall mean, collectively, (a) the lien and security interests created by this Agreement and the other Loan Documents, (b) all liens, encumbrances and other matters disclosed in the Title Insurance Policy, (c) liens, if any, for Taxes imposed by any Governmental Authority not yet due or delinquent or which are being contested by Borrower in

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​ good faith and in accordance with the terms and conditions of this Agreement, (d) liens in respect of property or assets imposed by law which were incurred in the ordinary course of business and in accordance with the terms and conditions of this Agreement, and liens for worker’s compensation, unemployment insurance and similar programs, in each case, arising in the ordinary course of business, which are not yet due or delinquent or which are being contested by Borrower in good faith and in accordance with the terms and conditions of this Agreement, (e) Leases in place as of the Closing Date or entered into in accordance with the terms hereof, (f) Permitted Equipment Leases in place as of the Closing Date or entered into in accordance with the terms hereof, (g) customary easements, rights-of-way, restrictions and other similar encumbrances for utilities and/or access (including any of such matters incurred or entered into by Borrower in the ordinary course of business and in accordance with the terms and conditions of this Agreement) which, in each case, would not reasonably be expected to have an Individual Material Adverse Effect  or an Aggregate Material Adverse Effect, (h) obligations pursuant to any PILOT Lease, and (i) such other title and survey exceptions as Lender has approved or may approve in writing in Lender’s sole discretion.

“Permitted Equipment Leases” shall mean equipment leases or other similar instruments entered into with respect to the Personal Property; provided, that, in each case, such equipment leases or similar instruments (i) are entered into on commercially reasonable terms and conditions in the ordinary course of Borrower’s business and (ii) relate to Personal Property which is (A) used in connection with the operation and maintenance of the Property in the ordinary course of Borrower’s business and (B) readily replaceable without material interference or interruption to the operation of the Property.

“Permitted Equity Transfer” shall have the meaning specified in Section 6.3 hereof.

“Permitted Fund Manager” shall mean any Person that on the date of determination is (a) a nationally-recognized manager of investment funds investing in debt or equity interests relating to commercial real estate properties, commercial real estate loans (or interests therein) or mezzanine loans (or interests therein), and (b) not a Disqualified Person.

“Permitted Investments” shall mean “permitted investments” as then defined and required by the Rating Agencies.

“Permitted Non-Controlling Pledge” shall mean the pledge of any Person’s interests in any Restricted Party (other than a pledge of a direct interest in Borrower and/or any SPE Component Entity) which is provided to secure any debt facility of such Person or other obligation or liability, whether or not of such Person; provided, that such pledged interests do not represent a direct or indirect Controlling interest in any Individual Borrower, any SPE Component Entity or any Individual Property.

“Permitted Pledge” shall mean, any one or more of the following: (i) a Permitted Parent Pledge, and/or (ii) a Permitted Non-Controlling Pledge.

“Permitted Parent Pledge” shall mean the pledge of any Person’s direct or indirect interests in AREIT OP or any direct or indirect equity owner, member, shareholder, or partner of AREIT OP; provided that, (i) (A) such pledge is to secure a loan or line of credit from a Qualified Transferee or an institutional Person reasonably acceptable to Lender secured by all or substantially all of the assets of such Person including the direct or indirect ownership interests held by such Person in Borrower, and (B) the repayment of the debt or obligations such pledge secures is not specifically tied solely to the cash flow of the Properties or any Individual Property (as opposed to, for example, the cash flow from a group of properties that do not secure the Loan), or (ii) such pledge is a pledge

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​ of non-Controlling interests that are less than twenty percent (20%) of the indirect ownership interests in Borrower.

“Person” shall mean any individual, corporation (including a business trust), partnership, joint venture, joint stock company, limited liability company, estate, trust, unincorporated association, any federal, state, county or municipal government or any bureau, department, political subdivision or agency thereof and any other entity and, in each case, any fiduciary acting in such capacity on behalf of any of the foregoing.

“Personal Property” shall have the meaning set forth in the granting clause of the Security Instrument.

“PILOT Documents” shall mean, individually and/or collectively, any documents executed (other than a PILOT Lease) in connection with any PILOT Lease and/or any other documents granting an abatement or benefit with respect to Taxes in favor of an Individual Borrower, an Individual Property (or any portion thereof) or the Tenant under a Lease with respect to such Individual Property, in each case, described on Schedule VII hereto.

“PILOT Lease” shall mean the PILOT lease described on Schedule VII hereto pursuant to which the applicable Individual Borrower owns a leasehold interest in its Individual Property (or any portion thereof).

“PILOT Lessor” shall mean the lessor under a PILOT Lease, as described on Schedule VII hereto.

“PILOT Property” or “PILOT Properties” shall mean that certain Individual Property demised by the PILOT Lease or subject to a PILOT Document as set forth on Schedule VII hereto.

“Plainfield Borrower” shall mean AREIT Plainfield Logistics Center LLC, a Delaware limited liability company.

“Plainfield Tax Incentive Documents” shall mean, collectively, (i) that certain Plainfield Town Council Resolution No. 2019-40, dated as of September 9, 2019, by the Town Council, Town of Plainfield Hendricks County, Indiana, and (ii) that certain Plainfield Town Council Resolution No. 2019-41, dated as of September 23, 2019, by the Town Council, Town of Plainfield Hendricks County, Indiana.

“Policies” shall have the meaning specified in Section 7.1 hereof.

“Prepayment Failure” shall have the meaning specified in Section 2.7(a) hereof.

“Prepayment Notice” shall have the meaning specified in Section 2.7(a) hereof.

“Prepayment Premium” shall mean with respect to a repayment or prepayment of the outstanding principal balance of the Loan made prior to the Prepayment Premium Date, an amount equal to the product of (a) the weighted average of the Spreads with respect to the Components of the Loan being prepaid in excess of the Free Prepayment Amount (weighted based on the amounts of such excess), (b) the outstanding principal balance of the Loan being prepaid in excess of the Free Prepayment Amount, and (c) a fraction, the numerator of which is the number of days remaining from (but excluding) the date that is the last day of the Interest Accrual Period during which such prepayment is made, through (and including) the last day of the Interest Accrual Period during which the Prepayment Premium Date occurs, and the denominator of which is 360. No Prepayment

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​ Premium is payable on any repayment or prepayment of the outstanding principal balance of the Loan made on or after the Prepayment Premium Date. The amount of the Prepayment Premium shall be calculated by Lender in its reasonable discretion and shall be final and binding absent manifest error.

“Prepayment Premium Date” shall mean the Monthly Payment Date occurring in November 2025.

“Prime Index Rate” shall mean the rate of interest published in The Wall Street Journal from time to time as the “Prime Rate” for the U.S. If more than one such “Prime Rate” is published in The Wall Street Journal for a day, the average of such “Prime Rates” shall be used, and such average shall be rounded up to the nearest 1/100th of one percent (0.01%). If The Wall Street Journal ceases to publish the “Prime Rate” for the U.S., Lender shall select an equivalent publication that publishes such “Prime Rate,” and if such “Prime Rates” are no longer generally published or are limited, regulated or administered by a governmental or quasigovernmental body, then Lender shall select a comparable interest rate index. Notwithstanding the foregoing, in no event will the Prime Index Rate, for purposes of the Loan, be deemed to be less than zero percent (0%) per annum.

“Prime Rate” shall mean, with respect to each Interest Accrual Period and Component, the per annum rate of interest equal to the Prime Index Rate plus the Prime Rate Spread for such Component; provided, however, that such rate shall not be less than the Spread for such Component.

“Prime Rate Loan” shall mean the Loan at such time as interest thereon accrues at a rate of interest equal to the Prime Rate.

“Prime Rate Spread” shall mean the difference (expressed as the number of basis points, and which may be a positive or negative value or zero) between (a) the arithmetic mean of Term SOFR (or the applicable Benchmark Replacement) plus the Spread calculated over the ninety (90) day period prior to the date Term SOFR (or such Benchmark Replacement) was last applicable to the Loan and (b) the arithmetic mean of the Prime Index Rate calculated over the ninety (90) day period prior to the date Term SOFR (or such Benchmark Replacement) was last applicable to the Loan.

“Prior Loan” shall mean any prior mortgage financing of the Property or any portion thereof between a Borrower and the lender thereunder.

“Prohibited Entity” **** shall mean any Person which (i) is a statutory trust or similar Person, (ii) owns a direct or indirect interest in Borrower or the Property through a tenancy-in-common or other similar form of ownership interest and/or (iii) is a Crowdfunded Person.

“Prohibited Person” means any Person:

(a)listed in the annex to, or who is otherwise subject to the provisions of, Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001, and relating to Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (the “Executive Order”);

(b)that is owned or Controlled by, or acting for or on behalf of, any person or entity that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;

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​ (c)with whom a Person is prohibited from dealing or otherwise engaging in any transaction by any terrorism or money laundering law, including the Executive Order;

(d)who commits, threatens or conspires to commit or supports “terrorism” as defined in the Executive Order;

(e)that is named as a “specially designated national and blocked person” on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website or at any replacement website or other replacement official publication of such list; or

(f)who is an Affiliate of a Person listed in clauses (a) through (e) above.

“Prohibited Transfer” shall have the meaning set forth in Section 6.2 hereof.

“Projections” shall have the meaning set forth in Section 11.8(b)(ii) hereof.

“Property” and/or “Properties” shall mean, individually and/or collectively, as the context may require, each Individual Property which is subject to the terms hereof and of the other Loan Documents.

“Property Document” shall mean, individually or collectively (as the context may require), the documents listed on Schedule VIII attached hereto, and any replacements, amendments, or supplements thereto.

“Provided Information” shall mean any information provided by or on behalf of any Borrower Party in connection with the Loan, the Property, such Borrower Party and/or any related matter or Person.

“Prudent Lender Standard” shall, with respect to any matter, be deemed to have been met if the matter in question (i) prior to a Securitization and, if the Loan is not included in any REMIC Trust, after a Securitization, is reasonably acceptable to Lender and (ii) if any portion of the Loan is or will be included in a REMIC Trust, after a Securitization, (A) if permitted by REMIC Requirements applicable to such matter, would be reasonably acceptable to Lender or (B) if the Lender discretion in the foregoing subsection (A) is not permitted under such applicable REMIC Requirements, would be acceptable to a prudent lender of securitized commercial mortgage loans.

“Qualified Insurer” shall have the meaning set forth in Section 7.1 hereof.

“Qualified Management Agreement” shall mean a management agreement with a Qualified Manager with respect to any Property, which management agreement: (i) is substantially in the form of the Management Agreement as of the Closing Date, (ii) is substantially in the form attached hereto as Exhibit B, or (iii) is otherwise approved by Lender in writing (which such approval may be conditioned upon Lender’s receipt of a Rating Agency Confirmation with respect to such management agreement and shall not otherwise be unreasonably withheld, conditioned or delayed).

“Qualified Manager” shall mean either (i) the Manager as of the Closing Date, (ii) an Affiliate of AREIT or AREIT OP or (iii) any Person selected by Borrower to serve as Manager that is reasonably approved by Lender in writing (which such approval may be conditioned upon Lender’s receipt of a Rating Agency Confirmation with respect to such Person and shall not otherwise be unreasonably withheld, conditioned or delayed).

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​ “Qualified Sub-Management Agreement” shall mean a sub-management agreement with a Qualified Sub-Manager with respect to any Property, which sub-management agreement: (i) is substantially in the form of a Sub-Management Agreement as of the Closing Date, or (ii) is otherwise approved by Lender in writing (which such approval shall not be unreasonably withheld, conditioned or delayed).

“Qualified Sub-Manager” shall mean either (i) each Sub-Manager as of the Closing Date, (ii) an Affiliate of AREIT or AREIT OP, (iii) McDonald Investments, Ltd., (iv) Tolles Development Company, (v) MDC Management, Inc., (vi) CBRE, or (vii) any Person selected by Borrower to serve as Sub-Manager that is reasonably approved by Lender in writing (which such approval shall not be unreasonably withheld, conditioned or delayed).

“Qualified Transferee” means one or more of the following:

(a)a real estate investment trust, bank, saving and loan association, investment bank, insurance company, trust company, commercial credit corporation, pension plan, pension fund or pension advisory firm, mutual fund, sovereign wealth fund, government entity or plan, provided that any such Person referred to in this clause (a) satisfies the Eligibility Requirements;

(b)an investment company, money management firm or “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act or an institutional “accredited investor” within the meaning of Regulation D under the Securities Act, provided that any such Person referred to in this clause (b) satisfies the Eligibility Requirements;

(c)an institution substantially similar to any of the Persons described in clause (a), (b) or (e) of this definition that satisfies the Eligibility Requirements;

(d)any Person Controlled by, Controlling or under common Control with any one or more of the Persons described in clause (a), (b) or (c) above or clause (e) below (provided that for this purpose, such Person and all such other Persons shall be aggregated as if they were one Person for purposes of measuring compliance with clause (a) of the Eligibility Requirements);

(e)an investment fund, limited liability company, limited partnership or general partnership (a “Permitted Investment Fund”) where (i) a Permitted Fund Manager acts (directly or indirectly) as general partner, managing member or fund manager, and (ii) (A) at least fifty percent (50%) of the equity interests in such investment vehicle are owned, directly or indirectly, by one or more of the following: a Qualified Transferee, an institutional “accredited investor” within the meaning of Regulation D promulgated under the Securities Act, and/or a “qualified institutional buyer” or both within the meaning of Rule 144A promulgated under the Securities Exchange Act of 1934, as amended, provided such institutional “accredited investors” or “qualified institutional buyers” that are used to satisfy the fifty percent (50%) test set forth above in this clause (e) satisfy the financial tests in clause (a) of the definition of Eligibility Requirements, or (B) such Permitted Investment Fund, collectively with one or more other Permitted Investment Funds that then hold interests in the Loan, and are managed by such Permitted Fund Manager, in the aggregate satisfy the financial tests in clause (a) of the Eligibility Requirements; provided, further, that such institutional “accredited investors,” “qualified institutional buyers” and/or the Qualified Transferees that are used to satisfy the fifty percent (50%) test set forth above in this clause

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​ (e) do not need to satisfy the experience test set forth in clause (b) of the definition of Eligibility Requirements so long as the Permitted Fund Manager does;

(f)any Person that is a Qualified Transferee but is acting in an agency capacity in connection with a lending syndicate, so long as more than fifty percent (50%) of the lenders in the lending syndicate (by loan balance or committed loan amounts) are Qualified Transferees; provided that the Qualified Transferees that are used to satisfy the fifty percent (50%) test set forth above in this clause (f) do not need to satisfy the experience test set forth in clause (b) of the definition of Eligibility Requirements so long as the Qualified Transferee acting in such agency capacity does; or

(g)following a Securitization, any Person as to which a Rating Agency Confirmation shall have been given with respect to such Transfer.

Notwithstanding the foregoing, no Person shall be (or be deemed to be) a Qualified Transferee (regardless of whether a Rating Agency Confirmation is obtained) if such Person is a Disqualified Person.

“Rate Cap Notice” shall have the meaning set forth in Section 2.8(g) hereof.

“Rating Agencies” shall mean each of S&P, Moody’s, Fitch and any other nationally-recognized statistical rating agency designated by Lender (and any successor to any of the foregoing) in connection with and/or in anticipation of any Secondary Market Transaction.

“Rating Agency Condition” shall be deemed to exist if (i) any Rating Agency fails to respond to any request for a Rating Agency Confirmation with respect to any applicable matter or otherwise elects (orally or in writing) not to consider any applicable matter or (ii) Lender (or its Servicer) is not required to and/or elects not to obtain (or cause to be obtained) a Rating Agency Confirmation with respect to any applicable matter, in each case, pursuant to and in compliance with any pooling and servicing agreement(s) or similar agreement(s), in each case, relating to the servicing and/or administration of the Loan.

“Rating Agency Confirmation” **** shall mean (i) prior to a Securitization or if the Rating Agency Condition exists, that Lender has (in consultation with the Rating Agencies (if required by Lender)) approved the matter in question in writing based upon Lender’s good faith determination of applicable Rating Agency standards and criteria and (ii) from and after a Securitization (to the extent the Rating Agency Condition does not exist), a written affirmation from each of the Rating Agencies (obtained at Borrower’s sole cost and expense) that the credit rating of the Securities by such Rating Agency immediately prior to the occurrence of the event with respect to which such Rating Agency Confirmation is sought will not be qualified, downgraded or withdrawn as a result of the occurrence of such event, which affirmation may be granted or withheld in such Rating Agency’s sole and absolute discretion.

“Register” shall have the meaning set forth in Section 11.8(a)(viii) hereof.

“Registrar” shall have the meaning set forth in Section 11.7 hereof.

“Registration Statement” shall have the meaning set forth in Section 11.2 hereof.

“Regulation AB” shall mean Regulation AB under the Securities Act and the Exchange Act, as such Regulation may be amended from time to time.

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​ “Reimbursement Contribution” shall have the meaning set forth in Section 17.20 hereof.

“Related Loan” shall mean a loan to an Affiliate of Borrower or secured by a Related Property, that is included in a Securitization with the Loan (or any portion thereof or interest therein).

“Related Property” shall mean a parcel of real property, together with improvements thereon and personal property related thereto, that is “related” within the meaning of the definition of Significant Obligor, to the Property.

“Release Price” **** shall mean, with respect to any Individual Property, an amount equal to (a) one hundred five percent (105%) of the Allocated Loan Amount for such Individual Property until twenty five percent (25%) of the original principal balance of the Loan shall have been prepaid hereunder, and (b) one hundred ten percent (110%) of the Allocated Loan Amount for such Individual Property thereafter. For the avoidance of doubt, if in connection with the release of any Individual Property prior to such time as twenty five percent (25%) of the original principal balance of the Loan has been prepaid, the sum of (x) one hundred five percent (105%) of the Allocated Loan Amount for such Individual Property and (y) all other principal amounts previously prepaid would exceed twenty five percent (25%) of the original principal balance of the Loan, then Borrower acknowledges that the Release Price for such Individual Property being released shall be determined pursuant to clause (a) above for a portion of the applicable Allocated Loan Amount until such portion of such Allocated Loan Amount multiplied by one hundred five percent (105%) (when aggregated with all other principal amounts previously prepaid) equals twenty five percent (25%) of the original principal balance of the Loan, and thereafter shall be determined pursuant to clause (b) above for the remainder of such Allocated Loan Amount.

“Released Property” shall have the meaning set forth in Section 2.10 hereof.

“Relevant Governmental Body” shall mean the Federal Reserve Board and/or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board and/or the Federal Reserve Bank of New York or any successor thereto.

“Remaining Property” shall have the meaning set forth in Section 2.10 hereof.

“REMIC Opinion” **** shall mean, as to any matter, an opinion as to the compliance of such matter with applicable REMIC Requirements (which such opinion shall be, in form and substance and from a provider, in each case, reasonably acceptable to Lender and acceptable to the Rating Agencies).

“REMIC Payment” shall have the meaning set forth in Section 7.3 hereof.

“REMIC Requirements” shall mean any applicable legal requirements relating to any REMIC Trust (including, without limitation, those relating to the continued treatment of the Loan (or the applicable portion thereof and/or interest therein) as a “qualified mortgage” held by such REMIC Trust, the continued qualification of such REMIC Trust as such under the IRS Code, the non-imposition of any tax on such REMIC Trust under the IRS Code (including, without limitation, taxes on “prohibited transactions” and “contributions”) and any other constraints, rules and/or other regulations and/or requirements relating to the servicing, modification and/or other similar matters with respect to the Loan (or any portion thereof and/or interest therein) that may now or hereafter exist under applicable legal requirements (including, without limitation under the IRS Code)).

“REMIC Trust” shall mean any “real estate mortgage investment conduit” within the meaning of Section 860D of the IRS Code that holds any interest in all or any portion of the Loan.

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​ “Rent Loss Proceeds” shall have the meaning set forth in Section 7.1 hereof.

“Rent Roll” shall have the meaning set forth in Section 3.18 hereof.

“Rents” shall have the meaning set forth in the Security Instrument.

“Replacement Interest Rate Cap Agreement” shall have the meaning set forth in Section 2.8(c) hereof.

“Required Financial Item” shall have the meaning set forth in Section 4.12 hereof.

“Reserve Accounts” shall mean the Tax Account, the Insurance Account, the Leasing Reserve Account, the Excess Cash Flow Account, the Operating Expense Account and any other escrow account established by this Agreement or the other Loan Documents (but specifically excluding the Cash Management Account, the Restricted Account and the Debt Service Account).

“Reserve Funds” shall mean the Tax and Insurance Funds, the Leasing Reserve Funds, the Excess Cash Flow Funds, the Operating Expense Funds and any other escrow funds established by this Agreement or the other Loan Documents.

“Resolution Authority” shall mean an EEA Resolution Authority or a UK Resolution Authority, as applicable.

“Responsible Officer” shall mean with respect to a Person, the chairman of the board, president, chief operating officer, chief financial officer, treasurer or vice president of such Person or its constituent Person or such other similar officer or representative of such Person reasonably acceptable to Lender.

“Restoration” shall mean, following the occurrence of a Casualty or a Condemnation which is of a type necessitating the repair of any Property (or any portion thereof), the completion of the repair, restoration, replacement or rebuilding of any Property (or applicable portion thereof) as nearly as possible to the condition such Property (or applicable portion thereof) was in immediately prior to such Casualty or Condemnation, with such alterations as may be reasonably approved by Lender.

“Restoration Retainage” shall have the meaning set forth in Section 7.4 hereof.

“Restoration Threshold” shall mean an amount equal to the lesser of (i) ten percent (10%) of the Allocated Loan Amount for the applicable Individual Property and (ii) five percent (5%) of the original principal amount of the Loan.

“Restricted Account” shall have the meaning set forth in Section 9.1 hereof.

“Restricted Account Agreement” shall mean that certain Deposit Account Control Agreement by and among Borrower, Lender and PNC Bank, National Association, dated as of the date hereof, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time in accordance with the terms hereof.

“Restricted Account Notice” shall mean a notice from Lender to the Eligible Institution maintaining the Restricted Account in accordance with the terms of the Restricted Account Agreement whereby Lender instructs said Eligible Institution to transfer all funds on deposit in the Restricted Account on each Business Day to the Cash Management Account.

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​ “Restricted Party” shall have the meaning set forth in Section 6.1 hereof.

“Sale or Pledge” shall have the meaning set forth in Section 6.1 hereof.

“Sanctions” shall have the meaning set forth in Section 3.30 hereof.

“Satisfactory Search Results” shall mean the results of Lender’s customary “know your customer”, credit history check, litigation, lien, bankruptcy, judgment and other similar searches with respect to the applicable transferee and its applicable affiliates, in each case, (i) revealing no matters which would have an Aggregate Material Adverse Effect and (ii) yielding results which are otherwise acceptable to Lender in its reasonable good-faith discretion. Borrower shall pay all of Lender’s reasonable out-of-pocket costs, fees and expenses in connection with the foregoing and, notwithstanding the forgoing, no such search results shall constitute “Satisfactory Search Results” until such out-of-pocket costs, fees and expenses are paid in full.

“Secondary Market Transaction” shall have the meaning set forth in Section 11.1 hereof.

“Securities” shall have the meaning set forth in Section 11.1 hereof.

“Securities Act” shall mean the Securities Act of 1933, as amended.

“Securitization” shall have the meaning set forth in Section 11.1 hereof.

“Security Deposits” shall mean any advance deposits or any other deposits collected with respect to the Property, whether in the form of cash, letter(s) of credit or other cash equivalents (including, without limitation, such deposits made in connection with any Lease).

“Security Instrument” shall mean, individually or collectively, as the context may require, each mortgage/deed of trust/deed to secure debt, assignment of leases and rents and security agreement, dated as of the date hereof, executed and delivered by the applicable Borrower as security for the Loan and encumbering the applicable Individual Property (or any portion thereof), and with respect to any PILOT Property, any joinder to a Security Instrument or other pledge or security agreement executed by a PILOT Lessor, as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time.

“Servicer” shall have the meaning set forth in Section 11.4 hereof.

“Severed Loan Documents” shall have the meaning set forth in Article 10 hereof.

“Significant Obligor” shall have the meaning set forth in Item 1101(k) of Regulation AB under the Securities Act.

“Single Purpose Entity” shall mean an entity which satisfies the requirements of Section 5.1 hereof and whose structure and organizational and governing documents are otherwise in form and substance acceptable to the Rating Agencies and satisfying the Prudent Lender Standard.

“SOFR” shall mean a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.

“SOFR Administrator” shall mean the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

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​ “SOFR Loan” shall mean the Loan at such time as interest thereon accrues at a rate of interest equal to the SOFR Rate.

“SOFR Rate” shall mean, with respect to each Interest Accrual Period and Component, the sum of (i) Term SOFR applicable to such Interest Accrual Period and (ii) the Spread for such Component.

“SPE Component Entity” shall have the meaning set forth in Section 5.1 hereof.

“Special Member” shall have the meaning set forth in Section 5.1 hereof.

“Sponsor” shall mean (i) individually and/or collectively, as the context may require, AREIT OP, or (ii) any successor to Sponsor pursuant to a Permitted Equity Transfer in accordance with Section 6.3, in which case, such successor shall replace Sponsor as described in clause (i) hereof.

“Spread” shall mean, with respect to each Component of the Loan:

(a)Component A:1.458690%;

(b)Component B:1.807690%;

(c)Component C:2.007690%;

(d)Component D:2.706690%;

(e)Component E:3.455690%;

(f)Component F:4.054690%; and

(g)Component HRR:5.552690%.

“S&P” shall mean S&P Global Ratings, a Standard & Poor’s Financial Services LLC business.

“State” shall mean each applicable state in which an applicable Individual Property or any part thereof is located.

“Stated Maturity Date” shall mean October 9, 2026.

“Strike Rate” shall mean the Initial Strike Rate, the Extension Strike Rate, or the Substitute Strike Rate, as applicable.

“Sub-Management Agreement” shall mean, collectively, each sub-management agreement entered into by and between Borrower and a Sub-Manager, pursuant to which such Sub-Manager is to provide sub-management and other services with respect to the Property, as the same may be amended, restated, replaced, extended, renewed, supplemented or otherwise modified from time to time.

“Sub-Manager” shall mean a Qualified Sub-Manager that is sub-managing a Property or such other entity selected as the sub-manager of the Property in accordance with the terms of this Agreement or the other Loan Documents.

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​ “Substitute Interest Rate Cap Agreement” shall have the meaning set forth in Section 2.8(h) hereof.

“Substitute Strike Rate” shall mean the greater of (i) three and one-half percent (3.50%) (as adjusted by the Benchmark Replacement Adjustment, if applicable) and (ii) a percentage rate equal to the Unadjusted Benchmark Replacement which would yield a Debt Service Coverage Ratio of 1.10:1.00.

“Survey” shall mean individually and/or collectively, as the context may require, those certain surveys of the Property certified and delivered to Lender in connection with the closing of the Loan.

“Syndication” shall have the meaning set forth in Section 11.8(a)(i) hereof.

“Tax Account” shall have the meaning set forth in Section 8.6 hereof.

“Tax and Insurance Adjustment” shall have the meaning set forth in the definition of Operating Expense.

“Tax and Insurance Funds” shall have the meaning set forth in Section 8.6 hereof.

“Tax Payment Date” shall mean, with respect to any applicable Taxes, the date occurring 30 days prior to the date the same are due and payable.

“Taxes” shall mean all taxes, assessments, water rates, sewer rents, and other governmental impositions, including, without limitation, vault charges and license fees for the use of vaults, chutes and similar areas adjoining the Land, now or hereafter levied or assessed or imposed against the Property or any part thereof.

“Tenant” shall mean any Person leasing, subleasing or otherwise occupying any portion of the Property under a Lease or other occupancy agreement.

“Tenant Direction Notice” shall have the meaning set forth in Section 9.2 hereof.

“Term SOFR” shall mean, with respect to each Interest Accrual Period, the Term SOFR Reference Rate for a one-month period on the day (such day, the “Periodic Term SOFR Determination Day”) that is two (2) U.S. Government Securities Business Days prior to the first day of such Interest Accrual Period, as such rate is published by the Term SOFR Administrator; provided, that if as of 5:00 p.m. (New York City time) on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for a one-month period has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for a one-month period as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for a one-month period was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Periodic Term SOFR Determination Day. Notwithstanding the foregoing, in no event will Term SOFR be deemed to be less than zero.

“Term SOFR Administrator” shall mean CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by the Lender in its reasonable discretion).

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​ “Term SOFR Reference Rate” shall mean the one-month forward-looking term rate based on SOFR, currently identified on the CME Group’s website at https://www.cmegroup.com/market-data/cme-group-benchmark-administration/term-sofr.html or any successor source.

“Title Insurance Policy” shall mean that certain ALTA mortgagee title insurance policy issued with respect to the Property and insuring the lien of the Security Instrument.

“Trigger Period” shall mean a period (A) commencing upon the earliest of (i) the occurrence and continuance of an Event of Default, (ii) the Properties failing to maintain a Debt Yield of at least 6.50% as of the end of two consecutive calendar quarters (provided, however, no Trigger Period shall be deemed to exist pursuant to this clause (ii) during any period that the Collateral Cure Conditions are satisfied); and (B) expiring upon (x) with regard to any Trigger Period commenced in connection with clause (i) above, the cure (if applicable) of such Event of Default, (y) with regard to any Trigger Period commenced in connection with clause (ii) above, the date that Debt Yield is equal to or greater than 6.50% for two (2) consecutive calendar quarters. Notwithstanding the foregoing, a Trigger Period shall not be deemed to expire in the event that a Trigger Period then exists for any other reason.

“True Up Payment” shall mean a payment into the applicable Reserve Account of a sum which, together with any applicable monthly deposits into the applicable Reserve Account, will be sufficient to discharge the obligations and liabilities for which such Reserve Account was established as and when reasonably appropriate. The amount of the True Up Payment shall be determined by Lender in its reasonable discretion and shall be final and binding absent manifest error.

“UCC” or “Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect in the State.

“UK Financial Institution” shall mean any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.

“UK Resolution Authority” shall mean the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.

“Unadjusted Benchmark Replacement” shall mean the Benchmark Replacement excluding the Benchmark Replacement Adjustment.

“Underwriter Group” shall have the meaning set forth in Section 11.2 hereof.

“Underwritten Net Operating Income” shall mean, for any date of determination, an amount calculated by Lender equal to: (a) Gross Revenue for the Properties, minus (b) Operating Expenses for the Properties, for the twelve (12) month period immediately preceding the date of calculation.  Lender’s calculation of Underwritten Net Operating Income shall be final absent manifest error.

“Unencumbered Borrower” shall have the meaning set forth in Section 2.10 hereof.

“Updated Information” shall have the meaning set forth in Section 11.1 hereof.

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​ “U.S. Government Securities Business Day” shall mean any day except for (a) a Saturday, (b) a Sunday, or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

“U.S. Obligations” shall mean direct full faith and credit obligations of the United States of America that are not subject to prepayment, call or early redemption.

“Work Charge” shall have the meaning set forth in Section 4.16 hereof.

“Write-Down and Conversion Powers” shall mean, (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.

Section 1.2.Principles of Construction.

All references to sections, schedules and exhibits are to sections, schedules and exhibits in or to this Agreement unless otherwise specified. All uses of the word “including” shall mean “including, **** without limitation” unless the context shall indicate otherwise. Unless otherwise specified, the words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. Unless otherwise specified, all meanings attributed to defined terms herein shall be equally applicable to both the singular and plural forms of the terms so defined.  References herein to “the Property or any portion thereof” and words of similar import shall be deemed to refer, as applicable, to any portion of the Property taken as a whole (including any Individual Property) and any portion of any Individual Property.

ARTICLE 2​ ​ GENERAL TERMS

Section 2.1.Loan Commitment; Disbursement to Borrower. Except as expressly and specifically set forth herein, Lender has no obligation or other commitment to loan any funds to Borrower or otherwise make disbursements to Borrower. Borrower hereby waives any right Borrower may have to make any claim to the contrary.

Section 2.2.The Loan. Subject to and upon the terms and conditions set forth herein, Lender hereby agrees to make and Borrower hereby agrees to accept the Loan on the Closing Date.

Section 2.3.Disbursement to Borrower. Borrower may request and receive only one borrowing hereunder in respect of the Loan and any amount borrowed and repaid hereunder in respect of the Loan may not be re-borrowed.

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​ Section 2.4.The Note and the Other Loan Documents. The Loan shall be evidenced by the Note and this Agreement and secured by this Agreement, the Security Instrument and the other Loan Documents.

Section 2.5.Interest Rate.

(a)Generally. Interest on the outstanding principal balance of the Loan shall accrue from the Closing Date at the Interest Rate until repaid in accordance with the applicable terms and conditions hereof.

(b)Determination of Interest Rate.

(i)Interest Rate. The Interest Rate with respect to the Loan shall be (A) the SOFR Rate with respect to the applicable Interest Accrual Period if the Loan is a SOFR Loan, (B) the Alternate Rate with respect to the applicable Interest Accrual Period if the Loan is an Alternate Rate Loan, or (C) the Prime Rate with respect to the applicable Interest Accrual Period if the Loan is a Prime Rate Loan.

(ii)Term SOFR Conforming Changes. In connection with the use or administration of Term SOFR, the Lender will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of Borrower or any other party to this Agreement or any other Loan Document. The Lender will promptly notify the Borrower of the effectiveness of any Conforming Changes in connection with the use or administration of Term SOFR.

(iii)Benchmark Unavailability Period. During a Benchmark Unavailability Period, the component of the Interest Rate based on Term SOFR (or the then-current Benchmark if the Loan is then an Alternate Rate Loan) shall during such Benchmark Unavailability Period be replaced with the Prime Index Rate and the Loan shall be converted to a Prime Rate Loan bearing interest based on the Prime Rate in effect on each applicable Determination Date.

(iv)Subject to the terms and conditions hereof, the Loan shall be either a SOFR Loan, an Alternate Rate Loan, or a Prime Rate Loan, as applicable, and Borrower shall pay interest on the outstanding principal balance of the Loan at the SOFR Rate, at the Alternate Rate, or at the Prime Rate, as applicable, for the applicable Interest Accrual Period. If and to the extent part of the Conforming Changes, any change in the rate of interest hereunder due to a change in the Benchmark shall become effective as of the opening of business on the first day on which such change in the Benchmark shall become effective. Each determination by Lender of the Interest Rate shall be conclusive and binding for all purposes, absent manifest error.

(v)Effect of Benchmark Transition Event.

(A)Notwithstanding anything to the contrary herein or in any other Loan Document, if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to the Periodic Term SOFR Determination Day (or if the Benchmark is not the Term SOFR Reference Rate, the Determination Date for such other Benchmark) for any Interest Accrual Period, the Benchmark Replacement will

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​ replace the then-current Benchmark for all purposes hereunder or under any Loan Document in respect of such determination and all determinations on all subsequent dates (without any amendment to, or further action or consent of any other party to, this Agreement).

(B)In connection with the use, administration, adoption, or implementation of a Benchmark Replacement, Lender will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of the Borrower or any other party to this Agreement or any other Loan Document.

(C)Lender will promptly notify Borrower of (I) the Benchmark Replacement Date, (II) the implementation of any Benchmark Replacement, (III) the effectiveness of any Conforming Changes, and/or (IV) any Benchmark Unavailability Period. Any determination, decision or election that may be made by Lender pursuant to this Section, including any determination with respect to a rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its sole discretion and without consent from the Borrower.

(D)Notwithstanding any provision of this Agreement to the contrary, in no event shall Borrower have the right to convert the Loan to an Alternate Rate Loan or a Prime Rate Loan.

(vi)Except as otherwise required by any Legal Requirements, all payments made by Borrower hereunder shall be made free and clear of, and without reduction for or on account of, income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions, reserves or withholdings imposed, levied, collected, withheld or assessed by any Governmental Authority, which are imposed, enacted or become effective after the date hereof (such non-excluded taxes being referred to collectively as “Foreign Taxes”), other than any Excluded Taxes. If any Legal Requirements (as determined in the good faith discretion of Borrower) requires the deduction or withholding of any Foreign Tax from any payment, then the Borrower shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with Legal Requirements. If any Foreign Taxes, other than Excluded Taxes, are required to be withheld from any amounts payable to Lender hereunder, the amounts so payable to Lender shall be increased to the extent necessary to yield to Lender (after payment of all Foreign Taxes) interest or any such other amounts payable hereunder at the rate or in the amounts specified hereunder. Whenever any Foreign Tax is payable pursuant to Legal Requirements by Borrower, as promptly as possible thereafter, Borrower shall send to Lender an original official receipt, if available, or certified copy thereof showing payment of such Foreign Tax. Borrower hereby indemnifies Lender for any incremental taxes, interest or penalties that are actually paid by Lender which may result from any failure by Borrower to pay any such Foreign Tax when due to the appropriate taxing authority or any failure by Borrower to remit to Lender the required receipts or other required documentary evidence.

(vii)In the event that any change in any Legal Requirements or in the interpretation or application thereof, or compliance by Lender with any request or directive

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​ (whether or not having the force of law) hereafter issued from any central bank or other Governmental Authority:

(A)shall hereafter impose, modify or hold applicable any reserve, capital adequacy, tax, special deposit, compulsory loan or similar requirement against assets held by, or deposits or other liabilities in or for the account of, advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of Lender which is not otherwise included in the determination of Term SOFR hereunder;

(B)shall hereafter have the effect of reducing the rate of return on Lender’s capital as a consequence of its obligations hereunder to a level below that which Lender could have achieved but for such adoption, change or compliance (taking into consideration Lender’s policies with respect to capital adequacy) by any amount deemed by Lender to be material; or

(C)shall hereafter impose on Lender any other condition and the result of any of the foregoing is to increase the cost to Lender of making, renewing or maintaining loans or extensions of credit or to reduce any amount receivable hereunder;

then, in any such case, Borrower shall pay to Lender, no later than thirty (30) days following Lender’s demand therefor, any additional amounts necessary to compensate Lender for such additional cost or reduced amount receivable which Lender deems to be material as reasonably determined by Lender; provided, that, such demand by Lender shall apply to all loans similarly affected by such change. If Lender becomes entitled to claim any additional amounts pursuant to this subsection, Lender shall provide Borrower with not less than **** thirty (30) days’ notice specifying in reasonable detail the event by reason of which it has become so entitled and the additional amount required to fully compensate Lender for such additional cost or reduced amount; provided, however, that in no event shall Borrower or any Borrower Party be liable for amounts which accrued more than ninety (90) days prior to the date such notice is delivered to Borrower. A certificate as to any additional costs or amounts payable pursuant to the foregoing sentence submitted by Lender to Borrower shall be conclusive in the absence of manifest error. This provision shall survive payment of the Note and the satisfaction of all other obligations of Borrower under this Agreement and the Loan Documents.

(viii)Borrower agrees to indemnify Lender and to hold Lender harmless from any actual loss or actual out-of-pocket expense which Lender actually sustains or incurs as a consequence of (A) any prepayment (whether voluntary or mandatory) of the Loan on a day that is not the last day of an Interest Accrual Period, including, without limitation, such loss or expense arising from interest or fees payable by Lender to lenders of funds obtained by it in order to maintain the Loan hereunder, (B) the occurrence of a Benchmark Replacement, and (C) with respect to any disbursement of the Loan to be made pursuant to the terms hereof, if such disbursement is not made on the date specified by Borrower in its request for such disbursement due to a failure of any Borrower to satisfy, or cause to be satisfied, any one or more of the conditions to such disbursement (the amounts referred to in clauses (A), (B) and (C) are herein referred to collectively as the “Breakage Costs”); provided, however, Borrower shall not indemnify Lender from any loss or expense arising from Lender’s illegal acts, fraud, willful misconduct or gross negligence and shall not be liable hereunder for any consequential, punitive, treble or special damages (except to the extent actually paid by Lender to any third party). This provision shall survive payment of the Note in full and the

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​ satisfaction of all other obligations of Borrower under this Agreement and the other Loan Documents.

(ix)Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any of the following Persons, Borrower, each Borrower Party and Lender acknowledge that any liability of any Affected Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by (i) the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an Affected Financial Institution; and (ii) the effects of any Bail-In Action on any such liability, including, if applicable, (A) a reduction in full or in part or cancellation of any such liability; (B) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; and/or (C) the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of the applicable Resolution Authority.

(x)Status of Lender.

(A)If at any time Lender is entitled to an exemption from or reduction of withholding tax with respect to payments made under any Loan Document, Lender shall deliver to Borrower, at the time or times reasonably requested by Borrower, such properly completed and executed documentation reasonably requested by Borrower as will permit such payments to be made without withholding or at a reduced rate of withholding.  In addition, Lender, if reasonably requested by Borrower, shall deliver such other documentation prescribed by Legal Requirements or reasonably requested by Borrower as will enable Borrower to determine whether or not Lender is subject to backup withholding or information reporting requirements.  Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in (2)(A), (2)(B) and (2)(D) below) shall not be required if in Lender’s reasonable judgment such completion, execution or submission would subject Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of Lender.

(B)Without limiting the generality of the foregoing:

(i)	If Lender is a U.S. Person, Lender shall deliver to Borrower on or prior to the date on which Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower), executed copies of IRS Form W-9 certifying that Lender is exempt from U.S. federal backup withholding tax;
(ii)	any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower (in such number of copies as shall be requested by the recipient) on or prior to the date on which
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such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower ), whichever of the following is applicable:
(iii)	in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of IRS Form W-8BEN or W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding tax pursuant to the “business profits” or “other income” article of such tax treaty;
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(iv)	executed copies of IRS Form W-8ECI;
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(v)	in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the IRS Code, (x) a certificate substantially in the form of Exhibit C to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the IRS Code, a “10 percent shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the IRS Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the IRS Code (a “U.S. Tax Compliance Certificate”) and (y) executed copies of IRS Form W-8BEN or W-8BEN-E, as applicable;
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(vi)	to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or W-8BEN-E, as applicable, a U.S. Tax Compliance Certificate substantially in the form of Exhibit C, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit C on behalf of each such direct and indirect partner;
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(C)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to Borrower (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of Borrower ), executed copies of any other form prescribed by applicable Legal Requirements as a basis for claiming exemption from or a reduction in U.S. federal withholding tax, duly completed, together with such supplementary documentation as may be

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​ prescribed by applicable Legal Requirements to permit Borrower to determine the withholding or deduction required to be made; and

(D)if a payment made to Lender under or in respect of this Agreement or any other Loan Document would be subject to U.S. federal withholding tax imposed by FATCA and if Lender fails to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the IRS Code, as applicable), Lender shall deliver to Borrower at the time or times prescribed by law such documentation prescribed by applicable Legal Requirements (including as prescribed by Section 1471(b)(3)(C)(i) of the IRS Code) and such additional documentation reasonably requested by Borrower as may be necessary for Borrower to comply with their obligations under FATCA and to determine that Lender has complied with Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.  Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify Borrower in writing of its legal inability to do so.

(E)Treatment of Certain Refunds.  If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any taxes as to which it has been indemnified pursuant to this Section 2.5(b) (including by the payment of additional amounts pursuant to this Section 2.5(b)), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the taxes giving rise to such refund), net of all out-of-pocket expenses (including taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund).  Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (x) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority.  Notwithstanding anything to the contrary in this paragraph (x), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (x) the payment of which would place the indemnified party in a less favorable net after-tax position than the indemnified party would have been in if the tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such tax had never been paid.  This paragraph shall not be construed to require any indemnified party to make available its tax returns (or any other information relating to its taxes that it deems confidential) to the indemnifying party or any other Person.

(xi)Lender shall not be entitled to claim compensation pursuant to this subsection for any increased cost or reduction in amounts received or receivable hereunder, or any reduced rate of return, which was incurred or which accrued prior to the earlier of (i) ninety (90) days before the date Lender notified Borrower of the change in law or other circumstance on which such claim for compensation is based and delivered to Borrower a written statement setting forth in reasonable detail the basis for the calculation of the

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​ additional amounts owed to Lender under this subsection, which statement shall be conclusive and binding on all parties absent manifest error, and (ii) any earlier date provided Lender notified Borrower of such change in law or circumstance and delivered the written statement referenced in clause (i) within ninety (90) days after Lender received written notice of such change in law or circumstance.

(xii)Lender will use reasonable efforts (consistent with legal and regulatory restrictions) to maintain the availability of the Loan and to avoid or reduce any increased or additional costs payable by Borrower under this subsection, including, if requested by Borrower, a transfer or assignment of the Loan to a branch, office or affiliate of Lender in another jurisdiction, or redesignation of its lending office with respect to the Loan, in order to maintain the availability of the Loan or to avoid or reduce such increased or additional costs, provided that the transfer or assignment or redesignation (A) would not result in any additional costs, expenses or risk to Lender that are not reimbursed by Borrower and (B) would not be disadvantageous in any other material respect to Lender as determined by Lender in its reasonable discretion.

(c)Default Rate. In the event that, and for so long as, any Event of Default shall have occurred and be continuing, (i) the then outstanding principal balance of the Loan and, to the extent permitted by Legal Requirements, overdue interest in respect of the Loan, shall each accrue interest at the Default Rate, calculated from the date the applicable Default occurred without regard to any grace or cure periods contained herein, (ii) without limitation of any rights or remedies contained herein and/or in any other Loan Document, any interest accrued at the Default Rate in excess of the interest component of the Monthly Debt Service Payment Amount shall, to the extent not already paid and/or due and payable hereunder, be due and payable on each Monthly Payment Date and (iii) all references herein and/or in any other Loan Document to the “Interest Rate” shall be deemed to refer to the Default Rate.

(d)Interest Calculation. Interest on the outstanding principal balance of the Loan shall be calculated by multiplying (a) the actual number of days elapsed in the period for which the calculation is being made by (b) a daily rate based on a three hundred sixty (360) day year (that is, the Interest Rate or the Default Rate, as then applicable, expressed as an annual rate divided by 360) by (c) the outstanding principal balance. The accrual period for calculating interest due on each Monthly Payment Date shall be the Interest Accrual Period in which the related Monthly Payment Date occurs. Borrower understands and acknowledges that such interest accrual requirement results in more interest accruing on the Loan than if either a thirty (30) day month and a three hundred sixty (360) day year or the actual number of days and a three hundred sixty-five (365) day year were used to compute the accrual of interest on the Loan.

(e)Usury Savings. This Agreement and the other Loan Documents are subject to the express condition that at no time shall Borrower be required to pay interest on the principal balance of the Loan (including, to the extent applicable, any prepayment premium and/or penalty) at a rate which could subject Lender to either civil or criminal liability as a result of being in excess of the Maximum Legal Rate. If by the terms of this Agreement or the other Loan Documents, Borrower is at any time required or obligated to pay interest on the principal balance due hereunder (including, to the extent applicable, any prepayment premium and/or penalty) at a rate in excess of the Maximum Legal Rate, the Interest Rate or the Default Rate, as the case may be, and/or, to the extent applicable, any prepayment premium and/or penalty shall, in each case, be deemed to be immediately reduced to the Maximum Legal Rate and all previous payments in excess of the Maximum Legal Rate shall be deemed to have been payments in reduction of principal and not on account of the interest due hereunder. All sums paid or agreed to be paid to Lender for the use,

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​ forbearance, or detention of the sums due under the Loan, shall, to the extent permitted by Legal Requirements, be amortized, prorated, allocated, and spread throughout the full stated term of the Loan until payment in full so that the rate or amount of interest on account of the Loan (including, to the extent applicable, any prepayment premium and/or penalty) does not exceed the Maximum Legal Rate from time to time in effect and applicable to the Loan for so long as the Loan is outstanding.

Section 2.6.Loan Payments.

(a)Borrower shall make a payment to Lender of interest only on (and the first Interest Accrual Period hereunder shall commence on) the Closing Date for the period from (and including) the Closing Date through (and including) the fourteenth (14^th^) day of either (i) the month in which the Closing Date occurs (if such Closing Date is after the first day of such month, but prior to the fifteenth (15^th^) day of such month) or (ii) if the Closing Date is after the fourteenth (14^th^) day of the then current calendar month, the month following the month in which the Closing Date occurs; provided, however, if the Closing Date is the fourteenth (14^th^) day of a calendar month, no such separate payment of interest shall be due. Borrower shall make a payment to Lender of interest and, to the extent applicable, principal in the amount of the Monthly Debt Service Payment Amount on the First Monthly Payment Date and on each Monthly Payment Date occurring thereafter to and including the Maturity Date. Each payment shall be applied first to accrued and unpaid interest and the balance to principal.

(b)Intentionally Omitted.

(c)Borrower shall pay to Lender on the Maturity Date the outstanding principal balance of the Loan, all accrued and unpaid interest and all other amounts due hereunder and under the Note, the Security Instrument and the other Loan Documents (including, without limitation, the Interest Shortfall).

(d)If any principal, interest or any other sum due under the Loan Documents, other than the payment of principal due on the Maturity Date, is not paid by Borrower on or prior to the date on which it is due, Borrower shall pay to Lender upon demand an amount equal to the lesser of five percent (5%) of such unpaid sum or the maximum amount permitted by Legal Requirements in order to defray the expense incurred by Lender in handling and processing such delinquent payment and to compensate Lender for the loss of the use of such delinquent payment. Any such amount shall be secured by the Security Instrument and the other Loan Documents.

(e)Loan Payments.

(i)Except as otherwise specifically provided herein, all payments and prepayments under this Agreement and the Note shall be made to Lender not later than 1:00 P.M., New York City time, on the date when due and shall be made in lawful money of the United States of America in immediately available funds at Lender’s office, and any funds received by Lender after such time shall, for all purposes hereof, be deemed to have been paid on the next succeeding Business Day.

(ii)Whenever any payment to be made hereunder or under any other Loan Document shall be stated to be due on a day which is not a Business Day, the due date thereof shall be deemed to be the immediately preceding Business Day.

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​ (iii)All payments required to be made by Borrower hereunder or under the Note or the other Loan Documents shall be made irrespective of, and without deduction for, any setoff, claim or counterclaim and shall be made irrespective of any defense thereto.

Section 2.7.Prepayments.

(a)Voluntary Prepayment. Except as provided herein, Borrower shall not have the right to prepay the Loan in whole or in part.  Borrower may, provided no Event of Default has occurred and is continuing, at its option and upon prior notice to Lender as set forth herein, prepay the Debt in whole or in part on any Business Day; provided that such prepayment is accompanied by payment of the Breakage Costs, the Prepayment Premium, if any, and the applicable Interest Shortfall, in each case, if applicable. Lender shall not be obligated to accept any prepayment unless it is accompanied by payment of the Breakage Costs, the Prepayment Premium, if any, and the applicable Interest Shortfall due in connection therewith; provided that, in the event that Borrower provides Lender with a Prepayment Notice (as defined below), Lender shall promptly provide Borrower with notice of the full amount due in connection with such prepayment. As a condition to any voluntary prepayment, Borrower shall give Lender written notice (a “Prepayment Notice”) of its intent to prepay, which notice must be given at least five (5) Business Days prior to the date upon which prepayment is to be made and must specify the date on which such prepayment is to be made.  Any Prepayment Notice may be revoked or modified by Borrower at anytime prior to the date of prepayment, provided Borrower hereby agrees that, in the event Borrower delivers a Prepayment Notice and fails to prepay the Loan in accordance with the Prepayment Notice and the terms of this Section 2.7 (a “Prepayment Failure”), Borrower shall pay Lender all actual, reasonable out-of-pocket costs and expenses incurred by Lender, including, without limitation, any Breakage Costs or similar expenses, as a result of such Prepayment Failure.  Notwithstanding the foregoing, Borrower shall be permitted to prepay a portion of the Debt (which amount shall not exceed twenty five percent (25%) of the original principal balance of the Loan, in the aggregate, including any mandatory prepayments of the Loan in connection with the terms and conditions of Section 2.7(b), below) (the “Free Prepayment Amount”), at any time without payment of any Prepayment Premium or other prepayment premium, penalty or fee, provided (A) there is no Event of Default continuing as of the date of the applicable prepayment, (B) Borrower has delivered to Lender a Prepayment Notice, and (C) Borrower pays, in addition to the amount to be prepaid, any Breakage Costs and the applicable Interest Shortfall, and all other sums due and payable under this Agreement, the Note, and the other Loan Documents, including, but not limited to all of Lender’s reasonable, out-of-pocket costs and expenses (including reasonable attorneys’ fees and disbursements) incurred in connection with such prepayment. For the avoidance of doubt, any mandatory prepayments of the Loan in connection with the terms and conditions of Section 2.7(b) hereof, and any prepayments in connection with a Partial Release pursuant to the terms and conditions of Section 2.10 hereof, shall be included in and shall count toward the aggregate twenty five percent (25%) cap on Free Prepayment Amount.

(b)Mandatory Prepayment. On each date on which Lender actually receives a distribution of Net Proceeds, and if Lender does not make such Net Proceeds available to Borrower for Restoration or for disbursement as Rent Loss Proceeds (as applicable), in each case, in accordance with the applicable terms and conditions hereof, Lender shall, immediately or on the date immediately prior to the next ensuing Monthly Payment Date, apply the Net Proceeds to prepay the Debt in an amount equal to one hundred percent (100%) of such Net Proceeds together with any applicable Interest Shortfall and any Breakage Costs. If any portion of the Loan is or will be included in a REMIC Trust, Borrower shall make the REMIC Payment as and to the extent required hereunder. No prepayment premium or penalty (including, without limitation, any Default Prepayment Premium) shall be due in connection with any prepayment made pursuant to this Section

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​ 2.7(b) (including, without limitation, in connection with any REMIC Payment). Any prepayment received by Lender pursuant to this Section 2.7(b) on a date other than a Monthly Payment Date shall be held by Lender as collateral security for the Loan in an interest bearing, Eligible Account at an Eligible Institution, with such interest accruing to the benefit of Borrower, and shall be applied by Lender as a prepayment of the full amount together with costs on the next Monthly Payment Date, with any interest on such funds paid to Borrower on such date provided no Event of Default then exists.

(c)Prepayments After Default. After the occurrence and during the continuance of an Event of Default and notwithstanding any acceleration of the Debt in accordance with the applicable terms and conditions hereof, the Default Prepayment Premium shall, in all cases, be deemed a portion of the Debt due and owing hereunder and under the other Loan Documents. Without limitation of the foregoing, if, after the occurrence and during the continuance of an Event of Default, (i) payment of all or any part of the Debt is tendered by Borrower (voluntarily or involuntarily), a purchaser at foreclosure or any other Person, (ii) Lender obtains a recovery of all or a portion of the Debt (through an exercise of remedies hereunder or under the other Loan Documents or otherwise) or (iii) the Debt is deemed satisfied (in whole or in part) through an exercise of remedies hereunder or under the other Loan Documents or at law, the Default Prepayment Premium, the Breakage Costs and the Interest Shortfall, in addition to the outstanding principal balance, all accrued and unpaid interest and other amounts payable under the Loan Documents, shall be deemed due and payable hereunder. Notwithstanding anything to the contrary contained herein or in any other Loan Document, (i) any prepayment of the Debt shall be applied to the Debt in such order and priority as may be determined by Lender in its sole discretion and (ii) the word “prepayment” when used herein and in the other Loan Documents shall also be deemed to mean repayment and payment.

(d)Application of Interest and Prepayments to Components.  Provided no Event of Default has occurred and is continuing, payments of interest shall be applied by Lender as follows: (i) first, to the payment of interest then due and payable under Component A; (ii) second, to the payment of interest then due and payable under Component B; (iii) third, to the payment of interest then due and payable under Component C; (iv) fourth, to the payment of interest then due and payable under Component D; (v) fifth, to the payment of interest then due and payable under Component E; (vi) sixth, to the payment of interest then due and payable under Component F; and (vii) seventh, to the payment of interest then due and payable under Component HRR.   Except for (x) any prepayment made prior to a Securitization of the Loan and (y) any prepayment of any portion of the Free Prepayment Amount made after a Securitization of the Loan, any prepayment of the principal of the Loan made pursuant to Section 2.7(a) hereof shall be applied by Lender as follows: (i) first, to the reduction of the outstanding principal balance of Component A until reduced to zero, (ii) second, to the reduction of the outstanding principal balance of Component B until reduced to zero, (iii) third, to the reduction of the outstanding principal balance of Component C until reduced to zero, (iv) fourth, to the reduction of the outstanding principal balance of Component D until reduced to zero, (v) fifth, to the reduction of the outstanding principal balance of Component E until reduced to zero, (vi) sixth, to the reduction of the outstanding principal balance of Component F until reduced to zero, and (vii)  seventh, to the reduction of the outstanding principal balance of Component HRR until reduced to zero.  Any prepayments of the Loan in connection with the release of any Individual Property pursuant to Section 2.10 hereof shall be applied to the Components of the Loan as follows: (i) first, to the reduction of the outstanding principal balance of Component A until reduced to zero, (ii) second, to the reduction of the outstanding principal balance of Component B until reduced to zero, (iii) third, to the reduction of the outstanding principal balance of Component C until reduced to zero, (iv) fourth, to the reduction of the outstanding principal balance of Component D until reduced to zero, (v) fifth, to the reduction of the outstanding principal

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​ balance of Component E until reduced to zero, (vi) sixth, to the reduction of the outstanding principal balance of Component F until reduced to zero and (vii) seventh, to the reduction of the outstanding principal balance of Component HRR until reduced to zero.   Any prepayment made prior to a Securitization of the Loan and any prepayment of the Free Prepayment Amount made after a Securitization of the Loan shall be applied to each Component of the Loan on a pro rata, pari passu basis.  Notwithstanding the foregoing, during the continuance of any Event of Default, any payment of principal and interest from whatever source may be applied by Lender between the Components in Lender’s sole discretion.

Section 2.8.Interest Rate Cap Agreement.

(a)Prior to or contemporaneously with the Closing Date, Borrower Interest Rate Cap Party shall enter into an Interest Rate Cap Agreement with a Term SOFR strike rate equal to the Initial Strike Rate. The Interest Rate Cap Agreement (i) shall at all times be in a form and substance reasonably acceptable to Lender, (ii) shall at all times be with a Counterparty, (iii) shall at all times be for a duration at least equal to the end of the Interest Accrual Period in which the then current Stated Maturity Date occurs, and (iv) shall at all times have a notional amount equal to or greater than the principal balance of the Loan and shall at all times provide for a strike rate to be equal to the Strike Rate. Borrower Interest Rate Cap Party shall direct such Counterparty to deposit directly into the Restricted Account any amounts due Borrower Interest Rate Cap Party under such Interest Rate Cap Agreement so long as any portion of the Debt is outstanding, provided that the Debt shall be deemed to be outstanding if the Property is transferred by judicial or non-judicial foreclosure or deed-in-lieu thereof. Additionally, Borrower Interest Rate Cap Party shall collaterally assign to Lender, pursuant to the Collateral Assignment of Interest Rate Cap Agreement, all of its right, title and interest in and to the Interest Rate Cap Agreement (and any replacements thereof), including, without limitation, its right to receive any and all payments under the Interest Rate Cap Agreement (and any replacements thereof), and Borrower Interest Rate Cap Party shall, and shall cause Counterparty to, deliver to Lender a fully executed Interest Rate Cap Agreement (which shall, by its terms, authorize the assignment to Lender and require that payments be deposited directly into the Restricted Account).

(b)Borrower Interest Rate Cap Party shall comply in all material respects with all of its obligations under the terms and provisions of the Interest Rate Cap Agreement. All amounts paid by the Counterparty under the Interest Rate Cap Agreement to Borrower or Lender shall be deposited promptly and directly into the Restricted Account. Borrower shall take all actions reasonably requested by Lender to enforce Lender’s rights under the Interest Rate Cap Agreement in the event of a default by the Counterparty and shall not waive, amend or otherwise modify any of its rights thereunder without Lender’s prior written consent.

(c)In the event of any downgrade, withdrawal or qualification of the rating of the Counterparty by any Rating Agency below the Minimum Counterparty Rating, Borrower shall replace the Interest Rate Cap Agreement not later than ten (10) Business Days following receipt of notice of such downgrade, withdrawal or qualification with an Interest Rate Cap Agreement in form and substance reasonably satisfactory to Lender (and meeting the requirements set forth in this Section 2.8) (a “Replacement Interest Rate Cap Agreement”) from a Counterparty reasonably acceptable to Lender having a Minimum Counterparty Rating.

(d)Borrower shall deliver to Lender a new Collateral Assignment of Interest Rate Cap Agreement reasonably acceptable to Lender in connection with each new Interest Rate Cap Agreement and Replacement Interest Rate Cap Agreement. In the event that Borrower fails to purchase and deliver to Lender the Interest Rate Cap Agreement or fails to maintain the Interest Rate

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​ Cap Agreement in accordance with the terms and provisions of this Agreement, Lender may purchase the Interest Rate Cap Agreement and the cost reasonably incurred by Lender in purchasing such Interest Rate Cap Agreement shall be paid by Borrower to Lender with interest thereon at the Default Rate from the date such cost was incurred by Lender until such cost is reimbursed by Borrower to Lender.

(e)Each Interest Rate Cap Agreement shall contain the following language or its equivalent: In the event of any downgrade, withdrawal or qualification of the rating of the Counterparty below (i) a long term credit rating from S&P of at least “A+”, (ii) a long term credit rating from Moody’s of at least “A3”, or (iii) a short term credit rating from Fitch of at least “F-1” or a long term credit rating from Fitch of at least “A”, the Counterparty must, within ten (10) business days, find a replacement Counterparty, at the Counterparty’s sole cost and expense, acceptable to each Rating Agency and Borrower; provided that, notwithstanding such a downgrade, withdrawal or qualification, unless and until the Counterparty transfers the Interest Rate Cap Agreement to a replacement Counterparty, the Counterparty will continue to perform its obligations under the Interest Rate Cap Agreement. Failure to satisfy the foregoing shall constitute an “Additional Termination Event” as defined by Section 5(b)(v) of the ISDA Master Agreement, with the Counterparty as the “Affected Party.” In the event that a Counterparty is required pursuant to the terms of an Interest Rate Cap Agreement to find a replacement Counterparty, Borrower covenants and agrees that Borrower shall seek Lender’s approval with respect thereto and shall not approve or consent to the foregoing unless and until Borrower receives Lender’s prior written approval and shall approve or consent to the foregoing upon receipt of Lender’s prior written approval. Borrower’s failure to comply with the requirements of this Section 2.8(e) shall constitute, at Lender’s option, an immediate Event of Default.

(f)With respect to each Interest Rate Cap Agreement, Borrower shall obtain and deliver to Lender an opinion from counsel (which counsel may be in house counsel for the Counterparty) for the Counterparty (and any related guarantor, if applicable) (upon which Lender and its successors and assigns may rely) which shall provide, in relevant part, that:

(i)the Counterparty (and guarantor, if applicable) is duly organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation and has the organizational power and authority to execute and deliver, and to perform its obligations under, the Interest Rate Cap Agreement (and related guaranty, if applicable);

(ii)the execution and delivery of the Interest Rate Cap Agreement (and guaranty, if applicable) by the Counterparty (and guarantor, if applicable), and any other agreement which the Counterparty (and guarantor, if applicable) has executed and delivered pursuant thereto, and the performance of its obligations thereunder have been and remain duly authorized by all necessary action and do not contravene any provision of its certificate of incorporation or by-laws (or equivalent organizational documents) or any law, regulation or contractual restriction binding on or affecting it or its property;

(iii)all consents, authorizations and approvals required for the execution and delivery by the Counterparty of the Interest Rate Cap Agreement (and guarantor of the guaranty, if applicable), and any other agreement which the Counterparty (and guarantor, if applicable) has executed and delivered pursuant thereto, and the performance of its obligations thereunder have been obtained and remain in full force and effect, all conditions thereof have been duly complied with, and no other action by, and no notice to or filing with any governmental authority or regulatory body is required for such execution, delivery or performance; and

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​ (iv)the Interest Rate Cap Agreement (and guaranty, if applicable), and any other agreement which the Counterparty (and guarantor, if applicable) has executed and delivered pursuant thereto, has been duly executed and delivered by the Counterparty (and guarantor, if applicable) and constitutes the legal, valid and binding obligation of the Counterparty (and guarantor, if applicable), enforceable against the Counterparty (and guarantor, if applicable) in accordance with its terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).

(g)Prior to purchasing any Interest Rate Cap Agreement or Replacement Interest Rate Cap Agreement, Borrower shall provide written notice of the terms of any such agreement to Lender (the “Rate Cap Notice”). Upon receipt of the Rate Cap Notice, any Affiliate of Lender shall have the right to match the terms thereof, and if such Affiliate so matches, Borrower shall be required to purchase such agreement from such Affiliate of Lender.

(h)Notwithstanding anything to the contrary contained in this Section 2.8, in Section 2.9(c) below or elsewhere in this Agreement, if, at any time, the Loan is converted from (I) a SOFR Loan to either an Alternate Rate Loan or a Prime Rate Loan or (II) an Alternate Rate Loan to an Alternate Rate Loan based on a different Benchmark Replacement, each in accordance with Section 2.5 above (each, an “Index Rate Conversion”), then:

(i)within thirty (30) days after such Index Rate Conversion, Borrower shall enter into, make all payments under, and satisfy all conditions precedent to the effectiveness of, a Substitute Interest Rate Cap Agreement (and in connection therewith, but not prior to Borrower taking all the actions described in this clause (i), Borrower Interest Rate Cap Party shall have the right to terminate any then-existing Interest Rate Cap Agreement) provided that if interest rate protection agreements with respect to Alternate Rate Loans are not available at a commercially reasonable cost (as reasonably determined by Lender), Lender and Borrower may pursue another option that is reasonably acceptable to Lender that provides Lender equivalent protection from rising interest rates; and

(ii)following such Index Rate Conversion, in lieu of satisfying the condition described in Section 2.9(c) with respect to any future Extension Period, Borrower Interest Rate Cap Party shall instead enter into, make all payments under, and satisfy all conditions precedent to the effectiveness of a Substitute Interest Rate Cap Agreement on or prior to the first day of such Extension Period.

As used herein, “Substitute Interest Rate Cap Agreement” shall mean an interest rate cap agreement between a Counterparty and Borrower Interest Rate Cap Party, obtained by Borrower Interest Rate Cap Party and collaterally assigned to Lender pursuant to this Agreement and shall contain each of the following:

(A)a term expiring no earlier than the end of the Interest Accrual Period in which the then current Maturity Date occurs and a strike rate no greater than the Substitute Strike Rate;

(B)the notional amount of the Substitute Interest Rate Cap Agreement shall be equal to or greater than the then outstanding principal balance of the Loan;

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​ (C)it provides that the only obligation of Borrower Interest Rate Cap Party thereunder is the making of a single payment to the Counterparty thereunder upon the execution and delivery thereof;

(D)it provides to Lender and Borrower Interest Rate Cap Party (as determined by Lender in its sole but good faith discretion), for the term of the Substitute Interest Rate Cap Agreement, a hedge against rising interest rates that is no less beneficial to Borrower Interest Rate Cap Party and Lender than (I) in the case of clause (h)(i) above, that which was provided by the Interest Rate Cap Agreement being replaced by the Substitute Interest Rate Cap Agreement and (II) in the case of clause (h)(ii) above, that which was intended to be provided by the Interest Rate Cap Agreement that, but for the operation of this Section 2.8(h), would have been required to have been delivered by Borrower Interest Rate Cap Party pursuant to Section 2.9(c) below as a condition to the requested Extension Period; and

(E)without limiting any of the provisions of the preceding clauses (A) through (D) above, it satisfies all of the requirements set forth in Section 2.8(a) hereof.

From and after the date of any Index Rate Conversion, all references to “Interest Rate Cap Agreement” and “Replacement Interest Rate Cap Agreement” herein (other than in the definition of “Interest Rate Cap Agreement”, the definition of “Replacement Interest Rate Cap Agreement” and as referenced in the first sentence of Section 2.8(a) hereof) shall be deemed to refer or relate, as applicable, to a Substitute Interest Rate Cap Agreement.

Section 2.9.Extension of the Maturity Date. Borrower shall have the option to extend the term of the Loan beyond the initial Stated Maturity Date for three (3) successive terms (the “Extension Option”) of one (1) year each (each, an “Extension Period”) to (i) the Monthly Payment Date occurring in October 2027 if the first Extension Option is exercised, (ii) the Monthly Payment Date occurring in October 2028 if the second Extension Option is exercised, and (iii) the Monthly Payment Date occurring in October 2029 if the second Extension Option is exercised (each such date, the “Extended Maturity Date”) upon satisfaction of the following terms and conditions (in each case as determined by Lender in good faith).

(a)no Event of Default shall have occurred and be continuing at the time an Extension Option is exercised and on the date that the applicable Extension Period is commenced;

(b)Borrower shall notify Lender of its election to extend the Stated Maturity Date as aforesaid not earlier than one hundred twenty (120) days and no later than thirty (30) days prior to the applicable Stated Maturity Date; provided, however, that Borrower shall be permitted to revoke such notice at any time up to five (5) days before the Stated Maturity Date provided that Borrower pays to Lender all actual out-of-pocket costs incurred by Lender in connection with such notice, including, without limitation, any Breakage Costs; and

(c)Borrower shall obtain and deliver to Lender prior to exercise of such Extension Option, a Replacement Interest Rate Cap Agreement, which Replacement Interest Rate Cap Agreement shall be effective commencing on the first day of the related Extension Period, shall have a strike rate equal to the Extension Strike Rate, and shall have a maturity date not earlier than the last day of the Interest Accrual Period in which the related Extended Maturity Date shall occur; and

(d)Borrower shall have paid to Lender all actual out-of-pocket costs and expenses incurred by Lender in connection with Borrower’s exercise of the applicable Extension Option.

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​ All references in this Agreement and in the other Loan Documents to the Maturity Date shall mean the Extended Maturity Date in the event the applicable Extension Option is exercised.

Section 2.10.Partial Release. ****

(a)Provided no Event of Default shall have occurred and be continuing (other than with respect to a Default Release), Borrower shall have the right at any time prior to the Maturity Date to obtain the release (a “Partial Release”) of one or more Individual Properties (each such released Individual Property, the “Released Property”, and the Individual Properties remaining encumbered by the Security Instrument, the “Remaining Properties”) from the lien of the Security Instrument thereon (and related Loan Documents) and the release of the applicable Individual Borrower’s obligations under the Loan Documents with respect to such Released Property (other than those expressly stated to survive), upon the satisfaction of each of the following conditions precedent:

(i)Lender shall have received at least ten (10) Business Days’ (or a shorter period of time if permitted by Lender in its sole discretion exercised in good faith) prior written notice requesting the release of the Released Property;

(ii)Borrower shall, in accordance with the provisions of Section 2.7(a) above, partially prepay the Loan in an amount equal to the Release Price or such other amounts as may be required to be prepaid in connection with such release under clause (vi) below (together with, without limitation, any Interest Shortfall (if applicable) and, with respect to any such payment in excess of the Free Prepayment Amount, the Prepayment Premium applicable thereto), or such greater amount as may be required to satisfy the Partial Release Test as set forth in clause (vi) below;

(iii)Intentionally Omitted;

(iv)Borrower shall submit to Lender, not less than ten (10) Business Days prior to the date of such release (or a shorter period of time if permitted by Lender in its sole discretion exercised in good faith), a release or assignment of lien (and related Loan Documents) for the Released Property for execution by Lender. Such release or assignment shall be in a form appropriate in the State in which the Released Property is located and shall contain standard provisions, if any, protecting the rights of the releasing or assigning lenders. In addition, Borrower shall provide all other documentation in connection with such release or assignment as may be reasonably requested by Lender;

(v)Borrower shall have delivered to Lender evidence reasonably satisfactory to Lender that the release of the Released Property will not violate any term or provision of any Major Lease, Property Document, PILOT Lease and/or PILOT Document, or Management Agreement in effect at the Remaining Property at the time of the release of the Released Property, in each case in any material respect, which evidence may take the form of a certification from Borrower contained in the Officer’s Certificate referenced in Section 2.10(a)(xiii) below;

(vi)As of the date of consummation of the Partial Release, after giving effect to the release of the Released Property from the lien of the related Security Instrument and the accordant partial prepayment of the Loan, the Debt Yield with respect to the Remaining Properties shall be equal to or greater than the Closing Date Debt Yield (such test, the “Partial Release Test”); provided that with respect to a release in connection with a sale to a third-party, unrelated to any Borrower, Guarantor, Sponsor, or any Affiliate thereof on a

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​ bona fide arm’s-length basis, at market pricing based on a market process, if the Partial Release Test would not be satisfied after giving effect to the release of the Released Property and payment of the Release Price, then such Partial Release shall be permitted upon payment of a release price equal to the greater of (1) one hundred percent (100%) of the net sales proceeds from the disposition of such Released Property (net of reasonable and customary closing costs payable to third parties in connection with the disposition of such Released Property) and (2) the Release Price for such Released Property; provided, further, that, notwithstanding the foregoing, Borrower shall also have the right to satisfy the Partial Release Test by making an additional prepayment of the Debt, in accordance with the terms and conditions of Section 2.7(a) hereof (including, without limitation, payment of any applicable Interest Shortfall, Breakage Costs, and/or Prepayment Premium), in an amount which, when applied to the repayment of the Debt, together with the applicable Release Price is sufficient such that the Partial Release Test is satisfied.  Upon request from Lender, Borrower shall deliver to Lender an Officer’s Certificate confirming Borrower’s calculation of the Debt Yield with respect to the Remaining Properties;

(vii)Borrower shall pay all recording charges, filing fees, taxes or other out-of-pocket expenses (including, without limitation, any mortgage and intangibles taxes and documentary stamp taxes) payable in connection with the release of the Released Property;

(viii)Intentionally Omitted;

(ix)Intentionally Omitted;

(x)In the event that the Released Property is the last Individual Property owned by Borrower Interest Rate Cap Party, Borrower Interest Rate Cap Party shall have assigned all of its right, title and interest in and to the Interest Rate Cap Agreement to another Individual Borrower that owns one or more Properties that shall remain subject to the lien of the Security Instrument after such release (such Borrower, the “Assignee Borrower”). In connection with (and as a condition precedent to) such assignment, Assignor (as defined in the Collateral Assignment of Interest Rate Cap Agreement and which, for the avoidance of doubt, may refer to Borrower Interest Rate Cap Party or any Assignee Borrower that has assumed the interests of such Assignor pursuant to and in accordance with this Agreement) and the other Borrowers (as applicable) shall execute and deliver to Lender (i) an assumption of the existing Collateral Assignment of Interest Rate Cap Agreement reasonably acceptable to Lender (or a new collateral assignment of interest rate cap agreement in form and substance substantially similar to the Collateral Assignment of Interest Rate Cap Agreement delivered on the Closing Date and otherwise reasonably acceptable to Lender) and (ii) an acknowledgment and consent to such assumption or new assignment executed by Counterparty and reasonably acceptable to Lender. Any Assignee Borrower may further assign its right, title and interest in and to the Interest Rate Cap Agreement to another Assignee Borrower, provided all of the conditions set forth in this Section 2.10(a)(x) are satisfied; and

(xi)Subsequent to such release, each remaining Individual Borrower and each SPE Component Entity shall continue to be a Single Purpose Entity pursuant to, and in accordance with, Article 5 hereof;

(xii)Borrower shall have paid or reimbursed Lender and/or Servicer for all reasonable out-of-pocket costs and expenses actually incurred by Lender and/or Servicer (including, without limitation, reasonable actually incurred attorneys’ fees and

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​ disbursements), and shall have paid the customary fees of Servicer in connection with such release, which fee shall (A) not exceed (x) $10,000.00 in the aggregate with respect to the coordinated release (simultaneously or on or about the same date) of between one (1) and four (4) Individual Properties and (y) $20,000.00 in the aggregate with respect to the coordinated release (simultaneously or on or about the same date) of five (5) or more Individual Properties; and

(xiii)Borrower shall deliver an Officer’s Certificate certifying that all requirements set forth in this Section 2.10 have been satisfied.

(b)In connection with any release under this Section 2.10, in the event that such release would result in the release of all Individual Properties held by an Individual Borrower (each an “Unencumbered Borrower”), such Unencumbered Borrower shall be released by Lender from the obligations of the Loan Documents, except with respect to those obligations that are expressly provided herein to survive repayment of the Loan. In connection with a release or cancellation of each Unencumbered Borrower, Lender agrees to deliver (i) a UCC-3 Financing Statement termination or amendment releasing Lender’s security interest in the collateral pledged to Lender relating to each Unencumbered Borrower, and (ii) instruments executed by Lender reasonably necessary to evidence the release or cancellation of each Unencumbered Borrower from its obligations under the Loan Documents. All reasonable out-of-pocket costs and expenses actually incurred by Lender in connection with such release shall be paid by Borrower.

(c)Intentionally Omitted.

(d)Notwithstanding the foregoing provisions of this Section 2.10, if any portion of the Loan is or will be included in a REMIC Trust, no Partial Release shall be permitted unless (x) Borrower shall have established to Lender’s reasonable satisfaction that the loan-to-value ratio of the Loan (expressed as a percentage) based upon valuations obtained by Borrower at its sole cost and expense using any commercially reasonable method permitted to a REMIC Trust (which may, provided the same is permitted under applicable REMIC requirements, include an existing appraisal to the extent the release occurs within twenty-four (24) months of the Closing Date or, if after such period, an updated appraisal, or a broker’s price opinion, in each case reasonably satisfactory to Lender, but shall be based solely on the value of real property and shall exclude personal property and going-concern value) does not exceed one hundred twenty-five percent (125%) immediately after the release of the Released Property, (y) the principal balance of the Loan is paid down by an amount not less than the greater of (I) the Release Price and (II) the least of the following amounts: (A) the net proceeds of an arm’s-length sale of the Released Property to an unrelated person, (B) the fair market value of the Released Property as reasonably determined by Lender at the time of the Partial Release, or (C) an amount such that the loan-to-value ratio of the Loan (as so reasonably determined by Lender) does not increase as a result of the Partial Release, or (z) Lender receives an opinion of counsel that the Securitization will not fail to maintain its status as a REMIC Trust as a result of the Partial Release.

(e)Notwithstanding anything to the contrary contained herein, Borrower shall have the right, but not the obligation, to cause the release of any Individual Property in order to cure a continuing Default or Event of Default with respect to an Individual Property for which Lender has delivered notice of such Default or Event of Default to Borrower, provided that (i) either (x) Borrower has, prior to the release, demonstrated in good faith to Lender that it has pursued a cure of the Default or Event of Default (which cure shall not require any shareholder, partner, or member of any such Borrower, including Guarantor, to make any capital contribution to Borrower to effectuate such cure or impose any obligation on Borrower, any shareholder, partner or member

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​ of such Borrower, including Guarantor, to use operating income or rents from any Property other than the Individual Property that is the subject of such Default or Event of Default to effectuate such cure) or (y) such default or Event of Default relates to an environmental condition at the Individual Property, and (ii) such Default or Event of Default was not caused by (or at the direction of) Borrower or an Affiliate thereof in bad faith to circumvent the requirements of this Section 2.10 (a “Default Release”).  In connection with any Default Release, Borrower shall be required to satisfy the conditions set forth in this Section 2.10, except that Borrower shall not be required to satisfy the condition set forth in Section 2.10(a)(vi).  Any prepayment of the Loan in connection with a Default Release shall be deemed a voluntary prepayment, and shall be subject to satisfaction of the conditions set forth in Section 2.7(a). Any such continuing Default or Event of Default with respect to such Individual Property will be deemed cured and no longer continuing upon the release of such Individual Property in accordance with the terms of this Section 2.10(e).

Section 2.11.Components of the Loan.

(a)For the purpose of computing interest payable from time to time on the principal amount of the Loan and certain other computations set forth herein, the principal balance of the Loan shall be divided into Component A, Component B, Component C, Component D, Component E, Component F and Component HRR. The initial principal amount of the Components shall be as follows:

COMPONENT	INITIAL PRINCIPAL AMOUNT
A	$261,000,000
B	$28,800,000
C	$31,000,000
D	$43,700,000
E<br><br>F	$66,900,000<br><br>$19,850,000
HRR	$23,750,000

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ARTICLE 3​​REPRESENTATIONS AND WARRANTIES

Borrower represents and warrants to Lender as of the Closing Date that:

Section 3.1.Legal Status and Authority. Borrower (a) is duly organized, validly existing and in good standing under the laws of its state of formation; (b) is duly qualified to transact business and is in good standing in the State; and (c) has all necessary approvals, governmental and otherwise, and full organizational power and authority to own, operate and lease each Property. Borrower has full organizational power, authority and legal right to mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey each Property pursuant to the terms hereof and to keep and observe all of the terms of this Agreement, the Note, the Security Instrument and the other Loan Documents on Borrower’s part to be performed.

Section 3.2.Validity of Documents. (a) The execution, delivery and performance of this Agreement, the Note, the Security Instrument and the other Loan Documents by Borrower and Guarantor and the borrowing evidenced by the Note and this Agreement (i) are within the organizational power and authority of such parties; (ii) have been authorized by all requisite organizational action of such parties; (iii) have received all necessary approvals and consents,

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​ corporate, governmental or otherwise; (iv) will not materially violate, conflict with, result in a breach of or constitute (with notice or lapse of time, or both) a material default under any provision of law, any order or judgment of any court or Governmental Authority applicable to Borrower or its assets or the Properties, any license, certificate or other governmental approval required for Borrower to operate the Properties, any applicable organizational documents, or any applicable indenture, agreement or other instrument, including, without limitation, the Management Agreement; (v) will not result in the creation or imposition of any lien, charge or encumbrance whatsoever upon any of its assets, except the lien and security interest created hereby and by the other Loan Documents; and (vi) will not require any authorization or license from, or any filing with, any Governmental Authority (except for the recordation of the Security Instrument in the appropriate land records in the State and except for Uniform Commercial Code filings and similar filings relating to the security interest created hereby and except for any other authorization, license or filing with any Governmental Authority which has been obtained or performed, or will be obtained or performed concurrently with the execution and delivery of this Agreement), (b) this Agreement, the Note, the Security Instrument and the other Loan Documents have been duly executed and delivered by or on behalf of Borrower and Guarantor through an authorized representative of Borrower and Guarantor and (c) this Agreement, the Note, the Security Instrument and the other Loan Documents to which it is a party constitute the legal, valid and binding obligations of Borrower and Guarantor. The Loan Documents are not subject to any right of rescission, set-off, counterclaim or defense by Borrower or Guarantor, including the defense of usury, nor to Borrower’s and Guarantor’s knowledge would the operation of any of the terms of the Loan Documents, or the exercise of any right thereunder, render the Loan Documents unenforceable (except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Creditors Rights Laws, and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law)). Neither Borrower nor Guarantor has asserted any right of rescission, set-off, counterclaim or defense with respect to the Loan Documents.

Section 3.3.Litigation. There is no action, suit, proceeding or governmental investigation, in each case, judicial, administrative or otherwise (including any condemnation or similar proceeding), pending or, to Borrower’s knowledge, threatened in writing against Borrower, Sponsor or Guarantor or against or affecting the Property that has not been disclosed to Lender by Borrower in writing, prior to the Closing Date, and in connection with the closing of the Loan, is not covered by insurance, or, if determined adversely to Borrower, would reasonably be likely to have an Individual Material Adverse Effect or Aggregate Material Adverse Effect.

Section 3.4.Agreements. To Borrower’s knowledge, Borrower is not a party to any agreement or instrument or subject to any restriction which would have an Individual Material Adverse Effect. Borrower is not in default in any material respect in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any agreement or instrument to which it is a party or by which Borrower or any Property is bound. Borrower has no material financial obligation under any agreement or instrument to which Borrower is a party or by which Borrower or any Property is otherwise bound, other than (a) obligations incurred in the ordinary course of the operation of the Property and (b) obligations under this Agreement, the Security Instrument, the Note and the other Loan Documents. There is no agreement or instrument to which Borrower is a party or by which Borrower is bound that would require the subordination in right of payment of any of Borrower’s obligations hereunder or under the Note to an obligation owed to another party.

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​ Section 3.5.Financial Condition.

(a)Borrower is solvent and Borrower has received reasonably equivalent value for the granting of the Security Instrument. No proceeding under Creditors Rights Laws with respect to any Borrower Party has been initiated by any Borrower Party or, to Borrower’s knowledge, by any other Person.

(b)In the last ten (10) years, (i) no petition in bankruptcy has been filed by any Borrower Party or, to Borrower’s knowledge, by any other Person against any Borrower Party and (ii) Borrower Party has never made any assignment for the benefit of creditors or taken advantage of any Creditors Rights Laws.

(c)No Borrower Party is contemplating either the filing of a petition by it under any Creditors Rights Laws or the liquidation of its assets or property and Borrower has no knowledge of any Person contemplating the filing of any such petition against any Borrower Party.

Section 3.6.Disclosure. Borrower has disclosed to Lender all material facts and has not intentionally failed to disclose any material fact known to Borrower that could be reasonably likely to cause any representation or warranty made herein to be materially misleading.

Section 3.7.No Plan Assets; FIRRMA.

(a)As of the date hereof and until the Debt is repaid in accordance with the applicable terms and conditions hereof, (a) Borrower is not and will not be an “employee benefit plan,” as defined in Section 3(3) of ERISA, subject to Title I of ERISA, (b) Borrower is not and will not be a “governmental plan” within the meaning of Section 3(32) of ERISA, (c) transactions by or with Borrower are not and will not be subject to any state statute regulating investments of, or fiduciary obligations with respect to, governmental plans and (d) none of the assets of Borrower constitutes or will constitute “plan assets” of one or more plans subject to Title I of ERISA or Section 4975 of the IRA Code within the meaning of 29 C.F.R. Section 2510.3-101, as modified by Section 3(42) of ERISA. As of the date hereof, neither Borrower, nor any member of a “controlled group of corporations” (within the meaning of Section 414 of the IRS Code) that includes Borrower, maintains, sponsors or contributes to a “defined benefit plan” (within the meaning of Section 3(35) of ERISA) or a “multiemployer pension plan” (within the meaning of Section 3(37)(A) of ERISA).

(b)Each of Borrower, the Constituent Owners of Borrower, the Property and acquisition thereof have complied with and are in compliance with FIRRMA. Borrower has provided to Lender with copies of any and all FIRRMA Documents it has received. No non-U.S. government (including any state owned enterprises or sovereign wealth funds) owns any equity interests (direct or indirect) in Borrower. Borrower has not made any voluntary filings relating to FIRRMA and Borrower is not required to make any mandatory filings relating to FIRRMA.

Section 3.8.Not a Foreign Person. Borrower is not a “foreign person” within the meaning of § 1445(f)(3) of the IRS Code.

Section 3.9.Intentionally Omitted.

Section 3.10.Business Purposes. The Loan is solely for the business purpose of Borrower, and is not for personal, family, household, or agricultural purposes.

Section 3.11.Borrower’s Principal Place of Business. Borrower’s principal place of business and its chief executive office as of the date hereof is 2000 Avenue of the Stars, 12^th^ Floor,

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​ Los Angeles, CA 90067. Borrower’s mailing address, as set forth in the opening paragraph hereof or as changed in accordance with the provisions hereof, is true and correct. Borrower’s organizational identification number, if any, assigned by the state of its organization is set forth on Schedule I attached hereto. Borrower’s federal tax identification number is set forth on Schedule I attached hereto. Borrower is not subject to back-up withholding taxes.

Section 3.12.Status of Property.

(a)To Borrower’s knowledge, Borrower has obtained all material Permits (the absence of which could reasonably be expected to have an Individual Material Adverse Effect or Aggregate Material Adverse Effect), all of which are in full force and effect as of the date hereof and not subject to revocation, suspension, forfeiture or modification.

(b)Except as otherwise disclosed by the Environmental Report (as defined in the Environmental Indemnity), to Borrower’s knowledge, each Individual Property and the present use and the contemplated use and occupancy thereof are in compliance in all material respects with all applicable zoning ordinances, building codes, land use laws, Environmental Laws and other similar Legal Requirements.

(c)Each Individual Property is served by all utilities required for the current or contemplated use thereof. All utility services are provided by public utilities and each Individual Property has accepted or is equipped to accept such utility service.

(d)All public roads and streets necessary for service of and access to each Individual Property for the current or contemplated use thereof have been completed, are serviceable and all-weather and are physically and legally open for use by the public. Each Individual Property has either direct access to such public roads or streets or access to such public roads or streets by virtue of a perpetual easement or similar agreement inuring in favor of Borrower and any subsequent owners of each Individual Property.

(e)Each Individual Property is served by public water and sewer systems.

(f)Except as otherwise disclosed in the property condition report delivered to Lender in connection with the closing of the Loan, to Borrower’s knowledge, (i) each Individual Property is free from damage caused by fire or other casualty, (ii) each Individual Property, including, without limitation, all buildings, improvements, parking facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection systems, electrical systems, equipment, elevators, exterior sidings and doors, landscaping, irrigation systems and all structural components, are in good condition, order and repair in all material respects; and (iii) there exists no structural or other material defects or damages in each Individual Property, whether latent or otherwise, and Borrower has not received written notice from any insurance company or bonding company of any defects or inadequacies in each Individual Property, or any part thereof, which would adversely affect in any material respect the insurability of the same or cause the imposition of extraordinary premiums or charges thereon or of any termination or threatened termination of any policy of insurance or bond.

(g)All costs and expenses of any and all labor, materials, supplies and equipment used in the construction of the Improvements have been paid in full. There are no mechanics’ or similar liens or claims which have been filed for work, labor or material (and no rights are outstanding that under applicable Legal Requirements could give rise to any such liens) affecting each Individual Property which are or may become a lien prior to or equal to the lien of the Security Instrument.

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​ (h)Borrower has paid in full for, and is the owner of, all material furnishings, fixtures and equipment (other than Tenants’ property or the property, if any, and equipment leased under any Permitted Equipment Lease) used in connection with the operation of each Individual Property, free and clear of any and all security interests, liens or encumbrances, except the lien and security interest created by this Agreement, the Note, the Security Instrument and the other Loan Documents and other Permitted Encumbrances.

(i)Except as otherwise disclosed in the property condition report delivered to Lender in connection with the closing of the Loan, to Borrower’s knowledge, all liquid and solid waste disposal, septic and sewer systems located on each Individual Property are in a good and safe condition and repair and in compliance in all material respects with all Legal Requirements.

(j)Except as expressly disclosed on the Survey, (i) no portion of the Improvements is located in an area identified by the Federal Emergency Management Agency or any successor thereto as an area having special flood hazards pursuant to the Flood Insurance Acts and (ii) no part of any Individual Property consists of or is classified as wetlands, tidelands or swamp and overflow lands.

(k)Except for encroachments expressly set forth in the Survey and that are insured against pursuant to the Title Insurance Policy, to Borrower’s knowledge, all the Improvements lie within the boundaries of the Land and any building restriction lines applicable to the Land.

(l)To Borrower’s knowledge, there are no pending or proposed special or other assessments for public improvements or otherwise affecting any Individual Property, nor are there any contemplated improvements to any Individual Property that may result in such special or other assessments.

(m)Except as otherwise disclosed to Lender in writing, prior to the Closing Date and in connection with the closing of the Loan, Borrower has not (i) made, ordered or contracted for any construction, repairs, alterations or improvements to be made on or to any Individual Property which have not been completed and paid prior to the same becoming due and delinquent, (ii) ordered any material amounts of materials for any such construction, repairs, alterations or improvements which have not been paid prior to the same becoming due and delinquent or (iii) attached any material fixtures to any Individual Property which have not been paid prior to the same becoming due and delinquent. There is no such construction, repairs, alterations or improvements ongoing at any Individual Property as of the Closing Date other than such construction, repairs alterations or improvements made in the ordinary course of business, and those of which have been disclosed to Lender in writing, prior to the Closing Date and in connection with the closing of the Loan. There are no outstanding or disputed claims for any Work Charges that have either been filed or delivered to Borrower in writing, and there are no outstanding filed liens or security interests (other than any unwritten, inchoate security interests that exist as a matter of law) in connection with any Work Charges.

(n)Borrower has no direct employees. All personnel employed at or in connection with any Individual Property are the direct employees of Manager or Sub-Manager.

Section 3.13.Financial Information. All financial data, including, without limitation, the balance sheets, statements of cash flow, statements of income and operating expense and rent rolls, prepared by or on behalf of, or delivered to Lender by or on behalf of, Borrower, Sponsor and/or Guarantor, in respect of Borrower, Sponsor, Guarantor and/or the Property prior to the date hereof (a) are true, complete and correct in all material respects, (b) accurately represent the financial

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​ condition of Borrower, Sponsor, Guarantor or the Property, as applicable, as of the date of such reports, and (c) to the extent prepared or audited by an independent certified public accounting firm, have been prepared in accordance with the Approved Accounting Method throughout the periods covered, except as disclosed therein. Borrower does not have any contingent liabilities, liabilities for taxes, unusual forward or long-term commitments or unrealized or anticipated losses from any unfavorable commitments that are known to Borrower and reasonably likely to have an Aggregate Material Adverse Effect, except as referred to or reflected in said financial statements. Since the date of such financial statements, there has been no materially adverse change in the financial condition, operations or business of Borrower, Sponsor or Guarantor from that set forth in said financial statements.

Section 3.14.Condemnation. Except with respect to the condemnation relating to the Property located at 2455 W. 1500 South, Salt Lake City, Utah (“Intermountain Space Center Property”), no Condemnation or other proceeding has been commenced or, to Borrower’s best knowledge, is threatened in writing with respect to all or any portion of any Property or for the relocation of the access to any Property.

Section 3.15.Separate Lots. Each Individual Property is assessed for real estate tax purposes as one or more wholly independent tax lot or lots, separate from any adjoining land or improvements not constituting a part of such lot or lots, and no other land or improvements is assessed and taxed together with the Property or any portion thereof.

Section 3.16.Insurance. Borrower has obtained and has delivered to Lender evidence of insurance, reflecting the insurance coverages, amounts and other requirements set forth in this Agreement. There are no present claims of any material nature under any of the Policies, and to Borrower’s knowledge, no Person, including Borrower, has done, by act or omission, anything which would impair the coverage of any of the Policies.

Section 3.17.Use of Property. Each Individual Property is used primarily for industrial purposes and other appurtenant, ancillary and related uses.

Section 3.18.Leases and Rent Roll. Except as disclosed in the rent roll for the Property delivered to and certified to Lender in connection with the closing of the Loan (the “Rent Roll”), (a) Borrower is the sole owner of the entire lessor’s interest in the Leases; (b) the Leases are valid and enforceable and in full force and effect; (c) all of the Leases are arms-length agreements with bona fide, independent third parties; (d) Borrower is not in default under any Lease beyond any applicable notice and grace periods and, to Borrower’s knowledge, no other party under any Lease is in default in any material respect beyond any applicable notice and grace periods; (e) except as set forth on an arrears report provided to Lender prior to the date hereof, all Rents due have been paid in full and no Tenant is in arrears in its payment of Rent; (f) the terms of all alterations, modifications and amendments to the Leases are reflected in the occupancy statement delivered to and approved by Lender; (g) except pursuant to the Loan Documents, none of the Rents reserved in the Leases have been assigned or otherwise pledged or hypothecated; (h) none of the Rents have been collected for more than one (1) month in advance (except a Security Deposit shall not be deemed rent collected in advance); (i) the premises demised under the Leases have been completed, all improvements, repairs, alterations or other work required to be furnished on the part of Borrower under the Leases have been completed, the Tenants under the Leases have accepted the premises demised thereunder and have taken possession of the same on a rent-paying basis and any payments, credits or abatements required to be given by Borrower to the Tenants under the Leases have been made in full; (j) to Borrower’s knowledge, there exist no offsets or defenses to the payment of any portion of the Rents and Borrower has no outstanding monetary obligation to any Tenant under any

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​ Lease; (k) Borrower has received no written notice from any Tenant challenging the validity or enforceability of any Lease; (l) Borrower has no agreements with the Tenants under the Leases other than expressly set forth in each Lease; (m) [intentionally omitted]; (n) no Lease contains an option to purchase, right of first refusal to purchase, right of first refusal to lease additional space at any Property, or any other similar provision other than the Wedgewood Lease; (o) no Person has any possessory interest in, or right to occupy, any Property except under and pursuant to a Lease; (p) all Security Deposits relating to the Leases are reflected on the Rent Roll and have been collected by Borrower; (q) no brokerage commissions or finders fees are due and payable regarding any Lease; (r) each Tenant is in actual, physical occupancy of the premises demised under its Lease; (s) to Borrower’s knowledge, there are no actions or proceedings (voluntary or otherwise) pending against any Tenants or guarantors under Leases, in each case, under bankruptcy or similar insolvency laws or regulations; and (t) to Borrower’s knowledge, no event has occurred giving any Tenant the right to cease operations at its leased premises (i.e., “go dark”), terminate its Lease or pay reduced or alternative Rent to Borrower under any of the terms of such Lease, such as a co-tenancy provision. Prior to the Closing Date, Borrower has requested Tenant estoppel certificates from each Tenant.

Section 3.19.Filing and Recording Taxes. All mortgage, mortgage recording, stamp, intangible or other similar tax required to be paid by any Person under applicable Legal Requirements currently in effect in connection with the execution, delivery, recordation, filing, registration, perfection or enforcement of any of this Agreement, the Security Instrument, the Note and the other Loan Documents, including, without limitation, the Security Instrument, have been paid or will be paid, and, under current Legal Requirements, the Security Instrument and the other Loan Documents are enforceable in accordance with their terms by Lender (or any subsequent holder thereof), except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Creditors Rights Laws, and by general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

Section 3.20.Management Agreement. The Management Agreement is in full force and effect and there is no default thereunder by any party thereto and, to Borrower’s knowledge, no event has occurred that, with the passage of time and/or the giving of notice would constitute a default thereunder. As of the date hereof, no management fees under the Management Agreement are past due.

Section 3.21.Illegal Activity/Forfeiture.

(a)No portion of the Property has been or will be purchased, improved, equipped or furnished by Borrower or, to Borrower’s knowledge, any other Person with proceeds of any illegal activity and to Borrower’s knowledge, there are no illegal activities or activities relating to controlled substances at any Property.

(b)There has not been and shall never be committed by Borrower, any Affiliate of Borrower or, to Borrower’s knowledge, there has not been committed by any other Person in occupancy of or involved with the operation or use of the Property any act or omission affording the federal government or any state or local government the right of forfeiture as against any Property or any part thereof or any monies paid in performance of Borrower’s obligations under this Agreement, the Note, the Security Instrument or the other Loan Documents. Borrower hereby covenants and agrees not to commit, permit or suffer to exist any act or omission affording such right of forfeiture.

Section 3.22.Taxes. Borrower has filed all federal, state, county, municipal, and city income, personal property and other tax returns required to have been filed by it and has paid all

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​ taxes and related liabilities which have become due pursuant to such returns or pursuant to any assessments received by it. Borrower knows of no basis for any additional assessment in respect of any such taxes and related liabilities for prior years.

Section 3.23.Permitted Encumbrances. None of the Permitted Encumbrances, individually or in the aggregate, materially interferes with the benefits of the security intended to be provided by this Agreement, the Security Instrument, the Note and the other Loan Documents materially and adversely affects the value or marketability of the Property, impairs the use or the operation of the Property in any material respect or impairs Borrower’s ability to pay its obligations in a timely manner.

Section 3.24.Third Party Representations. Each of the representations and the warranties made by Sponsor and Guarantor in the other Loan Documents (if any) are true, complete and correct in all material respects.

Section 3.25.Non-Consolidation Opinion Assumptions. All of the assumptions made in the Non-Consolidation Opinion, including, but not limited to, any exhibits attached thereto and/or certificates delivered in connection therewith, are true, complete and correct in all material respects.

Section 3.26.Federal Reserve Regulations. No part of the proceeds of the Loan will be used by Borrower for the purpose of purchasing or acquiring any “margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System or for any other purpose which would be inconsistent with such Regulation U or any other Regulations of such Board of Governors, or for any purposes prohibited by Legal Requirements or by the terms and conditions of this Agreement, the Security Instrument, the Note or the other Loan Documents. None of Borrower, Guarantor, Sponsor, and/or any Constituent Owner of the foregoing is affiliated with or is an insider with respect to Lender (or its affiliates) in any manner that implicates either Regulation W or Regulation O of the Federal Reserve Act (as each of the same may be amended, modified, supplemented, and/or replaced from time to time). Neither the Loan nor any transaction contemplated herein and/or in the other Loan Documents is in violation of Regulation W and/or Regulation O.

Section 3.27.Investment Company Act. Borrower is not (a) an “investment company” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended; or (b) subject to any other federal or state law or regulation which purports to restrict or regulate its ability to borrow money.

Section 3.28.Fraudulent Conveyance. Borrower (a) has not entered into the Loan or any Loan Document with the actual intent to hinder, delay, or defraud any creditor and (b) received reasonably equivalent value in exchange for its obligations under the Loan Documents. Giving effect to the Loan, the fair saleable value of Borrower’s assets exceeds and will, immediately following the execution and delivery of the Loan Documents, exceed Borrower’s total liabilities, including, without limitation, subordinated, unliquidated, disputed or contingent liabilities. To Borrower’s knowledge, the fair saleable value of Borrower’s assets is and will, immediately following the execution and delivery of the Loan Documents, be greater than Borrower’s probable liabilities, including the maximum amount of its contingent liabilities or its debts as such debts become absolute and matured. Borrower’s assets do not and, immediately following the execution and delivery of the Loan Documents will not, constitute unreasonably small capital to carry out its business as conducted or as proposed to be conducted. Borrower does not intend to, and does not believe that it will, incur debts and liabilities (including, without limitation, contingent liabilities

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​ and other commitments) beyond its ability to pay such debts as they mature (taking into account the timing and amounts to be payable on or in respect of obligations of Borrower).

Section 3.29.Intentionally Omitted.

Section 3.30.Anti-Money Laundering and Economic Sanctions.

(a)As of the date hereof and at all times throughout the term of the Loan, including after giving effect to any transfers of interests permitted pursuant to the Loan Documents, (a) none of the funds or other assets of any Borrower Party constitute (or will constitute) property of, or are (or will be) beneficially owned, directly or indirectly, by any Person or government that is the subject of economic sanctions or trade restrictions under U.S. law, including without limitation, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., the Trading with the Enemy Act, 50 U.S.C. §§ 4301 et seq., and any Executive Orders or regulations promulgated thereunder with the result that transactions involving or the investment in any such Borrower Party (whether directly or indirectly) is prohibited by applicable law or the Loan made by Lender is in violation of applicable law (“Embargoed Person”); (b) no Embargoed Person has (or will have) any interest of any nature whatsoever in any Borrower Party, with the result that the investment in any such Borrower Party (whether directly or indirectly), is prohibited by applicable law or the Loan is in violation of applicable law; and (c) none of the funds of any Borrower Party have been (or will be) derived from any unlawful activity with the result that transactions involving or the investment in any such Borrower Party (whether directly or indirectly), is prohibited by applicable law or the Loan is in violation of applicable law. Any violation of the clauses (a), (b) or (c) above shall, at Lender’s option, constitute an Event of Default hereunder. The representations contained in this Section 3.30(a) shall not be deemed to apply to any Person whose ownership interests in any indirect owner of Borrower is solely through the ownership of shares of stock in such indirect owner of Borrower whose shares are listed on the New York Stock Exchange, or another nationally recognized stock exchange.

(b)Each Borrower hereby represents and warrants that neither Borrower, SPE Component Entity nor Guarantor and, to Borrower’s knowledge, any other owner of a direct or indirect interest in any Borrower : (i) is a person who has been determined by competent authority to be subject to economic sanctions administered or enforced by the Office of Foreign Assets Control (“OFAC”) of the Department of the Treasury, the Department of State, or other relevant sanctions authority (“Sanctions”); (ii) has been previously indicted for or convicted of, or pled guilty or no contest to, any felony or crimes under the USA PATRIOT Act or other applicable anti-money laundering laws and regulations and all Sanctions; (iii) fail to operate (or have operated) under policies, procedures and practices, if any, that are in compliance with the USA PATRIOT Act and other applicable anti-money laundering laws and regulations and Sanctions; (iv) be (or have been) in receipt of any notice from OFAC, the Secretary of State or the Attorney General of the United States or any other department, agency or office of the United States, in each case, claiming a violation or possible violation of applicable anti-money laundering laws and regulations and/or Sanctions; (v) be (or have been) the subject of Sanctions, including those listed as a Specially Designated National or as a “blocked” Person on any lists issued by OFAC and those owned or controlled by or acting for or on behalf of such Specially Designated National or “blocked” Person; (vi) be (or have been) a Person who has been determined by competent authority to be subject to any of the prohibitions contained in the USA PATRIOT Act; or (vii) be (or have been) owned or controlled by or be (or have been) acting for or on behalf of, in each case, any Person who has been determined to be subject to the prohibitions contained in the USA PATRIOT Act. Each Borrower covenants and agrees that in the event Borrower receives any notice that any Borrower Party (or any of their respective beneficial owners or Affiliates) became the subject of Sanctions or is indicted,

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​ arraigned, or custodially detained on charges involving Sanctions, money laundering or predicate crimes to money laundering, Borrower shall promptly notify Lender. It shall be an Event of Default hereunder if any Borrower Party becomes the subject of Sanctions or is indicted, arraigned or custodially detained on charges involving Sanctions, money laundering or predicate crimes to money laundering. All capitalized words and phrases and all defined terms used in the USA PATRIOT Act of 2001, 107 Public Law 56 (October 26, 2001) and in other statutes and all orders, rules and regulations of the United States government and its various executive departments, agencies and offices related to applicable anti-money laundering laws and regulations (collectively referred as the “Patriot Act”) are incorporated into this Section. The representations contained in this Section 3.30 shall not be deemed to apply to any Person whose ownership interests in any indirect owner of Borrower is solely through the ownership of shares of stock in such indirect owner of Borrower whose shares are listed on the New York Stock Exchange, or another nationally recognized stock exchange.

Section 3.31.Organizational Chart. The organizational chart attached as Schedule IV hereto (the “Organizational Chart”), relating to Borrower and certain Affiliates and other parties, is true, complete and correct on and as of the date hereof.

Section 3.32.Bank Holding Company. Borrower is not a “bank holding company” or a direct or indirect subsidiary of a “bank holding company” as defined in the Bank Holding Company Act of 1956, as amended, and Regulation Y thereunder of the Board of Governors of the Federal Reserve System.

Section 3.33.**PILOT Leases and PILOT Documents.**After giving effect to any estoppels delivered to Lender in connection with the closing of the Loan:

(a)The PILOT Lease and/or PILOT Document, or a memorandum thereof, has been duly recorded or a true and correct copy thereof has been provided to Lender.

(b)Except as described herein or disclosed in any estoppel delivered to Lender in connection with the closing of the Loan, the PILOT Lease and the PILOT Documents have not been modified, amended or supplemented.

(c)The PILOT Lease and/or the PILOT Documents, as applicable, permits the interest of the applicable Individual Borrower party thereto to be encumbered by the related Security Instrument.

(d)Except for Permitted Encumbrances, the applicable Individual Borrower’s interest in the PILOT Lease and/or the PILOT Documents, as applicable, is not subject to any liens or encumbrances superior to, of equal priority with, or subordinate to the related Security Instrument.

(e)The applicable Individual Borrower’s interest in the PILOT Lease and the PILOT Documents is assignable to Lender or its designee and is further assignable by Lender and its successor and assigns in accordance with the applicable PILOT Lease and the PILOT Documents.

(f)The PILOT Lease and PILOT Documents are in full force and effect and neither the applicable Individual Borrower nor, to such Individual Borrower’s actual knowledge, any other party to such PILOT Lease or PILOT Document, as applicable, is in default thereunder, and to the applicable Borrower’s actual knowledge, there are no

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​ conditions which, with the passage of time or giving of notice, or both, would constitute a default thereunder. Except as disclosed as part of the PILOT Documents, the applicable Individual Borrower has not received any written notice from another party to such PILOT Lease or PILOT Document, as applicable, reducing the tax abatement in favor of such Individual Borrower or Tenant or terminating such PILOT Lease or PILOT Document, as applicable.

Section 3.34.Property Document Representations. With respect to each Property Document, Borrower hereby represents that (a) each Property Document is in full force and effect and has not been amended, restated, replaced or otherwise modified (except, in each case, as expressly set forth herein), (b) there are no material defaults under any Property Document by Borrower or, to Borrower’s knowledge, any other party thereto and, to Borrower’s knowledge, no event has occurred which, but for the passage of time, the giving of notice, or both, would constitute a default under any Property Document that would be reasonably likely to have an Individual Material Adverse Effect, (c) all rents, additional rents and other sums due and payable by Borrower under the Property Documents have been paid in full, and (d) to Borrower’s knowledge, no party to any Property Document has commenced any action against Borrower and Borrower has not given nor received any written notice for the purpose of terminating any Property Document.

Section 3.35.No Change in Facts or Circumstances; Disclosure. All information submitted by (or on behalf of) Borrower, Guarantor or Sponsor to Lender and in all financial statements, rent rolls, reports, certificates and other documents submitted by (or on behalf of) Borrower, Guarantor or Sponsor in connection with the Loan or in satisfaction of the terms thereof and all statements of material fact made by Borrower, Sponsor and/or Guarantor in this Agreement or in the other Loan Documents, are accurate, complete and correct in all material respects. To Borrower’s knowledge, there has been no material adverse change in any condition, fact, circumstance or event that would make any such information inaccurate, incomplete or otherwise misleading in any material respect or that would otherwise have an Individual Material Adverse Effect or Aggregate Material Adverse Effect. To Borrower’s knowledge, Borrower has disclosed to Lender all material facts and has not failed to disclose any material fact that could cause any representation or warranty made herein to be materially misleading.

Borrower agrees that, unless expressly provided otherwise, all of the representations and warranties of Borrower set forth in this Article 3 and elsewhere in this Agreement and the other Loan Documents shall survive for so long as any portion of the Debt remains owing to Lender. All representations, warranties, covenants and agreements made by Borrower in this Agreement and in the other Loan Documents shall be deemed to have been relied upon by Lender notwithstanding any investigation heretofore or hereafter made by Lender or on its behalf.

Section 3.36.Plainfield Tax Incentive Program. To Plainfield Borrower’s knowledge, the Plainfield Tax Incentive Documents are in full force and effect and Plainfield Borrower is receiving the tax benefits described more particularly therein. As of the date hereof, (a) to Plainfield Borrower’s knowledge, Plainfield Borrower receives a phased tax abatement on the property, which commenced in 2020 and runs for a period of 10 years and will be fully phased out in tax year 2030 under the Plainfield Tax Incentive Documents, (b) the copies of the Plainfield Tax Incentive Documents delivered to Lender are true, correct, and complete, and (c) to Plainfield Borrower’s knowledge, Plainfield Borrower is not in default of its obligations under or the terms and conditions of the Plainfield Tax Incentive Documents.

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​ ARTICLE 4​ ​ BORROWER COVENANTS

From the date hereof and until payment and performance in full of all obligations of Borrower under this Agreement, the Security Instrument, the Note and the other Loan Documents or the earlier release of the lien of the Security Instrument (and all related obligations) in accordance with the terms of this Agreement, the Security Instrument, the Note and the other Loan Documents, Borrower hereby covenants and agrees with Lender that:

Section 4.1.Existence. Borrower will continuously maintain (a) its existence and shall not dissolve or permit its dissolution, (b) its rights to do business in the State and (c) its franchises and trade names, if any.

Section 4.2.Legal Requirements.

(a)Borrower shall promptly comply and shall cause the Property to comply, in each case in all material respects, with all Legal Requirements affecting the Property or the use thereof (which such covenant shall be deemed to (i) include Environmental Laws and (ii) require Borrower to keep all material Permits in full force and effect).

(b)[Intentionally Omitted].

(c)Borrower shall give prompt notice to Lender of the receipt by Borrower of any written notice related to a material violation of any Legal Requirements applicable to Borrower or relating to the Property and of the commencement of any proceedings or investigations which relate to Borrower’s or the Property’s compliance with Legal Requirements.

(d)After prior written notice to Lender, Borrower, at its own expense, may contest (or permit to be contested) by appropriate legal proceeding, promptly initiated and conducted in good faith and with due diligence, the validity of any Legal Requirement, the applicability of any Legal Requirement to Borrower or the Property or any alleged violation of any Legal Requirement, provided that (i) no Event of Default has occurred and remains uncured; (ii) such proceeding shall be permitted under and be conducted in accordance with the provisions of any instrument to which Borrower is subject and shall not constitute a default thereunder and such proceeding shall be permitted by and conducted in accordance with all applicable Legal Requirements; (iii) no Individual Property nor any material part thereof or interest therein will be in imminent danger of being sold, forfeited, terminated, cancelled or lost; (iv) Borrower shall promptly upon final determination thereof comply with any such Legal Requirement determined to be valid or applicable or cure any violation of any Legal Requirement; (v) such proceeding shall suspend the enforcement of the contested Legal Requirement against Borrower or the Property; and (vi) in the event that the aggregate amount Borrower is contesting (pursuant to all of Borrower’s rights to contest in this Agreement) is greater than $4,000,000.00, Borrower shall furnish such security as may be required in the proceeding, or as may be reasonably requested by Lender (which security amount shall not exceed 110% of the amount that would be reasonably likely to become due if Borrower loses such contest, together with all interest and penalties payable in connection therewith), to insure compliance with such Legal Requirement. Lender may apply any such security or part thereof, as necessary to cause compliance with such Legal Requirement at any time when, in the reasonable judgment of Lender, the validity, applicability or violation of such Legal Requirement is finally established pursuant to a final judgment or ruling by the applicable Governmental Authority or an

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​ Individual Property (or any material part thereof or interest therein) shall be in imminent danger of being sold, forfeited, terminated, cancelled or lost.

Section 4.3.Maintenance and Use of Property. Borrower shall cause the Property to be maintained in a good and safe condition and repair reasonable wear and tear excepted. The Improvements and the Personal Property shall not be removed, demolished or materially altered (except for normal use or replacement of the Personal Property) without the consent of Lender or as otherwise permitted pursuant to Section 4.21 hereof. Subject to Section 7.2 hereof, Borrower shall perform (or shall cause to be performed) the prompt repair, replacement and/or rebuilding of any part of the Property which may be destroyed by any casualty, or become damaged, worn or dilapidated or which may be affected by any proceeding of the character referred to in Section 3.14 hereof and shall complete and pay for (or cause the completion and payment for) any structure at any time in the process of construction or repair on the Land. Borrower shall operate the Property for the same uses as the Property is currently operated and Borrower shall not, without the prior written consent of Lender, (i) change the use of the Property in any material respect, or (ii) initiate, join in, acquiesce in, or consent to any change in any private restrictive covenant, zoning law or other public or private restriction, the result of which would limit or more narrowly define the uses which may be made of the Property or any part thereof. If under applicable zoning provisions the use of all or any portion of the Property is or shall become a nonconforming use, Borrower will not cause or permit the nonconforming use to be discontinued (provided the foregoing prohibition shall not be deemed to be breached as a result of a Casualty and/or Condemnation, to the extent Borrower is complying with all applicable requirements set forth in the Casualty and/or Condemnation provisions in this Agreement and the other Loan Documents) or the nonconforming Improvement to be abandoned without the express written consent of Lender.

Section 4.4.Waste. Borrower shall not commit or suffer any physical waste of the Property or make any change in the use of the Property (excluding any change in use by any Tenant that is in compliance in all material respects with Legal Requirements and the terms of such Tenant’s Lease) which will in any way materially increase the risk of fire or other hazard arising out of the operation of the Property, or take any action that would reasonably be expected to invalidate or give cause for cancellation of any Policy. Borrower will not, without the prior written consent of Lender, permit any drilling or exploration for or extraction, removal, or production of any minerals from the surface or the subsurface of the Property, regardless of the depth thereof or the method of mining or extraction thereof.

Section 4.5.Taxes and Other Charges.

(a)Borrower shall pay (or cause to be paid) all Taxes and Other Charges now or hereafter levied or assessed or imposed against the Property or any part thereof prior to the date on which such sums become delinquent; provided, however, prior to the occurrence and continuance of an Event of Default, Borrower’s obligation to directly pay Taxes and Other Charges shall be suspended for so long as Borrower complies with the terms and provisions of Section 8.6 hereof. Borrower shall furnish to Lender receipts for the payment of the Taxes and Other Charges prior to the date the same shall become delinquent (provided, however, that Borrower is not required to furnish such receipts for payment of Taxes and Other Charges in the event that such Taxes have been paid by Lender pursuant to Section 8.6 hereof). Borrower shall not suffer and, subject to Sections 4.5(b) and 4.16(b) hereof, shall promptly cause to be paid and discharged any lien or charge whatsoever which may be or become a lien or charge against the Property other than a Permitted Encumbrance, and shall promptly pay for all utility services provided to the Property (except to the extent such utility services are paid for by Tenants directly to the providers of such utility services pursuant to the express terms of applicable Leases, in which case, Borrower shall use commercially reasonable

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​ efforts to cause the applicable Tenants to pay for all such utility services; provided, that, if Tenant does not pay for such utility services then Borrower shall be required to pay for all such services that could result in a lien against the Property or any of Borrower’s interest therein).

(b)After prior written notice to Lender, Borrower, at its own expense, may contest (or permit to be contested) by appropriate legal proceeding, promptly initiated and conducted in good faith and with due diligence, the amount or validity or application in whole or in part of any Taxes or Other Charges, provided that (i) no Event of Default has occurred and remains uncured; (ii) such proceeding shall be permitted under and be conducted in accordance with the provisions of any other material instrument to which Borrower is subject and shall not constitute a default thereunder and such proceeding shall be permitted by and conducted in accordance with all applicable Legal Requirements; (iii) no Individual Property nor any material part thereof or interest therein will be in imminent danger of being sold, forfeited, terminated, canceled or lost; (iv) Borrower shall promptly upon final determination thereof pay the amount of any such Taxes or Other Charges, together with all costs, interest and penalties which may be payable in connection therewith; (v) such proceeding shall suspend the collection of such contested Taxes or Other Charges from the Property; and (vi) in the event that the amount Borrower is contesting (pursuant to all rights to contest amounts set forth in this Agreement) is greater than $4,000,000.00, Borrower shall furnish such security as may be required in the proceeding, or deliver to Lender such reserve deposits as may be reasonably requested by Lender (which security amount shall not exceed 110% of the amount that would be reasonably likely to become due if Borrower loses such contest, together with all interest and penalties thereon), to insure the payment of any such Taxes or Other Charges (unless Borrower has paid all of the Taxes and Other Charges under protest). Lender may pay over any such cash deposit or part thereof held by Lender to the claimant entitled thereto at any time when, in the reasonable judgment of Lender, the entitlement of such claimant is established pursuant to a final judgment or ruling by the applicable Governmental Authority or any Individual  Property (or material part thereof or interest therein) shall be in imminent danger of being sold, forfeited, terminated, canceled or lost as a result of the failure to pay such Taxes and Other Charges or there shall be any danger of the lien of the Security Instrument being primed by any related lien.

Section 4.6.Litigation. Borrower shall give prompt written notice to Lender of any litigation or governmental proceedings pending or threatened in writing against Borrower which, if determined adversely to Borrower, would be reasonably likely to have an Aggregate Material Adverse Effect.

Section 4.7.Access to Property. Subject to the rights of Tenants under Leases, Borrower shall permit agents, representatives and employees of Lender to inspect the Property or any part thereof on any Business Day at reasonable hours upon reasonable advance notice.

Section 4.8.Notice of Default. Borrower shall promptly advise Lender of any material adverse change in Borrower’s, Sponsor’s and/or Guarantor’s condition (financial or otherwise) that is known to Borrower or of the occurrence of any Event of Default or monetary or material Default of which Borrower has knowledge.

Section 4.9.Cooperate in Legal Proceedings. Borrower shall cooperate reasonably with Lender with respect to any proceedings before any court, board or other Governmental authority which may in any way affect the rights of Lender hereunder or any rights obtained by Lender under any of the Note, the Security Instrument or the other Loan Documents and, in connection therewith, permit Lender, at its election, to participate in any such proceedings.

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​ Section 4.10.Performance by Borrower. Borrower hereby acknowledges and agrees that Borrower’s observance, performance and fulfillment of each and every covenant, term and provision to be observed and performed by Borrower under this Agreement, the Security Instrument, the Note and the other Loan Documents is a material inducement to Lender in making the Loan.

Section 4.11.Federal Reserve Regulations. Borrower shall, from time to time, provide Lender with such information relating to Borrower, any SPE Component Entity, Guarantor, Sponsor, and/or any Constituent Owner thereof as Lender shall deem necessary (in Lender’s sole and absolute discretion exercised in good faith) in determining Lender’s ongoing compliance with Regulation W and Regulation O of the Federal Reserve Act (as each of the same may be amended, modified, supplemented, and/or replaced from time to time). Notwithstanding anything to the contrary contained herein, none of Borrower, any SPE Component Entity, Guarantor, Sponsor, and/or any Constituent Owner thereof shall knowingly take any action that will cause Lender and/or the Loan to violate Regulation W and/or Regulation O.

Section 4.12.Books and Records.

(a)Borrower shall furnish to Lender:

(i)quarterly operating statements of each Individual Property detailing the revenues received, the expenses incurred and major capital improvements for the period of calculation and containing appropriate year-to-date information, within sixty (60) days after the end of each calendar quarter (other than each fiscal quarter ending on the close of the fiscal year of Borrower).  Such quarterly financial statements shall be accompanied by an Officer’s Certificate executed by an appropriate officer of Borrower or a controlling affiliate of Borrower, certifying that such financial statements are in all material respects true, complete and correct;

(ii)within one hundred twenty (120) days after the close of each fiscal year of Borrower (or such shorter time period as is necessary to comply with any applicable Legal Requirements (including, without limitation, Regulation AB), provided, that, (I) Lender shall notify Borrower in writing that such a shorter time period is required and (II) unless there is a change in Regulation AB or any other applicable Legal Requirement after the Closing Date, in no event shall such time period be shortened to sooner than eighty five (85) days after the close of each fiscal year of Borrower): (A) with respect to Borrower, an annual balance sheet, and statement of cash flow, profit and loss statement and statement of change in financial position (each of which shall not include any Person other than Borrower), (B) an annual operating statement of each Individual Property (detailing the revenues received, the expenses incurred and the components of Underwritten Net Operating Income before and after Debt Service and major capital improvements for the period of calculation and containing appropriate year-to-date information), and (C) a certification that Guarantor continues to satisfy the net worth requirements applicable to it.  Such annual financial statements shall be accompanied by an Officer’s Certificate executed by an appropriate officer of Borrower or a controlling affiliate of Borrower, certifying that such financial statements are in all material respects true, complete and correct.  Notwithstanding the foregoing, to the extent Moody’s rates securities in connection with a Securitization of the Loan, the annual income statement and balance sheets of Borrower required hereunder shall be prepared in accordance with Approved Accounting Method and shall be audited by an independent certified public accountant reasonably approved by Lender;

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​ (iii)by no later than January 31 of each new calendar year, an annual operating budget for the current calendar year presented on a monthly basis consistent with the annual operating statement described above for each Individual Property, including cash flow projections for the upcoming year and all proposed capital replacements and improvements, which such budget shall (A) until the occurrence and continuance of a Trigger Period, be provided to Lender for informational purposes and (B) after the occurrence and during the continuance of a Trigger Period not take effect until approved by Lender (after such approval has been given in writing, such approved budget shall be referred to herein as the “Approved Annual Budget”). Notwithstanding anything to the contrary contained herein, Lender shall have twenty (20) Business Days from receipt of written request from Borrower in which to approve or disapprove an annual operating budget during the continuance of a Trigger Period. In the event that Lender fails to respond to Borrower’s request for approval within such time, Lender’s approval shall be deemed given for all purposes. Until such time as Lender has approved or shall be deemed to approve a proposed annual operating budget, Borrower shall adhere to the most recent annual operating budget, adjusted to reflect actual increases in Taxes, Insurance Premiums and utilities expenses;

(iv)by no later than sixty (60) days after and as of the end of each calendar quarter, a calculation of the then current Debt Service Coverage Ratio and Debt Yield, together with such back-up information as Lender shall reasonably require, and after the occurrence and during the continuance of a Trigger Period, a calculation of the amount of Excess Cash Flow generated by each Individual Property for such period together with such back-up information as Lender shall reasonably require; and

(b)Upon reasonable request from Lender, Borrower shall furnish within a reasonable time following such request, to Lender:

(i)in connection with any release of any Property in accordance with the terms hereof, either (A) Borrower’s calculation of Debt Service Coverage Ratio, Debt Yield, Release Price and such other financial or management information as Lender may reasonably require, if applicable or (B) Borrower’s written confirmation that it agrees with Lender’s calculation of Debt Service Coverage Ratio, Debt Yield, Release Price and any other applicable calculations in connection with such release;

(ii)an accounting of all Security Deposits, including the nature and type of Security Deposit, the name and identification number of the accounts in which such Security Deposits are held (if applicable), such details regarding any Security Deposit not held in the form of cash as Lender may reasonably require, the name and address of the financial institutions in which such Security Deposits are held or have been otherwise issued by and the name of the Person to contact at such financial institution, along with any authority or release necessary for Lender to obtain information regarding such accounts or other information directly from such financial institutions; and

(iii)evidence reasonably acceptable to Lender of compliance with the terms and conditions of Articles 5 and 9 hereof.

(c)Borrower shall, within ten (10) Business Days of Lender’s written request, furnish Lender (and shall cause Sponsor and/or Guarantor to furnish to Lender) with such other additional financial or management information (including State and Federal tax returns) as may, from time to time, be reasonably required by Lender in form and substance reasonably satisfactory to Lender; provided, that, such requests are consistent with the financial information then provided by Borrower

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​ and Guarantor or such requested financial or management information is reasonably available to any Borrower Party within such time period. Borrower shall furnish to Lender and its agents convenient facilities for the examination and audit of any such books and records at any reasonable time from time to time during business hours upon reasonable advance notice.

(d)Borrower agrees that (i) Borrower shall keep adequate books and records of account and (ii) all Required Financial Items (defined below) to be delivered to Lender pursuant to Section 4.12 shall be insofar as any such Required Financial Item has been prepared by or on behalf of Borrower, Guarantor or Sponsor, or with respect to Borrower, Guarantor or the Property: (A) be complete and correct in all material respects; (B) present fairly the financial condition of the applicable Person in all material respects; (C) disclose all liabilities that are required to be reflected or reserved against; and (D) be prepared (1) in the form required by Lender and certified by a Responsible Officer of Borrower, (2) in hardcopy and electronic formats and (3) in accordance with the Approved Accounting Method. Borrower shall be deemed to warrant and represent that, as of the date of delivery of any such financial statement of Borrower, there has been no material adverse change in its financial condition, nor have any of its assets or properties been sold, transferred, assigned, mortgaged, pledged or encumbered since the date of such financial statement except as reflected in such financial statement or otherwise expressly permitted by the Loan Documents or disclosed by Borrower in a writing delivered to Lender. Borrower agrees that all Required Financial Items shall not contain any material misrepresentation or omission of a material fact.

(e)Borrower acknowledges the importance to Lender of the timely delivery of each of the items required by this Section 4.12 and the other financial reporting items required by this Agreement (each, a “Required Financial Item” and, collectively, the “Required Financial Items”).

Section 4.13.Estoppel Certificates.

(a)(i)  After written request by Lender, Borrower, within ten (10) Business Days of such request, but in no event more frequently than once in any twelve (12) month period (unless Lender shall require any such statement more frequently in connection with any assignment to an assignee or upon the occurrence and during the continuance of an Event of Default) shall furnish Lender or any proposed assignee with a statement, duly acknowledged and certified, setting forth (i) the original principal amount of the Loan, (ii) the unpaid principal amount of the Loan, (iii) the rate of interest of the Loan, (iv) the terms of payment and maturity date of the Loan, (v) the date installments of interest and/or principal were last paid, (vi) that, except as provided in such statement, no Event of Default exists, (vii) that this Agreement, the Note, the Security Instrument and the other Loan Documents are valid, legal and binding obligations and have not been modified or if modified, giving particulars of such modification, (viii) whether any offsets or defenses exist against the obligations secured hereby and, if any are alleged to exist, a detailed description thereof, (ix) that all Leases are in full force and effect and have not been modified (or if modified, setting forth all modifications), (x) the date to which the Rents thereunder have been paid pursuant to the Leases, and (xi) whether or not, to Borrower’s knowledge, any of the lessees under the Leases are in default under the Leases, and, if any of the lessees are in default, setting forth the specific nature of all such defaults.

(ii)  Provided no Event of Default has occurred and is continuing, after written request by Borrower, Lender, within twenty (20) Business Days of such request, shall furnish Borrower with a statement, duly acknowledged and certified, setting forth (i) the original principal amount of the Loan, (ii) the unpaid principal amount of the Loan, (iii) the rate of interest of the Loan, (iv) the terms of payment and maturity date of the Loan, (v) the date installments of interest and/or principal were

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​ last paid, and (vi) that Lender has not delivered any notice of Default of Event of Default. Borrower shall reimburse Lender for the reasonable out-of-pocket expenses incurred by Lender in connection with any such request.

(b)Borrower shall use commercially reasonable efforts to deliver to Lender, promptly upon request (but in no event more frequently than once in any twelve (12) month period, unless Lender shall require any such statement more frequently in connection with any Secondary Market Transaction or upon the occurrence and during the continuance of an Event of Default), duly executed estoppel certificates from any one or more Tenants as required by Lender attesting to such facts regarding the Lease as Lender may reasonably require, including, but not limited to, attestations that each Lease covered thereby is, except as disclosed in such estoppel certificate, in full force and effect with no defaults thereunder on the part of any party (or, if there are any defaults, setting forth the nature of such default), that none of the Rents have been paid more than one month in advance, except as security, no free rent or other concessions are due lessee and that the lessee claims no defense or offset against the full and timely performance of its obligations under the Lease.

(c)[Intentionally Omitted].

(d)Borrower shall use commercially reasonable efforts to obtain and deliver to Lender, within thirty (30) days of request by Lender, estoppel certificates from each party under any Property Document, PILOT Lease and/or PILOT Document, to the extent such Property Document, PILOT Lease and/or PILOT Document, provides material rights to Borrower or imposes material obligations on Borrower, in form and substance reasonably acceptable to Lender, but Lender may not make such request more frequently than once in any twelve (12) month period, unless Lender shall require any such statement more frequently in connection with a Secondary Market Transaction or upon the occurrence and during the continuance of an Event of Default.

Section 4.14.Leases and Rents.

(a)Unless otherwise consented to in writing by Lender (which consent shall not be unreasonably withheld, conditioned or delayed), all Leases and all renewals of Leases executed after the date hereof shall (i) provide for rental rates comparable to existing local market rates for similar properties, (ii) be with unaffiliated, third parties on terms and conditions (including, without limitation, terms and conditions relating to free rent, tenant improvements and other allowances) which are, in each case, commercially reasonable and comparable to existing local market terms and conditions for similar properties, (iii) provide that such Lease is subordinate to the Security Instrument and that the lessee will attorn to Lender and any purchaser at a foreclosure sale (provided, that, such subordination may be subject to Lender delivering a subordination, non-disturbance and attornment agreement in form and substance reasonably acceptable to Lender and such Tenant), and (iv) not contain any terms which would have an Individual Material Adverse Effect. Notwithstanding anything to the contrary contained herein, Borrower shall not, without the prior written approval of Lender (which approval shall not be unreasonably withheld, conditioned or delayed), enter into, renew, extend, amend or modify in any material respect, permit any assignment of or subletting under, waive any provisions of, release any party to, terminate, reduce rents under, accept a surrender of space under, or shorten the term of, in each case, any Major Lease, except to the extent any Major Lease expressly permits any of the foregoing without the consent or approval or Borrower, as a unilateral right of the Tenant, in which case Lender’s prior written approval shall not be required.  Notwithstanding the foregoing or anything herein to the contrary, Borrower may amend or modify: (i) a Major Lease, without Lender’s prior written consent, provided that such amendment or modification does not (A) materially reduce the obligations of the lessee, materially reduce the rights of the lessor, or increase the obligations of lessor or (B) result in (x) a change to

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​ the amount of, payment date or frequency of payments for rent, (y) a change to the expiration date, or (z) a grant of any option for additional space or term, or any option, right of first refusal, right of first offer or other similar entitlement to acquire or encumber any Property; and (ii) any Lease that is not a Major Lease (both immediately prior to, and after giving effect to, such amendment or modification) without Lender’s prior written consent, provided that such amendment or modification does not cause such Lease to fail to satisfy the conditions set forth in the first sentence of this Section 4.14(a).

Lender shall execute and deliver a customary subordination, non-disturbance and attornment agreement in form and substance reasonably acceptable to Lender and on such Tenant’s then-current standard form to Tenants under future Major Leases approved by Lender promptly upon request, with such changes as are agreed to between Tenant and Lender. Lender’s execution of a subordination, non-disturbance and attornment agreement which is not in compliance with the foregoing sentence shall be at Lender’s sole discretion and subject to such additional conditions as Lender shall reasonably determine.

(b)Without limitation of subsection (a) above, Borrower (i) shall observe and perform the obligations imposed upon the lessor under the Leases in all material respects in a commercially reasonable manner; (ii) shall enforce the terms, covenants and conditions contained in the Leases upon the part of the lessee thereunder to be observed or performed in a commercially reasonable manner; (iii) shall not collect any of the Rents more than one (1) month in advance (other than Security Deposits); (iv) shall not execute any assignment of lessor’s interest in the Leases or the Rents (except as contemplated by the Loan Documents); (v) shall not, without Lender’s prior written consent, alter, modify or change any Lease to the extent the same would, individually or in the aggregate, (A) cause any such Lease to violate 4.14(a)(i) through (iii) above or (B) have an Individual Material Adverse Effect; and (vi) shall hold all Security Deposits in accordance with Legal Requirements. Upon request, Borrower shall furnish Lender with executed copies of all Leases.

(c)Notwithstanding anything contained herein to the contrary, Borrower shall not willfully withhold from Lender any information requested by Lender regarding renewal, extension, amendment, modification, waiver of provisions of, termination, rental reduction of, surrender of space of, or shortening of the term of, any Major Lease during the term of the Loan. Borrower further agrees to provide Lender with written notice of a Tenant “going dark” under such Tenant’s Lease within five (5) Business Days after such Tenant “goes dark”. Borrower agrees to provide Lender with written notice of any event of default under a Major Lease within five (5) business days after the occurrence of any such event of default.

(d)Borrower shall notify Lender in writing, within ten (10) Business Days following receipt thereof, of Borrower’s receipt of any early termination fee or payment or other termination fee or payment paid by any Tenant under any Lease, and Borrower further covenants and agrees that Borrower shall hold any such termination fee or payment in trust for the benefit of Lender and that any use of such termination fee or payment shall be subject in all respects to Lender’s prior written consent in Lender’s sole discretion exercised in good faith (which consent may include, without limitation, a requirement by Lender that such termination fee or payment be placed by Borrower in reserve with Lender to be disbursed by Lender for tenant improvement and leasing commission costs with respect to the Property and/or for payment of the Debt or otherwise in connection with the Loan evidenced by the Note and/or the Property, as so determined by Lender). The foregoing consent right of Lender (including, without limitation, any reserve requirement) shall not be subject to any “cap” or similar limit on the amount of Reserve Funds held by Lender (including, without limitation, any “cap” or similar limit relating to the Leasing Reserve Funds).

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​ (e)Upon the occurrence and during the continuance of an Event of Default, Borrower shall, within thirty (30) days of demand by Lender, deliver to Lender all Security Deposits. Without limitation of any other term or provision contained herein, for purposes of clarification, for a Security Deposit to be deemed “delivered to Lender” in connection with the foregoing, the same must be in the form of cash or in a letter of credit solely in Lender’s name.

Section 4.15.Management Agreement.

(a)Borrower shall (i) diligently and promptly perform, observe and enforce in a commercially reasonable manner all of the terms, covenants and conditions of the Management Agreement on the part of Borrower to be performed, observed and enforced to the end that all things shall be done which are necessary to keep unimpaired the rights of Borrower under the Management Agreement, (ii) promptly notify Lender of the giving of any written notice by or to Borrower of any material default by Manager or Borrower in the performance or observance of any of the terms, covenants or conditions of the Management Agreement on the part of Borrower; (iii) promptly deliver to Lender a copy of any written notice of default or other material notice received by Borrower under the Management Agreement; (iv) promptly give notice to Lender of any notice or information that Borrower receives which indicates that Manager is terminating the Management Agreement or that Manager is otherwise discontinuing its management of the Property; and (v) promptly enforce the performance and observance of all of the covenants required to be performed and observed by Manager under the Management Agreement.

(b)Borrower shall not, without the prior written consent of Lender (which consent shall not be unreasonably withheld, conditioned or delayed), (i) surrender, terminate or cancel the Management Agreement, consent to any assignment of the Manager’s interest under the Management Agreement or otherwise replace Manager or renew or extend any Management Agreement (exclusive of, in each case, any automatic renewal or extension in accordance with its terms) or enter into any other new or replacement management agreement with respect to the Property, in each case except for entering into a Qualified Management Agreement with Manager or a Qualified Manager, and otherwise in accordance with the terms hereof, upon thirty (30) days’ prior written notice to Lender; provided, however, that Borrower may replace Manager and/or consent to the assignment of Manager’s interest under the Management Agreement, in each case, in accordance with the applicable terms and conditions hereof and of the other Loan Documents; (ii) reduce or consent to the reduction of the term of the Management Agreement; (iii) increase or consent to the increase of the amount of any charges under the Management Agreement; or (iv) otherwise modify, change, alter or amend, in any material respect, or waive or release any of its material rights and remedies under, the Management Agreement in any material respect.

(c)Following the occurrence and during the continuance of an Event of Default hereunder, without limiting the generality of the other provisions of this Agreement, and without waiving or releasing Borrower from any of its obligations hereunder, Lender shall have the right, but shall be under no obligation, to pay any sums and to perform any act or take any action as may be appropriate to cause all the terms, covenants and conditions of the Management Agreement on the part of Borrower to be performed or observed to be promptly performed or observed on behalf of Borrower, to the end that the rights of Borrower in, to and under the Management Agreement shall be kept unimpaired and free from default. During the existence of such Event of Default, Lender and any Person designated by Lender shall have, and are hereby granted, subject to the rights of Tenants, the right to enter upon the Property at any time and from time to time for the purpose of taking any such action. If Manager or Sub-Manager shall deliver to Lender a copy of any notice sent to Borrower of default under the Management Agreement, such notice shall constitute full protection to Lender for any action taken or omitted to be taken by Lender in good faith, in reliance thereon.

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​ Borrower shall notify Lender if Manager sub-contracts to a third party or an Affiliate any or all of its management responsibilities under the Management Agreement.

(d)Borrower shall, from time to time, use commercially reasonable efforts to obtain from Manager under the Management Agreement such certificates of estoppel with respect to compliance by Borrower with the terms of the Management Agreement, as may be reasonably requested by Lender (provided that, such request shall not be made more frequently than once in any twelve (12) month period so long as no Event of Default exists).

(e)In the event that the Management Agreement is scheduled to expire at any time during the term of the Loan, Borrower shall submit to Lender by no later than thirty (30) days prior to such expiration a draft replacement management agreement, for approval in accordance with the terms and conditions hereof.

(f)Borrower shall have the right to replace Manager or Sub-Manager or consent to the assignment of Manager’s rights under the Management Agreement or Sub-Manager’s rights under the Sub-Management Agreement, in each case, to the extent that (i) no Event of Default has occurred and is continuing, (ii) Lender receives at least thirty (30) days prior written notice of the same, (iii) such replacement or assignment (as applicable) will not result in any breach or default under any PILOT Lease and/or PILOT Document, and (iv) the applicable New Manager is a Qualified Manager engaged pursuant to a Qualified Management Agreement and the applicable New Sub-Manager is a Qualified Sub-Manager engaged pursuant to a Qualified Sub-Management Agreement, as applicable. Manager shall not (and Borrower shall not permit Manager to) resign as Manager or otherwise cease managing the Property until a New Manager is engaged to manage the Property in accordance with the applicable terms and conditions hereof and of the other Loan Documents.

(g)Intentionally Omitted.

(h)As conditions precedent to any engagement of a New Manager or New Sub-Manager hereunder, (i) New Manager and Borrower shall execute an Assignment of Management Agreement in the form reasonably required by Lender (with such changes thereto as may be required by the Rating Agencies), (ii) with respect to a New Sub-Manager, the New Sub-Management Agreement shall be subordinate to the Management Agreement or New Sub-Manager shall enter into a subordination agreement in form and substance reasonably acceptable to Lender and Borrower, (iii) to the extent that such New Manager is an Affiliated Manager, Borrower shall deliver to Lender a New Non-Consolidation Opinion with respect to such New Manager and new management agreement and (iv) if requested by Lender, Borrower shall deliver to Lender evidence that the engagement of such New Manager will not result in any breach or default under any PILOT Lease and/or PILOT Document.

(i)Borrower shall notify Lender in writing, within ten (10) Business Days following receipt thereof, of Borrower’s receipt of any early termination fee or similar payment or other termination fee or similar payment paid by any Manager or Sub-Manager, and Borrower further covenants and agrees that Borrower shall pay any such termination fee or payment to Lender, which amounts shall be held in the Cash Management Account and disbursed to Borrower in accordance with the terms hereof.

(j)If (a) an Event of Default occurs and is continuing, (b) Manager shall become subject to a bankruptcy or insolvency proceeding, or (c) a material default by the Manager occurs under the Management Agreement and is continuing beyond any applicable notice and grace periods, then, in the case of any of the foregoing, Borrower shall, at the written request of Lender, terminate the

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​ Management Agreement and replace the Manager with a Qualified Manager (which Qualified Manager may be an Affiliated Manager, except to the extent the terminated Manager was an Affiliated Manager, in which case the replacement Qualified Manager shall not be permitted to be an Affiliated Manager) pursuant to a Qualified Management Agreement, it being understood and agreed that the base management fee for such Qualified Manager shall not exceed then-prevailing market rates (and in no event shall such management fee exceed, with respect to each Individual Property, three percent (3.0%) of gross revenues attributable to such Individual Property to which such Qualified Management Agreement relates).

Section 4.16.Payment for Labor and Materials.

(a)Subject to Section 4.16(b) below, Borrower will promptly pay (or cause to be paid) when due all bills and costs for labor, materials, and specifically fabricated materials incurred by or on behalf of Borrower in connection with the Property (any such bills and costs, a “Work Charge”) and never permit to exist in respect of the Property or any part thereof any lien or security interest imposed in connection with any Work Charge, even though inferior to the liens and the security interests hereof, and in any event never permit to be created or exist in respect of the Property or any part thereof any other or additional lien or security interest other than the liens or security interests created hereby and by the Security Instrument, except for the Permitted Encumbrances.

(b)After prior written notice to Lender, Borrower, at its own expense, may contest (or permit to be contested) by appropriate legal proceeding, promptly initiated and conducted in good faith and with due diligence, the validity of any Work Charge, the applicability of any Work Charge to Borrower or to the Property or any alleged non-payment of any Work Charge and defer paying the same, provided that (i) no Event of Default has occurred and is continuing; (ii) such proceeding shall not be prohibited under and be conducted in all material respects in accordance with all applicable Legal Requirements; (iii) neither the applicable Individual Property nor any material part thereof or interest therein will be in imminent danger of being sold, forfeited, terminated, cancelled or lost; (iv) Borrower shall promptly upon final determination thereof pay (or cause to be paid) any such contested Work Charge determined to be valid, applicable or unpaid; (v) such proceeding shall suspend the collection of such contested Work Charge from the Property or Borrower shall have paid the same (or shall have caused the same to be paid) under protest; and (vi) in the event that the amount Borrower is contesting (pursuant to all rights to contest amounts set forth in this Agreement) is greater than $4,000,000.00, Borrower shall furnish (or cause to be furnished) such security as may be required in the proceeding, or as may be reasonably requested by Lender (which security amount shall not exceed 110% of the amount that would be reasonably likely to become due if Borrower loses such contest, together with all interest and penalties payable in connection therewith), to insure payment of such Work Charge. Lender may apply any such security or part thereof, as necessary to pay for such Work Charge at any time when, in the reasonable judgment of Lender, the validity, applicability or non-payment of such Work Charge is finally established pursuant to a final judgment or ruling by the applicable Governmental Authority or the Individual Property (or any material part thereof or interest therein) shall be in present danger of being sold, forfeited, terminated, cancelled or lost.

Section 4.17.Performance of Other Agreements. Borrower shall observe and perform in all material respects each and every term to be observed or performed by Borrower pursuant to the terms of any agreement or recorded instrument affecting or pertaining to the Property, or given by Borrower to Lender for the purpose of further securing the Debt and any amendments, modifications or changes thereto.

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​ Section 4.18.Debt Cancellation. Borrower shall not cancel or otherwise forgive or release any claim or debt (other than termination of Leases in accordance herewith) owed to Borrower by any Person, except for adequate consideration and in the ordinary course of Borrower’s business.

Section 4.19.ERISA ; FIRRMA.

(a)Assuming that no part of the proceeds of the Loan will constitute “plan assets” of one or more plans subject to Title I of ERISA or Section 4975 of the IRS Code within the meaning of 29 C.F.R. Section 2510.3-101, as modified by Section 3(42) of ERISA or an exemption from the prohibited transaction rules of Section 406 of ERISA and Section 4975 of the IRS Code applies with respect to such assets, Borrower shall not engage in any transaction which would cause any obligation, or action taken or to be taken, hereunder (or the exercise by Lender of any of its rights hereunder or under the other Loan Documents) to be a non-exempt prohibited transaction under ERISA.

(b)Borrower further covenants and agrees to deliver to Lender such certifications or other evidence from time to time throughout the term of the Security Instrument, as requested by Lender in its reasonable discretion, that (i) Borrower is not an “employee benefit plan” as defined in Section 3(3) of ERISA, or other retirement arrangement, which is subject to Title I of ERISA or Section 4975 of the IRS Code, or a “governmental plan” within the meaning of Section 3(32) of ERISA; (ii) to Borrower’s knowledge, Borrower is not subject to state statutes regulating investments and fiduciary obligations with respect to governmental plans; and (iii) one or more of the following circumstances is true:

(A)	Equity interests in Borrower are publicly offered securities, within the meaning of 29 C.F.R. § 2510.3-101(b)(2);
(B)	Less than twenty-five percent (25%) of each outstanding class of equity interests in Borrower are held by “benefit plan investors” within the meaning of 29 C.F.R.§ 2510.3-101(f)(2); or
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(C)	Borrower qualifies as an “operating company” or a “real estate operating company” within the meaning of 29 C.F.R § 2510.3-101(c) or (e) or an investment company registered under the Investment Company Act of 1940, as amended.
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(c)Borrower shall not maintain, sponsor, contribute to or become obligated to contribute to, or suffer or permit any member of Borrower’s “controlled group of corporations” to maintain, sponsor, contribute to or become obligated to contribute to a “defined benefit plan” or a “multiemployer pension plan”. The terms in quotes above are defined in Section 3.7 of this Agreement.

(d)Within three (3) Business Days of Borrower’s receipt of any FIRRMA Document, Borrower shall provide Lender a copy of the same. Concurrently with Borrower’s delivery of any FIRRMA Document, Borrower shall provide Lender a copy thereof. In the event that Borrower or any of its Affiliates meets with any Governmental Authority for any purpose relating to FIRRMA, Borrower shall provide Lender with a written summary of such meeting within three (3) Business Days thereafter. In the event that any review, investigation or other proceeding is commenced relating to FIRRMA and involving Borrower, the Constituent Owners of Borrower and/or the Property, Borrower shall provide Lender with a written summary of the status of such matters on a monthly, or if requested by Lender, more frequent, basis, including such information as Lender shall

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​ reasonably request. Borrower shall (and shall cause its Constituent Owners to) (i) comply with FIRRMA and (ii) respond to, and comply with, all requests, orders, and directives from any Governmental Authority related to FIRRMA; provided, however, the foregoing subsections (i) and (ii) shall not limit any obligation of Borrower to otherwise comply with any other applicable terms and conditions hereof and of the other Loan Documents. Notwithstanding anything contained herein to the contrary, each of any FIRRMA Prohibited Transfer and FIRRMA Prohibited Filing Event shall be deemed prohibited hereunder as a breach hereof and Borrower shall not permit the same to occur without Lender’s prior written consent.

Section 4.20.No Joint Assessment. Borrower shall not suffer, permit or initiate the joint assessment of the Property with (a) any other real property constituting a tax lot separate from the Property, or (b) any portion of the Property which may be deemed to constitute personal property, or any other procedure whereby the lien of any taxes which may be levied against such personal property shall be assessed or levied or charged to the Property.

Section 4.21.Alterations. Notwithstanding anything contained herein (including, without limitation, Article 8 hereof) to the contrary, Lender’s prior approval shall be required in connection with any alterations to any Improvements (a) that would reasonably be expected to result in an Individual Material Adverse Effect, (b) the cost of which (including any related alteration, improvement or replacement) is reasonably anticipated to exceed the Alteration Threshold or (c) that are structural in nature, which approval shall not be unreasonably withheld, conditioned or delayed (and shall be deemed granted if such alterations are set forth in any Lease entered into in accordance with this Agreement). If the total unpaid amounts incurred and to be incurred with respect to any alterations to the Improvements shall at any time exceed the Alteration Threshold, Borrower shall promptly deliver to Lender as security for the payment of such amounts and as additional security for Borrower’s obligations under the Loan Documents any of the following: (i) cash, (ii) U.S. Obligations, (iii) other security reasonably acceptable to Lender, (provided that Lender shall have received a Rating Agency Confirmation as to the form and issuer of same), or (iv) a completion bond reasonably acceptable to Lender (provided that Lender shall have received a Rating Agency Confirmation as to the form and issuer of same). Such security shall be in an amount equal to the excess of the total unpaid amounts incurred and to be incurred with respect to such alterations to the Improvements over the Alteration Threshold.

Section 4.22.Property Document Covenants. Without limiting the other provisions of this Agreement and the other Loan Documents, Borrower shall (i) promptly perform and/or observe, in all material respects, all of the covenants and agreements required to be performed and observed by it under the Property Documents and do all things necessary to preserve and to keep unimpaired its material rights thereunder; (ii) promptly notify Lender of any material default under the Property Documents of which it is aware; (iii) promptly deliver to Lender a copy of any material financial statement, business plan, capital expenditures plan, notice, report and estimate received by it under the Property Documents; (iv) enforce the performance and observance of all of the covenants and agreements required to be performed and/or observed under the Property Documents in a commercially reasonable manner; (v) cause the Property to be operated, in all material respects, in accordance with the Property Documents; and (vi) not, without the prior written consent of Lender (which consent shall not be unreasonably withheld, conditioned or delayed), (A) enter into any new Property Document or replace or execute material modifications to any existing Property Documents or renew or extend the same (exclusive of, in each case, any automatic renewal or extension in accordance with its terms), (B) surrender, terminate or cancel the Property Documents, (C) reduce or consent to the reduction of the term of the Property Documents, (D) materially increase or consent to the material increase of the amount of any charges under the Property Documents, (E) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under,

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​ the Property Documents in any material respect or (F) following the occurrence and during the continuance of an Event of Default, exercise any rights, make any decisions, grant any approvals or otherwise take any material action under the Property Documents.

Section 4.23.PILOT Leases and PILOT Documents.

(a)Each Individual Borrower that is subject to a PILOT Lease and/or PILOT Documents shall (or shall use commercially reasonable efforts to cause any Tenant to, as applicable; provided, that, if Tenant does not do any of the following then it shall remain Borrower’s obligation):

(i)pay all sums required to be paid by any Individual Borrower under and pursuant to the PILOT Documents, as and when such payment is payable, including any rents or additional rents required to be paid by such Individual Borrower, as tenant under and pursuant to the provisions of the PILOT Leases, as and when such rent or other charge is payable;

(ii)diligently perform and observe all of the terms, covenants and conditions in all material respects of the PILOT Lease and PILOT Documents on the part of such Individual Borrower to be performed and observed, prior to the expiration of any applicable grace period therein, including, without limitation, any minimum investments required with respect to the applicable PILOT Property;

(iii)promptly deliver to Lender a copy of any written notice received by Borrower of any default by any Individual Borrower under any PILOT Document and/or PILOT Lease on the part of any Individual Borrower;

(iv)timely submit, file or deliver all reporting and tax returns required pursuant to the terms of the PILOT Lease and/or PILOT Document, as applicable, and upon request of Lender, promptly deliver a copy of such reporting to Lender;

(v)conduct all leasing at the applicable PILOT Property in accordance with the terms and conditions in the PILOT Lease and/or PILOT Documents in all material respects, as applicable; and

(vi)continue to operate at the applicable PILOT Property and shall not cease operations or “go dark” with respect to such PILOT Property as required pursuant to the terms and conditions of the PILOT Lease and/or PILOT Document, as applicable.

Notwithstanding anything to the contrary contained herein, Lender acknowledges that all payments under any PILOT Bond held by Borrower may be made by Borrower via ledger or book entry only to the extent permitted under the applicable PILOT Documents.

(b)Except in connection with a Borrower’s acquisition of fee title to the fee estate held by a PILOT Lessor in accordance with Section 4.23(e) hereof, Borrower shall not and shall not cause or permit any other Person to, without the prior consent of Lender, transfer, surrender, terminate or cancel any PILOT Lease or PILOT Document, including any PILOT Bond or modify, change, supplement, alter or amend any PILOT Lease or PILOT Document, either orally or in writing.

(c)If any Individual Borrower shall default in the performance or observance of any material term, covenant or condition of any PILOT Lease and/or PILOT Document, as applicable, on the part of any such Individual Borrower to be performed or observed and shall fail to cure the same prior to the expiration of any applicable cure or grace period provided under the PILOT Lease

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​ and/or PILOT Document, as applicable, then, without limiting the generality of the other provisions of the Security Instruments, this Agreement and the other Loan Documents, and without waiving or releasing any such Individual Borrower from any of its obligations hereunder, Lender shall have the right, but shall be under no obligation, to pay any sums and to perform any act or take any action as may be appropriate to cause all of the material terms, covenants and conditions of the any such PILOT Lease and/or PILOT Document, as applicable, on the part of any such Individual Borrower to be performed or observed or to be promptly performed or observed on behalf of any such Individual Borrower, to the end that the rights of any such Individual Borrower in, to and under any such PILOT Lease and/or PILOT Document, as applicable, shall be kept unimpaired as a result thereof and free from default.  If Lender shall make any payment or perform any act or take action in accordance with the preceding sentence, Lender will notify Borrower of the making of any such payment, the performance of any such act or the taking of any such action.  In any such event, Lender and any Person designated as Lender’s agent by Lender shall have, and are hereby granted, the right to enter upon the applicable PILOT Property at any reasonable time, on reasonable written notice and from time to time for the purpose of taking any such action.  Lender may pay and expend such sums of money as Lender reasonably deems necessary for the purpose of curing any such default and upon so doing shall be subrogated to any and all rights of the PILOT Lessor or other counterparty to the applicable PILOT Document.  Borrower hereby agrees to pay to Lender within five (5) days after demand, all such sums so paid and expended by Lender, together with interest thereon from the day of such payment at the Default Rate.  All sums so paid and expended by Lender and the interest thereon shall be secured by the legal operation and effect of the Security Instruments.

(d)If any PILOT Lessor or other counterparty to a PILOT Document shall deliver to Lender a copy of any notice of default sent by such PILOT Lessor or counterparty to any applicable Individual Borrower under the applicable PILOT Lease and/or PILOT Document, such notice shall constitute full protection to Lender for any action taken or omitted to be taken by Lender, in good faith, in reliance thereon.  Borrowers will not subordinate or consent to the subordination of the PILOT Lease and/or PILOT Document, as applicable, to any mortgage, security deed, lease or other interest on or in the PILOT Lessor’s interest in all or any part of any fee interest in the PILOT Properties, unless, in each such case, the written consent of Lender shall have been first obtained.

(e)Each applicable Individual Borrower shall purchase the fee interest held by the applicable PILOT Lessor as and when required pursuant to the applicable PILOT Leases, and in connection therewith, shall pay all amounts due under such PILOT Leases and the PILOT Bonds, including, without limitation, rent payments, attorney’s fees and principal and interest payments on the PILOT Bonds (if any).  If any Individual Borrower shall fail to timely purchase the fee interest held by the applicable PILOT Lessor as and when required pursuant to the applicable PILOT Leases, then, without limiting the generality of the other provisions of the Security Instruments, this Agreement and the other Loan Documents, and without waiving or releasing any such Individual Borrower from any of its obligations hereunder, Lender shall have the right, but shall be under no obligation, to pay any sums and to perform any act or take any action as may be appropriate to acquire the fee interest held by the applicable PILOT Lessor, and Borrower hereby expressly authorizes and appoints Lender its attorney-in-fact to exercise any such option in the name of and upon behalf of Borrower, which power of attorney shall be irrevocable and shall be deemed to be coupled with an interest.  If Lender shall make any payment or perform any act or take action in accordance with the preceding sentence, Borrower hereby agrees to pay to Lender within five (5) days after day of such payment at the Default Rate.  All sums so paid and expended by Lender and the interest thereon shall be secured by the legal operation and effect of the Security Instruments.

(f)If an Individual Borrower shall become the owner of fee title to any fee title in the PILOT Properties, then the lien of the applicable Security Instruments shall be spread to cover such

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​ fee title.  Borrower agrees, at its sole cost and expense, including without limitation, Lender’s reasonable third-party attorney’s fees, to (i) execute any and all documents or instruments necessary to subject the foregoing interest to the lien of the applicable Security Instrument; and (ii) provide a title insurance policy or endorsement which shall insure that the lien of the applicable Security Instrument is a first lien on such interest, subject to the Permitted Encumbrances.  If any portion of the Loan is or will be included in a REMIC Trust, Borrower shall deliver a REMIC Opinion in connection with acquiring such fee title.

(g)Intentionally Omitted.

Section 4.24.**Seismic Work.**Borrower shall, at Borrower’s sole cost and expense, perform the seismic retrofit work at the Properties as set forth on Schedule VI hereto.  In connection therewith, (a) within ninety (90) days after the Closing Date Borrower (as such deadline may be extended by Lender in its reasonable discretion) (i) shall have engaged structural engineering firm(s), and other contractors as applicable, to perform such work, and (ii) shall have commenced the process of preparing plans and obtaining permits as applicable in connection with such work, and (b) Borrower shall complete such repairs on or prior to the end of the thirtieth (30^th^) month after the Closing Date (as such deadline may be extended by Lender in its reasonable discretion).

Section 4.25.Immediate Repairs.  Borrower shall, at Borrower’s sole cost and expense, perform the immediate and year-one deferred maintenance, environmental remediation and repairs (including ADA compliance and/or life safety) at the Property as set forth on Schedule III hereto (all such maintenance, remediation and repairs are hereinafter referred to as “Immediate Repairs”) and shall complete each of the Immediate Repairs identified (a) in the Immediate Repairs and ADA Repairs columns on or before the date that is one (1) year after the Closing Date and (b) in the Life Safety column on or before the date that is six (6) months after the Closing Date (in each case as such deadlines may be extended by Lender in its reasonable discretion).

Section 4.26.Plainfield Tax Incentive Documents. Except in connection with the release of the applicable Individual Property in accordance with the terms of this Agreement, Plainfield Borrower shall not, without the prior written consent of Lender, which consent shall not be unreasonably conditioned, delayed or withheld, terminate or cancel any Plainfield Tax Incentive Documents or modify, change, supplement, alter or amend such Plainfield Tax Incentive Documents, in writing in any material and adverse respect. Any termination, cancellation, modification, change, supplement, alteration or amendment of any Plainfield Tax Incentive Documents in any material and adverse respect without the prior written consent of Lender (to the extent required by this Section 5.1.39) shall be void ab initio and of no force and effect; provided, notwithstanding anything to the contrary herein,  Lender’s consent shall not be required in order for Plainfield Borrower to assign and/or transfer any Plainfield Tax Incentive Documents to any transferee which acquires an Individual Property subject to a Plainfield Tax Incentive Document solely in connection with a Permitted Assumption or an Approved Drop Down and/or New TRS Borrower Transfer (provided that such transferee provides Lender collateral with respect to the Plainfield Tax Incentive Documents that is substantially similar to the collateral provided by the Plainfield Borrower to Lender as of the Closing Date).

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​ ARTICLE 5​ ​ ENTITY COVENANTS

Section 5.1.Single Purpose Entity/Separateness.

(a)Borrower has not and will not:

(i)engage in any business or activity other than (A) in the case of each Individual Borrower (other than Parent Borrower),  the ownership, management, operation, maintenance, financing, leasing, development and sale of the applicable Individual Property, and activities incidental thereto, and or (B) in the case of Parent Borrower, acting as the member of each other Individual Borrower that is a limited liability company, acting as the limited partner of each Individual Borrower that is a limited partnership, acting as the member of each SPE Component Entity, and transacting lawful business that is incident, necessary and appropriate to accomplish the foregoing;

(ii)acquire or own any assets other than (A) with respect to an Individual Borrower (other than Parent Borrower), the applicable Individual Property and such incidental Personal Property as may be necessary for the ownership, management, operation, maintenance, financing, leasing and development of the applicable Individual Property, and (B) with respect to Parent Borrower, the equity ownership interests in each other Individual Borrower and SPE Component Entity, as applicable;

(iii)merge into or consolidate with any Person, divide or otherwise engage in or permit any Division or have the power to engage in or permit any Division or dissolve, terminate, liquidate in whole or in part, transfer or otherwise dispose of all or substantially all of its assets or change its legal structure, except as otherwise expressly permitted pursuant to the terms of this Agreement. As used herein, the term “Division” shall mean, as to any Person, such Person dividing and/or otherwise engaging in and/or becoming subject to, in each case, any division (whether pursuant to plan of division or otherwise), including, without limitation and to the extent applicable, pursuant to §18-217 of the Limited Liability Company Act of the State of Delaware or any similar provision of any other applicable Legal Requirements;

(iv)fail to observe all organizational formalities necessary to maintain its separate existence, or fail to preserve its existence as an entity duly organized, validly existing and in good standing (if applicable) under the applicable Legal Requirements of the jurisdiction of its organization or formation, or amend, modify, terminate or fail to comply with the “Special Purpose Provisions” (as defined in the applicable organizational documents) without the prior written consent of Lender and the receipt of a Rating Agency Confirmation;

(v)own any subsidiary, or make any investment in, any Person (other than, with respect to Parent Borrower, each other Borrower and each SPE Component Entity and, with respect to any SPE Component Entity, in each applicable Borrower);

(vi)commingle its funds or assets with the funds or assets of any other Person other than any other Borrower in connection with the Loan and other than co-borrowers under prior loans that have been repaid in full or that will be repaid in full upon the closing of the Loan;

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​ (vii)incur any Indebtedness, secured or unsecured, direct or contingent (including guaranteeing any obligation) that it still outstanding, other than (A) the Debt, (B) trade and operational indebtedness incurred in the ordinary course of business with trade creditors, provided such indebtedness is (1) unsecured, (2) not evidenced by a note, (3) on commercially reasonable terms and conditions, and (4) due not more than ninety (90) days past the date incurred and paid on or prior to such date, and/or (C) Permitted Equipment Leases; provided however, the aggregate amount of the indebtedness described in (B) and (C) shall not exceed at any time five percent (5%) of the outstanding principal amount of the Debt. No Indebtedness other than the Debt may be secured (senior, subordinate or pari passu) by the Property;

(viii)fail to maintain all of its books, records, financial statements and bank accounts separate from those of any other Person (including, without limitation, any Affiliates). Borrower’s assets have not and will not be listed as assets on the financial statement of any other Person; provided, however, that Borrower’s assets may have been and may be included in a consolidated financial statement of its Affiliates provided that (i) appropriate notation has been made and shall be made on such consolidated financial statements to indicate the separateness of Borrower and such Affiliates and to indicate that, except as contemplated by the Loan Documents with respect to the other Borrowers, Borrower’s assets and credit are not available to satisfy the debts and other obligations of such Affiliates or any other Person and (ii) such assets have been and shall be listed on Borrower’s own separate balance sheet. Borrower has maintained and will maintain its books, records, resolutions and agreements as official records;

(ix)except for capital contributions and capital distributions permitted under the terms of its organizational documents and properly reflected on its books and records, enter into any transaction, contract or agreement with any partner, member, principal or Affiliate, except, in each case, upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm’s-length basis with unaffiliated third parties;

(x)maintain its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person;

(xi)except with respect co-borrowers under prior loans that have been repaid in full or that will be repaid in full upon the closing of the Loan, as contemplated by the Loan Documents with respect to each other Borrower and insofar as an SPE Component Entity may become obligated for the debts or obligations of a Borrower in its capacity as general partner of such Borrower, assume or guaranty the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets to secure the obligations of any other Person or hold out its credit as being available to satisfy the obligations of any other Person;

(xii)make any loans or advances to any Person;

(xiii)fail to file its own tax returns unless Borrower is (1) treated as a “disregarded entity” for tax purposes and is not required to file tax returns under applicable Legal Requirements, or (2) required by applicable Legal Requirements to file consolidated tax returns;

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​ (xiv)fail to (A) hold itself out to the public and identify itself, in each case, as a legal entity separate and distinct from any other Person and not as a division or part of any other Person, (B) conduct its business solely in its own name, (C) hold its assets in its own name or (D) correct any known misunderstanding regarding its separate identity (but Borrower’s treatment of itself as a disregarded entity for tax purposes shall not breach this subsection (xiv));

(xv)fail to maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations (to the extent there exists sufficient cash flow from the applicable Individual Property to do so; provided this subsection (xv) shall not require (or prohibit) any equity owner to make additional capital contributions to Borrower);

(xvi)without the prior unanimous written consent of all of its partners or members, as applicable, and the prior unanimous written consent of each Independent Director (which shall be engaged at the Parent Borrower level), take any Material Action with respect to any Borrower or any SPE Component Entity (provided, that, none of any member or partner (as applicable) of Borrower or any SPE Component Entity or any board of directors or managers (as applicable) of Borrower or any SPE Component Entity may authorize the taking of any of the foregoing actions unless, in each case, there are at least two (2) Independent Directors then serving in such capacity at the Parent Borrower level in accordance with the terms of the applicable organizational documents and each of such Independent Directors have consented to such foregoing action);

(xvii)fail to allocate shared expenses (including, without limitation, shared office space) or fail to use separate stationery, invoices and checks;

(xviii)except with respect to joint obligations of the entities constituting the Borrower as contemplated by the Loan Documents and with respect to the joint obligations with co-borrowers under prior loans that have been repaid in full or that will be repaid in full upon the closing of the Loan, fail to pay its own liabilities (including, without limitation, salaries of its own employees) from its own funds or fail to maintain a sufficient number of employees in light of its contemplated business operations (in each case to the extent there exists sufficient cash flow from the applicable Individual Property to do so; provided this subsection (xviii) shall not require (or prohibit) any equity owner to make additional capital contributions to Borrower);

(xix)acquire obligations or securities of its partners, members or other Affiliates, as applicable, other than, (A) in the case of Parent Borrower, its interests in each other Borrower and each SPE Component Entity and (B) in the case of SPE Component Entity, its interests in the applicable Borrower;

(xx)identify its partners, members, or other Affiliates, as applicable, as a division or part of it (but Borrower’s treatment of itself as a disregarded entity for tax purposes shall not breach this subsection (xx)); or

(xxi)violate or cause to be violated the assumptions made with respect to Borrower and its principals in the Non-Consolidation Opinion or in any New Non-Consolidation Opinion.

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​ (b)Each Borrower shall be a limited partnership or limited liability company.  Each Borrower that is a limited partnership shall have a general partner that is an Acceptable LLC (each, an “SPE Component Entity”) whose sole asset is its interest in such Borrower.  Each Borrower that is a limited liability company and each SPE Component Entity shall have Parent Borrower as its sole member.  Parent Borrower shall, at all times, be required to satisfy the requirements of an Acceptable LLC.  Each SPE Component Entity (i) will at all times comply with each of the covenants, terms and provisions contained in Section 5.1(a)(iii) - (vi) (inclusive) and (viii) – (xxi) (inclusive) and Section 5.1(c) and (d) hereof, as if such representation, warranty or covenant was made directly by such SPE Component Entity; (ii) will not engage in any business or activity other than owning an interest in the applicable Borrower and acting as such Borrower’s general partner; (iii) will not acquire or own any assets other than its partnership interest in Borrower; (iv) will at all times continue to own no less than a 0.01% direct partnership interest in Borrower; (v) will not incur any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), except (A) trade payables in the ordinary course of its business, in amounts not to exceed $20,000.00, in the aggregate, provided that such indebtedness (i) is unsecured, (ii) is not evidenced by a note, (iii) is on commercially reasonable terms and conditions, and (iv) is paid within ninety (90) days of the date incurred and (B) insofar as it may become obligated for the debts or obligations of the applicable Borrower in its capacity as general partner of such Borrower; and (vi) will cause Borrower to comply with the provisions of this Section 5.1.

(c)The limited liability company agreement of Parent Borrower (the “Parent Borrower LLC Agreement”) shall provide that (i) upon the occurrence of any event that causes the last remaining member of Parent Borrower (“Parent Borrower Member”) to cease to be a member of Parent Borrower (other than (A) upon an assignment by Parent Borrower Member of all of its limited liability company interest in Parent Borrower and the admission of the transferee in accordance with the Loan Documents and the Parent Borrower LLC Agreement, or (B) the resignation of Parent Borrower Member and the admission of an additional member of Parent Borrower in accordance with the terms of the Loan Documents and the Parent Borrower LLC Agreement), each person acting as Independent Director of Parent Borrower shall, without any action of any other Person and simultaneously with the Parent Borrower Member ceasing to be the member of Parent Borrower automatically be admitted to Parent Borrower as a member with a 0% economic interest (“Special Member”) and shall continue Parent Borrower without dissolution and (ii) Special Member may not resign from Parent Borrower or transfer its rights as Special Member unless (A) a successor Special Member has been admitted to Parent Borrower as a Special Member in accordance with requirements of Delaware law and (B) after giving effect to such resignation or transfer, there remains at least two (2) Independent Directors of Parent Borrower in accordance with Section 5.2 below. The Parent Borrower LLC Agreement shall further provide that (i) Special Member shall automatically cease to be a member of Parent Borrower upon the admission to Parent Borrower of the first substitute member, (ii) Special Member shall be a member of Parent Borrower that has no interest in the profits, losses and capital of Parent Borrower and has no right to receive any distributions of the assets of Parent Borrower, (iii) pursuant to the applicable provisions of the Limited Liability Company Act of the State of Delaware (the “Act”), Special Member shall not be required to make any capital contributions to Parent Borrower and shall not receive a limited liability company interest in Parent Borrower, (iv) Special Member, in its capacity as Special Member, may not bind Parent Borrower and (v) except as required by any mandatory provision of the Act, Special Member, in its capacity as Special Member, shall have no right to vote on, approve or otherwise consent to any action by, or matter relating to, Parent Borrower including, without limitation, the merger, consolidation, division or conversion of Parent Borrower; provided, however, such prohibition shall not limit the obligations of the Person acting as Special Member, in its capacity as Independent Director, to vote on such matters required by the Loan Documents or the Parent

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​ Borrower LLC Agreement. In order to implement the admission to Parent Borrower of Special Member, Special Member shall execute a counterpart to the Parent Borrower LLC Agreement. Prior to its admission to Parent Borrower as Special Member, Special Member shall not be a member of Parent Borrower, but Special Member may serve as an Independent Director of Parent Borrower.

(d)The  limited liability company agreement of each Borrower that is a limited liability company and each SPE Component Entity (the “LLC Agreement”) shall further provide that (i) upon the occurrence of any event that causes the last remaining member of such Borrower or SPE Component Entity (the “Member”) to cease to be a member of Borrower or such SPE Component Entity (as applicable) (other than (A) upon an assignment by Member of all of its limited liability company interest in Borrower or such SPE Component Entity (as applicable) and the admission of the transferee, or (B) the resignation of Member and the admission of an additional member of Borrower or such SPE Component Entity (as applicable), in each case, in accordance with the terms of the Loan Documents and the LLC Agreement) to the fullest extent permitted by law, the personal representative of Member shall, within ninety (90) days after the occurrence of the event that terminated the continued membership of Member in Borrower or such SPE Component Entity (as applicable) agree in writing (A) to continue Borrower or such SPE Component Entity (as applicable) and (B) to the admission of the personal representative or its nominee or designee, as the case may be, as a substitute member of Borrower or such SPE Component Entity (as applicable) effective as of the occurrence of the event that terminated the continued membership of Member in Borrower or such SPE Component Entity (as applicable), (ii) the Bankruptcy (as defined in the LLC Agreement) of Member or Special Member shall not cause Member or Special Member to cease to be a member of Borrower or such SPE Component Entity (as applicable) and upon the occurrence of such an event, the business of Borrower or such SPE Component Entity (as applicable) shall continue without dissolution and (iii) to the fullest extent permitted by law, each of Member and Special Member waives any right it might have to agree in writing to dissolve Borrower or such SPE Component Entity (as applicable) upon the Bankruptcy (as defined in the LLC Agreement) of Member or Special Member, or the occurrence of an event that causes Member or Special Member to cease to be a member of Borrower or such SPE Component Entity (as applicable).

Section 5.2.Independent Director.

(a)The Parent Borrower LLC Agreement shall provide that at all times there shall be at least two duly appointed independent directors or managers of such entity (each, an “Independent Director”) who each shall (I) not have been at the time of each such individual’s initial appointment, and shall not have been at any time during the preceding five years, and shall not be at any time while serving as Independent Director, (i) a shareholder (or other equity owner) of, or an officer, director (other than in its capacity as Independent Director of (A) Parent Borrower or (B) an Affiliate of Parent Borrower that does not own a direct or indirect ownership interest in Parent Borrower and that is required by a creditor to be a special purpose entity, provided that such Independent Director (x) is employed by an Approved ID Provider and (y) the fees that such individual earns from serving as an Independent Director of affiliates of Parent Borrower in any given year constitute in the aggregate less than five percent (5%) of such individual’s annual income for that year), partner, member or employee of, Parent Borrower or any of their respective shareholders, partners, members, subsidiaries or Affiliates, (ii) a customer of, or supplier to, or other Person who derives any of its purchases or revenues from its activities with, Parent Borrower or any of their respective shareholders, partners, members, subsidiaries or Affiliates (other than in its capacity as Independent Director of Parent Borrower or any of its respective Affiliates), (iii) a Person who Controls or is under common Control with any such shareholder, officer, director, partner, member, employee supplier, customer or other Person, (iv) a family member of any such shareholder, officer, director, partner, member, employee, supplier, customer or other Person or (v) a trustee or similar Person in

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​ any proceeding under Creditors Rights Laws involving Parent Borrower or any of its partners, members, subsidiaries or Affiliates (II) shall have, at the time of their appointment, had at least three (3) years’ experience in serving as an independent director and (III) be employed by, in good standing with and engaged by Parent Borrower in connection with, in each case, an Approved ID Provider. Notwithstanding anything to the contrary contained herein, it shall be an additional covenant and requirement under this Article that Parent Borrower, as the entity housing the Independent Directors, shall be an Acceptable LLC.

(b)The organizational documents of each Borrower and each SPE Component Entity shall further provide that (I) the board of directors or managers of Borrower and each SPE Component Entity and the constituent equity owners of such entities (such constituent equity owners, the “Constituent Members”) shall not take any Material Action unless, in each case, at the time of such Material Action there shall be at least two Independent Directors engaged as provided by the terms hereof at the Parent Borrower level, and such Independent Directors vote in favor of or otherwise consent in advance in writing to such Material Action; (II) any resignation, removal or replacement of any Independent Director shall not be effective without (x)(1) prior written notice to Lender and the Rating Agencies (which such prior written notice must be given on the earlier of five (5) days or three (3) Business Days prior to the applicable resignation, removal or replacement) and (2) evidence that the replacement Independent Director satisfies the applicable terms and conditions hereof and of the applicable organizational documents (which such evidence must accompany the aforementioned notice) and (y) the replacement Independent Director having accepted its appointment as Independent Director by executing a counterpart to the applicable organizational document; (III) to the fullest extent permitted by applicable Legal Requirements, including Section 18-1101(c) of the Act and notwithstanding any duty otherwise existing at law or in equity, the Independent Directors shall consider only the interests of the applicable Borrower or SPE Component Entity (including such Borrower’s or SPE Component Entity’s respective creditors) in acting or otherwise voting on a Material Action with respect to such Borrower or SPE Component Entity; (IV) except for duties to the applicable Borrower or SPE Component Entity as set forth in the foregoing subsection (III), including duties to the applicable Borrower or SPE Component Entity’s Constituent Members and creditors, in each case solely to the extent of their respective economic interests in such Borrower or SPE Component Entity (as applicable), but exclusive of (x) all other interests (including, without limitation, all other interests of the Constituent Members), (y) the interests of other Affiliates of the applicable Borrower or SPE Component Entity and (z) the interests of any group of Affiliates of which the applicable Borrower or SPE Component Entity is a part), the Independent Directors shall not have any fiduciary duties to any Constituent Members, any directors of Borrower or any SPE Component Entity or any other Person; (V) the foregoing shall not eliminate the implied contractual covenant of good faith and fair dealing under applicable Legal Requirements; and (VI) to the fullest extent permitted by applicable Legal Requirements, including Section 18-1101(e) of the Act, an Independent Director shall not be liable to Borrower, any SPE Component Entity, any Constituent Member or any other Person for breach of contract or breach of duties (including fiduciary duties), unless the Independent Director acted in bad faith or engaged in willful misconduct.

(c)Notwithstanding anything to the contrary contained in this Agreement, no Independent Director shall be removed or replaced without Cause and unless the Borrower provides Lender with written notice (which such prior written notice must be given on the earlier of five (5) days or three (3) Business Days prior to the applicable removal or replacement) of (x) any proposed removal of such Independent Director, and (y) the identity of the proposed replacement Independent Director, together with a certification that such replacement satisfies the requirements for an Independent Director set forth in this Agreement.

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​ Section 5.3.Change of Name, Identity or Structure. Borrower shall not change (or permit to be changed) Borrower’s or any SPE Component Entity’s (a) name, (b) identity (including its trade name or names), (c) principal place of business set forth on the first page of this Agreement or (d) if not an individual, Borrower’s or any SPE Component Entity’s partnership or other structure or state of formation, without, in each case, notifying Lender of such change in writing at least thirty (30) days prior to the effective date of such change and, in the case of a change in Borrower’s or any SPE Component Entity’s structure or state of formation, without first obtaining the prior written consent of Lender and, if required by Lender, a Rating Agency Confirmation with respect thereto. Borrower shall execute and deliver to Lender, prior to or contemporaneously with the effective date of any such change, any financing statement or financing statement change required by Lender to establish or maintain the validity, perfection and priority of the security interest granted herein. At the request of Lender, Borrower shall execute a certificate in form satisfactory to Lender listing the trade names under which Borrower or each applicable SPE Component Entity intends to operate the Property, and representing and warranting that Borrower or the SPE Component Entity does business under no other trade name with respect to the Property.

Section 5.4.Business and Operations. Borrower will continue to engage in the businesses now conducted by it as and to the extent the same are necessary for the ownership, maintenance, management and operation of the Property. Borrower will qualify to do business and will remain in good standing under the laws of the State and each other applicable jurisdiction in which the Property is located, in each case, as and to the extent the same are required for the ownership, maintenance, management and operation of the Property.

Section 5.5.Recycled Entity. Borrower hereby represents and warrants to Lender that Borrower and each SPE Component Entity has not, since its formation: (a) failed to be duly formed, validly existing, and in good standing in the applicable jurisdiction(s) of its formation and the State; (b) had any judgments or liens of any nature against it except for (i) tax liens not yet delinquent, (ii) judgments which have been satisfied in full and (iii) liens in connection with the Prior Loan; (c) failed to comply in all material respects with all laws, regulations, and orders applicable to it or failed to receive all Permits necessary for it to operate; (d) been involved in any dispute with any taxing authority which is unresolved as of the Closing Date or failed to pay all taxes owed prior to the delinquency thereof (or, if later, then with all applicable penalties, interest and other sums due in connection therewith); (e) ever been party to any lawsuit, arbitration, summons, or legal proceeding that is still pending or that resulted in a judgment against it that has not been paid in full; (f) failed to comply with all separateness covenants contained in its organizational documents since its formation; (g) had any material contingent or actual obligations not related to, in the case of Borrower (other than Parent Borrower), the Property, in the case of SPE Component Entity, its interest in the applicable Borrower and in the case of Parent Borrower, its interest in the applicable Borrower and SPE Component Entity; (h) except as expressly disclosed to Lender in connection with the closing of the Loan, amended, modified, supplemented, restated, replaced or terminated its organizational documents (or consented to any of the foregoing); or (i) has been the product of, the subject of or otherwise involved in, in each case, any Division.

ARTICLE 6​​NO SALE OR ENCUMBRANCE

Section 6.1.Transfer Definitions. As used herein and in the other Loan Documents, “Restricted Party” shall mean Borrower, Sponsor, Guarantor, any SPE Component Entity or any shareholder, partner, member or non-member manager, or any direct or indirect legal or beneficial owner of Borrower, Sponsor, Guarantor, any SPE Component Entity or any non-member manager;

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​ and a “Sale or Pledge” shall mean a voluntary or involuntary sale, conveyance, mortgage, grant, bargain, encumbrance, pledge, assignment, grant of any options with respect to, or any other transfer or disposition of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) of a legal or beneficial interest.

Section 6.2.No Sale/Encumbrance.

(a)It shall be an Event of Default hereof if, without the prior written consent of Lender, (i) a Sale or Pledge of the Property or any part thereof or any legal or beneficial interest therein (including, without limitation, the Loan and/or Loan Documents) occurs, (ii) a Sale or Pledge of an interest in any Restricted Party occurs, and/or (iii) Borrower shall acquire any real property in addition to the real property owned by Borrower as of the Closing Date (each of the foregoing, collectively, a “Prohibited Transfer”), other than (s) pursuant to Leases of space in the Improvements to Tenants in accordance with the provisions of Section 4.14, (t) pursuant to any PILOT Leases in accordance with the provisions of Section 4.23, (u) as permitted pursuant to the express terms of this Article 6, (v) any Permitted Encumbrances, (w) any Permitted Equipment Leases, (x) if Lender exercises its right to split the Loan into a mortgage and mezzanine loan pursuant to Section 11.6 hereof, (1) the mezzanine loan liens, including, the pledge by any mezzanine borrower of 100% of the limited liability company interests in such Borrower, in each case, to secure the mezzanine loan pursuant to the mezzanine pledge agreement and/or any other mezzanine loan documents, and (2) a foreclosure of the mezzanine pledge agreement (or assignment-in-lieu of foreclosure) or any other mezzanine loan documents by mezzanine lender or its designee or nominee in accordance with the terms of the mezzanine loan documents, (y) a foreclosure of the Security Instrument (or deed-in-lieu of foreclosure) or any other Loan Documents by Lender or its designee or nominee in accordance with the terms of the Loan Documents, and (z) any acquisition, transfer or disposition in Borrower’s ordinary course of business, and in accordance with the terms and conditions of the Loan Documents, of any equipment, fixtures or other tangible personal property (free from the interest of Lender under this Agreement or any other Loan Documents) to the extent such equipment or other tangible personal property is either being replaced with property of equal or greater value and utility, or is no longer necessary in connection with the operation of the Property (included, without limitation, all Permitted Equipment Leases).

(b)A Prohibited Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for anything other than actual occupancy by a Tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any (A) Leases or any Rents, (B) Property Documents, or (C) PILOT Lease and/or PILOT Document, except as expressly permitted in accordance with Section 6.2(a); (iii) if a Restricted Party is a corporation, any merger, consolidation or Sale or Pledge of such corporation’s stock or the creation or issuance of new stock in one or a series of transactions; (iv) if a Restricted Party is a limited or general partnership or joint venture, any merger or consolidation or the change, removal, resignation or addition of a general partner or the Sale or Pledge of the partnership interest of any general or limited partner or any profits or proceeds relating to such partnership interests or the creation or issuance of new limited partnership interests; (v) if a Restricted Party is a limited liability company, any merger, Division or consolidation or the change, removal, resignation or addition of a managing member or non-member manager (or if no managing member, any member) or the Sale or Pledge of the membership interest of any member or any profits or proceeds relating to such membership interest; (vi) if a Restricted Party is a trust or nominee trust, any merger, consolidation or the Sale or Pledge of the legal or beneficial interest in a Restricted Party or the creation or issuance of new legal or beneficial interests in a Restricted Party or the revocation, rescission or termination of a Restricted

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​ Party; (vii) the removal or the resignation of Manager (including, without limitation, an Affiliated Manager) or the engagement of a New Manager, in each case, other than in accordance with Section 4.15; (viii) any action for partition of the Property (or any portion thereof or interest therein) or any similar action instituted or prosecuted by Borrower or by any other Person, pursuant to any contractual agreement or other instrument or under applicable law (including, without limitation, common law) and/or any other action instituted by (or at the behest of) Borrower or its Affiliates or consented to or acquiesced in by Borrower or its Affiliates which results in the breach or violation of any PILOT Lease and/or PILOT Document, and/or (ix) the incurrence of any property-assessed clean energy loans or similar indebtedness with respect to Borrower and/or the Property, including, without limitation, if such loans or indebtedness are made or otherwise provided by any Governmental Authority and/or secured or repaid (directly or indirectly) by any taxes or similar assessments.

Section 6.3.Permitted Equity Transfers. Notwithstanding the restrictions contained in this Article 6, the following transfers shall be permitted without Lender’s consent and without the obligation to pay any transfer or assumption fee or premium or provide any notice to Lender, except as otherwise expressly set forth herein (each, a “Permitted Equity Transfer”): (a) a transfer (but not a pledge, other than a Permitted Pledge) by devise or descent or by operation of law upon the death, or occurring as a result of the death or legal incapacity of a natural person that is of a Restricted Party or any direct or indirect owner, member, partner or shareholder of a Restricted Party, (b) the transfer of the direct or indirect legal or beneficial equity interests in Borrower or direct or indirect interests in any Restricted Party (excluding the direct interests in Borrower or any SPE Component Entity) in one or a series of transactions (including, the transfer (but not the pledge, other than a Permitted Pledge) of shares of stock, partnership interests or membership interests (as the case may be) in a Restricted Party (including, without limitation, any such transfer related to or in connection with the estate planning of such transferor)) other than those transfers described in clause (c) or (d) hereof, which transfers shall be governed by such applicable clause, (c) the sale, transfer, redemption, or issuance of common or preferred stock, shares, units, limited partnership interests, membership interests, or other equity interests or securities in any direct or indirect equity owner of Parent Borrower (including, without limitation, the direct or indirect interests in AREIT, or AREIT OP and any Permitted Pledge); provided, that, such equity interests or securities are publicly listed on the New York Stock Exchange or another nationally recognized stock exchange (provided, further, that, the foregoing provisions of this clause (c) shall not be deemed to waive, qualify or otherwise limit Borrower’s obligation to comply with (or to cause the compliance with) the other covenants set forth herein and in the other Loan Documents), (d) the sale, transfer, redemption, or issuance of non-Controlling interests in the form of common or preferred stock, shares, units, limited partnership interests, membership interests, or other non-Controlling equity interests or securities in any direct or indirect equity owner of Parent Borrower (including, without limitation, the direct or indirect interests in AREIT, or AREIT OP and any Permitted Pledge, but excluding transfers described in clause (c)); provided, that, such transfer shall comply with clause (ii) and (iii) below (provided, further, that, the foregoing provisions of this clause (d) shall not be deemed to waive, qualify or otherwise limit Borrower’s obligation to comply with (or to cause the compliance with) the other covenants set forth herein and in the other Loan Documents), (e) the issuance of preferred shares or units, by AREIT, or AREIT OP, or any direct or indirect owner of AREIT, or AREIT OP, of up to 125 shares or units at not more than $1,000.00 per share or unit, solely in order to comply with applicable real estate investment trust requirements under the code, and any subsequent Transfers of such preferred shares or units by the holders  thereof, (f) any Permitted Pledge and the exercise of any remedies under a Permitted Pledge, and (g) the transfer of any direct or indirect interests in Sponsor whether through a merger, consolidation or similar transaction, or whereby any other Person acquires, directly or indirectly, all or substantially all of the assets of Sponsor in one or

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​ a series of transactions, provided that the Sponsor or applicable surviving entity following such merger or other transaction continues to satisfy Eligibility Requirements and meets the definition of a Qualified Transferee; provided, further, that, in each case:

(i)with respect to the transfers listed in clauses (a), (b), (d), (f) and (g) above, Lender shall receive not less than ten (10) days prior written notice of such transfers (provided, that, for purposes of clarification, with respect to the transfers contemplated in subsection (a) above, the aforesaid notice shall only be deemed to be required ten (10) days prior to the consummation of the applicable transfers made as a result of probate or similar process following such death (as opposed to prior notice of the applicable death)); provided, further, that Borrower shall not be obligated to provide notice of any such sale or transfer which (A) does not (1) result in any change in Control of Borrower, Guarantor or Sponsor, or (2) require Lender to run “known your client” searches with respect to the applicable transferee pursuant to  subsection (z) of the last paragraph hereof, (B) does not violate or cause to be violated the assumptions made with respect to Borrower and its principals in the Non-Consolidation Opinion or in any New Non-Consolidation Opinion, and (C) otherwise satisfies the applicable conditions and requirements set forth in this Section 6.3;

(ii)with respect to the transfers listed in clauses (a), (b), (d), (e), and (f) above, no such transfers shall result in a change in Control of Sponsor or Guarantor (except as expressly permitted in accordance with clause (iii), below);

(iii)after giving effect to such transfers, either: (I) if the Guarantor Control Condition shall continue to be satisfied, and Sponsor (which shall include, for purposes hereof, a successor to either Sponsor by operation of law, whether through merger, consolidation or similar transaction, or any other Person who acquires, directly or indirectly, all or substantially all of the assets of either Sponsor (and which person may replace one or both Sponsors as a result of such transaction), in each case subject to the satisfaction of the other applicable conditions and requirements set forth in this Section 6.3) shall continue to Control Borrower and any SPE Component Entity and control the day-to-day operation of the Property, then Sponsor shall continue to own at least a five percent (5%) direct or indirect interest (in the aggregate) in Borrower and the Property, or (II) if the Guarantor Control Condition is not satisfied, or Sponsor no longer Controls Borrower and any SPE Component Entity and no longer control the day-to-day operation of the Property, then Sponsor shall continue to own at least a fifteen percent (15%) direct or indirect interest (in the aggregate) in Borrower and the Property, and the Borrower and any SPE Component Entity shall, after giving effect to such transfer, be controlled by a Qualified Transferee;

(iv)after giving effect to such transfers, the Property shall continue to be managed by Manager or a New Manager approved in accordance with the applicable terms and conditions hereof;

(v)in the case of the transfer of any direct equity ownership interests in Borrower or in any SPE Component Entity, such transfers shall be conditioned upon continued compliance with the relevant provisions of Article 5 hereof;

(vi)in the case of (1) the transfer of the management of the Property to a new Affiliated Manager in accordance with the applicable terms and conditions hereof, (2) the addition and/or replacement of a Guarantor and/or Sponsor in accordance with the applicable terms and conditions hereof and of the Guaranty or (3) the transfer of any equity ownership interests (I) directly in Borrower or in any SPE Component Entity, or (II) in any Restricted

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​ Party whose sole asset is a direct or indirect equity ownership interest in Borrower or in any SPE Component Entity, such transfers shall be conditioned upon delivery to Lender of a New Non-Consolidation Opinion addressing such transfer, addition and/or replacement;

(vii)with respect to the transfers listed in clauses (a), (b), (d), (e), (f) and (g), such transfers shall be conditioned upon Borrower’s ability to, after giving effect to the transfer in question (I) remake the representations contained herein relating to ERISA and FIRRMA matters (and, upon Lender’s request, Borrower shall deliver to Lender an Officer’s Certificate containing such updated representations effective as of the date of the consummation of the applicable transfer) and (II) continue to comply with the covenants contained herein relating to ERISA and FIRRMA matters; and

(viii)such transfers shall be permitted pursuant to the terms of the Property Documents and, if applicable, the PILOT Lease and/or PILOT Document.

Upon request from Lender, Borrower shall promptly provide Lender with:  (y) a revised version of the organizational chart delivered to Lender in connection with the Loan reflecting any transfer consummated in accordance with this Section 6.3 (to the extent such transferee would have been reflected on the organizational chart delivered in connection with the closing of the Loan, if such Transfer had occurred prior to the Closing Date), and (z) “know your client” searches (in form, scope and substance and from a provider, in each case, reasonably acceptable to Lender) with respect to any transferee (I) that has any direct and/or indirect Control rights with respect to Borrower, any SPE Component Entity, and/or any Guarantor and did not possess said Control rights prior to the applicable transfer or (II) owning (when aggregated with all Affiliates of said Person) twenty percent (20%) (or ten percent (10%) for any portion of the Loan held by JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, MORGAN STANLEY BANK, N.A. or NATIXIS REAL ESTATE CAPITAL LLC (such entities, collectively, the “Original Lender”), which has not been included in a Securitization) or more of the direct and/or indirect interests in Borrower, any SPE Component Entity and/or any Guarantor and who did not own said twenty percent (20%) (or ten percent (10%) for any portion of the Loan held by an Original Lender which has not been included in a Securitization) direct or indirect interest prior to such transfer (provided, that, notwithstanding the foregoing provisions of this Section, satisfaction of this subsection (z) shall, at Lender’s option, be a condition precedent to any such transfer).

Section 6.4.Permitted Property Transfer (Assumption). Notwithstanding the foregoing provisions of this Article 6, at any time other than the sixty (60) days prior to and following any Secondary Market Transaction the transfer of all (but not less than all) of the Properties, and the related assumptions of the Loan by, any Person (a “Transferee”) shall be permitted without Lender’s consent; provided that each of the following terms and conditions are satisfied:

(a)no Default or Event of Default has occurred and is continuing;

(b)Borrower shall have (i) delivered written notice to Lender of the terms of such prospective transfer not less than sixty (60) days before the date on which such transfer is scheduled to close and, concurrently therewith, all such information concerning the proposed Transferee as Lender shall reasonably require, and (ii) paid to Lender a non-refundable processing fee in the amount of $25,000; provided, that, in connection with the closing of the applicable transfer, the $25,000 fee shall be applied as a credit against the $250,000 fee, described in clause (c) below;

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​ (c)Borrower shall have paid to Lender, concurrently with the closing of such prospective transfer, (i) a non-refundable assumption fee in an amount equal to $250,000 for the first prospective transfer pursuant to this Section 6.4, (ii) all reasonable out-of-pocket costs and expenses, including reasonable attorneys’ fees, incurred by Lender in connection therewith and (iii) all reasonable out-of-pocket fees, costs and expenses of all third parties and the Rating Agencies incurred in connection therewith;

(d)after giving effect to the assumption in question, a Permitted Assumption Party which satisfies the net worth, liquidity and other similar covenants in the Guaranty (unless otherwise agreed to by Lender) shall own at least a fifteen percent (15%) direct or indirect interest (in the aggregate) in Transferee and the Property, and shall Control the Transferee, any SPE Component Entity and the Property;

(e)Transferee assumes and agrees to pay the Debt as and when due subject to the provisions of Article 13 hereof and, prior to or concurrently with the closing of such transfer, Transferee and its constituent partners, members, shareholders, Affiliates or sponsors as Lender may require, shall execute, without any cost or expense to Lender, such documents and agreements as Lender shall reasonably require to evidence and effectuate said assumption, and the applicable Permitted Assumption Party which Controls the Transferee and any new SPE Component Entity, shall execute and deliver (as a condition to the closing of such transfer) a recourse guaranty and an environmental indemnity in form and substance substantially identical to the Guaranty and Environmental Indemnity, respectively, with such changes to each of the foregoing as may be reasonably required by Lender to reflect the structure of the Permitted Assumption Party;

(f)Borrower and Transferee, without any cost to Lender, shall furnish any information reasonably requested by Lender for the preparation of, and shall authorize Lender to file, new financing statements and financing statement amendments and other documents to the fullest extent permitted by applicable Legal Requirements, and shall execute any additional documents reasonably requested by Lender;

(g)if such assignment and assumption is accomplished by deed, then Borrower shall have delivered to Lender, without any cost or expense to Lender, such endorsements to Lender’s Title Insurance Policy insuring that fee simple or leasehold title to the Property, as applicable, is vested in Transferee (subject to Permitted Encumbrances), hazard insurance endorsements or certificates and other similar materials as Lender may deem reasonably necessary at the time of the transfer, all in form and substance reasonably satisfactory to Lender, in each case, to the extent such endorsements are commercially available in the applicable jurisdiction;

(h)Transferee shall have furnished to Lender all appropriate papers evidencing Transferee’s organization and good standing, and the qualification of the signers to execute the assumption of the Debt, which papers shall include copies of all documents relating to the organization and formation of Transferee and of the entities, if any, which are partners or members of Transferee. Transferee and such constituent partners, members or shareholders of Transferee (as the case may be), as Lender shall reasonably require, shall comply with the covenants set forth in Article 5 hereof, and shall have furnished to Lender all appropriate “know your client” searches (in form, scope and substance and from a provider, in each case, reasonably acceptable to Lender) with respect to Transferee and any other Person (I) that has any direct and/or indirect Control rights with respect to Transferee, any SPE Component Entity, and/or any Guarantor and did not possess said Control rights prior to the applicable assumption or (II) owning (when aggregated with all Affiliates of said Person) twenty percent (20%) (or ten percent (10%) for any portion of the Loan held by an Original Lender which has not been included in a Securitization) or more of the direct and/or indirect

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​ interests in Transferee, any SPE Component Entity and/or any Guarantor and who did not own said twenty percent (20%) (or ten percent (10%) for any portion of the Loan held by an Original Lender which has not been included in a Securitization) direct or indirect interest prior to such assumption;

(i)Transferee shall assume the obligations of Borrower under any Management Agreement or provide a new management agreement with a new manager which meets the requirements of the Assignment of Management Agreement and Section 4.15 hereof and assign to Lender as additional security such new management agreement;

(j)Transferee shall furnish to Lender a New Non-Consolidation Opinion and, if any portion of the Loan is or will be included in a REMIC Trust, a REMIC Opinion, with respect to the transfer and the transactions related thereto and an additional opinion of counsel reasonably satisfactory to Lender and its counsel (A) that Transferee’s formation documents provide for the matters described in subparagraph (g) above, (B) that the assumption of the Debt has been duly authorized, executed and delivered, and that the assumption agreement and the other Loan Documents are valid, binding and enforceable against Transferee in accordance with their terms, (C) that Transferee and any entity which is a controlling stockholder, member or general partner of Transferee, have been duly organized, and are in existence and good standing and (D) with respect to such other matters as Lender may reasonably request and are customarily provided in such types of opinions;

(k)if required by Lender, Lender shall have received (A) a Rating Agency Confirmation with respect to such transfer and (B) evidence that the proposed transfer will not result in, if applicable, a breach or violation of any PILOT Lease and/or PILOT Document; and

(l)such assumption shall be conditioned upon Transferee’s ability to, after giving effect to the assumption in question (I) remake the representations contained herein relating to ERISA and FIRRMA matters (and, upon Lender’s request, Transferee shall deliver to Lender an Officer’s Certificate containing such updated representations effective as of the date of the consummation of the applicable transfer) and (II) comply with the covenants contained herein relating to ERISA and FIRRMA matters.

Section 6.5.Lender’s Rights. Lender reserves the right to condition the consent to a Prohibited Transfer requested hereunder upon (a) a modification of the terms hereof and on assumption of this Agreement and the other Loan Documents as so modified by the proposed Prohibited Transfer, (b) payment of all of Lender’s reasonable out-of-pocket expenses incurred in connection with such Prohibited Transfer, (c) receipt of a Rating Agency Confirmation with respect to the Prohibited Transfer, (d) the proposed transferee’s continued compliance with the covenants set forth in this Agreement, including, without limitation, the covenants in Article 5, (e) receipt of a New Non-Consolidation Opinion with respect to the Prohibited Transfer and/or (f) such other conditions and/or legal opinions as Lender shall reasonably determine are necessary. All reasonable, out-of-pocket expenses incurred by Lender shall be payable by Borrower whether or not Lender consents to the Prohibited Transfer. Lender shall not be required to demonstrate any actual impairment of its security or any increased risk of default hereunder in order to declare the Debt immediately due and payable upon a Prohibited Transfer without Lender’s consent. This provision shall apply to every Prohibited Transfer, whether or not Lender has consented to any previous Prohibited Transfer.

Section 6.6.Economic Sanctions, Anti-Money Laundering and Transfers. Borrower shall (and shall cause its Constituent Owners and Affiliates to) (a) at all times comply with the representations and covenants contained in Section 3.30 such that the same remain true, correct and

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​ not violated or breached and (b) not permit a Prohibited Transfer to occur and shall cause the ownership and Control requirements specified in this Article 6 (including, without limitation, those stipulated in Section 6.3 hereof) to be complied with at all times. Borrower hereby represents that, other than in connection with the Loan, the Loan Documents and any Permitted Encumbrances, as of the date hereof, there exists no Sale or Pledge of (i) the Property or any part thereof or any legal or beneficial interest therein or (ii) any interest in any Restricted Party. For purposes of clarification, references hereunder and/or under the other Loan Documents to “equity ownership interest” (or words of similar import) shall be deemed to refer to the legal and/or beneficial interests in a Person (as applicable); provided, that, when hereunder or under the other Loan Documents a specified percentage of the aforesaid “equity ownership interest” (or words of similar import) in a Person is required to be held, the same shall be deemed to refer to both the legal and beneficial interest in such Person. Notwithstanding anything to the contrary contained herein or in any other Loan Document (including, without limitation Sections 6.3 and 6.4 hereof), in no event shall Borrower or any SPE Component Entity be (I) a Prohibited Entity, (II) Controlled (directly or indirectly) by any Prohibited Entity or (III) more than 49% owned (directly or indirectly) by any Prohibited Entities (whether individually or in the aggregate), unless, in the case of each of the foregoing, Lender’s prior written consent is first obtained (which such consent shall be given or withheld in Lender’s sole discretion and may be conditioned on, among other things, Lender’s receipt of a Rating Agency Confirmation).

ARTICLE 7​ ​INSURANCE; CASUALTY; CONDEMNATION; RESTORATION

Section 7.1.Insurance.

(a)Borrower shall obtain and maintain, or cause to be obtained and maintained, insurance for Borrower and the Property providing at least the following coverages:

(i)insurance with respect to the Improvements and the Personal Property insuring against any peril now or hereafter included within the classification “All Risk” or “Special Perils” (including, without limitation, fire, lightning, windstorm / named storms, hail, terrorism and similar acts of sabotage, explosion, riot, riot attending a strike, civil commotion, vandalism, aircraft, vehicles and smoke), in each case (A) in an amount equal to 100% of the “Full Replacement Cost,” which for purposes of this Agreement shall mean actual replacement value exclusive of costs of excavations, foundations, underground utilities and footings, with a waiver of depreciation; (B) containing an agreed amount endorsement waiving all coinsurance provisions or shall be written on a no coinsurance form; (C) providing for no deductible in excess of $100,000 except with respect to windstorm/named storms or earthquake, which such insurance shall provide for no deductible in excess of 5% of the total insurable value of the Individual Property; (D) at all times insuring against at least those hazards that are commonly insured against under a “special causes of loss” form of policy, as the same shall exist on the date hereof, and together with any increase in the scope of coverage provided under such form after the date hereof; (E) providing coverage for Loss to the Undamaged Portion of the Building, Demolition Costs and Increased Cost of Construction, where coverage for the undamaged portion of the building has a limit equal to or greater than each Property and limits for demolition costs and increased cost of construction will be in amounts reasonably acceptable to Lender. The Full Replacement Cost shall be re-determined from time to time (but not more frequently than once in any twelve (12) calendar months) at the request of Lender by an appraiser or contractor designated and paid by Borrower and approved by Lender, or by an engineer or appraiser in the regular employ of the insurer; and (F) sinkhole insurance with

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​ a sublimit acceptable to Lender and shall be on terms consistent with the comprehensive all risk insurance policy required under this subsection (i). After the first appraisal, additional appraisals may be based on construction cost indices customarily employed in the trade. No omission on the part of Lender to request any such ascertainment shall relieve Borrower of any of its obligations under this Subsection;

(ii)commercial general liability insurance against all claims for personal injury, bodily injury, death or property damage occurring upon, in or about the Property, including “Dram Shop” or other liquor liability coverage if alcoholic beverages are sold, manufactured or distributed from the Property, such insurance (A) to be on the so-called “occurrence” form with a general aggregate limit of not less than $2,000,000 and a per occurrence limit of not less than $1,000,000, with no deductible or self-insured retention; (B) to continue at not less than the aforesaid limit until reasonably required to be changed by Lender in writing by reason of changed economic conditions making such protection inadequate; and (C) to cover at least the following hazards: (1) premises and operations; (2) products and completed operations on an “if any” basis; (3) independent contractors; (4) contractual liability for all insured contracts; (5) contractual liability covering the indemnities contained in Article 13 hereof to the extent the same is available; and (6) acts of terrorism and similar acts of sabotage;

(iii)loss of rents and/or business interruption insurance (A) with loss payable to Lender; (B) covering all risks required to be covered by the insurance provided for in Subsection 7.1(a)(i), (iv) and (vi) through (viii); (C) in an amount equal to 100% of the **** projected gross income from the Individual Property (on an actual loss sustained basis) for a period continuing until the Restoration of the Property is completed; the amount of such business interruption/loss of rents insurance shall be determined prior to the Closing Date and at least once each year thereafter based on Lender’s determination of the projected gross income from the Individual Property (on an actual loss sustained basis) for a period continuing until Restoration of the Property is completed; the amount of such business interruption/loss of rents insurance shall be determined prior to the Closing Date and at least once each year thereafter based on Lender’s determination of the projected gross income from the Property for a twenty-four (24) month period; and (D) containing an extended period of indemnity endorsement which provides that after the physical loss to the Improvements and the Personal Property has been repaired, the continued loss of income will be insured until such income either returns to the same level it was at prior to the loss, or the expiration of twelve (12) months from the date that the Property is repaired or replaced and operations are resumed, whichever first occurs, and notwithstanding that the policy may expire prior to the end of such period. Notwithstanding anything to the contrary contained herein or in any other Loan Documents, to the extent that insurance proceeds are payable to Lender pursuant to this Subsection (the “Rent Loss Proceeds”) and Borrower is entitled to disbursement of Net Proceeds for Restoration in accordance with the terms hereof, such Rent Loss Proceeds shall be deposited by Lender in the Cash Management Account and disbursed as provided in Article 9 hereof; provided, however, that (I) nothing herein contained shall be deemed to relieve Borrower of its obligations to pay the obligations secured hereunder on the respective dates of payment provided for in the Note except to the extent such amounts are actually paid out of the Rent Loss Proceeds and (II) in the event the Rent Loss Proceeds are paid in a lump sum in advance and Borrower is entitled to disbursement of such Rent Loss Proceeds in accordance with the terms hereof, Lender or Servicer shall hold such Rent Loss Proceeds in a segregated interest-bearing Eligible Account (which shall deemed to be included within the definition of the “Accounts” hereunder) and Lender or Servicer shall estimate the number of months required for Borrower to restore the damage caused by the

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​ applicable Casualty, shall divide the applicable aggregate Rent Loss Proceeds by such number of months and shall disburse such monthly installment of Rent Loss Proceeds from such Eligible Account into the Cash Management Account each month during the performance of such Restoration;

(iv)at all times during which structural construction, repairs or alterations are being made with respect to the Improvements (and only if the existing property and/or liability coverage forms do not otherwise apply) (A) commercial general liability and umbrella liability insurance covering claims related to the construction, repairs or alterations being made at the Property which are not covered by or under the terms or provisions of the commercial general liability and umbrella insurance policies required hereunder; and (B) the insurance provided for in Subsection 7.1(a)(i) written in a so-called builder’s risk completed value form (1) on a non-reporting basis, (2) against all risks insured against and on terms consistent with the coverages required pursuant to Subsections 7.1(a)(i), (iii) and (vi) through (viii), (3) including permission to occupy the Property, and (4) with an agreed amount endorsement waiving co-insurance provisions;

(v)in the event Borrower has any employees, workers’ compensation, subject to the statutory limits of the state in which the Property is located, and employer’s liability insurance with a limit of at least $1,000,000 per accident and per disease per employee, and $1,000,000 for disease aggregate in respect of any work or operations on or about the Property, or in connection with the Property or its operation (if applicable);

(vi)comprehensive boiler and machinery insurance and equipment breakdown coverage, in each case, covering all mechanical and electrical equipment and pressure vessels and boilers in an amount not less than their replacement cost or in such other amount as shall be reasonably required by Lender;

(vii)if any portion of the Improvements is currently or at any time in the future located in an area identified by (A) the Federal Emergency Management Agency in the Federal Register as an area having special flood hazards and/or (B) the Secretary of Housing and Urban Development or any successor thereto as an area having special flood hazards pursuant to the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973 or the National Flood Insurance Reform Act of 1994, as each may be amended, or any successor law (the “Flood Insurance Acts”), flood hazard insurance (1) in an amount equal to the maximum limit of coverage available for the Property under the Flood Insurance Acts plus (2) such additional amounts or other related and/or excess coverage as Lender may reasonably require with deductibles no greater than the maximum limit of coverage available under the Flood Insurance Acts;

(viii)earthquake, if the Individual Property is in seismic zone 3 or 4, sinkhole and mine subsidence insurance, if required, in amounts equal to the greater of 1.0x scenario upper loss (SUL) and one and one half times (1.5x) the probable maximum loss (PML)/scenario expected loss (SEL) multiplied by the Full Replacement Cost of the building plus business income/rental value as required in Section 7.1(a)(iii) and provided further that the insurance amounts for the coverages set forth in subclause (viii) hereof, to the extent insured under a blanket policy, shall not be less than the 475-year annual aggregate probable maximum loss as indicated in a portfolio seismic risk analysis for a 475-year return period, including the Individual Property located in seismic zone 3 or 4, covered by such earthquake limit, with a separate assessment for California to the extent there is a separate sublimit for California under the Policy (such analysis to be approved by Lender and secured by the applicable

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​ Borrower utilizing a third-party engineering firm qualified to perform such seismic risk analysis using the most current RMS software, or its equivalent, to include consideration of loss amplification, at the expense of the applicable Individual Borrower); provided that the insurance pursuant to subsection (viii) hereof shall be on terms consistent with the comprehensive all risk insurance policy required under this subsection (i);

(ix)umbrella liability insurance in an amount not less than $100,000,000 per occurrence and in the aggregate on terms consistent with the commercial general liability insurance policy required under subsection (ii) above;

(x)intentionally omitted;

(xi)if applicable, commercial auto/motor vehicle liability coverage for all owned and non-owned vehicles, including rented and leased vehicles containing minimum limits per occurrence, including umbrella coverage, of One **** Million and No/100 Dollars ($1,000,000); and

(xii)pollution legal liability insurance against claims for pollution remediation and legal liability resulting from existing conditions and new pollution events related to any Property in form and substance acceptable to Lender (“PLL Policy”), such insurance: (A) to be a claims made and reported policy which shall be maintained, either by renewal, extension or replacement, for a period commencing no later than the Closing Date and continuing through the date that is thirty-six (36) months beyond the fully extended Maturity Date (the “Required PLL Period”); (B) with a minimum limit of liability of Ten Million Dollars ($10,000,000) for each incident and Twenty Million Dollars ($20,000,000) in the aggregate, (C) with a self-insured retention not to exceed Fifty Thousand Dollars ($50,000) for each incident; (D) shall name Lender as an additional named insured with its successors and/or assigns as their interests may appear; and (E) shall, throughout the PLL Policy period, include the same coverages, terms, conditions and endorsements as the PLL Policy approved at Closing. In the event the limits which are in place as of the Closing Date are eroded by fifty percent (50%) or more due to claims, Borrower shall reinstate the available environmental coverage limits within sixty (60) days to the limits in place as of the Closing Date; and

(xiii)such other insurance and in such amounts as (A) may be required pursuant to the terms of the Property Documents, PILOT Lease and/or PILOT Document, and (B) Lender from time to time may reasonably request against such other insurable hazards which at the time are commonly insured against for property similar to the Property located in or around the region in which the Property is located.

(b)All insurance provided for in Subsection 7.1(a) hereof shall be obtained under valid and enforceable policies (the “Policies” or in the singular, the “Policy”), in such forms, amounts, coverages, deductibles, loss payees and insureds, in each case, as may be satisfactory to Lender, issued by financially sound and responsible insurance companies authorized to do business in the State and having a rating of (y) A or better by S&P “A2” or better by Moody’s, if Moody’s rates the insurance company and is rating the Securities and “A” or better by Fitch, if Fitch rates the insurance company and is rating the Securities, (provided, however for multi-layered policies, (A) if four (4) or less insurance companies issue the Policies, then at least 75% of the insurance coverage represented by the Policies must be provided by insurance companies with a claims paying ability rating of “A” or better by S&P, “A2” or better by Moody’s, if Moody’s rates the insurance company and is rating the Securities, “A” or better by Fitch, if Fitch rates the insurance company and is rating

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​ the Securities, with no remaining carrier below “BBB” by S&P, “Baa2” by Moody’s, if Moody’s rates the insurance company and is rating the Securities, and “BBB” or better by Fitch, if Fitch rates the insurance company and is rating the Securities or (B) if five (5) or more insurance companies issue the Policies, then at least sixty percent (60%) of the insurance coverage represented by the Policies must be provided by insurance companies with a claims paying ability rating of “A” or better by S&P, “A2” or better by Moody’s, if Moody’s rates the insurance company and is rating the Securities and “A” or better by Fitch, if Fitch rates the insurance company and is rating the Securities with no remaining carrier below “BBB” by S&P, “Baa2” by Moody’s, if Moody’s rates the insurance company and is rating the Securities and “BBB” by Fitch, if Fitch rates the insurance company and is rating the Securities) and (z) a rating of “A-VIII” or better in the current Best’s Insurance Reports.  Notwithstanding anything to the contrary, Borrower shall be permitted to maintain a portion of the coverage required hereunder with insurance companies which do not meet the foregoing requirements (“Otherwise Rated Insurers”) in their current participation amounts and positions within the syndicate provided that (1) Borrower shall replace the Otherwise Rated Insurers at renewal with insurance companies meeting the rating requirements set forth hereinabove and (2) if, prior to renewal, the current AM Best rating of any such Otherwise Rated Insurer is withdrawn or downgraded, Borrower shall replace any Otherwise Rated Insurer with an insurance company meeting the rating requirements set forth hereinabove.  Not less than fifteen (15) days prior to the expiration dates of the Policies theretofore furnished to Lender pursuant to Subsection 7.1(a), Borrower shall deliver complete copies of the Policies marked “premium paid” or accompanied by evidence satisfactory to Lender of payment of the premiums due thereunder (the “Insurance Premiums”), provided, however, that in the case of renewal Policies, Borrower may furnish Lender with binders and Acord Form 27 or 28 and Acord Form 25, as applicable, Certificates therefor to be followed by the original Policies when issued. At least once per calendar year, Borrower shall provide Lender with updated flood zone certifications for the Property (in form and substance acceptable to Lender), which such flood zone certifications shall be delivered to Lender upon the earlier to occur of (i) December 1 of each calendar year or (ii) the renewal of the applicable Policy providing flood insurance coverage during the applicable calendar year.

(c)Any blanket insurance Policy shall be subject to Lender approval and shall otherwise provide the same protection as would a separate Policy insuring only the Property in compliance with the provisions of Section 7.1 hereof, subject to review and approval by Lender based on the schedule of locations and values, and such. Further, to the extent the Policies are maintained pursuant to a blanket insurance Policy that covers more than one location within a one thousand foot radius of the Property (the “Radius”), the limits of such blanket insurance Policy must be sufficient to maintain coverage as set forth in this Section 7.1(vi) for the Property and any and all other locations combined within the Radius that are covered by such blanket insurance policy calculated on a total insured value basis. Such Policies may be “blanket policies” covering multiple locations so long as the coverages for the Property provide the protections listed above and, provided further that, any material changes to such blanket policies or an aggregation of the insured values covered under such blanket policies, including the reduction or erosion of flood, windstorm / named storm and earthquake limits or the addition of locations that are subject to the perils of flood, windstorm / named storm and earthquake, shall be subject to Lender’s review and reasonable approval by Lender based on the portfolio PML report(s) for the catastrophic perils and such other information as requested by Lender. Further, any such material changes, changes to the limits under the policy as of Closing Date or an aggregation of the insured values covered under the blanket policy, including the reduction or erosion of flood, windstorm / named storm and earthquake limits or the addition of locations that are subject to the perils of flood, windstorm / named storm and earthquake, shall be subject to Lender’s approval and Rating Agency Confirmation (which shall be provided at the Rating Agency’s sole discretion).

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​ (d)All property Policies provided for or contemplated by Subsection 7.1(a) shall name Borrower as a named insured and, in the case of liability Policies, shall name Lender as an additional insured, as their respective interests may appear, and, in the case of property Policies (including, but not limited to, terrorism, rent loss, business interruption, boiler and machinery/equipment breakdown, earthquake and flood insurance), such Policies shall contain a standard noncontributing mortgagee clause in favor of Lender providing that the loss thereunder shall be payable to Lender.

(e)All property Policies provided for in Subsection 7.1(a) shall contain clauses or endorsements to the effect that:

(i)with respect to the property Policies, (1) the following shall in no way affect the validity or enforceability of the Policy insofar as Lender is concerned: (A) any act or negligence of Borrower or of any other Person named as an insured, (B) any foreclosure or other similar exercise of remedies and (C) the failure to comply with the provisions of the Policy which might otherwise result in a forfeiture of the insurance or any part thereof and (2) the property Policies shall not be cancelled without at least thirty (30) days’ written notice to Lender, except ten (10) days’ notice for non-payment of premium;

(ii)with respect to the liability Policies, the Policy shall not be materially changed (other than to increase the coverage provided thereby), terminated or cancelled without at least thirty (30) days’ written notice to Lender and any other party named therein as an insured, except ten (10) days’ notice for non-payment of premium;

(iii)the issuer(s) of the Policy shall give written notice to Lender if the issuers elect not to renew the Policy prior to its expiration;

(iv)Lender shall not be liable for any Insurance Premiums thereon or subject to any assessments or commissions thereunder and that the related issuer(s) waive any related claims to the contrary;

(v)Lender shall, at its option and with no obligation to do so, have the right to directly pay Insurance Premiums in order to avoid cancellation, expiration and/or termination of the Policy due to non-payment of Insurance Premiums; and

(vi)the Policies shall include coverage for acts of terror or similar acts of sabotage in an amount equal to one hundred percent (100%) of the “Full Replacement Cost” of each Individual Property including the rental loss and/or business interruption coverage under subsection (a)(iii) above; provided that such coverage is available.  In the event that such coverage with respect to terrorist acts is not included as part of the “all risk” property policy required by subsection (a)(i) above, Borrower shall, nevertheless be required to obtain coverage for terrorism (as standalone coverage) in an amount equal to one hundred percent (100%) of the “Full Replacement Cost” of the Property including the rental loss and/or business interruption coverage under subsection (a)(iii) above; provided that such coverage is available.  Borrower shall obtain the coverage required under this clause (i) from a Qualified Insurer or in the event that such coverage is not available from a Qualified Carrier, Borrower shall obtain such coverage from the highest rated insurance company providing such coverage.

Borrower shall promptly forward to Lender a copy of each written notice received by Borrower of any modification, reduction or cancellation of any of the Policies or of any of the coverages afforded under any of the Policies.

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​ (f)By no later than five (5) days following the expiration date of any Policies, Borrower shall furnish to Lender a statement certified by Borrower or a Responsible Officer of Borrower of the amounts of insurance maintained in compliance herewith, of the risks covered by such insurance and of the insurance company or companies which carry such insurance and, if requested by Lender, verification of the adequacy of such insurance by an independent insurance broker or appraiser acceptable to Lender. Without limitation of the foregoing, Borrower shall also comply with the foregoing within ten (10) days of written request of Lender. Borrower shall promptly forward to Lender a copy of each written notice received by any Borrower Party of any modification, reduction or cancellation of any of the Policies or of any of the coverages afforded under any of the Policies.

(g)If at any time Lender is not in receipt of written evidence that all insurance required hereunder is in full force and effect, Lender shall have the right, without notice to Borrower to take such action as Lender deems necessary to protect its interest in the Property, including, without limitation, the obtaining of such insurance coverage as Lender in its sole discretion deems appropriate, and all expenses incurred by Lender in connection with such action or in obtaining such insurance and keeping it in effect shall be paid by Borrower to Lender upon demand and until paid shall be secured by the Security Instrument and shall bear interest at the Default Rate.

(h)In the event of a foreclosure of the Security Instrument or other transfer of title to the Property in extinguishment in whole or in part of the Debt, all right, title and interest of Borrower in and to the Policies then in force concerning the Property and all proceeds payable thereunder shall thereupon vest exclusively in Lender or the purchaser at such foreclosure or other transferee in the event of such other transfer of title.

(i)As an alternative to the Policies required to be maintained pursuant to the preceding provisions of this Section 7.1, Borrower will not be in default under this Section 7.1 if Borrower maintains (or causes to be maintained) Policies which (i) have coverages, deductibles and/or other related provisions other than those specified above and/or (ii) are provided by insurance companies not meeting the credit ratings requirements set forth above (any such Policy, a “Non-Conforming Policy”), provided, that, prior to obtaining such Non-Conforming Policies (or permitting such Non-Conforming Policies to be obtained), Borrower shall have (1) received Lender’s prior written consent thereto and (2) confirmed that Lender has received a Rating Agency Confirmation with respect to any such Non-Conforming Policy. Notwithstanding the foregoing, Lender hereby reserves the right to deny its consent to any Non-Conforming Policy regardless of whether or not Lender has consented to the same on any prior occasion.

(j)Borrower shall cooperate with Lender in obtaining for Lender the benefits of any Awards or insurance proceeds lawfully or equitably payable in connection with the Property, and Lender shall be reimbursed for any expenses incurred in connection therewith (including reasonable, actual attorneys’ fees and disbursements, and the payment by Borrower of the expense of an appraisal on behalf of Lender in case of a Casualty or Condemnation affecting the Property or any part thereto) out of such Awards or insurance proceeds. Any Net Proceeds related to such Awards or insurance proceeds shall be deposited with Lender and held and applied in accordance with the applicable terms and conditions hereof.

(k)Borrower hereby represents that the physical address for each Individual Property for all purposes (including, without limitation, insurance purposes) is as set forth on Schedule II attached hereto.

Section 7.2.Casualty. If the Property shall be damaged or destroyed, in whole or in part, by fire or other casualty (a “Casualty”) of which Borrower has knowledge or has received written

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​ notice and the Net Proceeds relating to such Casualty and the cost of completing the Restoration relating to such Casualty is greater than $250,000, Borrower shall give prompt notice of such damage to Lender and shall in a reasonably prompt manner proceed to commence and diligently prosecute the completion of the Restoration of the Property and otherwise comply with the provisions of Section 7.4. Borrower shall pay all costs of Restoration (including, without limitation, any applicable deductibles under the Policies) whether or not such costs are covered by the Net Proceeds. Lender may, but shall not be obligated to, make proof of loss if not made promptly by Borrower.

Section 7.3.Condemnation. Borrower shall promptly give Lender notice of the actual or threatened (in writing) commencement of any proceeding for the Condemnation of the Property of which Borrower has knowledge and shall deliver to Lender copies of any and all papers served in connection with such proceedings. Lender may participate in any such proceedings, and Borrower shall from time to time deliver to Lender all instruments requested by it to permit such participation. Borrower shall, at its expense, diligently prosecute any such proceedings, and shall consult with Lender, its attorneys and experts, and cooperate with them in the carrying on or defense of any such proceedings. Notwithstanding any taking by any public or quasi-public authority through Condemnation or otherwise (including but not limited to any transfer made in lieu of or in anticipation of the exercise of such taking), Borrower shall continue to pay the Debt at the time and in the manner provided for its payment in the Note and in this Agreement and the Debt shall not be reduced until any Award shall have been actually received and applied by Lender, after the deduction of reasonable out-of-pocket expenses of collection, to the reduction or discharge of the Debt. Lender shall not be limited to the interest paid on the Award by the condemning authority but shall be entitled to receive out of the Award interest at the rate or rates provided herein or in the Note. If the Property or any portion thereof is taken by a condemning authority, Borrower shall promptly commence and diligently prosecute the Restoration of the Property and otherwise comply with the provisions of Section 7.4 in all material respects. Borrower shall pay all costs of Restoration whether or not such costs are covered by the Net Proceeds. If the Property is sold, through foreclosure or otherwise, prior to the receipt by Lender of the Award, Lender shall have the right, whether or not a deficiency judgment on the Note shall have been sought, recovered or denied, to receive the Award, or a portion thereof sufficient to pay the Debt. Notwithstanding the foregoing or anything to the contrary contained herein, if any portion of the Loan is or will be included in a REMIC Trust, and if, in connection with any Casualty or Condemnation, a prepayment of the Debt (in whole or in part) is required under REMIC Requirements, (a) the applicable Net Proceeds shall be applied to the Debt in accordance with Section 7.4(c) hereof and (b) to the extent that the amount of the applicable Net Proceeds actually applied to the Debt in connection therewith is insufficient under REMIC Requirements, Borrower shall, within ten (10) Business Days of demand by Lender, prepay the principal amount of the Debt in accordance with the applicable terms and conditions hereof in an amount equal to such insufficiency plus the amount of any then applicable Interest Shortfall (such prepayment, together with any related Interest Shortfall payment, collectively, the “REMIC Payment”). If any portion of the Loan is or will be included in a REMIC Trust, Lender may require Borrower to deliver a REMIC Opinion in connection with each of the foregoing.

Section 7.4.Restoration. The following provisions shall apply in connection with the Restoration of the Property:

(a)If the Net Proceeds shall be less than the Restoration Threshold and the costs of completing the Restoration shall be less than the Restoration Threshold, the Net Proceeds will be disbursed by Lender to Borrower upon receipt, provided that all of the conditions set forth in Section 7.4(b)(i) are met and Borrower delivers to Lender a written undertaking to expeditiously commence and to satisfactorily complete with due diligence the Restoration in accordance with the terms of

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​ this Agreement. Notwithstanding the foregoing or anything herein to the contrary, in the event the Net Proceeds or the estimated cost of Restoration are equal to or less than the Restoration Threshold, such Net Proceeds shall be disbursed by Lender to Borrower upon receipt.

(b)If the Net Proceeds are equal to or greater than the Restoration Threshold or the costs of completing the Restoration are equal to or greater than the Restoration Threshold, Lender shall make the Net Proceeds available for the Restoration in accordance with the provisions of this Section 7.4.

(i)The Net Proceeds shall be made available for Restoration provided that each of the following conditions are met:

(A)no Event of Default shall have occurred and be continuing;

(B)(1) in the event the Net Proceeds are insurance proceeds, less than thirty percent (30%) of each of (i) fair market value of the applicable Individual Property as reasonably determined by Lender, and (ii) rentable area of the applicable Individual Property has been damaged, destroyed or rendered unusable as a result of a Casualty or (2) in the event the Net Proceeds are condemnation proceeds, less than ten percent (10%) of each of (i) the fair market value of the applicable Individual Property as reasonably determined by Lender and (ii) rentable area of the applicable Individual Property is taken, such land is located along the perimeter or periphery of the applicable Individual Property, no portion of the Improvements (other than ancillary, non-material, non-structural Improvements (including, but not limited to, landscaping, signs, and sidewalks)) is located on such land and such taking does not materially impair the existing access to the applicable Individual Property;

(C)Leases demising in the aggregate a percentage amount equal to or greater than seventy-five percent (75%) of the total rentable space in the applicable Individual Property which has been demised under executed and delivered Leases in effect as of the date of the occurrence of such fire or other casualty or taking, whichever the case may be, shall remain in full force and effect during and after the completion of the Restoration, notwithstanding the occurrence of any such Casualty or Condemnation, whichever the case may be, and Borrower furnishes to Lender evidence satisfactory to Lender that all Tenants under Major Leases shall continue to operate their respective space at the applicable Individual Property after the completion of the Restoration;

(D)Borrower shall commence (or shall cause the commencement of) the Restoration as soon as reasonably practicable (but in no event later than sixty (60) days after the issuance of a building permit with respect thereto) and shall diligently pursue the same to satisfactory completion in compliance with all applicable Legal Requirements, in all material respects, including, without limitation, all applicable Environmental Laws, and the applicable requirements of the Property Documents, PILOT Lease and/or PILOT Document (as applicable);

(E)Lender shall be satisfied, in its reasonable discretion, that any operating deficits which will be incurred with respect to the applicable Individual Property as a result of the occurrence of any such fire or other casualty or taking will be covered out of (1) the Net Proceeds, (2) the insurance coverage referred to in Section 7.1(a)(iii) above, or (3) by other funds of Borrower;

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​ (F)Lender shall be satisfied, in its reasonable discretion, that the Net Proceeds, together with any cash or cash equivalent deposited by Borrower with Lender, are sufficient to cover the cost of the Restoration;

(G)Lender shall be satisfied, in its reasonable discretion, that (I) upon the completion of the Restoration, the fair market value and cash flow of the applicable Individual Property will not be less than the fair market value and cash flow of the applicable Individual Property as the same existed immediately prior to the applicable Casualty or Condemnation and (II) Restoration of the Improvements on the Land (as each existed immediately prior to the applicable casualty or condemnation (with such changes to the Improvements as may be reasonably acceptable to Lender (taking into account subsection (I) above))) is permitted under applicable Legal Requirements and the Property Documents, PILOT Lease and/or PILOT Document (as applicable);

(H)Lender shall be satisfied, in its reasonable discretion, that the Restoration will be completed on or before the earliest to occur of (1) six (6) months prior to the Maturity Date, (2) such time as may be required under applicable Legal Requirements or (3) the expiration of the insurance coverage referred to in Section 7.1(a)(iii) above;

(I)[intentionally omitted];

(J)the applicable Individual Property and the use thereof after the Restoration will be in compliance with and permitted under all applicable Legal Requirements and the Property Documents, PILOT Lease and/or PILOT Document (as applicable);

(K)the Restoration shall be done and completed in an expeditious and diligent fashion and in compliance in all material respects with all applicable Legal Requirements and the Property Documents, PILOT Lease and/or PILOT Document (as applicable);

(L)the Property Documents, PILOT Lease and/or PILOT Document (as applicable) will remain in full force and effect during and after the Restoration; and

(M)if any portion of the Loan is or will be included in a REMIC Trust, Lender shall be satisfied, in its reasonable discretion, that making the Net Proceeds available for Restoration shall be permitted pursuant to REMIC Requirements and, in that regard, Lender may require Borrower to deliver a REMIC Opinion in connection therewith.

(ii)The Net Proceeds shall be held by Lender and, until disbursed in accordance with the provisions of this Section 7.4(b), shall constitute additional security for the Debt and other obligations under this Agreement, the Security Instrument, the Note and the other Loan Documents. The Net Proceeds (other than the Rent Loss Proceeds) shall be disbursed by Lender to, or as directed by, Borrower from time to time during the course of the Restoration, upon receipt of evidence reasonably satisfactory to Lender that (A) all materials installed and work and labor performed in connection with the related Restoration item have been paid for in full (except to the extent that they are to be paid for out of the requested disbursement), and (B) there exist no notices of pendency, stop orders, mechanic’s or

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​ materialman’s liens or notices of intention to file same, or any other liens or encumbrances of any nature whatsoever on the Property which have not either been fully bonded to the satisfaction of Lender and discharged of record or in the alternative fully insured to the satisfaction of Lender by the title company issuing the Title Insurance Policy or are otherwise being contested as expressly permitted under, and in accordance with, this Agreement.

(iii)All plans and specifications required in connection with the Restoration shall be subject to prior review and acceptance in all respects by Lender and by an independent consulting engineer selected by Lender (the “Casualty Consultant”). Lender shall have the use of the plans and specifications and all permits, licenses and approvals required or obtained in connection with the Restoration. The identity of the contractors, subcontractors and materialmen engaged in the Restoration shall be subject to prior review and acceptance by Lender and the Casualty Consultant, each in their reasonable discretion. All reasonable out-of-pocket costs and expenses incurred by Lender in connection with making the Net Proceeds available for the Restoration including, without limitation, reasonable counsel fees and disbursements and the Casualty Consultant’s fees, shall be paid by Borrower. Borrower shall have the right to settle all claims under the Policies jointly with Lender, provided that (a) no Event of Default exists, (b) Borrower promptly and with commercially reasonable diligence negotiates a settlement of any such claims and (c) the insurer with respect to the Policy under which such claim is brought has not raised any act of the insured as a defense to the payment of such claim. If an Event of Default exists, Lender shall, at its election, have the exclusive right to settle or adjust any claims made under the Policies in the event of a Casualty.  Notwithstanding the foregoing or anything herein to the contrary, Borrower shall have the exclusive right to settle all claims under the Policies equal to or less than $500,000.

(iv)In no event shall Lender be obligated to make disbursements of the Net Proceeds in excess of an amount equal to the costs actually incurred from time to time for work in place as part of the Restoration, as certified by the Casualty Consultant, minus the Restoration Retainage. The term “Restoration Retainage” as used in this Section 7.4(b) shall mean an amount equal to 10% of the costs actually incurred for work in place as part of the Restoration, as certified by the Casualty Consultant, until such time as the Casualty Consultant certifies to Lender that Net Proceeds representing 50% of the required Restoration have been disbursed. There shall be no Restoration Retainage with respect to costs actually incurred by Borrower for work in place in completing the last 50% of the required Restoration. The Restoration Retainage shall in no event, and notwithstanding anything to the contrary set forth above in this Section 7.4(b), be less than the amount actually held back by Borrower from contractors, subcontractors and materialmen engaged in the Restoration. The Restoration Retainage shall not be released until the Casualty Consultant certifies to Lender that the Restoration has been completed in accordance with the provisions of this Section 7.4(b) and that all approvals necessary for the re-occupancy and use of the Property have been obtained from all appropriate governmental and quasi-governmental authorities, and Lender receives evidence reasonably satisfactory to Lender that the costs of the Restoration have been paid in full or will be paid in full out of the Restoration Retainage, provided, however, that Lender will release the portion of the Restoration Retainage being held with respect to any contractor, subcontractor or materialman engaged in the Restoration as of the date upon which the Casualty Consultant certifies to Lender that the contractor, subcontractor or materialman has satisfactorily completed all work and has supplied all materials in accordance with the provisions of the contractor’s, subcontractor’s or materialman’s contract, and the contractor, subcontractor or materialman delivers the lien waivers and evidence of payment in full of all sums due to the contractor, subcontractor or materialman as may be reasonably requested by Lender or by

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​ the title company insuring the lien of the Security Instrument. If required by Lender, the release of any such portion of the Restoration Retainage shall be approved by the surety company, if any, which has issued a payment or performance bond with respect to the contractor, subcontractor or materialman.

(v)Lender shall not be obligated to make disbursements of the Net Proceeds more frequently than once every calendar month.

(vi)If at any time the Net Proceeds or the undisbursed balance thereof shall not, in the reasonable opinion of Lender in consultation with the Casualty Consultant, be sufficient to pay in full the balance of the costs which are estimated by the Casualty Consultant to be incurred in connection with the completion of the Restoration, Borrower shall deposit the deficiency (the “Net Proceeds Deficiency”) with Lender before any further disbursement of the Net Proceeds shall be made. The Net Proceeds Deficiency deposited with Lender shall be held by Lender and shall be disbursed for costs actually incurred in connection with the Restoration on the same conditions applicable to the disbursement of the Net Proceeds, and until so disbursed pursuant to this Section 7.4(b) shall constitute additional security for the Debt and other obligations under this Agreement, the Security Instrument, the Note and the other Loan Documents.

(vii)The excess, if any, of the Net Proceeds and the remaining balance, if any, of the Net Proceeds Deficiency deposited with Lender after the Casualty Consultant certifies to Lender that the Restoration has been completed in accordance with the provisions of this Section 7.4(b), and the receipt by Lender of evidence satisfactory to Lender that all costs incurred in connection with the Restoration have been paid in full, shall be remitted by Lender to Borrower, provided no Event of Default shall have occurred and shall be continuing under this Agreement, the Security Instrument, the Note or any of the other Loan Documents.

(c)All Net Proceeds not required (i) to be made available for the Restoration or (ii) to be returned to Borrower as excess Net Proceeds pursuant to Section 7.4(b)(vii) shall be retained and applied by Lender toward the payment of the Debt whether or not then due and payable in such order, priority and proportions as Lender in its discretion shall deem proper. If Lender shall receive and retain Net Proceeds, the lien of the Security Instrument shall be reduced only by the amount thereof received and retained by Lender and actually applied by Lender in reduction of the Debt; provided, however, notwithstanding anything herein to the contrary, no Prepayment Premium, shall be due and payable in connection with such reduction.

ARTICLE 8​ ​ RESERVE FUNDS

Section 8.1.Required Repairs.

(a)Deposits. Borrower shall perform the Immediate Repairs on or before the deadline described in Section 4.25 hereof. On the Closing Date, Borrower shall deposit with Lender the amount for each Individual Property set forth on Schedule III hereto in the ADA Repairs column.  Amounts so deposited with Lender shall be held by Lender in accordance with Section 8.7 hereof.  Amounts so deposited shall hereinafter be referred to as Borrower’s “Required Repair Fund” and the account in which such amounts are held shall hereinafter be referred to as Borrower’s “Required Repair Account”.

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​ (b)Release of Required Repair Funds.  Lender shall disburse to Borrower the Required Repair Funds from the Required Repair Account from time to time upon satisfaction by Borrower of each of the following conditions:  (a) Borrower shall submit a written request for payment to Lender at least ten (10) days prior to the date on which Borrower requests such payment be made and specifies the Immediate Repairs to be paid, (b) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall exist and remain uncured, and (c) Lender shall have received an Officers’ Certificate (i) stating that, to Borrower’s knowledge, all Immediate Repairs at the applicable Individual Property to be funded by the requested disbursement have been completed in good and workmanlike manner and in accordance with all applicable federal, state and local laws, rules and regulations, such certificate to be accompanied by a copy of any license, permit or other approval by any Governmental Authority required to commence and/or complete the Immediate Repairs, (ii) identifying each Person that supplied materials or labor in connection with the Immediate Repairs performed at such Individual Property to be funded by the requested disbursement, and (iii) stating that each such Person has been paid in full or will be paid in full upon such disbursement, such Officers’ Certificate to be accompanied by lien waivers or other evidence of payment satisfactory to Lender.  Lender shall not be required to make disbursements from the Required Repair Account with respect to the any Individual Property more than once a month and in an amount less than the Minimum Disbursement Amount (or a lesser amount if the total amount of Required Repair Funds is less than the Minimum Disbursement Amount, in which case only one disbursement of the amount remaining in the account shall be made unless such requested disbursement is in an amount greater than $25,000.00 (or a lesser amount if the total amount in the Required Repair Account is less than $25,000.00), in which case only one disbursement of the amount remaining in the account shall be made) and such disbursement shall be made only upon satisfaction of each condition contained in this Section 8.1. ****

Section 8.2.Intentionally Omitted.

Section 8.3.Leasing Reserve Funds.

(a) On the Closing Date, Borrower shall deposit into an Eligible Account held by Servicer (the “Leasing Reserve Account”) an amount equal to $103,556.00 for outstanding tenant improvements and leasing commissions owed to Tenants pursuant to existing Leases with respect to existing Tenants as of the Closing Date. Amounts deposited pursuant to this Section 8.3 are referred to herein as the “Leasing Reserve Funds”.

(b)Lender shall disburse to Borrower the Leasing Reserve Funds from time to time promptly upon satisfaction by Borrower of each of the following conditions: (i) Borrower shall submit a request for payment to Lender at least ten (10) days prior to the date on which Borrower requests such payment be made and specifies the tenant improvement costs and leasing commissions to be paid; (ii) on the date such request is received by Lender and on the date such payment is to be made, no Event of Default shall exist and remain uncured; (iii) Lender shall have reviewed and approved the Lease and related leasing commissions in respect of which Borrower is obligated to pay or reimburse certain tenant improvement costs and leasing commissions; (iv) Lender shall have received and approved (which approval shall not be unreasonably withheld, conditioned or delayed) a budget for tenant improvement costs and a schedule of leasing commissions payments and the requested disbursement will be used to pay all or a portion of such costs and payments; (v) Lender shall have received a certificate from Borrower (A) stating that, to Borrower’s knowledge, all tenant improvements at the Property to be funded by the requested disbursement have been or will be completed in good and workmanlike manner and in accordance with all applicable federal, state and local laws, rules and regulations, such certificate to be accompanied by a copy of any license, permit or other approval by any Governmental Authority required in connection with the tenant

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​ improvements, (B) identifying each Person that supplied materials or labor in connection with the tenant improvements to be funded by the requested disbursement and (C) stating that each such Person has been paid in full or will be paid in full upon such disbursement, such certificate to be accompanied by lien waivers, invoices and/or other evidence of payment satisfactory to Lender; and (vi) at Lender’s option, if the cost of any individual tenant improvement exceeds $250,000, a title search for the Property indicating that the Property is free from all liens, claims and other encumbrances other than Permitted Encumbrances. Lender shall not be required to disburse Leasing Reserve Funds more frequently than once each calendar month nor in an amount less than the Minimum Disbursement Amount (or a lesser amount if the total amount of Leasing Reserve Funds is less than the Minimum Disbursement Amount, in which case only one disbursement of the amount remaining in the account shall be made).

Section 8.4.**Operating Expense Funds.**On the first Monthly Payment Date occurring after each occurrence of a Trigger Period, Borrower shall make a True Up Payment into the Operating Expense Account (provided that, for the avoidance of doubt, and without in any way limiting Borrower’s obligation to make any such True Up Payment as and when due hereunder or in any way limiting Lender’s rights and remedies in connection with any failure to may any such True Up Payment as and when due hereunder, in no event shall this Section 8.4 require any equity owner to make additional capital contributions or return distributions to Borrower).  On each Monthly Payment Date occurring on and after the occurrence and continuance of a Trigger Period, Borrower shall deposit (or shall cause there to be deposited) into an Eligible Account held by Servicer (the “Operating Expense Account”) an amount equal to the aggregate amount of Approved Operating Expenses and Approved Extraordinary Expenses to be incurred by Borrower for the then current Interest Accrual Period (such amount, the “Op Ex Monthly Deposit”). Amounts deposited pursuant to this Section 8.4 are referred to herein as the “Operating Expense Funds”. Provided no Event of Default has occurred and is continuing, Lender shall disburse the Operating Expense Funds to Borrower to pay Approved Operating Expenses and/or Approved Extraordinary Expenses promptly upon Borrower’s request (which such request shall be accompanied by an Officer’s Certificate detailing the applicable expenses to which the requested disbursement relates and attesting that such expense shall be paid with the requested disbursement).

Section 8.5.Excess Cash Flow Funds.

(a)On each Monthly Payment Date occurring on and after the occurrence and during the continuance of a Trigger Period, Borrower shall deposit (or cause to be deposited) into an Eligible Account with Servicer (the “Excess Cash Flow Account”) an amount equal to the Excess Cash Flow generated by the Property for the immediately preceding Interest Accrual Period (each such monthly deposit being herein referred to as the “Monthly Excess Cash Flow Deposits” and the amounts on deposit in the Excess Cash Flow Account being herein referred to as the “Excess Cash Flow Funds”). If and to the extent that Excess Cash Flow shall fail to be collected in the Excess Cash Flow Account on any Monthly Payment Date due to: (w) any election by Lender (in its sole and absolute discretion exercised in good faith) not to deliver a Restricted Account Notice (despite the fact that a Trigger Period is ongoing), (x) any delay in the creation of the Cash Management Account pursuant to Section 9.1 hereof, (y) any delay by Lender or Servicer in declaring the occurrence of a Trigger Period, and/or (z) any violation of or failure to comply with, in each case, the Cash Management Provisions (including, without limitation, the Cash Management Provisions related to the timing of required deposits into the Restricted Account) on the part of Borrower, Borrower shall, within ten (10) Business Days of the applicable Monthly Payment Date, be required to make a True Up Payment into the Excess Cash Flow Account (to be held and disbursed pursuant to this Section 8.5) in the amount reasonably determined by Lender as would have been collected in

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​ the Excess Cash Flow Account but for the occurrence of the events contemplated by the foregoing clauses (w), (x), (y) and/or (z).

(b)Provided no Event of Default has occurred and is continuing, any Excess Cash Flow Funds remaining in the Excess Cash Flow Account shall be disbursed to Borrower (i) upon the expiration of any Trigger Period in accordance with the applicable terms and conditions hereof, provided no other Trigger Period is then ongoing and (ii) upon written request of Borrower, Lender shall disburse within three (3) Business Days of Borrower’s request but no more frequently than monthly, in the event of a shortfall in approved Operating Expenses at the Properties, in order to pay such amounts (to the extent not previously paid from funds in the Cash Management Account).

Section 8.6.Tax and Insurance Funds.  On the first Monthly Payment Date occurring after each occurrence and during the continuance of a Trigger Period, Borrower shall make a True Up Payment into Eligible Accounts held by Servicer and hereinafter respectively referred to as the “Tax Account” and the “Insurance Account”.  On each Monthly Payment Date occurring on and after the occurrence and during the continuance of a Trigger Period, Borrower shall deposit (or shall cause there to be deposited): (a) one-twelfth of an amount which would be sufficient to pay the Taxes payable, or reasonably estimated by Lender to be payable, during the next ensuing twelve (12) months assuming that said Taxes are to be paid in full on the Tax Payment Date (the “Monthly Tax Deposit”), each of which such deposits shall be held in the Tax Account, and (b) at the option of Lender, if the liability or casualty Policy maintained by Borrower covering the Property shall not constitute an approved blanket or umbrella Policy pursuant to Subsection 7.1(c) hereof, or Lender shall require Borrower to obtain a separate Policy pursuant to Subsection 7.1(c) hereof, one-twelfth of an amount which would be sufficient to pay the Insurance Premiums due for the renewal of the coverage afforded by the Policies upon the expiration thereof (the “Monthly Insurance Deposit”), each of which such deposits shall be held in the Insurance Account (amounts held in the Tax Account and the Insurance Account are collectively herein referred to as the “Tax and Insurance Funds”).  If, at any time, after the occurrence and during the continuance of a Trigger Period, Lender reasonably determines that amounts on deposit or scheduled to be deposited in (i) the Tax Account will be insufficient to pay all applicable Taxes in full on the Tax Payment Date and/or (ii) the Insurance Account will be insufficient to pay all applicable Insurance Premiums in full on the Insurance Payment Date, Borrower shall make a True Up Payment with respect to such insufficiency into the applicable Reserve Account. Borrower agrees to notify Lender promptly of any material changes to the amounts, schedules and instructions for payment of any Taxes and Insurance Premiums of which it has or obtains knowledge and authorizes Lender or its agent to obtain the bills for Taxes directly from the appropriate taxing authority. Provided there are sufficient amounts in the Tax Account and Insurance Account, respectively, and no Event of Default exists, Lender shall be obligated to pay the Taxes and Insurance Premiums as they become due on their respective due dates on behalf of Borrower by applying the Tax and Insurance Funds to the payment of such Taxes and Insurance Premiums. If the amount of the Tax and Insurance Funds shall exceed the amounts due for Taxes and Insurance Premiums pursuant to Sections 4.5 and 7.1 hereof, Lender shall, in its reasonable discretion, return any excess to Borrower or credit such excess against future payments to be made to the Tax and Insurance Funds.

Section 8.7.The Accounts Generally.

(a)All Reserve Funds shall be held in Eligible Accounts. Borrower grants to Lender a first-priority perfected security interest in each of the Accounts and any and all sums now or hereafter deposited in the Accounts as additional security for payment of the Debt. Until expended or applied in accordance herewith, the Accounts and the funds deposited therein shall constitute additional security for the Debt. The provisions of this Section 8.7 (together with the other related

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​ provisions of the other Loan Documents) are intended to give Lender and/or Servicer “control” of the Accounts and the Account Collateral and serve as a “security agreement” and a “control agreement” with respect to the same, in each case, within the meaning of the UCC. Borrower acknowledges and agrees that the Accounts are subject to the sole dominion, control and discretion of Lender, its authorized agents or designees, subject to the terms hereof, and Borrower shall have no right of withdrawal with respect to any Account except with the prior written consent of Lender or as otherwise provided herein. The funds on deposit in the Accounts shall not constitute trust funds and may be commingled with other monies held by Lender. Notwithstanding anything to the contrary contained herein, unless otherwise consented to in writing by Lender (which consent shall not be unreasonably withheld, conditioned or delayed), Borrower shall only be permitted to request (and Lender shall only be required to disburse) Reserve Funds on account of the liabilities, costs, work and other matters (as applicable) for which said sums were originally reserved hereunder, in each case, as reasonably determined by Lender.

(b)Borrower shall not, without obtaining the prior written consent of Lender, further pledge, assign or grant any security interest in the Accounts or the sums deposited therein or permit any lien to attach thereto, or any levy to be made thereon, or any UCC-1 Financing Statements, except those naming Lender as the secured party, to be filed with respect thereto. Borrower hereby authorizes Lender to file a financing statement or statements under the UCC in connection with any of the Accounts and the Account Collateral in the form required to properly perfect Lender’s security interest therein. Borrower agrees that at any time and from time to time, at the expense of Borrower, Borrower will promptly execute and deliver all further instruments and documents, and take all further action, that may be reasonably necessary or desirable, or that Lender may reasonably request, in order to perfect and protect any security interest granted or purported to be granted hereby (including, without limitation, any security interest in and to any Permitted Investments) or to enable Lender to exercise and enforce its rights and remedies hereunder with respect to any Account or Account Collateral.

(c)Notwithstanding anything to the contrary contained herein or in any other Loan Document, upon the occurrence and during the continuance of an Event of Default, without notice from Lender or Servicer (i) Borrower shall have no rights in respect of the Accounts, (ii) Lender may liquidate and transfer any amounts then invested in Permitted Investments pursuant to the applicable terms hereof to the Accounts or reinvest such amounts in other Permitted Investments as Lender may reasonably determine is necessary to perfect or protect any security interest granted or purported to be granted hereby or pursuant to the other Loan Documents or to enable Lender to exercise and enforce Lender’s rights and remedies hereunder or under any other Loan Document with respect to any Account or any Account Collateral, and (iii) Lender shall have all rights and remedies with respect to the Accounts and the amounts on deposit therein and the Account Collateral as described in this Agreement and in the Security Instrument, in addition to all of the rights and remedies available to a secured party under the UCC, and, notwithstanding anything to the contrary contained in this Agreement or in the Security Instrument, may apply the amounts of such Accounts as Lender determines in its sole discretion including, but not limited to, payment of the Debt.

(d)The insufficiency of funds on deposit in the Accounts shall not absolve Borrower of the obligation to make any payments, as and when due pursuant to this Agreement and the other Loan Documents, and such obligations shall be separate and independent, and not conditioned on any event or circumstance whatsoever.

(e)Borrower shall indemnify Lender and hold Lender harmless from and against any and all actions, suits, claims, demands, liabilities, actual losses, damages, obligations and out-of-pocket costs and expenses (including litigation costs and reasonable attorneys fees and expenses)

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​ arising from or in any way connected with the Accounts, the sums deposited therein or the performance of the obligations for which the Accounts were established, except to the extent arising from the gross negligence, illegal acts, fraud, or willful misconduct of Lender, its agents or employees. Borrower shall assign to Lender all rights and claims Borrower may have against all Persons supplying labor, materials or other services which are to be paid from or secured by the Accounts; provided, however, that Lender may not pursue any such right or claim unless an Event of Default has occurred and remains uncured.

(f)Borrower and Lender (or Servicer on behalf of Lender) shall maintain each applicable Account as an Eligible Account, except as otherwise expressly agreed to in writing by Lender. In the event that Lender or Servicer no longer satisfies the criteria for an Eligible Institution, Borrower shall cooperate with Lender in transferring the applicable Accounts to an institution that satisfies such criteria. Borrower hereby grants Lender power of attorney (irrevocable for so long as the Loan is outstanding) with respect to any such transfers and the establishment of accounts with a successor institution.

(g)Interest accrued on any Account other than an Interest Bearing Account shall not be required to be remitted either to Borrower or to any Account and may instead be retained by Lender. Funds deposited in the Interest Bearing Accounts shall be invested in Permitted Investments as provided for in Section 8.7(h) hereof. Interest accrued, if any, on sums on deposit in the Interest Bearing Accounts shall be remitted to and become part of the applicable Account. All such interest that so becomes part of the applicable Account shall be disbursed in accordance with the disbursement procedures contained herein applicable to such Account; provided, however, that Lender may, at its election, retain any such interest for its own account upon the occurrence and during the continuance of an Event of Default.

(h)Sums on deposit in the Interest Bearing Accounts shall, upon Borrower’s written request, be invested in Permitted Investments selected by Lender or Servicer provided (i) such investments are then regularly offered by Lender (or Servicer on behalf of Lender) for accounts of this size, category and type (Borrower acknowledges that the Servicer or Lender may only offer as an investment opportunity the right to place funds on deposit in the applicable Accounts in an interest bearing account (bearing interest at the money market rate)), (ii) such investments are permitted by applicable federal, State and local rules, regulations and laws, (iii) the maturity date of the Permitted Investment is not later than the date on which sums in the Interest Bearing Accounts are required to be disbursed pursuant to the terms hereof, and (iv) no Event of Default shall have occurred and be continuing. All income earned from the aforementioned Permitted Investments shall be property of Borrower and Borrower hereby irrevocably authorizes and directs Lender (or Servicer on behalf of Lender) to hold any income earned from the aforementioned Permitted Investments as part of the applicable Interest Bearing Account. Borrower shall be responsible for payment of any federal, State or local income or other tax applicable to income earned from Permitted Investments. No other investments of the sums on deposit in the Interest Bearing Accounts shall be permitted. Lender shall not be liable for any loss sustained on the investment of any funds in the Interest Bearing Accounts.

(i)Borrower acknowledges and agrees that it solely shall be, and shall at all times remain, liable to Lender or Servicer for all fees, charges, reasonable, out-of-pocket costs and expenses in connection with the Accounts, this Agreement and the enforcement hereof, including, without limitation, any monthly or annual fees or charges as may be assessed by Lender or Servicer in connection with the administration of the Accounts and the reasonable fees and expenses of legal counsel to Lender and Servicer as needed to enforce, protect or preserve the rights and remedies of Lender and/or Servicer under this Agreement.  Notwithstanding anything to the contrary contained herein, promptly after the Debt has been indefeasibly paid in full by Borrower, Borrower shall be

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​ entitled to all remaining Reserve Funds if any, unless the same have been credited towards the payment of the Debt.

Section 8.8.Letters of Credit.

(a)This Section shall apply to any Letters of Credit which are permitted to be delivered pursuant to the express terms and conditions hereof. Other than in connection with any Letters of Credit delivered in connection with the closing of the Loan, Borrower shall give Lender no less than ten (10) days written notice of Borrower’s election to deliver a Letter of Credit together with a draft of the proposed Letter of Credit and Borrower shall pay to Lender all of Lender’s reasonable out-of-pocket costs and expenses in connection therewith. No party other than Lender shall be entitled to draw on any such Letter of Credit. Upon ten (10) days prior written notice to Lender, Borrower may replace a Letter of Credit with a cash deposit to the applicable Reserve Fund. Prior to the return of a Letter of Credit, Borrower shall deposit an amount equal to the amount that would have accumulated in the applicable Reserve Fund and not been disbursed in accordance with the terms of this Agreement if such Letter of Credit had not been delivered. In the event that any disbursement of any Reserve Funds relates to a portion thereof provided through a Letter of Credit, any “disbursement” of said funds as provided above shall be deemed to refer to (i) Borrower providing Lender a replacement Letter of Credit in an amount equal to the original Letter of Credit posted less the amount of the applicable disbursement provided hereunder and (ii) Lender, after receiving such replacement Letter of Credit, returning such original Letter of Credit to Borrower; provided, that, no replacement Letter of Credit shall be required with respect to the final disbursement of the applicable Reserve Funds such that no further sums are required to be deposited in the applicable Reserve Funds.

(b)Each Letter of Credit delivered hereunder shall be additional security for the payment of the Debt. Upon the occurrence and during the continuance of an Event of Default, Lender shall have the right, at its option, to draw on any Letter of Credit and to apply all or any part thereof to the payment of the items for which such Letter of Credit was established or to apply each such Letter of Credit to payment of the Debt in such order, proportion or priority as Lender may determine. Any such application to the Debt shall be subject to the terms and conditions hereof relating to application of sums to the Debt. Lender shall have the additional rights to draw in full any Letter of Credit: (i) if Lender has received a notice from the issuing bank that the Letter of Credit will not be renewed and a substitute Letter of Credit is not provided at least forty five (45) days prior to the date on which the outstanding Letter of Credit is scheduled to expire; (ii) if Lender has not received a notice from the issuing bank that it has renewed the Letter of Credit at least forty five (45) days prior to the date on which such Letter of Credit is scheduled to expire and a substitute Letter of Credit is not provided at least forty five (45) days prior to the date on which the outstanding Letter of Credit is scheduled to expire; (iii) upon receipt of notice from the issuing bank that the Letter of Credit will be terminated (except if the termination of such Letter of Credit is permitted pursuant to the terms and conditions hereof or a substitute Letter of Credit is provided by no later than forty five (45) days prior to such termination); (iv) if Lender has received notice that the bank issuing the Letter of Credit shall cease to be an Approved Bank and Borrower has not substituted a Letter of Credit from an Approved Bank within fifteen (15) days after notice; and/or (v) if the bank issuing the Letter of Credit shall fail to (A) issue a replacement Letter of Credit in the event the original Letter of Credit has been lost, mutilated, stolen and/or destroyed or (B) consent to the transfer of the Letter of Credit to any Person designated by Lender. If Lender draws upon a Letter of Credit pursuant to the terms and conditions of this Agreement, provided no Event of Default exists, Lender shall apply all or any part thereof for the purposes for which such Letter of Credit was established. Notwithstanding anything to the contrary contained in the above, Lender is not obligated to draw any Letter of Credit upon the happening of an event specified in (i), (ii), (iii), (iv) or (v) above and shall not be liable for any losses

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​ sustained by Borrower due to the insolvency of the bank issuing the Letter of Credit if Lender has not drawn the Letter of Credit.

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ARTICLE 9​​CASH MANAGEMENT

Section 9.1.Establishment of Certain Accounts.

(a)Borrower shall, simultaneously herewith, establish an Eligible Account (the “Restricted Account”) pursuant to the Restricted Account Agreement in the name of Borrower for the sole and exclusive benefit of Lender into which Borrower shall deposit, or cause to be deposited, all revenue generated by the Property. Pursuant to the Restricted Account Agreement, funds on deposit in the Restricted Account shall be transferred on each Business Day to or at the direction of Borrower unless a Trigger Period exists and Lender elects (in its sole and absolute discretion) to deliver a Restricted Account Notice, in which case such funds shall be transferred on each Business Day to the Cash Management Account.

(b)Simultaneously herewith, Lender, on Borrower’s behalf, shall establish an Eligible Account (the “Cash Management Account”) with Lender or Servicer, as applicable, in the name of Borrower for the sole and exclusive benefit of Lender. Simultaneously herewith, Lender, on Borrower’s behalf, shall also establish with Lender or Servicer an Eligible Account into which Borrower shall deposit, or cause to be deposited the amounts required for the payment of debt service under the Loan (the “Debt Service Account”).

Section 9.2.Deposits into the Restricted Account; Maintenance of Restricted Account.

(a)Borrower represents, warrants and covenants that, so long as the Debt remains outstanding, (i) Borrower shall, or shall cause Manager (or cause Manager to cause Sub-Manager) to, as applicable, immediately deposit all revenue derived from the Property and received by Borrower, Manager or Sub-Manager, as the case may be, into the Restricted Account; (ii) Borrower shall instruct Manager and Sub-Manager to immediately deposit (A) all revenue derived from the Property collected by Manager and Sub-Manager, as applicable, if any, pursuant to the Management Agreement and Sub-Management Agreement, as applicable, (or otherwise) into the Restricted Account and (B) all funds otherwise payable to Borrower by Manager or Sub-Manager pursuant to the Management Agreement and Sub-Management Agreement, as applicable (or otherwise in connection with the Property) into the Restricted Account; (iii) (A) on or before the Closing Date, Borrower shall have sent (and hereby represents that it has sent) a notice, substantially in the form of Exhibit A attached hereto, to all Tenants now occupying space at the Property directing them to pay all rent and other sums due under the Lease to which they are a party into the Restricted Account (such notice, the “Tenant Direction Notice”), (B) simultaneously with the execution of any Lease entered into on or after the date hereof in accordance with the applicable terms and conditions hereof, Borrower shall furnish each Tenant under each such Lease the Tenant Direction Notice and (C) Borrower shall continue to send the aforesaid Tenant Direction Notices until each addressee thereof complies with the terms thereof; (iv) there shall be no other accounts maintained by Borrower or any other Person into which revenues from the ownership and operation of the Property are directly deposited; and (v) neither Borrower nor any other Person shall open any other such account with respect to the direct deposit of income in connection with the Property. Until deposited into the

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​ Restricted Account, any Rents and other revenues from the Property held by Borrower shall be deemed to be collateral and shall be held in trust by it for the benefit, and as the property, of Lender pursuant to the Security Instrument and shall not be commingled with any other funds or property of Borrower. Borrower warrants and covenants that it shall not rescind, withdraw or change any notices or instructions required to be sent by it pursuant to this Section 9.2 without Lender’s prior written consent.

(b)Borrower shall maintain the Restricted Account for so long as the Debt remains outstanding, which Restricted Account shall be under the sole dominion and control of Lender (subject to the terms hereof and of the Restricted Account Agreement). The Restricted Account shall have a title evidencing the foregoing in a manner reasonably acceptable to Lender. Borrower hereby grants to Lender a first-priority security interest in the Restricted Account and all deposits at any time contained therein and the proceeds thereof and will take all actions necessary to maintain in favor of Lender a perfected first priority security interest in the Restricted Account. Borrower hereby authorizes Lender to file UCC Financing Statements and continuations thereof to perfect Lender’s security interest in the Restricted Account and all deposits at any time contained therein and the proceeds thereof. All reasonable out-of-pocket costs and expenses for establishing and maintaining the Restricted Account (or any successor thereto) shall be paid by Borrower. All monies now or hereafter deposited into the Restricted Account shall be deemed additional security for the Debt. Borrower shall pay all sums due under and otherwise comply with the Restricted Account Agreement. Borrower shall not materially alter or modify either the Restricted Account or the Restricted Account Agreement, in each case without the prior written consent of Lender (which consent shall not be unreasonably withheld, conditioned or delayed). The Restricted Account Agreement shall provide (and Borrower shall provide) Lender online access to bank and other financial statements relating to the Restricted Account (including, without limitation, a listing of the receipts being collected therein). In connection with any Secondary Market Transaction, Lender shall have the right to cause the Restricted Account to be entitled with such other designation as Lender may select to reflect an assignment or transfer of Lender’s rights and/or interests with respect to the Restricted Account. Lender shall provide Borrower with prompt written notice of any such renaming of the Restricted Account. Borrower shall not further pledge, assign or grant any security interest in the Restricted Account or the monies deposited therein or permit any lien or encumbrance to attach thereto, or any levy to be made thereon, or any UCC Financing Statements, except those naming Lender as the secured party, to be filed with respect thereto. The Restricted Account (i) shall be an Eligible Account and (ii) shall not be commingled with other monies held by Borrower or Bank. Upon (A) Bank ceasing to be an Eligible Institution, (B) the Restricted Account ceasing to be an Eligible Account, (C) any resignation by Bank or termination of the Restricted Account Agreement by Bank or Lender and/or (D) the occurrence and continuance of an Event of Default, Borrower shall, within fifteen (15) Business Days of Lender’s request, (1) terminate the existing Restricted Account Agreement, (2) appoint a new Bank (which such Bank shall (I) be an Eligible Institution, (II) other than during the continuance of an Event of Default, be selected by Borrower and approved by Lender and (III) during the continuance of an Event of Default, be selected by Lender), (3) cause such Bank to open a new Restricted Account (which such account shall be an Eligible Account) and enter into a new Restricted Account Agreement with Lender on substantially the same terms and conditions as the previous Restricted Account Agreement and (4) send new Tenant Direction Notices and the other notices required pursuant to the terms hereof relating to such new Restricted Account Agreement and Restricted Account. Borrower constitutes and appoints Lender its true and lawful attorney-in-fact with full power of substitution to complete or undertake any action required of Borrower under this Section 9.2, upon the occurrence and during the continuance of an Event of Default, in the name of Borrower in the event Borrower fails to do the

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​ same. Such power of attorney shall be deemed to be a power coupled with an interest and cannot be revoked.

Section 9.3.Disbursements from the Cash Management Account. On each Monthly Payment Date, Lender or Servicer, as applicable, shall allocate all funds, if any, on deposit in the Cash Management Account and disburse such funds in the following amounts and order of priority:

(a)First, funds sufficient to pay the Monthly Tax Deposit due for the then applicable Monthly Payment Date, if any, shall be deposited in the Tax Account;

(b)Second, funds sufficient to pay the Monthly Insurance Deposit due for the then applicable Monthly Payment Date, if any, shall be deposited in the Insurance Account;

(c)Third, funds sufficient to pay the Debt Service due on the then applicable Monthly Payment Date shall be deposited in the Debt Service Account;

(d)Fourth, funds sufficient to pay the fees and expenses of the cash management bank then due and payable pursuant to the Cash Management Agreement shall be deposited in the Cash Management Account;

(e)Fifth, (without duplication of any portion thereof already deposited therein under subsection (c) above), funds sufficient to pay any interest accruing at the Default Rate and late payment charges, if any, shall be deposited into the Debt Service Account;

(f)Intentionally Omitted;

(g)Sixth, funds sufficient to pay any other amounts due and owing to Lender and/or Servicer pursuant to the terms hereof and/or of the other Loan Documents, if any, shall be deposited with or as directed by Lender; and

(h)Seventh, to the extent that a Trigger Period has occurred and is continuing, funds sufficient to pay the Op Ex Monthly Deposit for the then applicable Monthly Payment Date, if any, shall be deposited in the Operating Expense Account;

(i)Eighth, all amounts remaining in the Cash Management Account after deposits for items (a) through (h) above (“Excess Cash Flow”) shall (i) to the extent that a Trigger Period has occurred and is continuing, be deposited into the Excess Cash Flow Account and (ii) to the extent that no Trigger Period exists, be disbursed to Borrower.

Section 9.4.Withdrawals from the Debt Service Account. Prior to the occurrence and continuance of an Event of Default, funds on deposit in the Debt Service Account, if any, shall be used to pay Debt Service when due, together with any late payment charges.

Section 9.5.Payments Received Under this Agreement. Notwithstanding anything to the contrary contained in this Agreement or the other Loan Documents, provided no Event of Default has occurred and is continuing, Borrower’s obligations with respect to the monthly payment of Debt Service and amounts due for the Reserve Accounts shall (provided Lender is not prohibited from withdrawing or applying any funds in the applicable Accounts by operation of law or otherwise) be deemed satisfied to the extent sufficient amounts are deposited in applicable Accounts to satisfy such obligations on the dates each such payment is required, regardless of whether any of such amounts are so applied by Lender.

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​ ARTICLE 10​​EVENTS OF DEFAULT; REMEDIES

Section 10.1.Event of Default.

The occurrence of any one or more of the following events shall constitute an “Event of Default”:

(a)if (A) any monthly Debt Service payment or the payment due on the Maturity Date is not paid when due, (B) any deposit to any of the Accounts required hereunder or under the other Loan Documents is not paid when due or (C) any other portion of the Debt is not paid when due and such non-payment continues for five (5) days following notice to Borrower that the same is due and payable, except to the extent (i) sums sufficient to pay such Debt Service or other Debt in question had been reserved hereunder for the express purpose of paying the same prior to the applicable due date for the Debt Service or other Debt in question and Lender failed to pay the Debt Service or other Debt in question when required hereunder, (ii) Lender’s access to such sums was not restricted or constrained in any manner and (iii) no Event of Default was continuing;

(b)subject to Borrower’s right to contest Taxes and Other Charges pursuant to Section 4.5(b) hereof, if any of the Taxes or Other Charges are not paid on or before the latest date on which the same may be paid without penalty or lien, except to the extent (A) sums sufficient to pay the Taxes or Other Charges in question had been reserved hereunder prior to the applicable due date for the Taxes or Other Charges in question for the express purpose of paying the Taxes or Other Charges in question and Lender failed to pay the Taxes or Other Charges in question when required hereunder, (B) Lender’s access to such sums was not restricted or constrained in any manner and (C) no Event of Default was continuing;

(c)if the Policies are not kept in full force and effect or if evidence of the same is not delivered to Lender as provided in Section 7.1 hereof and, with respect to a failure to deliver evidence, such failure to deliver evidence is not cured within five (5) Business Days after Borrower’s receipt of written notice thereof from Lender; except to the extent (A) sums sufficient to pay the premium for such Policies have been reserved hereunder prior to the applicable due date for the payment of the premium for such Policies in question for the express purpose of paying the premium for such Policies in question and Lender failed to pay the premium for such Policies in question when required hereunder, (B) Lender’s access to such sums was not restricted or constrained in any manner, and (C) no Event of Default was continuing;

(d)if any of the representations or covenants:  (i) contained in Article 5 are breached or violated; provided, however, that to the extent such breach is inadvertent and non-recurring, then such  breach shall not constitute an Event of Default, if (A) to the extent such breach is curable, Borrower shall promptly cure such breach within thirty (30) days after Borrower obtains knowledge of such breach, and (B) to the extent reasonably requested by Lender, Borrower delivers a new or updated Non-Consolidation Opinion in connection therewith; (ii) contained in Article 6 are breached beyond any applicable notice and cure period; or (iii) contained in Section 4.23 are breached or violated in any material respect beyond any applicable notice and cure periods and such breach or violation causes an Individual Material Adverse Effect;

(e)if any representation or warranty made herein, in the Guaranty or in the Environmental Indemnity or in any other guaranty, or in any certificate, report, financial statement or other instrument or document furnished to Lender in connection with the Loan by any Borrower

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​ Party shall have been false or misleading in any material adverse respect when made; provided, Borrower may cure unintentional and immaterial misrepresentations within thirty (30) days after Borrower becomes aware in any manner and/or from any source whatsoever; provided, however, that if such default is susceptible of cure but cannot reasonably be cured within such thirty (30) day period, and Borrower (or Guarantor, if applicable) shall have commenced to cure such default within such thirty (30) day period and thereafter diligently and expeditiously proceeds to cure the same, such thirty (30) day period shall be extended for an additional period of time as is reasonably necessary for Borrower (or Guarantor, if applicable) in the exercise of due diligence to cure such default, such additional period not to exceed ninety (90) days; provided, further that, with respect to Guarantor, if an Event of Default is reasonably expected to occur or does occur under the Guaranty or under the Loan Agreement with respect to a representation or warranty made by Borrower on behalf of Guarantor under this clause (e) then it shall not be an Event of Default under this clause (e) so long as (A) no other monetary or material non-monetary Default or Event of Default is then continuing, (B) there are no amounts then outstanding under the Guaranty for which Lender has made demand (unless such amounts are paid in full to Lender no later than the date that the Approved Replacement Guarantor Condition is satisfied) (Lender reserving the right to make a demand at the time that this proviso is applicable, and not waiving the right to make a demand thereafter) and (C) within fifteen (15) Business Days of the occurrence of such Event of Default the Approved Replacement Guarantor Condition is satisfied;

(f)if (i) Borrower, any SPE Component Entity, any Affiliated Manager, Sponsor or Guarantor shall commence any case, proceeding or other action (A) under any Creditors Rights Laws seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, liquidation or dissolution, or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or Borrower or any managing member or general partner of Borrower, any SPE Component Entity, any Affiliated Manager, Sponsor or Guarantor shall make a general assignment for the benefit of its creditors; (ii) there shall be commenced against Borrower or any managing member or general partner of Borrower, any SPE Component Entity, any Affiliated Manager, Sponsor or Guarantor any case, proceeding or other action of a nature referred to in clause (i) above (other than any case, action or proceeding already constituting an Event of Default by operation of the other provisions of this subsection) which (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of sixty (60) days; (iii) there shall be commenced against Borrower, any SPE Component Entity, any Affiliated Manager, Sponsor or Guarantor any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets (other than any case, action or proceeding already constituting an Event of Default by operation of the other provisions of this subsection) which results in the entry of any order for any such relief which shall not have been vacated, discharged, or stayed or bonded pending appeal within ninety (90) days from the entry thereof; (iv) Borrower, any SPE Component Entity, any Affiliated Manager, Sponsor or Guarantor shall take any action in furtherance of, in collusion with respect to, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; (v) Borrower, any SPE Component Entity, any Affiliated Manager, Sponsor or Guarantor shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due; (vi) any Restricted Party is substantively consolidated with any other entity in connection with any proceeding under the Bankruptcy Code or any other Creditors Rights Laws involving Sponsor or its subsidiaries; or (vii) a Bankruptcy Event occurs; provided, that, with respect to Guarantor, if an Event of Default is reasonably expected to occur or does occur under this clause (f) then it shall not be an Event of Default under this clause (f) so long as (i) no other monetary or material non-monetary Default or Event of Default is then

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​ continuing, (ii) there are no amounts then outstanding under the Guaranty for which Lender has made demand (unless such amounts are paid in full to Lender no later than the date that the Approved Replacement Guarantor Condition is satisfied) (Lender reserving the right to make a demand at the time that this proviso is applicable, and not waiving the right to make a demand thereafter) and (iii) within fifteen (15) Business Days of the occurrence of such Event of Default, the Approved Replacement Guarantor Condition is satisfied;

(g)if Borrower shall be in default beyond applicable notice and grace periods under any other mortgage, deed of trust, deed to secure debt or other security agreement covering any part of the Property whether it be superior or junior in lien to the Security Instrument;

(h)subject to Borrower’s right to contest pursuant to Sections 4.5(b) and 4.16(b) hereof, if the Property becomes subject to any mechanic’s, materialman’s or other lien other than a lien for any Taxes not then due and payable and the lien shall remain undischarged of record (by payment, bonding or otherwise) for a period of forty-five (45) days;

(i)if any federal tax lien is filed against Borrower, any SPE Component Entity, Sponsor, Guarantor or the Property and same is not discharged of record (by payment, bonding or otherwise) within thirty (30) days after same is filed; provided, that, with respect to Guarantor, if an Event of Default is reasonably expected to occur or does occur under this clause (i) then it shall not be an Event of Default under this clause (i)so long as (i) no other monetary or material non-monetary Default or Event of Default is then continuing, (ii) there are no amounts then outstanding under the Guaranty for which Lender has made demand (unless such amounts are paid in full to Lender no later than the date that the Approved Replacement Guarantor Condition is satisfied) (Lender reserving the right to make a demand at the time that this proviso is applicable, and not waiving the right to make a demand thereafter) and (iii) within fifteen (15) Business Days of the occurrence of such Event of Default, the Approved Replacement Guarantor Condition is satisfied;

(j)if Borrower shall fail to deliver to Lender, within ten (10) days after request by Lender, the estoppel certificates required by Section 4.13(a) or (c) hereof;

(k)if any default beyond any applicable notice and cure periods occurs under any guaranty or indemnity executed in connection herewith (including, without limitation, the Environmental Indemnity and/or the Guaranty) and such default continues after the expiration of applicable grace periods, if any; provided, that, with respect to Guarantor, if an Event of Default is reasonably expected to occur or does occur under this clause (k) then it shall not be an Event of Default under this clause (k) so long as  (i) no other monetary or material non-monetary Default or Event of Default is then continuing, (ii) there are no amounts then outstanding under the Guaranty for which Lender has made demand (unless such amounts are paid in full to Lender no later than the date that the Approved Replacement Guarantor Condition is satisfied) (Lender reserving the right to make a demand at the time that this proviso is applicable, and not waiving the right to make a demand thereafter) and (iii) within fifteen (15) Business Days of the occurrence of such Event of Default, the Approved Replacement Guarantor Condition is satisfied;

(l)if any of the assumptions contained in the Non-Consolidation Opinion, or in any New Non-Consolidation Opinion (including, without limitation, in any schedules thereto and/or certificates delivered in connection therewith) are untrue or shall become untrue in any material respect; provided, however, that any such breach shall not constitute an Event of Default (A) (i) such breach is inadvertent and nonrecurring and (ii) if such breach is curable, if Borrower shall promptly cure such breach within thirty (30) days after Borrower obtains knowledge of such breach, and (B) Borrower promptly delivers to Lender a modification or replacement of the Non-Consolidation

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​ Opinion to the effect that such breach shall not alter the conclusions set forth in the opinions rendered in the Non-Consolidation Opinion, which opinion or modification and the counsel delivering such opinion or modification shall be acceptable to Lender in its sole discretion;

(m)if Borrower defaults under the Management Agreement beyond the expiration of applicable notice and grace periods, if any, thereunder or if the Management Agreement is canceled, terminated or surrendered, expires pursuant to its terms or otherwise ceased to be in full force and effect, unless, in each such case, Borrower, contemporaneously with such cancellation, termination, surrender, expiration or cessation, enters into a Qualified Management Agreement with a Qualified Manager in accordance with the applicable terms and provisions hereof;

(n)if Borrower fails to appoint a New Manager upon the request of Lender and/or fails to comply with any limitations on instructing the Manager as required by and in accordance with, as applicable, the terms and provisions of, this Agreement, the Assignment of Management Agreement, and the Security Instrument;

(o)if (A) any representation and/or covenant herein relating to ERISA or Section 4975 of the IRS Code is breached in a manner which results in any obligation or action taken or to be taken hereunder (or the exercise by Lender of any of its rights hereunder or under the other Loan Documents) to be a non-exempt prohibited transaction under ERISA or Section 4975 of  the IRS Code or (B) any representation and/or covenant herein relating to FIRRMA matters is breached;

(p)if (A) Borrower shall fail (beyond any applicable notice or grace period) to pay any rent, additional rent or other charges payable under any Property Document as and when payable thereunder, (B) Borrower defaults in any material respect under the Property Documents beyond the expiration of applicable notice and grace periods, if any, thereunder, (C) any of the Property Documents are amended, supplemented, replaced, restated or otherwise modified in any material respect without Lender’s prior written consent or if Borrower consents to a transfer of any party’s interest thereunder without Lender’s prior written consent, or (D) any Property Document and/or the estate created thereunder is canceled, rejected, terminated, surrendered or expires pursuant to its terms, unless in such case Borrower enters into a replacement thereof in accordance with the applicable terms and provisions hereof, (E) [intentionally omitted], or (F) the leasehold estate created by any PILOT Lease shall be surrendered, or any PILOT Lease or PILOT Document shall be terminated or cancelled for any reason or circumstance without the prior written consent of Lender (except if in connection with such surrender or termination, Borrower acquires the fee estate from the applicable PILOT Lessor in accordance with the terms hereof);

(q)if Borrower shall fail to observe, perform or discharge any of Borrower’s obligations, covenants, conditions or agreements under the Interest Rate Cap Agreement and otherwise comply with the covenants set forth in Section 2.8 hereof (subject to any notice and cure periods under the Interest Rate Cap Agreement);

(r)if Borrower shall continue to be in default under or breach of any term, covenant or condition of this Agreement not specified in subsections (a) through (q) above or not otherwise specifically specified as an Event of Default in this Agreement, if the same is not cured (i) within ten (10) days after written notice from Lender (in the case of any default which can be cured by the payment of a sum of money) or (ii) for thirty (30) days after written notice from Lender (in the case of any other default or breach); provided, that, with respect to any default or breach specified in subsection (ii), if the same cannot reasonably be cured within such thirty (30) day period and Borrower shall have commenced to cure the same within such thirty (30) day period and thereafter diligently and expeditiously proceeds to cure the same, such thirty (30) day period shall be extended

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​ for so long as it shall require Borrower in the exercise of due diligence to cure the same, it being agreed that no such extension shall be for a period in excess of ninety (90) days; or

(s)if any default shall exist under any of the other Loan Documents beyond any applicable cure periods contained in such Loan Documents or if any other such event shall occur or condition shall exist, if the effect of such event or condition is to accelerate the maturity of any portion of the Debt or to permit Lender to accelerate the maturity of all or any portion of the Debt.

Section 10.2.Remedies.

(a)Upon the occurrence and during the continuance of an Event of Default (other than an Event of Default described in Section 10.1(f) above with respect to Borrower or any SPE Component Entity only) and at any time thereafter Lender may, in addition to any other rights or remedies available to it pursuant to this Agreement, the Security Instrument, the Note and the other Loan Documents or at law or in equity, take such action, without notice or demand, that Lender deems advisable to protect and enforce its rights against Borrower and in the Property, including, without limitation, declaring the Debt to be immediately due and payable, and Lender may enforce or avail itself of any or all rights or remedies provided in this Agreement, the Security Instrument, the Note and the other Loan Documents against Borrower and the Property, including, without limitation, all rights or remedies available at law or in equity. Upon any Event of Default described in Section 10.1(f) above with respect to Borrower or any SPE Component Entity only, the Debt and all other obligations of Borrower under this Agreement, the Security Instrument, the Note and the other Loan Documents shall immediately and automatically become due and payable, without notice or demand, and Borrower hereby expressly waives any such notice or demand, anything contained herein or in the Security Instrument, the Note and the other Loan Documents to the contrary notwithstanding.

(b)Upon the occurrence and during the continuance of an Event of Default, all or any one or more of the rights, powers, privileges and other remedies available to Lender against Borrower under this Agreement, the Security Instrument, the Note or the other Loan Documents executed and delivered by, or applicable to, Borrower or at law or in equity may be exercised by Lender at any time and from time to time, whether or not all or any of the Debt shall be declared due and payable, and whether or not Lender shall have commenced any foreclosure proceeding or other action for the enforcement of its rights and remedies under this Agreement, the Security Instrument, the Note or the other Loan Documents with respect to the Property. Any such actions taken by Lender shall be cumulative and concurrent and may be pursued independently, singularly, successively, together or otherwise, at such time and in such order as Lender has determined in its sole discretion, to the fullest extent permitted by applicable Legal Requirements, without impairing or otherwise affecting the other rights and remedies of Lender permitted by applicable Legal Requirements, equity or contract or as set forth herein or in the Security Instrument, the Note or the other Loan Documents. No delay or omission to exercise any remedy, right or power accruing upon an Event of Default shall impair any such remedy, right or power or shall be construed as a waiver thereof, but any such remedy, right or power may be exercised from time to time and as often as may be deemed expedient. A waiver of one Default or Event of Default with respect to Borrower shall not be construed to be a waiver of any subsequent Default or Event of Default by Borrower or to impair any remedy, right or power consequent thereon.

(c)Upon the occurrence and during the continuance of an Event of Default, Lender shall have the right from time to time to partially foreclose the Security Instrument in any manner and for any amounts secured by the Security Instrument then due and payable as determined by Lender in its sole discretion including, without limitation, the following circumstances: (i) in the event

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​ Borrower defaults beyond any applicable grace period in the payment of one or more scheduled payments of principal and interest, Lender may foreclose the Security Instrument to recover such delinquent payments, or (ii) in the event Lender elects to accelerate less than the entire outstanding principal balance of the Loan, Lender may foreclose the Security Instrument to recover so much of the principal balance of the Loan as Lender may accelerate and such other sums secured by the Security Instrument as Lender may elect. Notwithstanding one or more partial foreclosures, the Property shall remain subject to the Security Instrument to secure payment of sums secured by the Security Instrument and not previously recovered.

(d)Upon the occurrence and during the continuance of an Event of Default, Lender shall have the right from time to time to sever the Note and the other Loan Documents into one or more separate notes, security instruments and other security documents (the “Severed Loan Documents”) in such denominations as Lender shall determine in its sole discretion for purposes of evidencing and enforcing its rights and remedies provided hereunder; provided, that, the aggregate principal balance, weighted average interest rates, amortization, if any, the Maturity Date, and all the other material economic terms immediately following the consummation of any such transaction (and thereafter) shall be the same as immediately prior thereto and the same shall not otherwise impose additional material obligations or liabilities on any Borrower Party or otherwise be adverse to any Borrower Party in any other material respect. Borrower shall execute and deliver to Lender from time to time, promptly after the request of Lender, a severance agreement and such other documents as Lender shall request in order to effect the severance described in the preceding sentence, all in form and substance reasonably satisfactory to Lender. Borrower hereby absolutely and irrevocably appoints Lender as its true and lawful attorney, coupled with an interest, in its name and stead to make and execute all documents necessary or desirable to effect the aforesaid severance, upon the occurrence and during the continuance of an Event of Default, Borrower ratifying all that its said attorney shall do by virtue thereof; provided, however, Lender shall not make or execute any such documents under such power until three (3) days after notice has been given to Borrower by Lender of Lender’s intent to exercise its rights under such power. Borrower shall not be obligated to pay any costs or expenses incurred in connection with the preparation, execution, recording or filing of the Severed Loan Documents and the Severed Loan Documents shall not contain any representations, warranties or covenants not contained in the Loan Documents and any such representations and warranties contained in the Severed Loan Documents will be given by Borrower only as of the Closing Date.

(e)Notwithstanding anything to the contrary contained herein or in any other Loan Document, any amounts recovered from the Property or any other collateral for the Loan and/or paid to or received by Lender may, after the occurrence and during the continuance of an Event of Default, be applied by Lender toward the Debt in such order, priority and proportions as Lender in its sole discretion shall determine.

(f)Upon the occurrence and during the continuance of an Event of Default, Lender may, but without any obligation to do so and without notice to or demand on Borrower and without releasing Borrower from any obligation hereunder or being deemed to have cured any Event of Default hereunder, make, do or perform any obligation of Borrower hereunder in such manner and to such extent as Lender may deem necessary. Upon the occurrence and during the continuance of an Event of Default, Lender is authorized to enter upon the Property for such purposes, or appear in, defend, or bring any action or proceeding to protect Lender’s interest in the Property for such purposes, and the reasonable out-of-pocket cost and expense thereof (including reasonable attorneys’ fees to the extent permitted by applicable Legal Requirements), with interest as provided in this Section, shall constitute a portion of the Debt and shall be due and payable to Lender upon demand. All such costs and expenses incurred by Lender in remedying such Event of Default or

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​ such failed payment or act or in appearing in, defending, or bringing any action or proceeding shall bear interest at the Default Rate, for the period after such cost or expense was incurred through and including the date of payment to Lender. All such costs and expenses incurred by Lender together with interest thereon calculated at the Default Rate shall be deemed to constitute a portion of the Debt and be secured by the liens, claims and security interests provided to Lender under the Loan Documents and shall be immediately due and payable upon demand by Lender therefore.

ARTICLE 11​ ​ SECONDARY MARKET

Section 11.1.Securitization.

(a)Lender shall have the right (i) to sell or otherwise transfer the Loan (or any portion thereof and/or interest therein), (ii) to sell participation interests in the Loan (or any portion thereof and/or interest therein) or (iii) to securitize the Loan (or any portion thereof and/or interest therein) in a single asset securitization or a pooled asset securitization. The transactions referred to in clauses (i), (ii) and (iii) above shall hereinafter be referred to collectively as “Secondary Market Transactions” and the transactions referred to in clause (iii) shall hereinafter be referred to as a “Securitization”. Any certificates, notes or other securities issued in connection with a Securitization are hereinafter referred to as “Securities”.

(b)If requested by Lender, Borrower shall assist Lender in satisfying the market standards to which Lender customarily adheres or which may be reasonably required in the marketplace or by the Rating Agencies in connection with any Secondary Market Transactions, including, without limitation, to:

(i)provide (A) updated financial and other information with respect to the Property, the business operated at the Property, Borrower, Guarantor, Sponsor, SPE Component Entity and Manager, (B) updated budgets relating to the Property, (C) updated appraisals, market studies, environmental reviews (Phase I’s and, if appropriate, Phase II’s), property condition reports and other due diligence investigations of the Property (the “Updated Information”), together, if customary, with appropriate verification of the Updated Information through letters of auditors or opinions of counsel reasonably acceptable to Lender and the Rating Agencies and (D) revisions to and other agreements with respect to the Property Documents, PILOT Lease and/or PILOT Document (as applicable), in form and substance reasonably acceptable to Lender and the Rating Agencies;

(ii)provide new and/or updated opinions of counsel, which may be relied upon by Lender, the Rating Agencies and their respective counsel, agents and representatives, as to substantive non-consolidation, fraudulent conveyance, matters of Delaware and federal bankruptcy law relating to limited liability companies, true sale, true lease and any other opinion customary in Secondary Market Transactions or required by the Rating Agencies with respect to the Property, Property Documents, PILOT Lease and/or PILOT Document, Borrower and Borrower’s Affiliates, which counsel and opinions shall be reasonably satisfactory in form and substance to Lender and the Rating Agencies;

(iii)provide updated, as of the closing date of the Secondary Market Transaction, representations and warranties made in the Loan Documents and such additional representations and warranties as the Rating Agencies may require; provided that such

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​ additional representations and warranties do not materially increase the obligations and liabilities of any Borrower Party under the Loan Documents; and

(iv)execute such amendments to the Loan Documents, the Property Documents, PILOT Lease and/or PILOT Document, and Borrower’s or any SPE Component Entity’s organizational documents as may be reasonably requested by Lender or requested by the Rating Agencies or otherwise to effect any Secondary Market Transaction, including, without limitation, (A) to amend and/or supplement the Independent Director provisions provided herein and therein, in each case, in accordance with the applicable requirements of the Rating Agencies, (B) bifurcating the Loan into two or more components and/or additional separate notes and/or creating additional senior/subordinate note structure(s) (any of the foregoing, a “Loan Bifurcation”) and (C) to modify all operative dates (including but not limited to payment dates, interest period start dates and end dates, etc.) under the Loan Documents, by up to ten (10) days; provided, however, that Borrower shall not be required to so modify or amend any Loan Document if such modification or amendment would change the rights and/or obligations of Borrower or Guarantor in any adverse manner, change the interest rate, the stated maturity (except as provided in subclause (C) above) or the amortization of principal set forth herein or change recourse obligations, except in connection with a Loan Bifurcation which may result in varying fixed interest rates and amortization schedules, but which shall have the same initial weighted average coupon of the original Note.

Notwithstanding anything herein to the contrary and except as otherwise provided in the immediately succeeding sentence, with respect to any compliance by any Borrower Party with requests made pursuant to this **** Section 11.1(b) with respect to any Secondary Market Transaction, each Borrower Party shall pay their own costs and expenses incurred prior to the consummation of the corresponding Secondary Market Transaction in connection therewith (including, without limitation, attorneys’ fees and expenses) and Lender shall pay its owns costs and expenses in connection therewith (including, without limitation, attorneys’ fees and expenses). Notwithstanding the foregoing, and except as otherwise expressly set forth in this Agreement, Lender shall reimburse Borrower for any reasonable, out-of-pocket, third-party costs incurred by Borrower relating to the consummation of the corresponding Secondary Market Transaction in Borrower’s complying with requests made pursuant to this Section 11.1(b), other than the attorney’s fees of the Borrower Parties (which shall be borne by Borrower, and not reimbursed by Lender).

(c)If, at the time a Disclosure Document is being prepared for a Securitization, Lender reasonably expects that Borrower alone or Borrower and one or more Affiliates of Borrower collectively, or the Property alone or the Property and Related Properties collectively, will be a Significant Obligor, Borrower shall furnish to Lender upon request (i) the selected financial data or, if applicable, net operating income, required under Item 1112(b)(1) of Regulation AB, if Lender expects that the principal amount of the Loan together with any Related Loans as of the cut-off date for such Securitization may, or if the principal amount of the Loan together with any Related Loans as of the cut-off date for such Securitization and at any time during which the Loan and any Related Loans are included in a Securitization does, equal or exceed ten percent (10%) (but less than twenty percent (20%)) of the aggregate principal amount of all mortgage loans included or expected to be included, as applicable, in the Securitization, or (ii) the financial statements required under Item 1112(b)(2) of Regulation AB, if Lender expects that the principal amount of the Loan together with any Related Loans as of the cut-off date for such Securitization may, or if the principal amount of the Loan together with any Related Loans as of the cut-off date for such Securitization and at any time during which the Loan and any Related Loans are included in a Securitization does, equal or exceed twenty percent (20%) of the aggregate principal amount of all mortgage loans included or

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​ expected to be included, as applicable, in the Securitization. Such financial data or financial statements shall be furnished to Lender (A) within ten (10) Business Days after notice from Lender in connection with the preparation of Disclosure Documents for the Securitization, (B) not later than thirty (30) days after the end of each fiscal quarter of Borrower and (C) not later than seventy-five (75) days after the end of each fiscal year of Borrower; provided, however, that Borrower shall not be obligated to furnish financial data or financial statements pursuant to clauses (B) or (C) of this sentence with respect to any period for which a filing pursuant to the Exchange Act in connection with or relating to the Securitization (an “Exchange Act Filing”) is not required. If requested by Lender, Borrower shall furnish to Lender financial data and/or financial statements for any tenant of the Property if, in connection with a Securitization, Lender expects there to be, with respect to such tenant or group of Affiliated tenants, a concentration within all of the mortgage loans included or expected to be included, as applicable, in the Securitization such that such tenant or group of Affiliated tenants would constitute a Significant Obligor.

(d)All financial data and statements provided by Borrower hereunder shall be prepared in accordance with GAAP, and shall meet the requirements of Regulation AB and other applicable legal requirements. All financial statements referred to in this Section shall be audited by independent accountants of Borrower acceptable to Lender in accordance with Regulation AB and all other applicable legal requirements, shall be accompanied by the manually executed report of the independent accountants thereon, which report shall meet the requirements of Regulation AB and all other applicable legal requirements, and shall be further accompanied by a manually executed written consent of the independent accountants, in form and substance acceptable to Lender, to the inclusion of such financial statements in any Disclosure Document and any Exchange Act Filing and to the use of the name of such independent accountants and the reference to such independent accountants as “experts” in any Disclosure Document and Exchange Act Filing, all of which shall be provided at the same time as the related financial statements are required to be provided. All financial data and statements (audited or unaudited) provided by Borrower under this Section shall be accompanied by an Officer’s Certificate, which certification shall state that such financial statements meet the requirements set forth in the first sentence of this subsection (d).

(e)If reasonably requested by Lender, Borrower shall provide Lender, promptly upon request, with any other or additional financial statements, or financial, statistical or operating information, as Lender shall determine to be reasonably required pursuant to Regulation AB or any amendment, modification or replacement thereto or other legal requirements in connection with any Disclosure Document or any Exchange Act Filing or as shall otherwise be reasonably requested by Lender.

(f)In the event Lender determines, in connection with a Securitization, that the financial data and financial statements required in order to comply with Regulation AB or any amendment, modification or replacement thereto or other legal requirements are other than as provided herein, then notwithstanding the provisions of this Section, Lender may request, and Borrower shall promptly provide, such other financial data and financial statements as Lender determines to be reasonably necessary or appropriate for such compliance.

Section 11.2. Disclosure.

(a)Borrower (on its own behalf and on behalf of each other Borrower Party) understands that information provided to Lender by Borrower, any other Borrower Party and/or their respective agents, counsel and representatives may be (i) included in (A) the Disclosure Documents and (B) filings under the Securities Act and/or the Exchange Act and (ii) made available to Investors, the

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​ Rating Agencies and service providers, in each case, in connection with any Secondary Market Transaction.

(b)Borrower shall indemnify Lender and its officers, directors, partners, employees, representatives, agents and affiliates against any losses, claims, damages or liabilities (collectively, the “Liabilities”) to which Lender and/or its officers, directors, partners, employees, representatives, agents and/or affiliates may become subject in connection with any Disclosure Document and/or any Covered Rating Agency Information, in each case, insofar as such Liabilities arise out of or are based upon any untrue statement of any material fact in the Provided Information and/or arise out of or are based upon the omission to state a material fact in the Provided Information required to be stated therein or necessary in order to make the statements in the applicable Disclosure Document and/or Covered Rating Agency Information, in light of the circumstances under which they were made, not misleading.

(c)Borrower shall provide in connection with each of (i) a preliminary and a final private placement memorandum or (ii) a preliminary and final prospectus or prospectus supplement, as applicable, an agreement (A) certifying that Borrower has examined such Disclosure Documents specified by Lender and that each such Disclosure Document, as it relates to Borrower, Borrower Affiliates, the Property, Manager, Sub-Manager, Sponsor, Guarantor and all other aspects of the Loan, does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, (B) indemnifying Lender (and for purposes of this Section 11.2, Lender hereunder shall include its officers and directors), the Affiliate of Lender (“Lender Affiliate”) that has filed the registration statement relating to the Securitization (the “Registration Statement”), each of its directors, each of its officers who have signed the Registration Statement and each Person that controls the Affiliate within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (collectively, the “Lender Group”), and Lender Affiliate, and any other placement agent or underwriter with respect to the Securitization, each of their respective directors and each Person who controls Lender Affiliate or any other placement agent or underwriter within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act (collectively, the “Underwriter Group”) for any Liabilities to which Lender, the Lender Group or the Underwriter Group may become subject insofar as the Liabilities arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in such sections or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated in such sections or necessary in order to make the statements in such sections, in light of the circumstances under which they were made, not misleading and (C) agreeing to reimburse Lender, the Lender Group and/or the Underwriter Group for any reasonable legal or other out-of-pocket expenses reasonably incurred by Lender, the Lender Group and the Underwriter Group in connection with investigating or defending the Liabilities; provided, however, that Borrower will not be liable in any such case under clauses (B) or (C) above with respect to information (including financial information or forecasted information) solely contained in any report commissioned or accepted by Lender and prepared by a third-party unrelated to Borrower, and Borrower shall not be liable for Liabilities arising solely from Lender’s failure to revise any Disclosure Document and/or Covered Rating Agency Information to reflect any Borrower comments that were delivered, in writing, to Lender, or for any Liabilities caused solely by the gross negligence, willful misconduct, illegal acts, or fraud of the applicable indemnified parties. The indemnification provided for in clauses (B) and (C) above shall be effective whether or not the indemnification agreement described above is provided. The aforesaid indemnity will be in addition to any liability which Borrower may otherwise have.

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​ (d)In connection with filings under Exchange Act and/or the Securities Act, Borrower shall (i) indemnify Lender, the Lender Group and the Underwriter Group for Liabilities to which Lender, the Lender Group or the Underwriter Group may become subject insofar as the Liabilities arise out of or are based upon the omission or alleged omission to state in the Disclosure Document a material fact required to be stated in the Disclosure Document in order to make the statements in the Disclosure Document, in light of the circumstances under which they were made, not misleading and (ii) reimburse Lender, the Lender Group or the Underwriter Group for any reasonable legal or other out-of-pocket expenses reasonably incurred by Lender, the Lender Group or the Underwriter Group in connection with defending or investigating the Liabilities.

(e)Promptly after receipt by an indemnified party under this Section 11.2 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 11.2, notify the indemnifying party in writing of the commencement thereof (but the omission to so notify the indemnifying party will not relieve the indemnifying party from any liability which the indemnifying party may have to any indemnified party hereunder except to the extent that failure to notify causes prejudice to the indemnifying party). In the event that any action is brought against any indemnified party, and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled, jointly with any other indemnifying party, to participate therein and, to the extent that it (or they) may elect by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, to assume the defense thereof with counsel satisfactory to such indemnified party. After notice from the indemnifying party to such indemnified party under this Section 11.2, such indemnifying party shall pay for any reasonable legal or other out-of-pocket expenses subsequently incurred by such indemnifying party in connection with the defense thereof; provided, however, if the defendants in any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there are any legal defenses available to it and/or other indemnified parties that are different from or additional to those available to the indemnifying party, the indemnified party or parties shall have the right to select separate counsel to assert such legal defenses and to otherwise participate in the defense of such action on behalf of such indemnified party at the cost of the indemnifying party.

(f)The liabilities and obligations of both Borrower and Lender under this Section 11.2 shall survive the termination of this Agreement and the satisfaction and discharge of the Debt. Failure by Borrower and/or any Borrower Party to comply with the provisions of Section 11.1 and/or Section 11.2 within the timeframes specified therein and/or as otherwise required by Lender shall, at Lender’s option, constitute a breach of the terms thereof and/or the occurrence and continuance of an Event of Default. Borrower (on its own behalf and on behalf of each Borrower Party) hereby expressly authorizes and appoints Lender its attorney-in-fact to take any actions required of any Borrower Party under Sections 11.1, 11.2 and/or 11.6 in the event any Borrower Party fails to do the same, upon the occurrence and during the continuance of an Event of Default, which power of attorney shall be irrevocable and shall be deemed to be coupled with an interest. Notwithstanding anything to the contrary contained herein, (i) except as may otherwise expressly provided to the contrary in this Article 11, each Borrower Party shall bear its own cost of compliance with this Article (including, without limitation, the costs of any ongoing financial reporting or similar provisions contained herein) and (ii) to the extent that the timeframes for compliance with such ongoing financial reporting and similar provisions are shorter than the timeframes allowed for comparable reporting obligations under Section 4.12 hereof (if any), the timeframes under this Article 11 shall control.

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​ Section 11.3.Reserves/Escrows. In the event that Securities are issued in connection with the Loan, all funds held by Lender in escrow or pursuant to reserves in accordance with this Agreement and the other Loan Documents shall be deposited in “eligible accounts” at “eligible institutions” and, to the extent applicable, invested in “permitted investments” as then defined and required by the Rating Agencies.

Section 11.4.Servicer. At the option of Lender, the Loan may be serviced by a servicer/special servicer/trustee selected by Lender (collectively, the “Servicer”) and Lender may delegate all or any portion of its responsibilities under this Agreement and the other Loan Documents to such Servicer pursuant to a servicing agreement between Lender and such Servicer.  Borrower shall not be responsible for the payment of any set up or ongoing regular monthly master servicing fee or any other fees under the servicing agreement. Notwithstanding the foregoing, Borrower shall promptly reimburse Lender within ten (10) Business Days of receipt of written notice for (a) all actual out-of-pocket reasonable costs and expenses incurred for enforcement of the Loan, liquidation fees, workout fees, special servicing fees, operating advisor fees (if incurred in connection with the enforcement, workout or special servicing of the Loan), certificate administrator fees (if incurred in connection with the enforcement, workout or special servicing of the Loan), or any other similar fees incurred in connection with the enforcement, workout or special servicing of the Loan, (b) to the extent late charges and default interest under the Loan Documents paid by Borrower are insufficient to pay the same, interest payable on advances made by Servicer or the trustee with respect to (i) delinquent Debt Service payments or expenses related to curing an Event of Default, payable by Lender to Servicer or a trustee and provided for under any servicing agreement or actual out of pocket reasonable expenses paid by Servicer or a trustee in respect of the protection and preservation of any Property (including, without limitation, payments of Taxes and Insurance Premiums), or (ii) as a result of an Event of Default under the Loan or the Loan becoming specially serviced, an enforcement, refinancing or restructuring of the credit arrangements provided for under the Loan Documents in the nature of a “work-out” of the Loan Documents or any insolvency or bankruptcy of Borrower, and (c) during the continuance of an Event of Default, the costs of all property inspections and/or appraisals of the Properties (or any updates to any existing inspection or appraisal) that Servicer may be required to obtain (other than the cost of regular annual inspections required to be borne by Servicer under any servicing agreement). Additionally, Borrower shall pay the customary and reasonable review and servicing fees in connection with any consent requests or other special requests made by Borrower during the term of the Loan, provided that such review and servicing fees, excluding any reasonable out-of-pocket third party fees and expenses, in connection with routine and customary consent requests shall not exceed $5,000 in the aggregate for any such consent or special request except as expressly set forth herein for Partial Releases.  Notwithstanding anything to the contrary contained herein, provided that, (1) such special servicing, liquidation and/or workout fees in the aggregate (a) shall be in an amount no greater than 1.0% of the payments or collections of interest and principal on the Loan during such time period that the Loan is in special servicing and (b) such special servicing fees shall not exceed a rate equal to the greater of (x) 0.25% per annum on the then-outstanding principal balance of the Loan and (y) a rate per annum equaling $5,000 per month and (c) such workout fees shall not exceed a rate equal to 0.25% per annum on the then-outstanding principal balance of the Loan and (2) liquidation fees that may be due servicer in connection with the exercise of any or all remedies permitted under the loan documents shall be in an amount no greater than 0.25% of the liquidation proceeds.

Section 11.5.Rating Agency Costs and REMIC Savings Clause.

(a)In connection with any Rating Agency Confirmation or other Rating Agency consent, approval or review required hereunder (other than the initial review of the Loan by the Rating Agencies in connection with a Securitization), Borrower shall pay all of the reasonable out-of-pocket

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​ costs and expenses of Lender, Servicer and each Rating Agency in connection therewith, and, if applicable, shall pay any out-of-pocket fees reasonably imposed by any Rating Agency in connection therewith.

(b)Notwithstanding anything to the contrary contained herein, if any portion of the Loan is or will be included in a REMIC Trust, and if, in connection with any release of any portion of the Property constituting real property, a prepayment of the Debt (in whole or in part) is required under REMIC Requirements, Borrower shall make the applicable REMIC Payment (if any) as and when set forth herein (or, if not otherwise set forth herein, as and when required in order to satisfy REMIC Requirements). If any portion of the Loan is or will be included in a REMIC Trust, Lender may require Borrower to deliver a REMIC Opinion in connection with each of the foregoing.

Section 11.6.Mezzanine Option. Subject to the immediately succeeding sentence, Lender shall have the option (the “Mezzanine Option”) at any time to divide the Loan into two parts, a mortgage loan and a mezzanine loan, provided, that (i) the total loan amounts for such mortgage loan and such mezzanine loan shall equal the then outstanding amount of the Loan immediately prior to Lender’s exercise of the Mezzanine Option, and (ii) the weighted average interest rate of such mortgage loan and mezzanine loan shall equal the Interest Rate (other than due to “rate creep” (i) with respect to a prepayment of the Loan (other than the Free Prepayment Amount), (ii) due to an Event of Default that has occurred and is continuing, or (iii) with respect to application of proceeds to the prepayment of the Loan in connection with a Casualty or Condemnation). Borrower shall, at Lender’s sole cost and expense (except that Borrower shall be responsible for, and shall not be entitled to any reimbursement for, Borrower’s attorney’s fees and expenses), cooperate with Lender in Lender’s exercise of the Mezzanine Option in good faith and in a timely manner, which such cooperation shall include, but not be limited to, (i) executing such amendments to the Loan Documents and Borrower or any SPE Component Entity’s organizational documents as may be reasonably requested by Lender or requested by the Rating Agencies, (ii) creating one or more Single Purpose Entities (the “Mezzanine Borrower”), which such Mezzanine Borrower shall (A) own, directly or indirectly, 100% of the equity ownership interests in Borrower (the “Equity Collateral”), and (B) together with such constituent equity owners of such Mezzanine Borrower as may be designated by Lender, execute such agreements, instruments and other documents as may be reasonably required by Lender in connection with the mezzanine loan (including, without limitation, a promissory note evidencing the mezzanine loan and a pledge and security agreement pledging the Equity Collateral to Lender as security for the mezzanine loan); and (iii) delivering such opinions, title endorsements, UCC title insurance policies, documents and/or instruments relating to the Property Documents, PILOT Lease and/or PILOT Document (as applicable), and other materials as may be reasonably required by Lender or the Rating Agencies.  Notwithstanding the foregoing, Lender shall not create any mezzanine loan without the prior written consent of Borrower.

Section 11.7.Conversion to Registered Form. At the request of Lender, Borrower shall appoint, as its agent, a registrar and transfer agent (the “Registrar”) reasonably acceptable to Lender which shall maintain, subject to such reasonable regulations as it shall provide, such books and records as are necessary for the registration and transfer of the Note in a manner that shall cause the Note to be considered to be in registered form for purposes of Section 163(f) of the IRS Code. The option to convert the Note into registered form once exercised may not be revoked. Any agreement setting out the rights and obligation of the Registrar shall be subject to the reasonable approval of Lender. Borrower may revoke the appointment of any particular person as Registrar, effective upon the effectiveness of the appointment of a replacement Registrar. The Registrar shall not be entitled to any fee from Borrower or Lender or any other lender in respect of transfers of the Note and other Loan Documents. ****

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​ Section 11.8.Syndication. Without limiting Lender’s rights under Section 11.1, the provisions of this Section 11.8 shall only apply in the event that the Loan is syndicated in accordance with the provisions of this Section 11.8 set forth below.

(a)Sale of Loan, Co-Lenders, Participations and Servicing.

(i)Lender and any Co-Lender may, at their option, without Borrower’s consent (but with written notice to Borrower), sell with novation all or any part of their right, title and interest in, and to, and under the Loan (the “Syndication”), to one or more additional lenders (each a “Co-Lender”). Each additional Co-Lender shall enter into an assignment and assumption agreement (the “Assignment and Assumption”) assigning a portion of Lender’s or Co-Lender’s rights and obligations under the Loan, and pursuant to which the additional Co-Lender accepts such assignment and assumes the assigned obligations. From and after the effective date specified in the Assignment and Assumption (i) each Co-Lender shall be a party hereto and to each Loan Document to the extent of the applicable percentage or percentages set forth in the Assignment and Assumption and, except as specified otherwise herein, shall succeed to the rights and obligations of Lender and the Co-Lenders hereunder and thereunder in respect of the Loan, and (ii) Lender, as lender and each Co-Lender, as applicable, shall, to the extent such rights and obligations have been assigned by it pursuant to such Assignment and Assumption, relinquish its rights and be released from its obligations hereunder and under the Loan Documents.

(ii)The liabilities of Lender and each of the Co-Lenders shall be several and not joint, and Lender’s and each Co-Lender’s obligations to Borrower under this Agreement shall be reduced by the amount of each such Assignment and Assumption. Neither Lender nor any Co-Lender shall be responsible for the obligations of any other Co-Lender. Lender and each Co-Lender shall be liable to Borrower only for their respective proportionate shares of the Loan.

(iii)Borrower agrees that it shall, in connection with any sale of all or any portion of the Loan, whether in whole or to an additional Co-Lender or Participant, within ten (10) Business Days after receipt of written requested by Agent (as hereinafter defined), furnish Agent with the certificates required under Sections 4.12 and 4.13 hereof and such other information as reasonably requested by any additional Co-Lender or Participant in performing its due diligence in connection with its purchase of an interest in the Loan.

(iv)Lender (or an Affiliate of Lender) shall act as administrative agent for itself and the Co-Lenders (together with any successor administrative agent, the “Agent”) pursuant to this Section 11.8. Borrower acknowledges that Lender, as Agent, shall have the sole and exclusive authority to execute and perform this Agreement and each Loan Document on behalf of itself, as Lender and as agent for itself and the Co-Lenders subject to the terms of the Co-Lending Agreement. Lender acknowledges that Lender, as Agent, shall retain the exclusive right to grant approvals and give consents with respect to all matters requiring consent hereunder. Except as otherwise provided herein, Borrower shall have no obligation to recognize or deal directly with any Co-Lender, and no Co-Lender shall have any right to deal directly with Borrower with respect to the rights, benefits and obligations of Borrower under this Agreement, the Loan Documents or any one or more documents or instruments in respect thereof. Borrower may rely conclusively on the actions of Lender as Agent to bind Lender and the Co-Lenders, notwithstanding that the particular action in question may, pursuant to this Agreement or the Co-Lending Agreement be subject to the consent or direction of some or all of the Co-Lenders. Lender may resign as Agent of the

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​ Co-Lenders, in its sole discretion, or if required to by the Co-Lenders in accordance with the term of the Co-Lending Agreement, in each case without the consent of but upon prior written notice to Borrower. Upon any such resignation, a successor Agent shall be determined pursuant to the terms of the Co-Lending Agreement. The term “Agent” shall include any successor Agent.

(v)Notwithstanding any provision to the contrary in this Agreement, the Agent shall not have any duties or responsibilities except those expressly set forth herein (and in the Co-Lending Agreement) and no covenants, functions, responsibilities, duties, obligations or liabilities of Agent shall be implied by or inferred from this Agreement, the Co-Lending Agreement, or any other Loan Document, or otherwise exist against Agent.

(vi)Except to the extent its obligations hereunder and its interest in the Loan have been assigned pursuant to one or more Assignments and Assumption, Lender, as Agent, shall have the same rights and powers under this Agreement as any other Co-Lender and may exercise the same as though it were not Agent, respectively. The term “Co-Lender” or “Co-Lenders” shall, unless otherwise expressly indicated, include Lender in its individual capacity. Lender and the other Co-Lenders and their respective Affiliates may accept deposits from, lend money to, act as trustee under indentures of, and generally engage in any kind of business with, Borrower, or any Affiliate of Borrower and any Person who may do business with or own securities of Borrower or any Affiliate of Borrower, all as if they were not serving in such capacities hereunder and without any duty to account therefor to each other.

(vii)If required by any Co-Lender, Borrower hereby agrees to execute supplemental notes in the principal amount of such Co-Lender’s pro rata share of the Loan substantially in the form of the Note, and such supplemental note shall (i) be payable to order of such Co-Lender, (ii) be dated as of the Closing Date, and (iii) mature on the Maturity Date. Such supplemental note shall provide that it evidences a portion of the existing indebtedness hereunder and under the Note and not any new or additional indebtedness of Borrower. The term “Note” as used in this Agreement and in all the other Loan Documents shall include all such supplemental notes.

(viii)Lender, as Agent, shall maintain at its domestic lending office or at such other location as Lender, as Agent, shall designate in writing to each Co-Lender and Borrower a copy of each Assignment and Assumption delivered to and accepted by it and a register for the recordation of the names and addresses of the Co-Lenders, the amount of each Co-Lender’s proportionate share of the Loan and the name and address of each Co-Lender’s agent for service of process (the “Register”). The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and Borrower, Lender, as Agent, and the Co-Lenders may treat each person or entity whose name is recorded in the Register as a Co-Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection and copying by Borrower or any Co-Lender during normal business hours upon reasonable prior notice to the Agent. A Co-Lender may change its address and its agent for service of process upon written notice to Lender, as Agent, which notice shall only be effective upon actual receipt by Lender, as Agent, which receipt will be acknowledged by Lender, as Agent, upon request.

(ix)Notwithstanding anything herein to the contrary, any financial institution or other entity may be sold a participation interest in the Loan by Lender or any Co-Lender without Borrower’s consent (such financial institution or entity, a “Participant”). No

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​ Participant shall have any rights under this Agreement, the Note or any of the Loan Documents and the Participant’s rights in respect of such participation shall be solely against Lender or Co-Lender, as the case may be, as set forth in the participation agreement executed by and between Lender or Co-Lender, as the case may be, and such Participant. Borrower may rely conclusively on the actions of Lender as Agent to bind Lender and any Participant, notwithstanding that the particular action in question may, pursuant to this Agreement or any participation agreement be subject to the consent or direction of some or all of the Participants. No participation shall relieve Lender or Co-Lender, as the case may be, from its obligations hereunder or under the Note or the Loan Documents and Lender or Co- Lender, as the case may be, shall remain solely responsible for the performance of its obligations hereunder.

(x)Notwithstanding any other provision set forth in this Agreement, Lender or any Co-Lender may at any time create a security interest in all or any portion of its rights under this Agreement (including, without limitation, amounts owing to it in favor of any Federal Reserve Bank in accordance with Regulation A of the Board of Governors of the Federal Reserve System).

(b)Cooperation in Syndication.

(i)Borrower agrees to assist Lender in completing a Syndication reasonably satisfactory to Lender. Such assistance shall include (i) direct contact between senior management and advisors of Borrower and Guarantor and the proposed Co-Lenders, (ii) assistance in the preparation of a confidential information memorandum and other marketing materials to be used in connection with the Syndication, (iii) the hosting, with Lender, of one or more meetings of prospective Co-Lenders or with the Rating Agencies, (iv) the delivery of appraisals satisfactory to Lender if required, and (v) working with Lender to procure a rating for the Loan by the Rating Agencies.

(ii)Lender shall manage all aspects of the Syndication of the Loan, including decisions as to the selection of institutions to be approached and when they will be approached, when their commitments will be accepted, which institutions will participate, the allocations of the commitments among the Co-Lenders and the amount and distribution of fees among the Co-Lenders. To assist Lender in its Syndication efforts, Borrower agrees promptly to prepare and provide to Lender all information with respect to Borrower, Affiliated Manager, Guarantor, any SPE Component Entity (if any) and the Property contemplated hereby, including all financial information and projections (the “Projections”), as Lender may reasonably request in connection with the Syndication of the Loan. Borrower hereby represents and covenants that (i) all information other than the Projections (the “Information”) that has been or will be made available to Lender by Borrower or any of their representatives is or will be, when furnished, complete and correct in all material respects and does not or will not, when furnished, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which such statements are made and (ii) the Projections that have been or will be made available to Lender by Borrower or any of their representatives have been or will be prepared in good faith based upon reasonable assumptions. Borrower understands that in arranging and syndicating the Loan, Lender, the Co-Lenders and, if applicable, the Rating Agencies, may use and rely on the Information and Projections without independent verification thereof.

(iii)If required in connection with the Syndication, Borrower hereby agrees to:

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​ (A)amend the Loan Documents to give Lender the right, at Lender’s sole cost and expense, to have the Property reappraised on an annual basis;

(B)deliver updated financial and operating statements and other information reasonably required by Lender to facilitate the Syndication;

(C)deliver reliance letters reasonably satisfactory to Lender with respect to the environmental assessments and reports delivered to Lender prior to the Closing Date, which will run to Lender, any Co-Lender and their respective successors and assigns;

(D)execute modifications to the Loan Documents required by the Co- Lenders, provided that such modification will not (except as set forth in clause (E) below), change any material or economic terms of the Loan Documents, or otherwise materially increase the obligations or materially decrease the rights of Borrower pursuant to the Loan Documents; and

(E)if Lender elects, in its sole discretion, prior to or upon a Syndication, to split the Loan into two or more parts, or the Note into multiple component notes or tranches which may have different interest rates, principal amounts, and payment priorities, Borrower agrees to cooperate with Lender in connection with the foregoing and to execute the required modifications and amendments to the Note, this Agreement and the Loan Documents and to provide opinions necessary to effectuate the same. Such Notes or components may be assigned different interest rates, so long as the initial weighted average of such interest rates does not exceed the applicable Interest Rate.

Borrower shall be responsible for payments of its legal fees incurred in connection with compliance with the requests made under this Section. All other reasonable third party costs and expenses incurred by Borrower in connection with Borrower’s complying with requests made under this Section shall be paid by Lender. The costs and expenses incurred by Lender in connection with a Syndication shall be paid by Lender.

(c)Limitation of Liability. No claim may be made by Borrower, or any other Person against Agent, Lender or any Co-Lenders or the Affiliates, directors, officers, employees, attorneys or agent of any of such Persons for any special, indirect, consequential or punitive damages in respect of any claim for breach of contract or any other theory of liability arising out of or related to the transactions contemplated by this Agreement or any act, omission or event occurring in connection therewith; and Borrower hereby waives, releases and agrees not to sue upon any claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favor.

(d)No Joint Venture. Notwithstanding anything to the contrary herein contained, neither Agent, Lender nor any Co-Lender by entering into this Agreement or by taking any action pursuant hereto, will be deemed a partner or joint venturer with Borrower.

(e)Voting Rights of Co-Lenders. Borrower acknowledges that the Co-Lending Agreement may contain provisions which require that amendments, waivers, extensions, modifications, and other decisions with respect to the Loan Documents shall require the approval of all or a number of the Co-Lenders holding in the aggregate a specified percentage of the Loan or

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​ any one or more Co-Lenders that are specifically affected by such amendment, waiver, extension, modification or other decision.

ARTICLE 12​​INDEMNIFICATIONS

Section 12.1.General Indemnification. Borrower shall, at its sole cost and expense, protect, defend, indemnify, release and hold harmless the Indemnified Parties from and against any and all actual Losses imposed upon or incurred by or asserted against any Indemnified Parties and directly or indirectly arising out of or in any way relating to any one or more of the following except to the extent caused solely by the illegal acts, fraud, gross negligence or willful misconduct of any Indemnified Party: (a) any accident, injury to or death of persons or loss of or damage to property occurring in, on or about the Property or any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways; (b) any use, nonuse or condition in, on or about the Property or any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways; (c) performance of any labor or services or the furnishing of any materials or other property in respect of the Property or any part thereof; (d) any failure of the Property to be in compliance with any applicable Legal Requirements; (e) any and all claims and demands whatsoever which may be asserted against Lender by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in any Lease, Management Agreement or any Property Document, PILOT Lease and/or PILOT Document (as applicable); (f) the payment of any commission, charge or brokerage fee to anyone (other than a broker or other agent retained by Lender) which may be payable in connection with the funding of the Loan evidenced by the Note and secured by the Security Instrument; and/or (g) the holding or investing of the funds on deposit in the Accounts or the performance of any work or the disbursement of funds in each case in connection with the Accounts. Any amounts payable to Lender by reason of the application of this Section 12.1 shall be due and payable within ten (10) Business Days after demand, and if not timely paid, thereafter shall bear interest at the Default Rate until paid.

Section 12.2.Mortgage and Intangible Tax Indemnification. Borrower shall, at its sole cost and expense, protect, defend, indemnify, release and hold harmless the Indemnified Parties from and against any and all actual Losses imposed upon or incurred by or asserted against any Indemnified Parties and directly or indirectly arising out of or in any way relating to any tax on the making and/or recording of the Security Instrument, the Note or any of the other Loan Documents.

Section 12.3.ERISA and FIRRMA Indemnification. Borrower shall, at its sole cost and expense, protect, defend, indemnify, release and hold harmless the Indemnified Parties from and against any and all Losses (including, without limitation, reasonable attorneys’ fees and costs incurred in the investigation, defense, and settlement of Losses incurred in correcting any prohibited transaction or in the sale of a prohibited loan (other than a prohibited transaction or prohibited loan resulting solely from Lender’s failure to comply with an exemption from the prohibited transaction rules of Section 406 of ERISA and Section 4975 of the IRS Code in connection with Lender’s use of “plan assets” within the meaning of 29 C.F.R. Section 2510.3- 101, as modified by Section 3(42) of ERISA), and in obtaining any individual prohibited transaction exemption under ERISA that may be required, in Lender’s sole discretion) that Lender may incur, directly or indirectly, as a result of a default under Sections 3.7 or 4.19 of this Agreement.

Section 12.4.Duty to Defend, Legal Fees and Other Fees and Expenses. Upon written request by any Indemnified Party, Borrower shall defend such Indemnified Party (if requested by

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​ any Indemnified Party, in the name of the Indemnified Party) by attorneys and other professionals reasonably acceptable to the Indemnified Parties. Notwithstanding the foregoing, any Indemnified Parties may, in their sole discretion, engage their own attorneys and other professionals to defend or assist them, and, at the option of Indemnified Parties, their attorneys shall control the resolution of any claim or proceeding. Within ten (10) Business Days following demand therefor, Borrower shall pay or, in the sole discretion of the Indemnified Parties, reimburse, the Indemnified Parties for the payment of reasonable fees and disbursements of attorneys, engineers, environmental consultants, laboratories and other professionals actually reasonably incurred in connection therewith.

Section 12.5.Survival. The obligations and liabilities of Borrower under this Article 12 shall fully survive indefinitely notwithstanding any termination, satisfaction, assignment, entry of a judgment of foreclosure, exercise of any power of sale, or delivery of a deed in lieu of foreclosure of the Security Instrument.

Section 12.6.Environmental Indemnity. Simultaneously herewith, Borrower and Guarantor have executed and delivered the Environmental Indemnity to Lender, which Environmental Indemnity is not secured by the Security Instrument.

ARTICLE 13​​EXCULPATION

Section 13.1.Exculpation.

(a)Subject to the qualifications below, Lender shall not enforce the liability and obligation of Borrower to perform and observe the obligations contained in the Note, this Agreement, the Security Instrument or the other Loan Documents by any action or proceeding wherein a money judgment or any deficiency judgment or other judgment establishing personal liability shall be sought against Borrower or any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or Affiliate of Borrower or any legal representatives, successors or assigns of any of the foregoing (collectively, the “Exculpated Parties”), except that Lender may bring a foreclosure action, an action for specific performance or any other appropriate action or proceeding to enable Lender to enforce and realize upon its interest under the Note, this Agreement, the Security Instrument and the other Loan Documents, or in the Property, the Rents, or any other collateral given to Lender pursuant to the Loan Documents; provided, however, that, except as specifically provided herein, any judgment in any such action or proceeding shall be enforceable against Borrower only to the extent of Borrower’s interest in the Property, in the Rents and in any other collateral given to Lender, and Lender, by accepting the Note, this Agreement, the Security Instrument and the other Loan Documents, shall not sue for, seek or demand any deficiency judgment against Borrower or any of the Exculpated Parties in any such action or proceeding under or by reason of or under or in connection with the Note, this Agreement, the Security Instrument or the other Loan Documents. The provisions of this Section shall not, however, (1) constitute a waiver, release or impairment of any obligation evidenced or secured by any of the Loan Documents; (2) impair the right of Lender to name Borrower as a party defendant in any action or suit for foreclosure and sale under the Security Instrument; (3) affect the validity or enforceability of any indemnity, guaranty or similar instrument (including, without limitation, indemnities set forth in Article 12 hereof, Section 11.2 hereof, in the Guaranty and the Environmental Indemnity) made in connection with the Loan or any of the rights and remedies of Lender thereunder (including, without limitation, Lender’s right to enforce said rights and remedies against Borrower and/or Guarantor (as applicable) personally and without the effect of the exculpatory provisions of this Article 13 as to Borrower and/or Guarantor) (provided, that the foregoing shall not modify the effect of the exculpatory

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​ provisions of this Article 13 with respect to any principal, director, officer, employee, beneficiary, shareholder, partner, member, trustee, agent, or other Affiliate of Borrower or any legal representatives, successors or assigns of any of the foregoing, and provided further that Guarantor’s liability shall be as more particularly set forth in the Guaranty); (4) impair the rights of Lender to (A) obtain the appointment of a receiver and/or (B) enforce its rights and remedies provided in Articles 8 and 9 hereof; (5) impair the enforcement of the assignment of leases and rents contained in the Security Instrument and in any other Loan Documents; (6) impair the right of Lender to enforce Section 4.12(e) of this Agreement; or (7) constitute a prohibition against Lender to seek a deficiency judgment against Borrower in order to fully realize the security granted by the Security Instrument or to commence any other appropriate action or proceeding in order for Lender to exercise its remedies against the Property (or any portion thereof).

(b)Notwithstanding the foregoing, nothing herein shall in any manner or way release, affect or impair the right of Lender to recover, and Borrower shall be fully and personally liable and subject to legal action, for any Loss actually incurred by Lender (including reasonable attorneys’ fees and costs reasonably incurred) arising out of or in connection with the following:

(i)fraud or intentional misrepresentation by any Borrower Party in connection with the Loan;

(ii)the willful misconduct of any Borrower Party;

(iii)any litigation or other legal proceeding related to the Debt filed by any Borrower Party or any other action of any Borrower Party that is filed with the intention of delaying, opposing, impeding, obstructing, hindering, enjoining or  otherwise interfering with or frustrating the efforts of Lender to exercise any rights and remedies available to Lender as provided herein and in the other Loan Documents;

(iv)material physical waste to the Property caused by the intentional acts or intentional omissions of any Borrower Party; provided, that, the foregoing shall not include a Borrower’s failure to maintain the Property to the extent the Property did not generate sufficient cash flow during the period in question (or such cash flow was not made available by Lender to Borrower for Borrower’s use) to pay all of the Borrower’s current and/or past due liabilities (including the cost of maintenance) with respect to the Property after paying Taxes and Insurance Premiums;

(v)the misappropriation or conversion by any Borrower Party of (A) any insurance proceeds paid by reason of any loss, damage or destruction to the Property (or any portion thereof), (B) any Awards or other amounts received in connection with the Condemnation of all or a portion of the Property, (C) any Rents, (D) any Security Deposits or Rents collected in advance or (E) any other monetary collateral for the Loan (including, without limitation, any Reserve Funds and/or any portion thereof disbursed to (or at the direction of) Borrower);

(vi)failure to pay Taxes, charges for labor or materials or other charges that can create liens on any portion of the Property in accordance with the terms and provisions hereof; provided, that, Borrower shall not be liable to the extent (i) with respect to Taxes, funds to pay such amounts were deposited with Lender as Tax and Insurance Funds for Taxes or Other Charges at the time payment was due, (ii)with respect to Taxes, such Taxes or Other Charges owed or lien on the Property, as applicable, are being contested strictly in accordance with the terms of the Loan Documents, or (iii) the Property did not generate sufficient cash flow at the time in question (or such cash flow was not made available by Lender to Borrower as, and when, required hereunder for

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​ Borrower’s use) to pay such Taxes prior to paying any other current and/or past due liabilities with respect to the Property;

(vii)failure to pay Insurance Premiums, to maintain the Policies in full force and effect, in each case, as expressly provided herein; provided, that, Borrower shall not be liable to the extent funds to pay such amounts were deposited with Lender as Tax and Insurance Funds for Insurance Premiums at the time payment was due; provided, further, that the foregoing shall not include Borrower’s failure to pay Insurance Premiums or maintain the Policies to the extent that the Property did not generate sufficient cash flow during the period in question (or such cash flow was not made available to Borrower by Lender as, and when, required hereunder for Borrower’s use) to pay such Insurance Premiums after paying Taxes but prior to paying any other current and/or past due liabilities with respect to the Property;

(viii)any Security Deposits which are not delivered to Lender within the timeframe required hereunder except to the extent any such Security Deposits were applied in accordance with the terms and conditions of any of the Leases prior to the occurrence of the applicable Event of Default. For purposes of clarification, for a Security Deposit to be deemed “delivered to Lender” in connection with the foregoing, the same must be in the form of cash or in a letter of credit solely in Lender’s name;

(ix)[intentionally omitted];

(x)any breach of any applicable Legal Requirement mandating the forfeiture by any Borrower of any of the Properties, or any portion thereof, because of the conduct or purported conduct of criminal activity by a Borrower Party in connection therewith;

(xi)the failure to make any REMIC Payment and/or any True Up Payment as and when required herein; provided that such failure shall not result in recourse liability hereunder unless Borrower fails to cure such failure within fifteen (15) days of receipt of written notice from Lender of such failure;

(xii)(A) any voluntary termination of any PILOT Lease and/or PILOT Document or transfer or surrender of any PILOT Lease and/or PILOT Document by Borrower without Lender’s prior written consent other than in connection with Borrower acquiring the fee estate from the applicable PILOT Lessor or as otherwise expressly permitted under this Agreement, (B) any termination of  any PILOT Lease and/or PILOT Document as a result of a foreclosure of the applicable Security Instrument or deed in lieu thereof or (C) Borrower’s failure to comply with, or Borrower’s breach of, any PILOT Lease and/or PILOT Document that results in (x) a reduction of any tax abatement and/or mandatory repayment of any past or current tax abatement under such PILOT Lease and/or PILOT Document, as applicable, (y) termination of such PILOT Lease and/or PILOT Document, as applicable, and the benefits thereunder in favor of Borrower or Tenant or (z) a default by such Borrower under the applicable Lease for such PILOT Property;

(xiii)the failure by Borrower to purchase or replace (as applicable) any Interest Rate Cap Agreement or Replacement Interest Rate Cap Agreement (as applicable), in each case, as and when required by the terms hereof; provided that (A) such failure shall not result in recourse liability hereunder unless Borrower fails to cure such failure within fifteen (15) days of receipt of written notice from Lender of such failure and (B) the recourse liability hereunder shall be limited to the actual costs incurred by Lender in purchasing such Interest Rate Cap Agreement;

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​ (xiv)any representation, warranty or covenant contained in Article 5 hereof is violated or breached; and/or

(xv)any representation, warranty or covenant contained in Article 6 hereof is violated or breached.

(c)Notwithstanding anything to the contrary in this Agreement, the Note or any of the Loan Documents, (A) Lender shall not be deemed to have waived any right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the Bankruptcy Code to file a claim for the full amount of the Debt or to require that all collateral shall continue to secure all of the Debt owing to Lender in accordance with the Loan Documents, and (B) the Debt shall be fully recourse to Borrower in the event that a Bankruptcy Event occurs.

ARTICLE 14​ ​ NOTICES

Section 14.1.Notices. All notices or other written communications hereunder shall be deemed to have been properly given (a) upon delivery, if delivered in person with receipt acknowledged by the recipient thereof and confirmed by telephone by sender, (b) one (1) Business Day after having been deposited for overnight delivery with any reputable overnight courier service, (c) three (3) Business Days after having been deposited in any post office or mail depository regularly maintained by the U.S. Postal Service and sent by registered or certified mail, postage prepaid, return receipt requested, and (d) if transmitted by e-mail, (x) if such e-mail was sent prior to 5 P.M. EST on a Business Day, then on the date such e-mail was sent, or (y) if such e-mail was sent on a day that is not a Business Day or after 5 P.M. EST on a Business Day, then on the Business Day immediately succeeding the date such e-mail was sent, in each case addressed as follows:

​	​<br>Attention: AREG Legal Department; Stefanie Sommers<br><br>​<br><br>​
If to Borrower:	c/o Ares Management LLC<br>Tabor Center<br>1200 17^th^ Street, Suite 2900<br><br>Denver, Colorado 80202<br>Attention: AREG Legal Department; Stefanie Sommers<br><br>Email: ssommers@aresmgmt.com
With a copy to:<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​<br><br>​	c/o Ares Management LLC<br><br>Tabor Center<br>1200 17^th^ Street, Suite 2900<br><br>Denver, Colorado 80202<br>Attention: Josh Widoff, Esq.<br><br>Email: jwidoff@aresmgmt.com<br><br>​<br><br>c/o Ares Management LLC<br>Tabor Center<br>1200 17^th^ Street, Suite 2900<br><br>Denver, Colorado 80202<br>Attention: Scott Seager<br><br>Email: sseager@aresmgmt.com<br><br>​<br><br>Hogan Lovells US LLP<br><br>1601 Wewatta Street, Suite 900<br><br>Denver, Colorado 80202<br><br>Attention: Scott Campbell, Esq.<br><br>Email: scott.campbell@hoganlovells.com<br><br>​
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With a copy to (which shall not constitute notice):
If to Lender:	JPMorgan Chase Bank, National Association <br>383 Madison Avenue, 8^th^ Floor<br>New York, New York 10179-00010<br>Attention:  Simon B. Burce<br>Email: simon.burce@jpmchase.com<br><br>JPMorgan Chase Bank, National Association<br>SPG Middle Office/CIB<br>383 Madison Avenue, 8^th^ Floor<br>New York, New York 10179-0001<br>Attention:  Gisella Leonardis<br>Email: cmbs.loans.mo@jpmorgan.com
With a copy to:	Morgan Stanley Mortgage Capital Holdings LLC<br><br>1585 Broadway, 25th Floor<br><br>New York, New York 10036<br><br>Attention: John Maurer<br><br>and by email to: crelamnotices@morganstanley.com<br><br>and by email to: crelamfinreport@morganstanley.com
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With a copy to:	Natixis Real Estate Capital LLC<br><br>1251 Avenue of the Americas<br><br>New York, New York 10020<br><br>Attention: Real Estate Administration<br><br>Email: USCIBSnDAssetManagementTeam@natixis.com<br><br>​
With a copy to:	Cadwalader, Wickersham & Taft LLP<br>200 Liberty Street<br>New York, New York 10281<br>Attention: Bonnie A. Neuman, Esq.<br>Email: bonnie.neuman@cwt.com<br><br>​

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or addressed as such party may from time to time designate by written notice to the other parties.

Either party by notice to the other may designate additional or different addresses for subsequent notices or communications. Without limitation of any of the requirements of this Article 14, from and after Securitization of the entire Loan (or any other Secondary Market Transaction involving a transfer of the Loan by the initial Lender), in no event shall any notice delivered to JPMorgan Chase Bank, National Association or any Affiliate thereof be deemed an effective notice to “Lender” for purposes of this Agreement or any other Loan Document.

ARTICLE 15​​FURTHER ASSURANCES

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​ Section 15.1.Replacement Documents. Upon receipt of a customary affidavit of an officer of Lender, on Lender’s then standard form, as to the loss, theft, destruction or mutilation of the Note, this Agreement or any of the other Loan Documents which is not of public record, and, in the case of any such mutilation, upon surrender and cancellation of the Note, this Agreement or such other Loan Document, Borrower will issue, in lieu thereof, a replacement thereof, dated the date of the Note, this Agreement or such other Loan Document, as applicable, in the same principal amount thereof and otherwise of like tenor; provided, that, such affidavit shall state that (A) Lender was the last holder of the Note in due course, (B) Lender has not given, pledged, sold, endorsed, assigned, transferred, or otherwise disposed of the Note and, if the Note is lost, that Lender is unable to locate the Note, and (C) if the original Note comes into the possession or control of Lender, it will promptly deliver and surrender the same to Borrower.

Section 15.2.Recording of Security Instrument, etc. Borrower forthwith upon the execution and delivery of the Security Instrument and thereafter, from time to time, will cause the Security Instrument and any of the other Loan Documents creating a lien or security interest or evidencing the lien hereof upon the Property and each instrument of further assurance to be filed, registered or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect and perfect the lien or security interest hereof upon, and the interest of Lender in, the Property. Except as otherwise expressly provided in this Agreement, Borrower will pay all taxes, filing, registration or recording fees, and all expenses incident to the preparation, execution, acknowledgment and/or recording of the Note, the Security Instrument, this Agreement, the other Loan Documents, any note, deed of trust or mortgage supplemental hereto, any security instrument with respect to the Property and any instrument of further assurance, and any modification or amendment of the foregoing documents, and all federal, state, county and municipal taxes, duties, imposts, assessments and charges arising out of or in connection with the execution and delivery of the Security Instrument, any deed of trust or mortgage supplemental hereto, any security instrument with respect to the Property or any instrument of further assurance, and any modification or amendment of the foregoing documents, except where prohibited by applicable Legal Requirements so to do.

Section 15.3.Further Acts, etc. Except as otherwise expressly provided in this Agreement, Borrower will, at the cost of Borrower, and without expense to Lender, do, execute, acknowledge and deliver all and every further acts, deeds, conveyances, deeds of trust, mortgages, assignments, notices of assignments, transfers and assurances as Lender shall, from time to time, reasonably require, for the better assuring, conveying, assigning, transferring, and confirming unto Lender the property and rights hereby mortgaged, deeded, granted, bargained, sold, conveyed, confirmed, pledged, assigned, warranted and transferred or intended now or hereafter so to be, or which Borrower may be or may hereafter become bound to convey or assign to Lender, or for carrying out the intention or facilitating the performance of the terms of this Agreement or for filing, registering or recording the Security Instrument, or for complying with all Legal Requirements. Borrower, on demand, will execute and deliver, and in the event it shall fail to so execute and deliver, hereby authorizes Lender to execute in the name of Borrower or without the signature of Borrower to the extent Lender may lawfully do so, one or more financing statements to evidence more effectively the security interest of Lender in the Property. Borrower grants to Lender an irrevocable power of attorney coupled with an interest for the purpose of exercising and perfecting any and all rights and remedies available to Lender at law and in equity, including without limitation, such rights and remedies available to Lender pursuant to this Section 15.3. Notwithstanding the foregoing, no such documents, agreements or instruments shall (x) materially modify any of the economic and material business terms and provisions of the Loan Documents, (y) materially increase any obligation of the Borrower under the Loan Documents, or (z) materially modify any right of the Borrower under the Loan Documents.

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​ Section 15.4.Changes in Tax, Debt, Credit and Documentary Stamp Laws.

(a)If any law is enacted or adopted or amended after the date of this Agreement which deducts the Debt from the value of the Property for the purpose of taxation and which imposes a tax, either directly or indirectly, on the Debt or Lender’s interest in the Property, Borrower will pay the tax, with interest and penalties thereon, if any. If Lender is advised by counsel chosen by it that the payment of tax by Borrower would be unlawful or taxable to Lender or unenforceable or provide the basis for a defense of usury then Lender shall have the option by written notice of not less than ninety (90) days to declare the Debt immediately due and payable (without any Prepayment Premium).

(b)Borrower will not claim or demand or be entitled to any credit or credits on account of the Debt for any part of the Taxes or Other Charges assessed against the Property, or any part thereof, and no deduction shall otherwise be made or claimed from the assessed value of the Property, or any part thereof, for real estate tax purposes by reason of the Security Instrument or the Debt. If such claim, credit or deduction shall be required by applicable Legal Requirements, Lender shall have the option, by written notice of not less than ninety (90) days, to declare the Debt immediately due and payable (without any Prepayment Premium).

(c)If at any time the United States of America, any State thereof or any subdivision of any such State shall require revenue or other stamps to be affixed to the Note, the Security Instrument, or any of the other Loan Documents or impose any other tax or charge on the same, Borrower will pay for the same, with interest and penalties thereon, if any.

ARTICLE 16​​WAIVERS

Section 16.1.Remedies Cumulative; Waivers.

The rights, powers and remedies of Lender under this Agreement shall be cumulative and not exclusive of any other right, power or remedy which Lender may have against Borrower pursuant to this Agreement, the Security Instrument, the Note or the other Loan Documents, or existing at law or in equity or otherwise. Lender’s rights, powers and remedies may be pursued singularly, concurrently or otherwise, at such time and in such order as Lender may determine in Lender’s sole discretion. No delay or omission to exercise any remedy, right or power accruing upon an Event of Default shall impair any such remedy, right or power or shall be construed as a waiver thereof, but any such remedy, right or power may be exercised from time to time and as often as may be deemed expedient. A waiver of one Default or Event of Default with respect to Borrower shall not be construed to be a waiver of any subsequent Default or Event of Default by Borrower or to impair any remedy, right or power consequent thereon.

Section 16.2.Modification, Waiver in Writing.

No modification, amendment, extension, discharge, termination or waiver of any provision of this Agreement, the Security Instrument, the Note and the other Loan Documents, nor consent to any departure by Borrower therefrom, shall in any event be effective unless the same shall be in a writing signed by the party against whom enforcement is sought, and then such waiver or consent shall be effective only in the specific instance, and for the purpose, for which given. Except as otherwise expressly provided herein, no notice to, or demand on Borrower, shall entitle Borrower to any other or future notice or demand in the same, similar or other circumstances.

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​ Section 16.3.Delay Not a Waiver.

Neither any failure nor any delay on the part of Lender in insisting upon strict performance of any term, condition, covenant or agreement, or exercising any right, power, remedy or privilege under this Agreement, the Security Instrument, the Note or the other Loan Documents, or any other instrument given as security therefor, shall operate as or constitute a waiver thereof, nor shall a single or partial exercise thereof preclude any other future exercise, or the exercise of any other right, power, remedy or privilege. In particular, and not by way of limitation, by accepting payment after the due date of any amount payable under this Agreement, the Security Instrument, the Note or the other Loan Documents, Lender shall not be deemed to have waived any right either to require prompt payment when due of all other amounts due under this Agreement, the Security Instrument, the Note and the other Loan Documents, or to declare a default for failure to effect prompt payment of any such other amount.

Section 16.4.Waiver of Trial by Jury.

BORROWER AND LENDER, BY ACCEPTANCE OF THIS AGREEMENT, HEREBY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LEGAL REQUIREMENTS, THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER IN CONTRACT, TORT OR OTHERWISE, RELATING DIRECTLY OR INDIRECTLY TO THE LOAN, THE APPLICATION FOR THE LOAN, THIS AGREEMENT, THE NOTE, THE SECURITY INSTRUMENT OR THE OTHER LOAN DOCUMENTS OR ANY ACTS OR OMISSIONS OF LENDER OR BORROWER.

Section 16.5.Waiver of Notice.

Borrower shall not be entitled to any notices of any nature whatsoever from Lender except (a) with respect to matters for which this Agreement specifically and expressly provides for the giving of notice by Lender to Borrower and (b) with respect to matters for which Lender is required by applicable Legal Requirements to give notice, and Borrower hereby expressly waives the right to receive any notice from Lender with respect to any matter for which this Agreement does not specifically and expressly provide for the giving of notice by Lender to Borrower.

Section 16.6.Remedies of Borrower.

In the event that a claim or adjudication is made that Lender or any of its agents have acted unreasonably or unreasonably delayed acting in any case where by applicable Legal Requirements or under this Agreement, the Security Instrument, the Note and the other Loan Documents, Lender or such agent, as the case may be, has an obligation to act reasonably or promptly, Borrower agrees that neither Lender nor its agents shall be liable for any monetary damages, and Borrower’s sole remedies shall be limited to commencing an action seeking injunctive relief or declaratory judgment. The parties hereto agree that any action or proceeding to determine whether Lender has acted reasonably shall be determined by an action seeking declaratory judgment. Lender agrees that, in such event, it shall cooperate in expediting any action seeking injunctive relief or declaratory judgment.

Section 16.7.Marshalling and Other Matters.

Borrower hereby waives, to the extent permitted by applicable Legal Requirements, the benefit of all appraisement, valuation, stay, extension, reinstatement and redemption laws now or hereafter in force and all rights of marshalling in the event of any sale under the Security Instrument

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​ of the Property or any part thereof or any interest therein. Further, Borrower hereby expressly waives any and all rights of redemption from sale under any order or decree of foreclosure of the Security Instrument on behalf of Borrower, and on behalf of each and every person acquiring any interest in or title to the Property subsequent to the date of the Security Instrument and on behalf of all persons to the extent permitted by applicable Legal Requirements.

Section 16.8.Waiver of Statute of Limitations.

To the extent permitted by applicable Legal Requirements, Borrower hereby expressly waives and releases to the fullest extent permitted by applicable Legal Requirements, the pleading of any statute of limitations as a defense to payment of the Debt or performance of its obligations hereunder, under the Note, Security Instrument or other Loan Documents.

Section 16.9.Waiver of Counterclaim. Borrower hereby waives the right to assert a counterclaim, other than a compulsory counterclaim, in any action or proceeding brought against it by Lender or its agents.

Section 16.10.Sole Discretion of Lender. Wherever pursuant to this Agreement (a) Lender exercises any right given to it to approve or disapprove, (b) any arrangement or term is to be satisfactory to Lender, or (c) any other decision or determination is to be made by Lender, the decision to approve or disapprove all decisions that arrangements or terms are satisfactory or not satisfactory, and all other decisions and determinations made by Lender, shall be in the sole discretion of Lender, except as may be otherwise expressly and specifically provided herein.

ARTICLE 17​ ​ MISCELLANEOUS

Section 17.1.Survival. This Agreement and all covenants, agreements, representations and warranties made herein and in the certificates delivered pursuant hereto shall survive the making by Lender of the Loan and the execution and delivery to Lender of the Note, and shall continue in full force and effect so long as all or any of the Debt is outstanding and unpaid unless a longer period is expressly set forth in this Agreement, the Security Instrument, the Note or the other Loan Documents. Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the legal representatives, successors and assigns of such party. All covenants, promises and agreements in this Agreement, by or on behalf of Borrower, shall inure to the benefit of the legal representatives, successors and assigns of Lender.

Section 17.2.Governing Law. THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, THE LOAN WAS MADE BY LENDER AND ACCEPTED BY BORROWER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE LOAN DELIVERED PURSUANT HERETO WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS AND THE OBLIGATIONS ARISING HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD TO PRINCIPLES OF

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​ CONFLICTS OF LAWS) AND ANY APPLICABLE LAW OF THE UNITED STATES OF AMERICA, EXCEPT THAT AT ALL TIMES THE PROVISIONS FOR THE CREATION, PERFECTION, AND ENFORCEMENT OF THE LIENS AND SECURITY INTERESTS IN REAL PROPERTY (INCLUDING ALL IMPROVEMENTS AND FIXTURES THEREON) CREATED PURSUANT TO THE LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAW OF THE STATE IN WHICH THE APPLICABLE INDIVIDUAL PROPERTY IS LOCATED, IT BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED BY THE LAW OF SUCH STATE, THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE CONSTRUCTION, VALIDITY AND ENFORCEABILITY OF ALL LOAN DOCUMENTS AND ALL OF THE OBLIGATIONS ARISING HEREUNDER OR THEREUNDER. TO THE FULLEST EXTENT PERMITTED BY LAW, BORROWER HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS, AND THIS AGREEMENT, THE NOTE AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR BORROWER ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS WILL, AT LENDER’S OPTION, BE INSTITUTED IN **** (OR, IF PREVIOUSLY INSTITUTED, MOVED TO) ANY FEDERAL OR STATE COURT DESIGNATED BY LENDER IN THE CITY OF NEW YORK, COUNTY OF NEW YORK. BORROWER HEREBY (I) WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING AND (II) IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. BORROWER AND LENDER HEREBY ACKNOWLEDGE AND AGREE THAT THE FOREGOING AGREEMENT, WAIVER AND SUBMISSION ARE MADE PURSUANT TO SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

BORROWER DOES HEREBY DESIGNATE AND APPOINT:

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CORPORATION TRUST COMPANY

1209 ORANGE STREET

WILMINGTON, DELAWARE 19801

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AS ITS AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY FEDERAL OR STATE COURT IN NEW YORK, NEW YORK, AND AGREES THAT SERVICE OF PROCESS UPON SAID AGENT AT SAID ADDRESS AND WRITTEN NOTICE OF SAID SERVICE MAILED **** OR DELIVERED TO BORROWER IN THE MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON BORROWER IN ANY SUCH SUIT, ACTION OR PROCEEDING IN THE STATE OF NEW YORK. BORROWER (I) SHALL GIVE PROMPT NOTICE TO LENDER OF ANY **** CHANGED ADDRESS OF ITS AUTHORIZED AGENT HEREUNDER, (II) MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A SUBSTITUTE AUTHORIZED AGENT WITH AN OFFICE IN NEW YORK, NEW YORK (WHICH SUBSTITUTE AGENT AND OFFICE SHALL BE

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​ DESIGNATED AS THE PERSON AND ADDRESS FOR SERVICE OF PROCESS), AND (III) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS AUTHORIZED AGENT CEASES TO HAVE AN OFFICE IN NEW YORK, NEW YORK OR IS DISSOLVED WITHOUT LEAVING A SUCCESSOR.

Section 17.3.Headings. Notwithstanding anything to the contrary contained herein, (i) the Article and/or Section headings in this Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose and (ii) covenants contained in Articles and/or Sections hereof labeled or otherwise primarily containing representations (and vice versa) shall, in each case, be deemed fully effective hereunder and shall not be otherwise affected by virtue of the foregoing.

Section 17.4.Severability. Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable Legal Requirements, but if any provision of this Agreement shall be prohibited by or invalid under applicable Legal Requirements, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

Section 17.5.Preferences. Lender shall have the continuing and exclusive right to apply or reverse and reapply any and all payments by Borrower to any portion of the obligations of Borrower hereunder. To the extent Borrower makes a payment or payments to Lender, which payment or proceeds or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other party under any Creditors Rights Laws, state or federal law, common law or equitable cause, then, to the extent of such payment or proceeds received, the obligations hereunder or part thereof intended to be satisfied shall be revived and continue in full force and effect, as if such payment or proceeds had not been received by Lender.

Section 17.6.Expenses. Except as otherwise expressly provided in this Agreement, Borrower covenants and agrees to pay its own costs and expenses and pay, or, if Borrower fails to pay, to reimburse, Lender, upon receipt of written notice from Lender, for Lender’s reasonable out-of-pocket costs and expenses (including reasonable, actual attorneys’ fees and disbursements) in each case, incurred by Lender in accordance with this Agreement in connection with (i) the preparation, negotiation, execution and delivery of this Agreement, the Security Instrument, the Note and the other Loan Documents and the consummation of the transactions contemplated hereby and thereby and all the costs of furnishing all opinions by counsel for Borrower (including without limitation any opinions requested by Lender as to any legal matters arising under this Agreement, the Security Instrument, the Note and the other Loan Documents with respect to the Property); (ii) Borrower’s ongoing performance of and compliance with Borrower’s respective agreements and covenants contained in this Agreement, the Security Instrument, the Note and the other Loan Documents on its part to be performed or complied with after the Closing Date, including, without limitation, confirming compliance with environmental and insurance requirements; (iii) Lender’s ongoing performance and compliance with all agreements and conditions contained in this Agreement, the Security Instrument, the Note and the other Loan Documents on its part to be performed or complied with after the Closing Date (including, without limitation, those contained in Articles 8 and 9 hereof); (iv) the negotiation, preparation, execution, delivery and administration of any consents, amendments, waivers, extensions, releases or other modifications to this Agreement, the Security Instrument, the Note and the other Loan Documents and any other documents or matters reasonably requested by Lender; (v) securing Borrower’s compliance with any requests made pursuant to the provisions of this Agreement; (vi) the filing and recording fees and expenses, title insurance, survey charges, and reasonable fees and out-of-pocket expenses of counsel for providing to Lender all required legal opinions, and other similar reasonable, out-of-

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​ pocket expenses incurred in creating and perfecting the lien in favor of Lender pursuant to this Agreement, the Security Instrument, the Note and the other Loan Documents; (vii) enforcing or preserving any rights, in response to third party claims or the prosecuting or defending of any action or proceeding or other litigation, in each case against, under or affecting Borrower, this Agreement, the Security Instrument, the Note, the other Loan Documents, the Property, or any other security given for the Loan; (viii) servicing the Loan (including, without limitation, enforcing any obligations of or collecting any payments due from Borrower under this Agreement, the Security Instrument, the Note and the other Loan Documents or with respect to the Property) or in connection with any refinancing or restructuring of the credit arrangements provided under this Agreement in the nature of a “work-out” or of any insolvency or bankruptcy proceedings; (ix) a conversion of the Benchmark, the Benchmark Replacement, the Benchmark Replacement Condition, the Benchmark Replacement Adjustment, the Benchmark Unavailability Period and the Conforming Changes; and (x) the preparation, negotiation, execution, delivery, review, filing, recording or administration of any documentation associated with the exercise of any of Borrower’s rights hereunder and/or under the other Loan Documents regardless of whether or not any such right is consummated (including, without limitation, Borrower’s rights hereunder to (i) defease the Loan and to permit or undertake transfers (including under Sections 6.3 and 6.4 hereof), (ii) any extension option and (iii) any property releases, in each case, in accordance with the applicable terms and conditions hereof); provided, however, that, with respect to each of subsections (i) through (x) above, (A) none of the foregoing subsections shall be deemed to be mutually exclusive or limit any other subsection, (B) the same shall be deemed to (I) include, without limitation and in each case, any related special servicing fees, liquidation fees, modification fees, work-out fees and other similar costs or expenses payable to any Servicer, trustee and/or special servicer of the Loan (or any portion thereof and/or interest therein) and (II) exclude any requirement that Borrower directly pay the base monthly servicing fees due to any master servicer on account of the day to day, routine servicing of the Loan (provided, further, that the foregoing subsection (II) shall not be deemed to otherwise limit any fees, costs, expenses or other sums required to be paid to Lender under this Section, the other terms and conditions hereof and/or of the other Loan Documents) and (C) Borrower shall not be liable for the payment of any such costs and expenses to the extent the same arise by reason of the gross negligence, illegal acts, fraud or willful misconduct of Lender.

Section 17.7.Cost of Enforcement. In the event (a) that the Security Instrument is foreclosed in whole or in part, (b) of the bankruptcy, insolvency, rehabilitation or other similar proceeding in respect of Borrower or any of its constituent Persons or an assignment by Borrower or any of its constituent Persons for the benefit of its creditors, or (c) Lender exercises any of its other remedies under this Agreement, the Security Instrument, the Note and the other Loan Documents, Borrower shall be chargeable with and agrees to pay all costs of collection and defense, including reasonable, out-of-pocket attorneys’ fees and costs, actually incurred by Lender or Borrower in connection therewith and in connection with any appellate proceeding or post judgment action involved therein, together with all required service or use taxes.

Section 17.8.Schedules and Exhibits Incorporated. The schedules and exhibits annexed hereto are hereby incorporated herein as a part of this Agreement with the same effect as if set forth in the body hereof.

Section 17.9.Offsets, Counterclaims and Defenses. Any assignee of Lender’s interest in and to this Agreement, the Security Instrument, the Note and the other Loan Documents shall take the same free and clear of all offsets, counterclaims or defenses which are unrelated to such documents which Borrower may otherwise have against any assignor of such documents, and no such unrelated counterclaim or defense shall be interposed or asserted by Borrower in any action or proceeding brought by any such assignee upon such documents and any such right to interpose or

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​ assert any such unrelated offset, counterclaim or defense in any such action or proceeding is hereby expressly waived by Borrower.

Section 17.10.No Joint Venture or Partnership; No Third Party Beneficiaries.

(a)Borrower and Lender intend that the relationships created under this Agreement, the Security Instrument, the Note and the other Loan Documents be solely that of borrower and lender. Nothing herein or therein is intended to create a joint venture, partnership, tenancy-in-common, or joint tenancy relationship between Borrower and Lender nor to grant Lender any interest in the Property other than that of mortgagee, beneficiary or lender.

(b)This Agreement, the Security Instrument, the Note and the other Loan Documents are solely for the benefit of Lender and Borrower and nothing contained in this Agreement, the Security Instrument, the Note or the other Loan Documents shall be deemed to confer upon anyone other than Lender and Borrower any right to insist upon or to enforce the performance or observance of any of the obligations contained herein or therein. All conditions to the obligations of Lender to make the Loan hereunder are imposed solely and exclusively for the benefit of Lender and no other Person (other than Lender) shall have standing to require satisfaction of such conditions in accordance with their terms or be entitled to assume that Lender will refuse to make the Loan in the absence of strict compliance with any or all thereof and no other Person shall under any circumstances be deemed to be a beneficiary of such conditions (other than Lender), any or all of which may be freely waived in whole or in part by Lender if, in Lender’s sole discretion, Lender deems it advisable or desirable to do so.

(c)The general partners, members, principals and (if Borrower is a trust) beneficial owners of Borrower are experienced in the ownership and operation of properties similar to the Property, and Borrower and Lender are relying solely upon such expertise and business plan in connection with the ownership and operation of the Property. Borrower is not relying on Lender’s expertise, business acumen or advice in connection with the Property.

(d)Notwithstanding anything to the contrary contained herein, Lender is not undertaking the performance of (i) any obligations related to the Property (including, without limitation, under the Leases); or (ii) any obligations with respect to any agreements, contracts, certificates, instruments, franchises, permits, trademarks, licenses and other documents to which any Borrower Party and/or the Property is subject.

(e)By accepting or approving anything required to be observed, performed or fulfilled or to be given to Lender pursuant to this Agreement, the Security Instrument, the Note or the other Loan Documents, including, without limitation, any officer’s certificate, balance sheet, statement of profit and loss or other financial statement, survey, appraisal, or insurance policy, Lender shall not be deemed to have warranted, consented to, or affirmed the sufficiency, the legality or effectiveness of same, and such acceptance or approval thereof shall not constitute any warranty or affirmation with respect thereto by Lender.

(f)Borrower recognizes and acknowledges that in accepting this Agreement, the Note, the Security Instrument and the other Loan Documents, Lender is expressly and primarily relying on the truth and accuracy of the representations and warranties set forth in Article 3 of this Agreement without any obligation to investigate the Property and notwithstanding any investigation of the Property by Lender; that such reliance existed on the part of Lender prior to the date hereof, that the warranties and representations are a material inducement to Lender in making the Loan; and that Lender would not be willing to make the Loan and accept this Agreement, the Note, the Security

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​ Instrument and the other Loan Documents in the absence of the warranties and representations as set forth in Article 3 of this Agreement.

Section 17.11.Publicity. All news releases, publicity or advertising by Borrower or its Affiliates through any media intended to reach the general public which refers to this Agreement, the Note, the Security Instrument or the other Loan Documents or the financing evidenced by this Agreement, the Note, the Security Instrument or the other Loan Documents, to Lender or any of its Affiliates shall, except to the extent such release is required by applicable Legal Requirements, be subject to the prior written approval of Lender, not to be unreasonably withheld. Without limitation of any other term or provision hereof, nothing contained herein or in the other Loan Documents shall be deemed to restrict Lender and/or Servicer from (and Lender and/or Servicer shall be authorized to) disseminate to any Person any and all information it obtains in connection with the Loan as Lender and/or Servicer deems necessary or appropriate.

Section 17.12.Limitation of Liability. No claim may be made by Borrower, or any other Person against Lender or its Affiliates, directors, officers, employees, attorneys or agents of any of such Persons for any special, indirect, consequential or punitive damages in respect of any claim for breach of contract or any other theory of liability arising out of or related to the transactions contemplated by this Agreement or any act, omission or event occurring in connection therewith; and Borrower hereby waives, releases and agrees not to sue upon any claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favor.

Section 17.13.Conflict; Construction of Documents; Reliance. In the event of any conflict between the provisions of this Agreement and the Security Instrument, the Note or any of the other Loan Documents, the provisions of this Agreement shall control. The parties hereto acknowledge that they were represented by competent counsel in connection with the negotiation, drafting and execution of this Agreement, the Note, the Security Instrument and the other Loan Documents and this Agreement, the Note, the Security Instrument and the other Loan Documents shall not be subject to the principle of construing their meaning against the party which drafted same. Borrower acknowledges that, with respect to the Loan, Borrower shall rely solely on its own judgment and advisors in entering into the Loan without relying in any manner on any statements, representations or recommendations of Lender or any parent, subsidiary or Affiliate of Lender. Lender shall not be subject to any limitation whatsoever in the exercise of any rights or remedies available to it under this Agreement, the Note, the Security Instrument and the other Loan Documents or any other agreements or instruments which govern the Loan by virtue of the ownership by it or any parent, subsidiary or Affiliate of Lender of any equity interest any of them may acquire in Borrower, and Borrower hereby irrevocably waives the right to raise any defense or take any action on the basis of the foregoing with respect to Lender’s exercise of any such rights or remedies. Borrower acknowledges that Lender engages in the business of real estate financings and other real estate transactions and investments which may be viewed as adverse-to or competitive with the business of Borrower or its Affiliates.

Section 17.14.Entire Agreement. This Agreement, the Note, the Security Instrument and the other Loan Documents contain the entire agreement of the parties hereto and thereto in respect of the transactions contemplated hereby and thereby, and all prior agreements among or between such parties, whether oral or written between Borrower and Lender are superseded by the terms of this Agreement, the Note, the Security Instrument and the other Loan Documents.

Section 17.15.Liability. If Borrower consists of more than one Person, the obligations and liabilities of each such Person hereunder shall be joint and several. This Agreement shall be binding

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​ upon and inure to the benefit of Borrower and Lender and their respective successors and assigns forever.

Section 17.16.Duplicate Originals; Counterparts. This Agreement may be executed in any number of duplicate originals and each duplicate original shall be deemed to be an original. The failure of any party hereto to execute this Agreement, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder.

Section 17.17.Brokers. Borrower agrees (i) to pay any and all fees imposed or charged by all brokers, mortgage bankers and advisors (each a “Broker”) hired or contracted by any Borrower Party or their Affiliates in connection with the transactions contemplated by this Agreement and (ii) to indemnify and hold Lender harmless from and against any and all claims, demands and liabilities for brokerage commissions, assignment fees, finder’s fees or other compensation whatsoever arising from this Agreement or the making of the Loan which may be asserted against Lender by any Person. The foregoing indemnity shall survive the termination of this Agreement and the payment of the Debt. Borrower hereby represents and warrants that the only Broker engaged by any Borrower Party in connection with the transactions contemplated by this Agreement respect hereto is Cushman & Wakefield. Lender hereby agrees to pay any and all fees imposed or charged by any Broker hired solely by Lender. Borrower acknowledges and agrees that (a) any Broker is not an agent of Lender and has no power or authority to bind Lender, (b) Lender is not responsible for any recommendations or advice given to any Borrower Party by any Broker, (c) Lender and the Borrower Parties have dealt at arms-length with each other in connection with the Loan, (d) no fiduciary or other special relationship exists or shall be deemed or construed to exist among Lender and the Borrower Parties and (e) none of the Borrower Parties shall be entitled to rely on any assurances or waivers given, or statements made or actions taken, by any Broker which purport to bind Lender or modify or otherwise affect this Agreement or the Loan, unless Lender has, in its sole discretion, agreed in writing with any such Borrower Party to such assurances, waivers, statements, actions or modifications. Borrower acknowledges and agrees that Lender may, in its sole discretion, pay fees or compensation to any Broker in connection with or arising out of the closing and funding of the Loan. Such fees and compensation, if any, (i) shall be in addition to any fees which may be paid by any Borrower Party to such Broker and (ii) create a potential conflict of interest for Broker in its relationship with the Borrower Parties. Such fees and compensation, if applicable, may include a direct, one-time payment, servicing fees and/or incentive payments based on volume and size of financings involving Lender and such Broker.

Section 17.18.Set-Off. In addition to any rights and remedies of Lender provided by this Agreement and by law, Lender shall have the right in its sole discretion, without prior notice to Borrower, any such notice being expressly waived by Borrower to the extent permitted by applicable Legal Requirements, upon any amount becoming due and payable by Borrower hereunder (whether at the stated maturity, by acceleration or otherwise), to set-off and appropriate and apply against such amount any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by Lender or any Affiliate thereof to or for the credit or the account of Borrower; provided however, Lender may only exercise such right during the continuance of an Event of Default. Lender agrees promptly to notify Borrower after any such set-off and application made by Lender; provided that the failure to give such notice shall not affect the validity of such set-off and application.

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​ Section 17.19.Unintended Payments.

(a)If JPMorgan Chase Bank, National Association, any Affiliate of the foregoing, or any agent thereof (including, without limitation, any Servicer or administrative agent acting on said Person’s behalf) (individually and/or collectively, the “Payor Party”) notifies Borrower, any Lender or any Person who has received funds on behalf of said Borrower or Lender (any such Borrower, Lender or other recipient, a “Payment Recipient”) that the Payor Party has determined in its reasonable discretion (whether or not after receipt of any notice under immediately succeeding clause (b)) that any funds received by such Payment Recipient from the Payor Party or any of its Affiliates were erroneously transmitted to, or otherwise erroneously or mistakenly received by, such Payment Recipient (whether or not known to such Borrower, Lender, or other Payment Recipient on its behalf) (any such funds, whether received as a payment, prepayment or repayment of principal, interest, fees, distribution or otherwise, individually and collectively, an “Erroneous Payment”) and demands the return of such Erroneous Payment (or a portion thereof), such Erroneous Payment shall at all times remain the property of the Payor Party and shall be segregated by the Payment Recipient and held in trust for the benefit of the Payor Party, and such Borrower or Lender shall (or, with respect to any Payment Recipient who received such funds on its behalf, shall cause such Payment Recipient to) promptly, but in no event later than two (2) Business Days thereafter, return to the Payor Party the amount of any such Erroneous Payment (or portion thereof) as to which such a demand was made, in same day funds (in the currency so received), together with interest thereon in respect of each day from and including the date such Erroneous Payment (or portion thereof) was received by such Payment Recipient to the date such amount is repaid to the Payor Party in same day funds at the greater of the Federal Funds Rate and a rate determined by the Payor Party in accordance with banking industry rules on interbank compensation from time to time in effect. A notice of the Payor Party to any Payment Recipient under this clause (a) shall be conclusive, absent manifest error.

(b)Without limiting the immediately preceding clause (a), each Lender or any Person who has received funds on behalf of a Lender, hereby further agrees that if it receives a payment, prepayment or repayment (whether received as a payment, prepayment or repayment of principal, interest, fees, distribution or otherwise) from the Payor Party (or any of its Affiliates) (x) that is in a different amount than, or on a different date from, that specified in a notice of payment, prepayment or repayment sent by the Payor Party (or any of its Affiliates) with respect to such payment, prepayment or repayment, (y) that was not preceded or accompanied by a notice of payment, prepayment or repayment sent by the Payor Party (or any of its Affiliates), or (z) that such Lender or other such recipient, otherwise becomes aware was transmitted, or received, in error or by mistake (in whole or in part) in each case:

(i)(A) in the case of immediately preceding clauses (x) or (y), an error shall be presumed to have been made (absent written confirmation from the Payor Party to the contrary) or (B) an error has been made (in the case of immediately preceding clause (z)), in each case, with respect to such payment, prepayment or repayment; and

(ii)such Lender shall (and shall cause any other recipient that receives funds on its respective behalf to) promptly (and, in all events, within one (1) Business Day of its knowledge of such error) notify the Payor Party of its receipt of such payment, prepayment or repayment, the details thereof (in reasonable detail) and that it is so notifying the Payor Party pursuant to this Section 17.19(b).

(c)Each Lender hereby authorizes the Payor Party to set off, net and apply any and all amounts at any time owing to such Lender under any Loan Document, or otherwise payable or

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​ distributable by the Payor Party to such Lender from any source, against any amount due to the Payor Party under immediately preceding clause (a) or under the indemnification provisions of this Agreement or any co-lender agreement entered into by and among any such Lender and any Payor Party.

(d)The parties hereto agree that an Erroneous Payment shall not pay, prepay, repay, discharge or otherwise satisfy any obligations pursuant to the Loan Documents by the Borrower, Guarantor, or any Affiliate thereof, except, in each case, to the extent such Erroneous Payment is, and solely with respect to the amount of such Erroneous Payment that is, comprised of funds received by the Payor Party from the Borrower for the purpose of making such Erroneous Payment.

(e)To the extent permitted by applicable Legal Requirements, no Payment Recipient shall assert any right or claim to an Erroneous Payment, and hereby waives, and is deemed to waive, any claim, counterclaim, defense or right of set-off or recoupment with respect to any demand, claim or counterclaim by the Payor Party for the return of any Erroneous Payment received, including without limitation waiver of any defense based on “discharge for value” or any similar doctrine.

(f)Each party’s obligations, agreements and waivers under this Section 17.19 shall survive the resignation or replacement of any Payor Party hereunder, any transfer of rights or obligations by, or the replacement of, a Lender and/or the repayment, satisfaction or discharge of the Debt and all other obligations (or any portion thereof) under any Loan Document.

Section 17.20.Contributions and Waivers.

(a)As a result of the transactions contemplated by this Agreement and the other Loan Documents, each Borrower will benefit, directly and indirectly, from each Borrower’s obligation to pay the Debt and perform its obligations hereunder and under the other Loan Documents (collectively, the “Obligations”) and in consideration therefore each Borrower desires to enter into an allocation and contribution agreement among themselves as set forth in this Section to allocate such benefits among themselves and to provide a fair and equitable agreement to make contributions among each of Borrowers in the event any payment is made by any individual Borrower hereunder to Lender (such payment being referred to herein as a “Contribution,” and for purposes of this Section, includes any exercise of recourse by Lender against any Property of a Borrower and application of proceeds of such Property in satisfaction of such Borrower’s obligations, to Lender under the Loan Documents).

(b)Each Borrower shall be liable hereunder with respect to the Obligations only for such total maximum amount (if any) that would not render its Obligations hereunder or under any of the Loan Documents subject to avoidance under Section 548 of the Bankruptcy Code or any comparable provisions of applicable Legal Requirements.

(c)In order to provide for a fair and equitable contribution among Borrowers in the event that any Contribution is made by an individual Borrower (a “Funding Borrower”), such Funding Borrower shall be entitled to a reimbursement Contribution (“Reimbursement Contribution”) from all other Borrowers for all payments, damages and expenses incurred by that Funding Borrower in discharging any of the Obligations, in the manner and to the extent set forth in this Section.

(d)For purposes hereof, the “Benefit Amount” of any individual Borrower as of any date of determination shall be the net value of the benefits to such Borrower and its Affiliates from extensions of credit made by Lender to (i) such Borrower and (ii) to the other Borrowers hereunder

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​ and the Loan Documents to the extent such other Borrowers have guaranteed or mortgaged their property to secure the Obligations of such Borrower to Lender.

(e)Each Borrower shall be liable to a Funding Borrower in an amount equal to the greater of (i) the (A) ratio of the Benefit Amount of such Borrower to the total amount of Obligations, multiplied by (B) the amount of Obligations paid by such Funding Borrower, or (ii) ninety-five percent (95%) of the excess of the fair saleable value of the property of such Borrower over the total liabilities of such Borrower (including the maximum amount reasonably expected to become due in respect of contingent liabilities) determined as of the date on which the payment made by a Funding Borrower is deemed made for purposes hereof (giving effect to all payments made by other Funding Borrowers as of such date in a manner to maximize the amount of such Contributions).

(f)In the event that at any time there exists more than one Funding Borrower with respect to any Contribution (in any such case, the “Applicable Contribution”), then Reimbursement Contributions from other Borrowers pursuant hereto shall be allocated among such Funding Borrowers in proportion to the total amount of the Contribution made for or on account of the other Borrowers by each such Funding Borrower pursuant to the Applicable Contribution. In the event that at any time any Borrower pays an amount hereunder in excess of the amount calculated pursuant to this Section above, that Borrower shall be deemed to be a Funding Borrower to the extent of such excess and shall be entitled to a Reimbursement Contribution from the other Borrowers in accordance with the provisions of this Section.

(g)Each Borrower acknowledges that the right to Reimbursement Contribution hereunder shall constitute an asset in favor of Borrower to which such Reimbursement Contribution is owing.

(h)No Reimbursement Contribution payments payable by a Borrower pursuant to the terms of this Section shall be paid until all amounts then due and payable by all of Borrowers to Lender, pursuant to the terms of the Loan Documents, are paid in full in cash. Nothing contained in this Section shall limit or affect in any way the Obligations of any Borrower to Lender under the Loan Documents.

(i)To the extent permitted by applicable Legal Requirements, each Borrower waives:

(i)any right to require Lender to proceed against any other Borrower or any other Person or to proceed against or exhaust any security held by Lender at any time or to pursue any other remedy in Lender’s power before proceeding against Borrower;

(ii)any defense based upon any legal disability or other defense of any other Borrower, any guarantor of any other Person or by reason of the cessation or limitation of the liability of any other Borrower or any guarantor from any cause other than full payment of all sums payable under the Loan Documents;

(iii)any defense based upon any lack of authority of the officers, directors, partners or agents acting or purporting to act on behalf of any other Borrower or any principal of any other Borrower or any defect in the formation of any other Borrower or any principal of any other Borrower;

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​ (iv)any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in any other respects more burdensome than that of a principal;

(v)any defense based upon any failure by Lender to obtain collateral for the indebtedness or failure by Lender to perfect a lien on any collateral;

(vi)presentment, demand, protest and notice of any kind;

(vii)any defense based upon any failure of Lender to give notice of sale or other disposition of any collateral to any other Borrower or to any other Person or any defect in any notice that may be given in connection with any sale or disposition of any collateral;

(viii)any defense based upon any failure of Lender to comply with applicable laws in connection with the sale or other disposition of any collateral, including any failure of Lender to conduct a commercially reasonable sale or other disposition of any collateral;

(ix)any defense based upon any use of cash collateral under Section 363 of the Bankruptcy Code;

(x)any defense based upon any agreement or stipulation entered into by Lender with respect to the provision of adequate protection in any bankruptcy proceeding;

(xi)any defense based upon any borrowing or any grant of a security interest under Section 364 of the Bankruptcy Code;

(xii)any defense based upon the avoidance of any security interest in favor of Lender for any reason;

(xiii)any defense based upon any bankruptcy, insolvency, reorganization, arrangement, readjustment of debt, liquidation or dissolution proceeding, including any discharge of, or bar or stay against collecting, all or any of the obligations evidenced by the Note or owing under any of the Loan Documents;

(xiv)any defense or benefit based upon Borrower’s, or any other party’s, resignation of the portion of any obligation secured by the Security Instrument to be satisfied by any payment from any other Borrower or any such party;

(xv)all rights and defenses arising out of an election of remedies by Lender even though the election of remedies, such as non-judicial foreclosure with respect to security for the Loan or any other amounts owing under the Loan Documents, has destroyed Borrower’s rights of subrogation and reimbursement against any other Borrower; and

(xvi)all rights and defenses that Borrower may have because any of the Debt is secured by real property. This means, among other things (subject to the other terms and conditions of the Loan Documents): (1) Lender may collect from Borrower without first foreclosing on any real or personal property collateral pledged by any other Borrower, and (2) if Lender forecloses on any real property collateral pledged by any other Borrower, (I) the amount of the Debt may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the collateral is worth more than the sale price and (II) Lender may collect from Borrower even if any other Borrower, by foreclosing on the real property collateral, has destroyed any right Borrower may have to collect from any other Borrower.

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​ This is an unconditional and irrevocable waiver of any rights and defenses Borrower may have because any of the Debt is secured by real property; and except as may be expressly and specifically permitted herein, any claim or other right which Borrower might now have or hereafter acquire against any other Borrower or any other Person that arises from the existence or performance of any obligations under the Loan Documents, including any of the following: (i) any right of subrogation, reimbursement, exoneration, contribution, or indemnification; or (ii) any right to participate in any claim or remedy of Lender against any other Borrower or any collateral security therefor, whether or not such claim, remedy or right arises in equity or under contract, statute or common law.

(j)Each Borrower hereby restates and makes the waivers made by Guarantor in the Guaranty for the benefit of Lender. Such waivers are hereby incorporated by reference as if fully set forth herein (and as if applicable to each Borrower) and shall be effective for all purposes under the Loan (including, without limitation, in the event that any Borrower is deemed to be a surety or guarantor of the Debt (by virtue of each Borrower being co-obligors and jointly and severally liable hereunder, by virtue of each Borrower encumbering its interest in the Property for the benefit or debts of the other Borrowers in connection herewith or otherwise)).

Section 17.21.Cross-Default; Cross-Collateralization; Waiver of Marshalling Assets.

(a)Borrower acknowledges that Lender has made the Loan to Borrower upon the security of its collective interest in the Properties and in reliance upon the aggregate of the Properties taken together being of greater value as collateral security than the sum of each Individual Property taken separately. Each Borrower agrees that each of the Loan Documents (including, without limitation, the Security Instruments) are and will be cross collateralized and cross defaulted with each other so that (i) an Event of Default under any of the Loan Documents shall constitute an Event of Default under each of the other Loan Documents; (ii) an Event of Default hereunder shall constitute an Event of Default under each Security Instrument; (iii) each Security Instrument shall constitute security for the Note as if a single blanket lien were placed on all of the Properties as security for the Note; and (iv) such cross collateralization shall in no event be deemed to constitute a fraudulent conveyance and Borrower waives any claims related thereto.

(b)To the fullest extent permitted by law, each Borrower, for itself and its successors and assigns, waives all rights to a marshalling of the assets of Borrower, Borrower’s partners, and others with interests in Borrower, and of the Properties, or to a sale in inverse order of alienation in the event of foreclosure of all or any of the Security Instruments, and agrees not to assert any right under any laws pertaining to the marshalling of assets, the sale in inverse order of alienation, homestead exemption, the administration of estates of decedents, or any other matters whatsoever to defeat, reduce or affect the right of Lender under the Loan Documents to a sale of the Properties for the collection of the Debt without any prior or different resort for collection or of the right of Lender to the payment of the Debt out of the net proceeds of the Properties in preference to every other claimant whatsoever. In addition, each Borrower, for itself and its successors and assigns, waives in the event of foreclosure of any or all of the Security Instruments, any equitable right otherwise available to Borrower which would require the separate sale of the Properties or require Lender to exhaust its remedies against any Individual Property or any combination of the Properties before proceeding against any other Individual Property or combination of Properties; and further in the event of such foreclosure each Borrower does hereby expressly consent to and authorize, at the option of Lender, the foreclosure and sale either separately or together of any combination of the Properties.

​	​	​
​	-152-	​

​

​

​ Section 17.22.Acknowledgement and Consent to Bail-In of Affected Financial Institutions .

Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Affected Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a)the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an Affected Financial Institution; and

(b)the effects of any Bail-In Action on any such liability, including, if applicable:

(i)a reduction in full or in part or cancellation of any such liability;

(ii)a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(iii)the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of the applicable Resolution Authority.

[NO FURTHER TEXT ON THIS PAGE]

​

​

​	​	​
​	-153-	​

​

​

​ IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized representatives, all as of the day and year first above written.

BORROWER:

AREIT EAST COLUMBIA IC LLC, a Delaware limited liability company

By: AREIT 2024 Pl LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By: AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By: Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

​	​	​
​	​	​

​

​

​ AREIT GILLINGHAM IC LP, a Delaware limited partnership

By: AREIT Gillingham IC GP LLC, a Delaware limited liability company, its General Partner

By: AREIT 2024 Pl LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By: AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By: Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

​

​

​ AREIT INTERMOUNTAIN SPACE CENTER LLC, a Delaware limited liability company

By: AREIT 2024 Pl LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By: AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By: Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ AREIT LAS VEGAS IC I LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By: AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By: Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ AREIT LAS VEGAS IC II LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By: AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By: Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory ​

​ AREIT MORENO VALLEY DC LP, a Delaware limited partnership

​

By: AREIT Moreno Valley DC GP LLC, a Delaware limited liability company, its General Partner

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By: AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By: Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ AREIT PHOENIX IC LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ AREIT PLAINFIELD LOGISTICS CENTER LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ AREIT STAFFORD GROVE IP LP, a Delaware limited partnership

By:AREIT Stafford Grove IP GP LLC, a Delaware limited liability company, its General Partner

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By:AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

​

​

​ AREIT TEMPE IC LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ AREIT TRANSPORT DRIVE CC LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By:AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory ​

​ AREIT VM8 LOGISTICS CENTER LP, a Delaware limited partnership

By:AREIT VM8 Logistics Center GP LLC, a Delaware limited liability company, its General Partner

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By:AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory ​

​ AREIT WESTERN FOOD CENTER LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ BCDPF 25 LINDEN INDUSTRIAL CENTER LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By:AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

​

​

​ BCDPF 395 LOGISTICS CENTER LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ BCDPF AIRWAY INDUSTRIAL PARK LP, a Delaware limited partnership

By:BCDPF Airway Industrial Park GP LLC, a Delaware limited liability company, its General Partner

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ BCDPF AURORA DC LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By:AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ BCDPF BAY AREA COMMERCE CENTER LP, a Delaware limited partnership

By: BCDPF Bay Area Commerce Center GP LLC, a Delaware limited liability company, its General Partner

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By:AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory

‌​

​

​ BCDPF CLAYTON COMMERCE CENTER LLC, a Delaware limited liability company

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP,

a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory ​

​ BCDPF LITTLE ORCHARD BUSINESS PARK LP, a Delaware limited partnership

By:BCDPF Little Orchard Business Park GP LLC, a Delaware limited liability company, its General Partner

By:DPF Cherry Creek LLC, a Delaware limited liability company, its Sole Member

By:AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory ​

​ BCDPF TUSTIN BUSINESS CENTER LP, a Delaware limited partnership

By: BCDPF Tustin Business Center GP LLC, a Delaware limited liability company, its General Partner

By: AREIT 2024 P1 LLC, a Delaware limited liability company, its Sole Member

By:AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By:Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory ​

​ AREIT 2024 P1 LLC, a Delaware limited liability company

By: AREIT Real Estate Holdco LLC, a Delaware limited liability company, its Sole Member

By:AREIT Operating Partnership LP, a Delaware limited partnership, its Sole Member

By: Ares Real Estate Income Trust Inc., a Maryland corporation, its General Partner

By: /s/ Jonathan Hiller

Name: Jonathan Hiller

Title: Authorized Signatory ​

​ LENDER:

​

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a banking association chartered under the laws of the United States of America

By: /s/ Jessica Wong

Name: Jessica Wong

Title: Authorized Signatory ​

​ LENDER:

​

MORGAN STANLEY BANK, N.A., a national banking association

​

By: /s/ Jane Lam

Name: Jane Lam

Title: Managing Director ​

​ ​

LENDER:

​

NATIXIS REAL ESTATE CAPITAL LLC, a Delaware limited liability company

​

By: /s/ Jared Zimmel

Name: Jared Zimmel

Title: Executive Director

​

By: /s/ Melissa Naturman

Name: Melissa Naturman

Title: Director

​ ​

​ [SCHEDULE I]

​ ​

​ [SCHEDULE II]

​ ​

​ [SCHEDULE III]

​ ​

​ [SCHEDULE IV]

​ ​

​ [SCHEDULE V]

​ ​

​ [SCHEDULE VI]

​ ​

​**[SCHEDULE VII]**​

​ [SCHEDULE VIII]

​ ​

​ [SCHEDULE IX]

​ ​

​ [EXHIBIT A]

​ ​

​ [EXHIBIT B]

​

​ ​

​**[** EXHIBIT **C]**​

Exhibit 19.1 ARES REAL ESTATE INCOME TRUST INC.

Insider Trading Policy

( revised and adopted as of March 4, 2025 )

In order to promote compliance with federal, state and foreign securities laws and take an active role in the prevention of insider trading violations by Insiders (as defined below) of Ares Real Estate Income Trust Inc. (the “Company”), the Company has adopted this Insider Trading Policy (this “Policy”).

No director, officer or employee of Company, its advisor, Ares Commercial Real Estate Management LLC (including its parent company Ares Management LLC, the “Advisor”), or any of their immediate family members living in their household (including any spouse, registered domestic partner, child, stepchild, grandchild, parent, stepparent, grandparent, sibling, or person with whom such person has an adoptive or “in-law” relationship) or any trusts, corporations or other entities controlled by a person covered by this Policy (each, an “Insider” and, collectively, the “Insiders”) may engage in transactions in any securities while in possession of material nonpublic information regarding the issuer of such securities where such information was improperly obtained, where it was obtained under circumstances contemplating that it would not be used for personal gain and in certain other circumstances (so-called “insider trading”), nor may any Insider communicate such material nonpublic information to any person who could use such information to purchase or sell securities (so-called “tipping”).^1^ In addition, this Policy prohibits Insiders from, without the prior approval of the Company’s Chief Compliance Officer (the “CCO”) or another designated member of the Ares Management Compliance Department (the “Compliance Department”):

●	buying or selling puts or calls or other derivative securities (other than derivative securities issued by the Company, such as convertible notes) based on the Company’s securities;
●	engaging in the short sale of the Company’s securities;
---	---
●	holding the Company’s securities in a margin account or pledging the Company’s securities as collateral for a loan; or
---	---
●	entering into hedging or monetization transactions or similar arrangements with respect to the Company’s securities.
---	---

^1^   Liability for insider trading or tipping is contingent upon the existence of some fiduciary or other duty, a relationship of trust with respect to the source of the material nonpublic information or the misappropriation of such information. Any Insider who comes into possession of material nonpublic information should presume that such a duty or relationship exists until the Advisor’s legal personnel or the CCO, or another designated member of the Compliance Department, advises the Insider to the contrary. ​

​ ​

Before purchasing, selling, redeeming, gifting, including charitable donations, or otherwise transacting in, either personally or on behalf of others, any of the Company’s outstanding securities, each Insider must obtain clearance from the Advisor’s Chief Compliance Officer (the “ CCO ”) or the Ares Management Compliance Department (the “ Compliance Department ”).  Insiders who are employees or officers of the Company, its Advisor or their affiliates are also subject to additional requirements regarding personal securities trading and holdings set forth in applicable codes of ethics.

Definition of “Securities”

The term “securities” includes common and preferred stock, debt securities, options or derivative instruments with respect to securities, securities that are convertible into or exercisable or exchangeable for other securities, as well as partnership interests.

Definition of Material Information

The question of whether information is “material” is not always easily resolved. Generally speaking, information is “material” where there is a substantial likelihood that a reasonable investor would consider the information important in deciding whether to buy or sell the securities in question or where the information, if disclosed, could be viewed by a reasonable investor as having significantly altered the “total mix” of information available. Where the nonpublic information relates to a possible or contingent event, materiality depends upon a balancing of both the probability that the event will occur and the anticipated magnitude of the event in light of the totality of the activities of the issuer involved. No simple test exists to determine when information is material; assessments of materiality involve a highly fact-specific inquiry. For this reason, you should direct any questions about whether information is material, as well as any questions regarding specific transactions, to the CCO or the Compliance Department.

Common, but by no means exclusive, examples of what may be “material” include the following:

●	Distribution changes
●	Financial forecasts
---	---
●	Changes in previously disclosed financial information
---	---
●	Mergers or significant acquisitions or dispositions
---	---
●	Proposed issuances of new securities
---	---
●	Tender offers of existing securities
---	---
●	Changes to the share repurchase program
---	---
●	Major litigation or any outcomes of or developments in such litigation
---	---
●	Significant changes in management or operations
---	---
●	Significant development with respect to a tenant, lease or property
---	---
●	Significant new investment targets to be introduced
---	---
●	Extraordinary borrowings or liquidity problems
---	---

​

​

●	Purchase or sale of substantial assets
●	Governmental investigations, criminal actions or indictments and any collateral consequences
---	---
●	Information received from political intelligence firms such as legislative and regulatory research analysis reports that are not publicly available
---	---
●	Cybersecurity incidents or threats
---	---
●	Violations or potential violations of applicable law
---	---

​

“Inside” information could be material because of its expected effect on the net asset value of the Company, securities of companies with whom the Company does business or in which the Company has made or considered making an investment.  Moreover, the resulting prohibition against the misuse of inside information includes not only restrictions on trading in the Company’s outstanding securities, but restrictions on trading in the securities of such other companies affected by the inside information.

Definition of “Nonpublic” Information

Information is “nonpublic” until it has been made available to investors generally and they have had time to act on it. In this respect, one must be able to point to some fact to show that the information is generally public, such as inclusion in reports filed with the Securities and Exchange Commission or press releases issued by the issuer of the securities or reference to such information in wire services or publications of general circulation such as Reuters, Bloomberg, Dow Jones, The Wall Street Journal or The New York Times.  In addition, the fact that information has been disclosed to a few members of the public does not necessarily make it “public” for insider trading purposes.

Penalties for Insider Trading

Liability and penalties for insider trading or tipping are severe, both for individuals involved in such unlawful conduct and their employers.  A person can be subject to some or all of the penalties below even if he or she does not personally benefit from the violation (for example, where the person tipped another).

Penalties and liabilities include:

●	Civil injunctions
●	Private civil damage actions
---	---
●	Jail sentences
---	---
●	Disgorgement of profits (or the amount of losses avoided) plus statutory interest
---	---
●	Civil penalties for the person who committed the violation of up to three times the profit gained or loss avoided, whether or not the person actually received a benefit (for example, where the person tipped another)
---	---
●	Civil penalties for the employer or other controlling person of up to the greater of $1,000,000 or three times the amount of the profit gained or loss avoided
---	---

​

​

●	Criminal sanctions and/or imprisonment

​

In addition, any violation of this Policy can be expected to result in serious sanctions by the Company or the Advisor, including dismissal of the persons involved.

Transactions Subject to this Policy

This Policy applies to all transactions, direct or indirect, in (i) the Company’s securities while an Insider is in possession of material nonpublic information about the Company, and (ii) the securities of certain companies **** with whom the Company does business or in which the Company has made or considered making an investment while an Insider is in possession of material nonpublic information about such company that the Insider obtained in the course of such Insider’s relationship with the Company.

This Policy continues to apply to transactions even after Insiders have terminated employment or other services to the Company. If Insiders are aware of material nonpublic information when their employment or service relationship terminates, they may not transact or trade in the Company’s securities until that information has become public or is no longer material.

Preclearance Before Trading in the Company’s Securities

The Company does not intend to list its outstanding securities on a securities exchange. Generally, the Company’s securities will only be available for purchase pursuant to accepted subscription orders as of the first day of each month, and such securities may only be sold pursuant to the Company’s share redemption program.  Before purchasing, selling, redeeming or gifting either personally or on behalf of others, any of the Company’s outstanding securities, Insiders must obtain clearance from the CCO or the Compliance Department. Clearance of a transaction will generally be valid only for a period specified by the CCO or the Compliance department. If the transaction is not completed within the specified period, pre-clearance of the transaction must be re-requested. If clearance is denied, the fact of such denial must be kept confidential by the person requesting such clearance.

From time to time, material nonpublic information regarding the Company may be pending and not publicly disclosed. While such material nonpublic information is pending, the Company may impose special blackout periods. If the Company imposes a special blackout period, it will notify the persons affected. Thereafter, and until they receive notice that the special blackout period has ended, such individuals shall be prohibited from engaging in any transactions involving the Company’s securities and from disclosing the fact of such suspension of trading to others.

Pre-clearance should not be considered a “safe harbor,” and all Insiders should use good judgment at all times. If an Insider is in possession of material nonpublic information, even if cleared to transact, then the Insider should not trade in the Fund’s securities until the information has been made publicly available or is no longer material. ​

​ Transactions Pursuant to an Approved 10b5-1 Trading Plan

The prohibitions on trading outlined in this Policy do not apply to transactions under a pre-existing written plan, contract, instruction or arrangement (a “Rule 10b5-1 Plan”) pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Securities Exchange Act”) that: (i) at the time of adoption or modification, has been reviewed and approved by the CCO or the Compliance Department; (ii) was entered into or modified in good faith by the Insider during an Open Trading Window, at a time when the Insider was not in possession of material nonpublic information about the Company, and could have otherwise engaged in a transaction in the Company’s securities pursuant to the terms of this Policy; (iii) (A) explicitly specifies the amount of securities to be purchased or sold and the price at which and the date on which the securities are to be purchased or sold; (B) includes a written formula or algorithm, or computer program, for determining the amount of securities to be purchased or sold and the price at which and the date on which the securities are to be purchased or sold; or (C) gives a third party the discretionary authority to execute such purchases and sales, outside the influence or control of the Insider, so long as such third party does not possess any material nonpublic information about the Company; and (iv) otherwise complies with the requirements of Rule 10b5-1 under the Securities Exchange Act.

Once a Rule 10b5-1 Plan is approved and is adopted or modified, it is subject to a “cooling-off” period before execution of the first trade. The cooling-off period for directors and officers subject to Section 16 of the Securities Exchange Act ends on the later of: (1) 90 days following the Rule 10b5-1 Plan adoption or modification or (2) two business days following the disclosure in Form 10-Q or Form 10-K of the Company’s financial results for the fiscal quarter in which the Rule 10b5-1 Plan was adopted or modified (however, the cooling-off period will not exceed 120 days following plan adoption or modification). For all other Insiders, a 30-day cooling-off period is required.

An Insider may not enter into overlapping Rule 10b5-1 Plans (subject to certain exceptions) and may only enter into one single-trade Rule 10b5-1 Plan during any 12-month period (subject to certain exceptions). Directors and officers subject to Section 16 of the Securities Exchange Act must include a representation in their Rule 10b5-1 Plan certifying that: (i) they are not aware of any material nonpublic information regarding the Company; and (ii) they are adopting the Rule 10b5-1 Plan in good faith and not as part of a plan or scheme to evade the prohibitions in Rule 10b-5. All Insiders entering into a Rule 10b5-1 Plan must act in good faith with respect to that plan.

Note that any trades made pursuant to an approved Rule 10b5-1 Plan by individuals who are subject to Section 16 of the Securities Exchange Act, give rise to a Section 16 reporting obligation on the Company’s periodic report for the quarter in which the Rule 10b5-1 Plan is adopted or terminated or modified. The Insider is responsible for ensuring that the Rule 10b5-1 Plan is validly adopted and transactions made thereunder are appropriately reported. The early termination of a Rule 10b5-1 Plan must be approved by the CCO or the Compliance Department.

​ ​

​ Each Insider shall instruct the third-party effecting transactions on its behalf under a Rule 10b5-1 Plan to send duplicate confirmations of all transactions effected under the Rule 10b5-1 Plan to the CCO or the Compliance Department.

Obligations under this Policy

Insiders at all times should avoid even the appearance of impropriety with respect to trading in the Company’s securities or the securities of any of the companies with whom the Company does business or in which the Company has made or considered making an investment.  When there is any question as to a potential application of this Policy, insider trading laws or any other restrictions on insider trading, or if you know of a suspected violation of this Policy or those laws or other restrictions, you should consult with the CCO or the Compliance Department. ​

Exhibit 21.1

​

Ares Real Estate Income Trust Inc.

Subsidiary List as of December 31, 2024

​

NAME	JURISDICTION
ADREX 1031 California Lender LLC	Delaware
ADREX 1031 Lender Diversified I LLC	Delaware
ADREX 1031 Lender Diversified II LLC	Delaware
ADREX 1031 Lender Diversified 3 LLC	Delaware
ADREX 1031 Lender Diversified 4 LLC	Delaware
ADREX 1031 Lender Diversified 5 LLC	Delaware
ADREX 1031 Lender Diversified 6 LLC	Delaware
ADREX 1031 Lender Diversified 7 LLC	Delaware
ADREX 1031 Lender LLC	Delaware
ADREX 1031 Lender Multifamily I LLC	Delaware
ADREX 56^th^ Ave IC DST	Delaware
ADREX Diversified I LLC	Delaware
ADREX Diversified I Manager LLC	Delaware
ADREX Diversified I Master Tenant LLC	Delaware
ADREX Diversified I TRS LLC	Delaware
ADREX Diversified II DST	Delaware
ADREX Diversified II Manager LLC	Delaware
ADREX Diversified II Master Tenant LLC	Delaware
ADREX Diversified II TRS LLC	Delaware
ADREX Diversified 3 DST	Delaware
ADREX Diversified 3 Manager LLC	Delaware
ADREX Diversified 3 Master Tenant LLC	Delaware
ADREX Diversified 3 TRS LLC	Delaware
ADREX Manager LLC	Delaware
ADREX Diversified 4 DST	Delaware
ADREX Diversified 4 Manager LLC	Delaware
ADREX Diversified 4 Master Tenant LLC	Delaware
ADREX Diversified 4 TRS LLC	Delaware
ADREX Diversified 5 DST	Delaware
ADREX Diversified 5 Manager LLC	Delaware
ADREX Diversified 5 Master Tenant LLC	Delaware
ADREX Diversified 5 TRS LLC	Delaware
ADREX Diversified 6 DST	Delaware
ADREX Diversified 6 Manager LLC	Delaware
ADREX Diversified 6 Master Tenant LLC	Delaware
ADREX Diversified 6 TRS LLC	Delaware
ADREX Diversified 7 DST	Delaware
ADREX Diversified 7 Manager LLC	Delaware
ADREX Diversified 7 Master Tenant LLC	Delaware
ADREX Diversified 7 TRS LLC	Delaware
ADREX Boca Apartments DST	Delaware
ADREX Fort Myers Self-Storage DST	Delaware
NAME	JURISDICTION
---	---
ADREX Glen Afton IC DST	Delaware
ADREX Johns Creek DST	Delaware
ADREX Master Tenant LLC	Delaware
ADREX Metro North IC DST	Delaware
ADREX Miami NW 114^th^ IC DST	Delaware
ADREX Multifamily I DST	Delaware
ADREX Multifamily I Manager LLC	Delaware
ADREX Multifamily I Master Tenant LLC	Delaware
ADREX Multifamily I TRS LLC	Delaware
ADREX Newtown Square Self-Storage DST	Delaware
ADREX North Harney IC DST	Delaware
ADREX Norwood Storage DST	Delaware
ADREX Pine Vista IC DST	Delaware
ADREX Pinellas Park Self-Storage DST	Delaware
ADREX Sarasota Self-Storage DST	Delaware
ADREX Sharon Hill Self-Storage DST	Delaware
ADREX Sugar Land CC DST	Delaware
ADREX Trevose Self-Storage DST	Delaware
ADREX Tri County Parkway IC DST	Delaware
American Financial Exchange L.L.C.	New Jersey
AREIT 107 Morgan Lane Lease Management LLC	Delaware
AREIT 107 Morgan Lane LLC	Delaware
AREIT 2024 P1 LLC	Delaware
AREIT Acquisitions LLC	Delaware
AREIT Andover Member LLC	Delaware
AREIT Andover Platform LLC	Delaware
AREIT Andover Services LLC	Delaware
AREIT Artizia Borrower LLC	Delaware
AREIT Artizia Holdco LLC	Delaware
AREIT Artizia LLC	Delaware
AREIT Atlantic Ave Parent Member LLC	Delaware
AREIT Brockton IC LLC	Delaware
AREIT Chester LLC	Delaware
AREIT City View LLC	Delaware
AREIT Clearwater LLC	Delaware
AREIT Debt Securities Holdco LLC	Delaware
AREIT Diversified I DST Holder LLC	Delaware
AREIT Diversified II DST Holder LLC	Delaware
AREIT East Columbia ICLLC	Delaware
AREIT Enterprise Way IC LLC	Delaware
AREIT Exchange REIT LLC	Delaware
AREIT Exchange REIT Holdco LLC	Delaware
AREIT Fairfield CC Borrower LLC	Delaware
AREIT Fairfield CC Holdco LLC	Delaware
AREIT Fairfield CC LLC	Delaware
AREIT General Washington IC LLC	Delaware		NAME	JURISDICTION
---	---
AREIT Gillingham IC GP LLC	Delaware
AREIT Gillingham IC Lease Management LLC	Delaware
AREIT Gillingham IC LP	Delaware
AREIT Greenfield DC Borrower LLC	Delaware
AREIT Greenfield DC Holdco LLC	Delaware
AREIT Greenfield DC LLC	Delaware
AREIT Grove City LC Borrower LLC	Delaware
AREIT Grove City LC Holdco LLC	Delaware
AREIT Grove City LC LLC	Delaware
AREIT Industrial Drive IC LLC	Delaware
AREIT Intermountain Space Center LLC	Delaware
AREIT JV Credit Facility Holdco LLC	Delaware
AREIT Kenzie Borrower LLC	Delaware
AREIT Kenzie Holdco LLC	Delaware
AREIT Kenzie LLC	Delaware
AREIT Las Vegas IC I LLC	Delaware
AREIT Las Vegas IC II LLC	Delaware
AREIT Manor Riverwalk LLC	Delaware
AREIT Manor Riverwalk Parent JV Member LLC	Delaware
AREIT Maplewood Drive IC LLC	Delaware
AREIT-McDowell Vue Parent LLC	Delaware
AREIT MC European Real Estate Debt Holdco LLC	Delaware
AREIT MC US RE JV Member LLC	Delaware
AREIT Mered II LP LLC	Cayman
AREIT Mercury Borrower LLC	Delaware
AREIT Mercury Holdco LLC	Delaware
AREIT Mercury LLC	Delaware
AREIT MF2 LLC	Delaware
AREIT MF3 LLC	Delaware
AREIT MF4 LLC	Delaware
AREIT MF5 LLC	Delaware
AREIT MF6 LLC	Delaware
AREIT MF7 LLC	Delaware
AREIT MF8 LLC	Delaware
AREIT MF9 LLC	Delaware
AREIT MF10 LLC	Delaware
AREIT MF11 LLC	Delaware
AREIT MF12 LLC	Delaware
AREIT Moreno Valley GP LLC	Delaware
AREIT Moreno Valley DC LP	Delaware
AREIT Net Lease Portfolio Aggregator Member LLC	Delaware
AREIT New Albany IC LLC	Delaware
AREIT New Town Square Self-Storage LLC	Delaware
AREIT NLD JV Aggregator Member LLC	Delaware
AREIT Norfolk Self-Storage Borrower LLC	Delaware
AREIT Norfolk Self-Storage Holdco LLC	Delaware		NAME	JURISDICTION
---	---
AREIT Norfolk Self-Storage LLC	Delaware
AREIT North 5^th^ Street CC Holdco II LLC	Delaware
AREIT North 5^th^ Street CC Holdco I LLC	Delaware
AREIT North 5^th^ Street CC Holdco LLC	Delaware
AREIT North 5^th^ Street CC LLC	Delaware
AREIT Ohio LC Borrower LLC	Delaware
AREIT Ohio LC Holdco LLC	Delaware
AREIT Ohio LC LLC	Delaware
AREIT Operating Partnership LP	Delaware
AREIT PDC Common Holdings LLC	Delaware
AREIT PDC Pref Investor LLC	Delaware
AREIT Phoenix IC LLC	Delaware
AREIT Pima Street LC Borrower LLC	Delaware
AREIT Pima Street LC Holdco LLC	Delaware
AREIT Pima Street LC LLC	Delaware
AREIT Plainfield Logistics Center LLC	Delaware
AREIT Preston Sherry LLC	Delaware
AREIT-PRH Manor Riverwalk Parent LLC	Delaware
AREIT Property Management LLC	Delaware
AREIT Real Estate Holdco LLC	Delaware
AREIT Redmond Borrower LLC	Delaware
AREIT Redmond Holdco LLC	Delaware
AREIT Redmond LLC	Delaware
AREIT Richmond Airport LC I Borrower LLC	Delaware
AREIT Richmond Airport LC I Holdco LLC	Delaware
AREIT Richmond Airport LC I LLC	Delaware
AREIT Richmond Airport LC II Borrower LLC	Delaware
AREIT Richmond Airport LC II Holdco LLC	Delaware
AREIT Richmond Airport LC II LLC	Delaware
AREIT Richmond Airport LC III Borrower LLC	Delaware
AREIT Richmond Airport LC III Holdco LLC	Delaware
AREIT Richmond Airport LC III LLC	Delaware
AREIT Richmond Airport LC IV LLC	Delaware
AREIT Salt Pond LLC	Delaware
AREIT San Stone Oak GP LLC	Delaware
AREIT San Stone Oak LP	Delaware
AREIT Southpark LC I Borrower LLC	Delaware
AREIT Southpark LC I Holdco LLC	Delaware
AREIT Southpark LC I LLC	Delaware
AREIT Southpark LC II Borrower LLC	Delaware
AREIT Southpark LC II Holdco LLC	Delaware
AREIT Southpark LC II LLC	Delaware
AREIT Southpark LC III Borrower LLC	Delaware
AREIT Southpark LC III Holdco LLC	Delaware
AREIT Southpark LC III LLC	Delaware
AREIT Shenandoah Square LLC	Delaware		NAME	JURISDICTION
---	---
AREIT Stafford Grove IP GP LLC	Delaware
AREIT Stafford Grove IP LP	Delaware
AREIT Suniland LLC	Delaware
AREIT Tempe IC LLC	Delaware
AREIT The Palms LLC	Delaware
AREIT Transport Drive CC LLC	Delaware
AREIT TRS Lender LLC	Delaware
AREIT TRS Holdco I LLC	Delaware
AREIT TRS Holdco LLC	Delaware
AREIT TRS Holdings LLC	Delaware
AREIT UK Fragco 1 LLC	Delaware
AREIT UK Fragco 2 LLC	Delaware
AREIT UK Fragco 3 LLC	Delaware
AREIT UK Holdco LLC	Delaware
AREIT VM8 Logistics Center GP LLC	Delaware
AREIT VM8 Logistics Center LP	Delaware
AREIT Vue Parent JV Member LLC	Delaware
AREIT Wes Warren IC LLC	Delaware
AREIT Western Food Center LLC	Delaware
AREIT Whitestown DC I Borrower LLC	Delaware
AREIT Whitestown DC I Holdco LLC	Delaware
AREIT Whitestown DC I LLC	Delaware
AREIT Whitestown DC II Borrower LLC	Delaware
AREIT Whitestown DC II Holdco LLC	Delaware
AREIT Whitestown DC II LLC	Delaware
AREIT Whitestown DC III Borrower LLC	Delaware
AREIT Whitestown DC III Holdco LLC	Delaware
AREIT Whitestown DC III LLC	Delaware
AREIT Yale Village LLC	Delaware
Ares Diversified Real Estate Exchange LLC	Delaware
Bala Pointe GP, LLC	Delaware
Bala Pointe Owner LP	Delaware
BCD TRS Corp.	Delaware
BCD TRS Services LLC	Delaware
BCDPF 25 Linden Industrial Center LLC	Delaware
BCDPF 250 Radar Holdco 1 LLC	Delaware
BCDPF 250 Radar Holdco 2 LLC	Delaware
BCDPF 250 Radar Holdco LLC	Delaware
BCDPF 395 Logistics Center LLC	Delaware
BCDPF Air Tech DC II LLC	Delaware
BCDPF Air Tech DC III LLC	Delaware
BCDPF Air Tech DC LLC	Delaware
BCDPF Airway Industrial Park GP LLC	Delaware
BCDPF Airway Industrial Park LP	Delaware
BCDPF Aurora DC LLC	Delaware
BCDPF Barrow Crossing LLC	Delaware		NAME	JURISDICTION
---	---
BCDPF Barrow Crossing Pad II LLC	Delaware
BCDPF Barrow Crossing Pad III LLC	Delaware
BCDPF Bay Area Commerce Center GP LLC	Delaware
BCDPF Bay Area Commerce Center LP	Delaware
BCDPF Campus Drive IC LLC	Delaware
BCDPF Cayco LLC	Delaware
BCDPF Clayton Commerce Center LLC	Delaware
BCDPF Florence Logistics Center LLC	Delaware
BCDPF Juno Winter Park LLC	Delaware
BCDPF Kaiser Business Center LLC	Delaware
BCDPF Little Orchard Business Park GP LLC	Delaware
BCDPF Little Orchard Business Park LP	Delaware
BCDPF Long Island Logistics Center LLC	Delaware
BCDPF Northgate DC LLC	Delaware
BCDPF Radar Distribution Center LLC	Delaware
BCDPF Railhead DC GP LLC	Delaware
BCDPF Railhead DC LP	Delaware
BCDPF Springdale LLC	Delaware
BCDPF Sterling IC LLC	Delaware
BCDPF Tempe Student Housing Portfolio JV Member LLC	Delaware
BCDPF Tempe Student Housing Portfolio LLC	Delaware
BCDPF The Daley at Shady Grove LLC	Delaware
BCDPF Tri County DC II LLC	Delaware
BCDPF Tri County DC LLC	Delaware
BCDPF Tustin Business Center GP LLC	Delaware
BCDPF Tustin Business Center LP	Delaware
BCDPF Vasco IC LLC	Delaware
BCDPF Village at Lee Branch LLC	Delaware
BCDPF World Connect Logistics Center LLC	Delaware
BC Exchange Perimeter Manager LLC	Delaware
Core Tucson Main Gate LLC	Delaware
DCTRT Bala Pointe GP LLC	Delaware
DCTRT Bala Pointe LP	Delaware
DCTRT REPO Holdco LLC	Delaware
DCTRT Securities Holdco LLC	Delaware
DCTRT Springing Member Inc.	Delaware
Div Cap Bala Pointe I General Partnership	Delaware
DPF 1031 Parent LLC	Delaware
DPF 1600 Woodbury Avenue LLC	Delaware
DPF Beaver Creek GP LLC	Delaware
DPF Beaver Creek LP	Delaware
DPF Cherry Creek LLC	Delaware
DPF LOC Lender LLC	Delaware
DPF Mashpee Manager LLC	Delaware
DPF Sandwich LLC	Delaware
DPF Services LLC	Delaware
NAME	JURISDICTION
---	---
NLD JV Credit Facility Holdco LLC	Delaware
Perimeter Town Center Master Condominium Association, Inc.	Georgia
Plaza X Leasing Associates L.L.C.	New Jersey
Plaza X Realty L.L.C.	New Jersey
Plaza X Urban Renewal Associates L.L.C.	New Jersey
Southcape Village, LLC	Massachusetts
TRT 1300 Connecticut Avenue Owner LLC	Delaware
TRT 270 Center Holdings LLC	Delaware
TRT 270 Center Owner LLC	Delaware
TRT Flying Cloud Drive LLC	Delaware
TRT Harborside LLC	Delaware
TRT Hyannis LLC	Delaware
TRT Lending LLC	Delaware
TRT Lending Subsidiary I Holdco LLC	Delaware
TRT Lending Subsidiary I LLC	Delaware
TRT Lending Subsidiary II Holdco LLC	Delaware
TRT Lending Subsidiary II LLC	Delaware
TRT Meriden LLC	Delaware
TRT New Bedford LLC	Delaware
TRT Saugus LLC	Delaware
TRT Wareham LLC	Delaware
TRT Weymouth III LLC	Delaware
TRT Whitman 475 Bedford LLC	Delaware

​

Exhibit 23.1

​

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the registration statements (No. 333-230311) on Form S-3, (No. 333-252212) on Form S-11 on Form S-3, and (No. 333-194237) on Form S-8 of our report dated March 6, 2025, with respect to the consolidated financial statements of Ares Real Estate Income Trust Inc.

​

​

/s/ KPMG LLP

​

Denver, Colorado

March 6, 2025

Exhibit 31.1

​

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Jeffrey W. Taylor, certify that:

1.    I have reviewed this Annual Report on Form 10-K of Ares Real Estate Income Trust Inc. (the “registrant”);

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

​

​

​	​	​
March 6, 2025	​	/s/ JEFFREY W. TAYLOR
​	​	Jeffrey W. Taylor<br>Partner, Co-President <br>(Principal Executive Officer)

​

Exhibit 31.2

​

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Taylor M. Paul, certify that:

1.    I have reviewed this Annual Report on Form 10-K of Ares Real Estate Income Trust Inc. (the “registrant”);

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)   Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

​

​

​	​	​
2	​	​
​		​
March 6, 2025	​	/s/ TAYLOR M. PAUL
​	​	Taylor M. Paul<br><br>Managing Director,<br><br>Chief Financial Officer and Treasurer<br><br>(Principal Financial Officer and Principal Accounting Officer)

​

Exhibit 32.1

​

CERTIFICATIONS PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Certification of Principal Executive Officer

In connection with the Annual Report on Form 10-K of Ares Real Estate Income Trust Inc. (the “Company”) for the period ended December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jeffrey W. Taylor, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)   The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

​

​	​	​
​		​
March 6, 2025	​	/s/ JEFFREY W. TAYLOR
​	​	Jeffrey W. Taylor<br>Partner, Co-President <br>(Principal Executive Officer)

​

Certification of Principal Financial Officer

In connection with the Annual Report on Form 10-K of Ares Real Estate Income Trust Inc. (the “Company”) for the period ended December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Taylor M. Paul, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)   The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

​

​	​	​
​		​
March 6, 2025	​	/s/ TAYLOR M. PAUL
​	​	Taylor M. Paul <br>Managing Director, <br>Chief Financial Officer and Treasurer <br>(Principal Financial Officer and Principal Accounting Officer)

​

Exhibit 99.1

​

CONSENT OF INDEPENDENT VALUATION ADVISOR

​

We hereby consent to the references to our name and the description of our role in the valuation process described under the heading “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities—Net Asset Value” in Part II, Item 5 of the Annual Report on Form 10-K for the period ended December 31, 2024 of Ares Real Estate Income Trust Inc. (the “Company”), filed by the Company with the Securities and Exchange Commission on the date hereof, being included or incorporated by reference in (i) the Company’s Registration Statement on Form S-3 (File No. 333-230311), (ii) the Company’s Registration Statement on Form S-8 (File No. 333-194237) and (iii) the Company’s Registration Statement on Form S-11 on Form S-3 (File No. 333-252212). In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933.

​

​

​	​	​
​	​	/s/ Altus Group U.S. Inc.
March 6, 2025	​	Altus Group U.S. Inc.

​