FALSE000163125600016312562023-07-182023-07-18


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
FORM 8-K
______________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 18, 2023
KBS GROWTH & INCOME REIT, INC.
(Exact Name of Registrant as Specified in Its Charter)
______________________________________________________
Maryland000-5605047-2778257
(State or Other Jurisdiction of
Incorporation or Organization)		(Commission File
Number)		(I.R.S. Employer
Identification No.)

800 Newport Center Drive, Suite 700
Newport Beach, California 92660
(Address of principal executive offices)
Registrant's telephone number, including area code: (949) 417-6500
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
NoneN/AN/A
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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. ☐



ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS
Foreclosure of the Commonwealth Building
On January 18, 2018, KBS Growth & Income REIT, Inc. (the “Company”), through an indirect wholly owned subsidiary, (the “Commonwealth Borrower”) entered into a loan agreement (the “Commonwealth Loan Agreement”) secured by the Commonwealth Building in Portland, Oregon with the Metropolitan Life Insurance Company (the “Commonwealth Lender”), an unaffiliated lender, for borrowings of up to $51.4 million (the “Commonwealth Building Mortgage Loan”).
As previously disclosed, on February 13, 2023, the Commonwealth Borrower was in maturity default with respect to the Commonwealth Building Mortgage Loan following its failure to pay the amount of the debt outstanding on the loan on its February 1, 2023 due date. Given the reduced rent and occupancy by the building’s tenants, as well as the market conditions in Portland, Oregon, where the property is located, the Commonwealth Building was valued at less than the outstanding debt of $47.8 million. On July 18, 2023, the Commonwealth Building was sold at public auction in a foreclosure sale to a buyer affiliated with the Commonwealth Lender and all interest in the Commonwealth Building was transferred to the buyer on that date.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

1


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 hereunto duly authorized.
KBS GROWTH & INCOME REIT, INC.
Dated: July 24, 2023BY:/s/ Jeffrey K. Waldvogel
Jeffrey K. Waldvogel
Chief Financial Officer, Treasurer and Secretary



KBS GROWTH & INCOME REIT, INC.
SUMMARY OF UNAUDITED PRO FORMA FINANCIAL STATEMENTS
The following pro forma information should be read in conjunction with the consolidated balance sheet and notes of KBS Growth & Income REIT, Inc. (“KBS Growth & Income REIT”) as of March 31, 2023, the related consolidated statements of operations, stockholders’ (deficit) equity, and cash flows for the year ended December 31, 2022 and for the three months ended March 31, 2023 and the notes thereto. The consolidated financial statement of KBS Growth & Income REIT for the year ended December 31, 2022 and the consolidated financial statements as of and for the three months ended March 31, 2023 have been included in KBS Growth & Income REIT’s prior filings with the SEC.
The unaudited pro forma balance sheet as of March 31, 2023 has been prepared to give effect to the foreclosure of the Commonwealth Building as if the foreclosure occurred on March 31, 2023. The unaudited pro forma balance sheet does not purport to reflect the actual transaction or financial position of KBS Growth & Income REIT as the foreclosure occurred on July 18, 2023 and certain amounts and balances have changed.
The unaudited pro forma statements of operations for the three months ended March 31, 2023 and for the year ended December 31, 2022 have been prepared to give effect to the foreclosure of the Commonwealth Building on July 18, 2023, as if such foreclosure occurred on January 1, 2022.
These unaudited pro forma financial statements are prepared for informational purposes only and are not necessarily indicative of future results or of actual results that would have been achieved had the foreclosure of the Commonwealth Building been consummated as of the dates indicated.
F-1

KBS GROWTH & INCOME REIT, INC.
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEETS
As of March 31, 2023
(in thousands, except share and per share amounts)
Pro Forma Adjustments
KBS Growth & Income REIT Historical (a)Commonwealth
Building (b)		Pro Forma Total
Assets
Real estate:
Land$16,764 $(4,629)$12,135 
Buildings and improvements91,954 (33,760)58,194 
Tenant origination and absorption costs5,350 — 5,350 
Total real estate, cost114,068 (38,389)75,679 
Less accumulated depreciation and amortization(15,270)1,133 (14,137)
Total real estate, net98,798 (37,256)61,542 
Cash and cash equivalents4,050 (16)4,034 
Restricted cash1,322 (412)910 
Rents and other receivables5,756 (1,841)3,915 
Above-market leases, net46 — 46 
Prepaid expenses and other assets2,990 (933)2,057 
Total assets$112,962 $(40,458)$72,504 
Liabilities and stockholders’ equity
Notes payable, net$103,601 $(47,762)$55,839 
Accounts payable and accrued liabilities2,772 (737)2,035 
Due to affiliates5,913 — 5,913 
Below-market leases, net392 — 392 
Other liabilities1,305 (353)952 
Total liabilities113,983 (48,852)65,131 
Commitments and contingencies
Redeemable common stock— — — 
Stockholders’ (deficit) equity:
Preferred stock, $.01 par value; 10,000,000 shares authorized, no shares issued and outstanding— — — 
Class A common stock, $.01 par value per share; 500,000,000 shares authorized, 9,838,569 and 9,838,569 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively 99 — 99 
Class T common stock, $.01 par value per share; 500,000,000 shares authorized, 307,606 shares and 307,606 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively3 — 3 
Additional paid-in capital85,340 — 85,340 
Cumulative distributions and net losses(86,463)8,394 (78,069)
Total stockholders’ (deficit) equity(1,021)8,394 7,373 
Total liabilities and stockholders’ (deficit) equity$112,962 $(40,458)$72,504 
F-2

KBS GROWTH & INCOME REIT, INC.
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEETS
As of March 31, 2023
(in thousands, except share and per share amounts)
(a)Historical financial information derived from KBS Growth & Income REIT’s Quarterly Report on Form 10-Q as of March 31, 2023.
(b)Represents adjustments to reflect the foreclosure sale of the Commonwealth Building as if the foreclosure occurred on March 31, 2023.

F-3

KBS GROWTH & INCOME REIT, INC.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Three Months Ended March 31, 2023
(in thousands, except share and per share amounts)
Pro Forma Adjustments
KBS Growth & Income REIT Historical (a)Commonwealth Building (b)Pro Forma Total
Revenues:
Rental income$3,701 $(954)$2,747 
Other operating income33 (1)32 
Total revenues3,734 (955)2,779 
Expenses:
Operating, maintenance, and management897 (322)575 
Property management fees and expenses to affiliate— — — 
Real estate taxes and insurance864 (157)707 
Asset management fees to affiliate— — — 
General and administrative expenses514 — 514 
Depreciation and amortization1,351 (485)866 
Interest expense2,244 (1,294)950 
Total expenses5,870 (2,258)3,612 
Other income:
Interest and other income29 — 29 
Total other income29 — 29 
Net loss$(2,107)$1,303 $(804)
Net loss per common share, basic and diluted$(0.21)$(0.08)
Weighted-average number of common shares outstanding basic and
diluted		10,146,175 10,146,175 
F-4

KBS GROWTH & INCOME REIT, INC.
NOTES TO UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Three Months Ended March 31, 2023
(a)Historical financial information derived from KBS Growth & Income REIT’s Quarterly Report on Form 10-Q for the three months ended March 31, 2023.
(b)Amounts represent the historical operations of the Commonwealth Building as reflected in the historical statement of operations of KBS Growth & Income REIT for the three months ended March 31, 2023.
F-5

KBS GROWTH & INCOME REIT, INC.
UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Year Ended December 31, 2022
(in thousands, except share and per share amounts)
Pro Forma Adjustments
KBS Growth & Income REIT Historical (a)Commonwealth BuildingPro Forma Total
Revenues:
Rental income$14,466 $(4,100)$10,366 
Other operating income136 (16)120 
Total revenues14,602 (4,116)(b)10,486 
Expenses:
Operating, maintenance, and management3,721 (1,424)2,297 
Property management fees and expenses to affiliate70 (32)38 
Real estate taxes and insurance3,182 (588)2,594 
Asset management fees to affiliate(1,740)753 (987)
General and administrative expenses1,871 (117)1,754 
Depreciation and amortization5,926 (1,921)4,005 
Interest expense4,185 (1,666)2,519 
Impairment charges on real estate18,665 (9,600)9,065 
Total expenses35,880 (14,595)(b)21,285 
Other income:
Interest and other income44 — 44 
Gain related to forgiveness of advance from the Advisor1,338 — 1,338 
Loss on foreclosure of real estate assets— (3,690)(c)(3,690)
Total other income1,382 (3,690)(2,308)
Net loss$(19,896)$6,789 $(13,107)
Net loss per common share, basic and diluted$(1.96)$(1.29)
Weighted-average number of common shares outstanding basic and
diluted		10,160,159 10,160,159 
F-6

KBS GROWTH & INCOME REIT, INC.
NOTES TO UNAUDITED PRO FORMA STATEMENT OF OPERATIONS
For the Year Ended December 31, 2022
(a)Historical financial information derived from KBS Growth & Income REIT’s Annual Report on Form 10-K for the year ended December 31, 2022.
(b)Amounts represent the historical operations of the Commonwealth Building as reflected in the historical statement of operations of KBS Growth & Income REIT for the year ended December 31, 2022.
(c)The loss on foreclosure of real estate assets reflects the net assets and liabilities of the Commonwealth Building on January 1, 2022 which were relieved upon foreclosure as if the foreclosure had occurred on January 1, 2022.
F-7
v3.23.2
Cover Page
Jul. 18, 2023
Cover [Abstract]  
Document Type 8-K
Document Period End Date Jul. 18, 2023
Entity Registrant Name KBS GROWTH & INCOME REIT, INC.
Entity Incorporation, State or Country Code MD
Entity File Number 000-56050
Entity Tax Identification Number 47-2778257
Entity Address, Address Line One 800 Newport Center Drive
Entity Address, Address Line Two Suite 700
Entity Address, City or Town Newport Beach
Entity Address, State or Province CA
Entity Address, Postal Zip Code 92660
City Area Code 949
Local Phone Number 417-6500
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Entity Central Index Key 0001631256
Amendment Flag false
KBS Growth and Income REIT (CE) (USOTC:KBSG)
Historical Stock Chart
From Oct 2024 to Nov 2024 Click Here for more KBS Growth and Income REIT (CE) Charts.
KBS Growth and Income REIT (CE) (USOTC:KBSG)
Historical Stock Chart
From Nov 2023 to Nov 2024 Click Here for more KBS Growth and Income REIT (CE) Charts.