What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2021-03-31 compared with 2020-03-30 · 1587 added, 767 removed, 1003 unchanged (70% of the section changed)

32 unchanged sentences

The following exhibits are included, or incorporated by reference, in this Annual Report on Form 10-K for the year ended December 31, 2020 (and are numbered in accordance with Item 601 of Regulation S-K).

2.1 Agreement and Plan of Merger, dated as of August 30, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor II Merger Sub, LLC and Cole Office & Industrial REIT (CCIT II), Inc.

(Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed August 31, 2020).

2.2 Agreement and Plan of Merger, dated as of August 30, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor III Merger Sub, LLC and Cole Office & Industrial REIT (CCIT III), Inc.

(Incorporated by reference to Exhibit 2.2 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed August 31, 2020).

2.3 Agreement and Plan of Merger, dated as of August 30, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor V Merger Sub, LLC and Cole Credit Property Trust V, Inc.

(Incorporated by reference to Exhibit 2.3 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed August 31, 2020).

2.4 Amendment to Agreement and Plan of Merger, dated as of October 22, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor II Merger Sub, LLC and Cole Office & Industrial REIT (CCIT II), Inc.

(Incorporated by reference to Exhibit 2.3 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed October 28, 2020).

2.5 Amendment to Agreement and Plan of Merger, dated as of October 24, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor II Merger Sub, LLC and Cole Office & Industrial REIT (CCIT II), Inc.

(Incorporated by reference to Exhibit 2.4 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed October 28, 2020).

2.6 Amendment No.

1 to Agreement and Plan of Merger, dated as of November 3, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor III Merger Sub, LLC and Cole Office & Industrial REIT (CCIT III), Inc.

(Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed November 4, 2020).

2.7 Amendment to Agreement and Plan of Merger, dated as of October 22, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor V Merger Sub, LLC and Cole Credit Property Trust V, Inc.

(Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed October 28, 2020).

2.8 Amendment to Agreement and Plan of Merger, dated as of October 24, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor V Merger Sub, LLC and Cole Credit Property Trust V, Inc.

(Incorporated by reference to Exhibit 2.2 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed October 28, 2020).

2.9 Amendment No.

3 to Agreement and Plan of Merger, dated as of October 29, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor V Merger Sub, LLC and Cole Credit Property Trust V, Inc.

(Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed November 2, 2020).

3.1 Articles of Amendment and Restatement of CIM Real Estate Finance Trust, Inc.

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000-54939), filed August 20, 2019).

Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934

Distribution Reinvestment Plan (Incorporated by reference to Exhibit 4.9 to the Company’s Registration Statement on Form S-3 (File No.

333-212832), filed August 2, 2016).

4.1 Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 (Incorporated by reference to Exhibit 4.1 to the Company’s Annual Report on Form 10-K (File No.

000-54939), filed March 30, 2020).

4.2 Second Amended and Restated Distribution Reinvestment Plan (Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed May 1, 2020).

10.1 Amended and Restated Management Agreement by and between CIM Real Estate Finance Trust, Inc.

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000-54939), filed December 12, 2019.

10.10 Form of Indemnification Agreement (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed August 14, 2020).

10.11 Amendment No.

1 to Credit and Security Agreement, dated March 19, 2020, by and between CMFT Corporate Credit Securities, LLC, as borrower, CMFT Securities Investments, LLC, as collateral manager and equityholder, Citibank, N.A., as administrative agent and as lender, Citibank, N.A.

(acting through its Agency & Trust division), as collateral custodian and as collateral agent, and Virtus Group, LP, as collateral administrator (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed March 24, 2020).

10.12 Master Repurchase Agreement, dated June 4, 2020, by and between CMFT RE Lending RF Sub CB, LLC and Citibank, N.A.

(Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed June 9, 2020).

10.13 Guaranty, dated as of June 4, 2020, by CIM Real Estate Finance Trust, Inc.

for the benefit of Citibank, N.A.

(Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed June 9, 2020).

10.14 Master Repurchase Agreement, dated September 21, 2020, by and between CMFT RE Lending RF Sub BB, LLC and Barclays Bank PLC (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed September 24, 2020).

10.15 Guaranty, dated as of September 21, 2020, by CIM Real Estate Finance Trust, Inc.

for the benefit of Barclays Bank PLC (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed September 24, 2020).

10.16 Termination Notice, dated as of October 29, 2020, by and by and between CIM Real Estate Finance Trust, Inc.

and Cole Office & Industrial REIT (CCIT II), Inc.

(Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No.

000-54939), filed November 2, 2020).

10.17* Modification Agreement and Limited Consent, dated December 21, 2020 by and between Cole Ope rating Partnership V , LP, the Lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the Lenders.

10.18* Modification Agreement and Limited Consent , dated December 21, 2020 by and between CIM Real Estate Finance Operating Partnership, LP , the Lenders party t hereto, and JPM organ C hase B ank , N.A., as administrative agent for the Lenders .

21.1* Subsidiaries of the Registrant.

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Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

XBRL Instance Document.

XBRL Taxonomy Extension Schema Document.

XBRL Taxonomy Extension Calculation Linkbase Document.

XBRL Taxonomy Extension Definition Linkbase Document.

XBRL Taxonomy Extension Label Linkbase Document.

XBRL Taxonomy Extension Presentation Linkbase Document.

101.INS* XBRL Instance Document.

101.SCH* XBRL Taxonomy Extension Schema Document.

101.CAL* XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF* XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB* XBRL Taxonomy Extension Label Linkbase Document.

101.PRE* XBRL Taxonomy Extension Presentation Linkbase Document.

104* Cover Page Interactive Data File (formatted as InLine XBRL and contained in Exhibit 101).

____________________________________

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FORM 10-K SUMMARY

Pursuant to the requirements of Section 13 or 15(d) 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 this 30 th day of March, 2020.

CIM Real Estate Finance Trust, Inc.

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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 and on the date indicated.

Signature Title Date

/s/ RICHARD S.

Chairman of the Board of Directors, Chief Executive Officer and President

March 30, 2020

(Principal Executive Officer)

RESSLER Chairman of the Board of Directors, Chief Executive Officer and President March 31, 2021

Ressler (Principal Executive Officer)

/s/ NATHAN D.

Chief Financial Officer and Treasurer

March 30, 2020

(Principal Financial Officer)

DEBACKER Chief Financial Officer and Treasurer March 31, 2021

DeBacker (Principal Financial Officer)

/s/ JEFFREY R.

Vice President of Accounting

March 30, 2020

(Principal Accounting Officer)

PATRICK DUNCAN

Independent Director

March 30, 2020

SMITH Vice President of Accounting March 31, 2021

Smith (Principal Accounting Officer)

PATRICK DUNCAN Independent Director March 31, 2021

Patrick Duncan

/s/ LAWRENCE S.

Independent Director

March 30, 2020

JONES Independent Director March 31, 2021

/s/ ALICIA K.

Independent Director

March 30, 2020

BRIAN KRETZMER

Independent Director

March 30, 2020

HARRISON Independent Director March 31, 2021

BRIAN KRETZMER Independent Director March 31, 2021

Brian Kretzmer

/s/ HOWARD A.

Independent Director

March 30, 2020

/s/ AVRAHAM SHEMESH

March 30, 2020

SILVER Independent Director March 31, 2021

/s/ STEPHEN O.

EVANS Independent Director March 31, 2021

/s/ MARCUS E.

BROMLEY Independent Director March 31, 2021

/S/ ROBERT A.

GARY IV Independent Director March 31, 2021

/s/ CALVIN E.

HOLLIS Independent Director March 31, 2021

/s/ AVRAHAM SHEMESH Director March 31, 2021

Avraham Shemesh

/s/ ELAINE Y.

March 30, 2020

WONG Director March 31, 2021

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Financial Statements

Financial Statements Page

Report of Independent Registered Public Accounting Firm

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Consolidated Statements of Operations for the Years Ended December 31, 2020, 2019 and 2018

Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2019, 2018 and 2017

Consolidated Statements of Comprehensive (Loss) Income for the Years Ended December 31, 2020, 2019 and 2018

Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2020, 2019 and 2018

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We have audited the accompanying consolidated balance sheets of CIM Real Estate Finance Trust, Inc.

and subsidiaries (the “Company”) as of December 31, 2019 and 2018, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows, for each of the three years in the period ended December 31, 2019, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the “financial statements”).

and subsidiaries (the “Company”) as of December 31, 2020 and 2019, the related consolidated statements of operations, comprehensive (loss) income, stockholders’ equity, and cash flows, for each of the three years in the period ended December 31, 2020, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.

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We believe that our audits provide a reasonable basis for our opinion.

Change in Accounting Principle

As discussed in Note 2 to the financial statements, the Company has changed its method of accounting for credit losses in the year ended December 31, 2020 due to adoption of Accounting Standard Update, or ASU, 2016-13 “Financial Instruments – Credit Losses – Measurement of Credit Losses on Financial Instruments (Topic 326).” The assessment of allowance for credit losses is also communicated as a critical audit matter below.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the 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 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 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.

Real Estate Assets:

Determination of Impairment Indicators — Refer to Notes 2 and 4 to the financial statements

Critical Audit Matter Description

The Company’s evaluation of real estate assets for impairment involves an initial assessment of each real estate asset to determine whether events or changes in circumstances exist that may indicate that the carrying amounts of real estate assets are no longer recoverable.

Possible indications of impairment may include credit concerns of a property’s major tenants, changes in anticipated holding periods, or other circumstances.

When events or changes in circumstances exist, the Company evaluates its real estate assets for impairment by comparing undiscounted future cash flows expected to be generated over the life of each asset to the respective carrying amount.

If the carrying amount of an asset exceeds the undiscounted future cash flows, an analysis is performed to determine the fair value of the asset.

The Company makes significant assumptions to evaluate real estate assets for possible indications of impairment, including expected holding periods.

Changes in these assumptions could result in additional impairment charges in the future.

Given the Company’s evaluation of possible indications of impairment of real estate assets requires management to make significant assumptions, performing audit procedures to evaluate whether management appropriately identified events or changes in circumstances indicating that the carrying amounts of real estate assets may not be recoverable required a high degree of auditor judgment.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the evaluation of real estate assets for possible indications of impairment included the following, among others:

• We evaluated management’s impairment indicator analysis by testing real estate assets for possible indications of impairment, including searching for adverse asset-specific and/or market conditions, such as vacancies, tenants that are late on rent or have outstanding rent balances, tenant move-outs, and tenant bankruptcies, among others.

• We tested the assumptions underlying management’s cash flow projections prepared as a completeness test to evaluate whether all impairment indicators have been appropriately identified.

• We performed corroborating inquiries with management, including property accounting, leasing and portfolio oversight to determine whether factors were identified in the current period that may be an impairment indicator, including changes in expected holding periods, or changes in market rental rates.

Assessment of Allowance for Credit Losses – Refer to Notes 2 and 7 to the financial statements (also see change in accounting principle explanatory paragraph above)

Critical Audit Matter Description

In the first quarter of 2020, the Company adopted Accounting Standards Update (“ASU”) No.

2016-13, Financial Instruments - Credit Losses (Topic 326), which requires evaluation by the Company to estimate and record potential credit losses related to the Company’s loans held-for-investment.

Significant judgments are required in estimating the allowance for credit losses, including the estimation of future cash flows, the estimation of the fair value and selling costs of the collateral of collateral-dependent loans when the Company determines foreclosure is probable, and assumptions regarding probability of default and loss of broadly syndicated loans.

We identified the assessment of the allowance for credit losses as a critical audit matter based on the significant amount of judgment required by management when evaluating the allowance for credit losses.

This required a high degree of auditor judgment and an increased extent of effort, including evaluating the allowance for credit losses methodology and analytical models, and evaluating the key inputs and assumptions used in the models.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the allowance for credit losses for the loans held-for-investment portfolio included the following, among others:

• We tested the accuracy and evaluated the relevance of the historical loss data as an input to each applicable allowance model.

• We evaluated the loss data from external sources used by the Company to determine its relevance to the Company's loans held-for-investment portfolio and consistency with external data from other sources.

• We evaluated the estimated cash flows and fair value determinations from the Company’s models and tested each model’s computational accuracy.

/s/ Deloitte & Touche LLP

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(in thousands, except share and per share amounts)

December 31, 2019

December 31, 2018

December 31, 2020 December 31, 2019

Real estate assets:

Land $ 881,896 $ 700,210

Buildings, fixtures and improvements 2,490,030 1,830,101

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Total real estate assets, net 3,308,105 2,469,335

Real estate-related securities 38,194 —

Loans held-for-investment and related receivables, net 962,624 301,630

Allowance for credit losses ( 70,358 ) —

Total loans held-for-investment and related receivables, net 892,266 301,630

Cash and cash equivalents 121,385 466,024

Restricted cash 7,023 7,331

Rents and tenant receivables

Interest receivable, prepaid expenses and other assets

Rents and tenant receivables, net 74,419 58,374

Prepaid expenses and other assets 10,406 11,731

Deferred costs, net 4,293 2,301

Assets held for sale 3,518 351,897

Total assets $ 4,459,609 $ 3,668,623

LIABILITIES AND STOCKHOLDERS’ EQUITY

Credit facilities and notes payable, net

Credit facilities, notes payable and repurchase facilities, net $ 2,144,993 $ 1,604,860

Accrued expenses and accounts payable 30,419 22,038

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Distributions payable 10,969 16,510

Deferred rental income, derivative liability and other liabilities

Derivative liabilities, deferred rental income and other liabilities 27,361 19,448

Total liabilities 2,261,183 1,697,837

Commitments and contingencies

Redeemable common stock and noncontrolling interest

Redeemable common stock — 180,838

STOCKHOLDERS’ EQUITY

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Accumulated distributions in excess of earnings ( 961,006 ) ( 816,181 )

Accumulated other comprehensive (loss) income

Accumulated other comprehensive loss ( 2,047 ) ( 3,908 )

Total stockholders’ equity 2,198,426 1,789,948

Total liabilities, redeemable common stock, noncontrolling interest and stockholders’ equity

Total liabilities, redeemable common stock and stockholders’ equity $ 4,459,609 $ 3,668,623

The accompanying notes are an integral part of these consolidated financial statements.

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Year Ended December 31,

2020 2019 2018

Rental and other property income $ 261,530 $ 393,224 $ 429,636

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Depreciation and amortization 80,973 107,867 140,979

Real estate impairment 16,737 72,939 32,975

Provision for credit losses 68,356 — —

Total operating expenses 278,189 304,810 302,246

Gain on disposition of real estate, net 27,518 180,666 6,299

Merger-related expenses, net ( 2,193 ) — —

Merger termination fee income 7,380 — —

Operating income 45,439 289,212 135,329

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Total other expense ( 68,957 ) ( 106,192 ) ( 97,917 )

Net income ( 23,518 ) 183,020 37,412

Net income allocated to noncontrolling interest — 121 134

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CIM REAL ESTATE FINANCE TRUST, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(in thousands)

Year Ended December 31,

2020 2019 2018

Net income $ ( 23,518 ) $ 183,020 $ 37,412

Other comprehensive (loss) income

Unrealized gain on real estate-related securities 1,657 — —

Reclassification adjustment for realized gain included in income as other income ( 510 ) — —

Unrealized (loss) gain on interest rate swaps ( 11,607 ) ( 11,456 ) 8,210

Amount of (gain) loss reclassified from other comprehensive income into income as interest expense and other, net

Amount of loss (gain) reclassified from other comprehensive (loss) income into income as interest expense and other, net 12,321 ( 3,475 ) ( 4,305 )

Total other comprehensive (loss) income 1,861 ( 14,931 ) 3,905

Comprehensive income

Comprehensive (loss) income ( 21,657 ) 168,089 41,317

Comprehensive income allocated to noncontrolling interest — 121 134

Comprehensive income attributable to the Company

Comprehensive (loss) income attributable to the Company $ ( 21,657 ) $ 167,968 $ 41,183

The accompanying notes are an integral part of these consolidated financial statements.

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(in thousands, except share amounts)

Distributions in Excess of Earnings

Accumulated Other Comprehensive Income (Loss)

Common Stock Capital in

of Par Value Accumulated

Distributions in Excess of Earnings Accumulated Other Comprehensive Income (Loss) Total

Stockholders’

Shares Par Value

Balance, January 1, 2018 311,582,319 $ 3,116 $ 2,607,300 $ ( 646,834 ) $ 6,630 $ 1,970,212

Cumulative effect of accounting changes — — — ( 488 ) 488 —

Issuance of common stock 9,615,850 96 91,668 — — 91,764

Equity-based compensation 14,008 — 33 — — 33

Distributions declared on common stock — $ 0.625 per common share

— — — ( 194,573 ) — ( 194,573 )

Redemptions of common stock ( 9,830,781 ) ( 98 ) ( 93,732 ) — — ( 93,830 )

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Balance, December 31, 2018 311,381,396 $ 3,114 $ 2,607,330 $ ( 804,617 ) $ 11,023 $ 1,816,850

Cumulative effect of accounting changes

Issuance of common stock 9,335,895 93 82,295 — — 82,388

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Distributions declared on common stock — $ 0.625 per common share

— — — ( 194,463 ) — ( 194,463 )

Redemptions of common stock ( 9,528,065 ) ( 95 ) ( 83,993 ) — — ( 84,088 )

Changes in redeemable common stock — — 1,155 — — 1,155

Comprehensive income

Comprehensive income (loss) — — — 182,899 ( 14,931 ) 167,968

Balance, December 31, 2019 311,207,725 $ 3,112 $ 2,606,925 $ ( 816,181 ) $ ( 3,908 ) $ 1,789,948

Cumulative effect of accounting changes — — — ( 2,002 ) — ( 2,002 )

Issuance of common stock 4,211,747 42 34,149 — — 34,191

Issuance of common stock in connection with the Mergers 52,574,431 526 383,793 — — 384,319

Equity-based compensation 22,059 — 160 — — 160

Distributions declared on common stock — $ 0.38 per common share

— — — ( 119,305 ) — ( 119,305 )

Redemptions of common stock ( 6,013,994 ) ( 60 ) ( 48,006 ) — — ( 48,066 )

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Year Ended December 31,

2020 2019 2018

Cash flows from operating activities:

Net income $ ( 23,518 ) $ 183,020 $ 37,412

Adjustments to reconcile net income to net cash provided by operating activities:

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Amortization and accretion on deferred loan fees ( 1,909 ) ( 2,441 ) ( 268 )

Amortization of premiums and discounts on credit investments ( 668 ) — —

Capitalized interest income ( 539 ) ( 8,546 ) —

Equity-based compensation 160 138 33

Straight-line rental income, net

Straight-line rental income ( 6,738 ) ( 6,564 ) ( 8,077 )

Write-offs for uncollectible lease-related receivables 5,664 952 522

Gain on disposition of real estate assets, net ( 27,518 ) ( 180,666 ) ( 6,299 )

Loss on sale of credit investments, net 227 — —

Amortization of gain on swap termination ( 13 ) ( 18 ) —

Impairment of real estate assets 16,737 72,939 32,975

Fair value adjustment to contingent consideration

Ineffectiveness of interest rate swaps

Provision for credit losses 68,356 — —

Write-off of deferred financing costs 633 2,271 46

Changes in assets and liabilities:

Rents and tenant receivables

Rents and tenant receivables, net ( 12,536 ) 16,034 ( 2,432 )

Prepaid expenses and other assets 1,276 ( 6,456 ) ( 833 )

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Cash flows from investing activities:

Cash acquired in connection with the Mergers 13,810 — —

Investment in real estate-related securities ( 76,644 ) — —

Investment in broadly syndicated loans ( 582,654 ) ( 2,750 ) —

Investment in real estate assets

Capital expenditures

Investment in real estate assets and capital expenditures ( 48,995 ) ( 23,887 ) ( 19,202 )

Origination and acquisition of loans held-for-investment, net ( 238,563 ) ( 217,014 ) ( 89,295 )

Principal payments received on loans held-for-investment

Origination and exit fees received on loans held-for-investment 3,200 1,697 185

Investment in revenue bonds

Principal payments received on loans held-for-investment 119,443 17,186 —

Principal payments received on real estate-related securities 2,571 — —

Net proceeds from sale of real estate-related securities 37,593 — —

Net proceeds from disposition of real estate assets 263,797 1,399,953 64,180

Net proceeds from sale of broadly syndicated loans 39,902 — —

Payment of property escrow deposits ( 875 ) ( 350 ) ( 1,100 )

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Proceeds from the settlement of insurance claims 400 110 240

Net cash provided by (used in) investing activities

Net cash (used in) provided by investing activities ( 466,140 ) 1,175,295 ( 43,892 )

Cash flows from financing activities:

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Distributions to stockholders ( 90,655 ) ( 112,083 ) ( 102,822 )

Proceeds from credit facility and notes payable

Repayments of credit facility and notes payable, net of swap termination payments received

Proceeds from credit facility and repurchase facilities 576,880 424,500 268,000

Repayments of credit facility and notes payable ( 417,902 ) ( 1,137,022 ) ( 227,181 )

Payment of loan deposits ( 65 ) — —

Refund of loan deposits

Deferred financing costs paid ( 5,360 ) ( 1,211 ) —

Distributions to noncontrolling interest — ( 285 ) ( 279 )

Net cash (used in) provided by financing activities

Net increase (decrease) in cash and cash equivalents and restricted cash

Net cash provided by (used in) financing activities 14,832 ( 910,189 ) ( 156,112 )

Net (decrease) increase in cash and cash equivalents and restricted cash ( 344,947 ) 453,681 5,831

Cash and cash equivalents and restricted cash, beginning of period 473,355 19,674 13,843

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CIM Real Estate Finance Trust, Inc.

(formerly known as Cole Credit Property Trust IV, Inc.) (the “Company”) is a non-exchange traded real estate investment trust (“REIT”) formed as a Maryland corporation on July 27, 2010, that elected to be taxed, and currently qualifies, as a REIT for U.S.

(the “Company”) is a non-exchange traded real estate investment trust (“REIT”) formed as a Maryland corporation on July 27, 2010, that elected to be taxed, and currently qualifies, as a REIT for U.S.

federal income tax purposes beginning with its taxable year ended December 31, 2012.

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As of December 31, 2020, the rentable square feet at these properties was 94.1 % leased, including month-to-month agreements, if any.

As of December 31, 2019 , there were 29 properties identified as held for sale.

See Note 4 — Real Estate Assets to the consolidated financial statements in this Annual Report on Form 10-K for a discussion of the held for sale properties as of December 31, 2019 .

The Company intends to pursue a more diversified investment strategy across the capital structure by balancing the Company’s existing core of necessity commercial real estate assets leased to creditworthy tenants under long-term net leases with a portfolio of commercial mortgage loans and other credit investments in which the Company’s sponsor and its affiliates have expertise.

As of December 31, 2019 , the Company’s loan portfolio consisted of 12 loans with a net book value of $301.6 million .

Substantially all of the Company’s business is conducted through CIM Real Estate Finance Operating Partnership, LP (formerly known as Cole Operating Partnership IV, LP), a Delaware limited partnership, of which the Company is the sole general partner and owns, directly or indirectly, 100% of the partnership interests.

The Company is externally managed by CIM Real Estate Finance Management, LLC (formerly known as Cole REIT Management IV, LLC), a Delaware limited liability company (“CMFT Management”), which is an affiliate of CIM Group, LLC (“CIM”).

CIM is a community-focused real estate and infrastructure owner, operator, developer and lender with multi-disciplinary expertise, including acquisitions, management, development, leasing, research and capital markets.

CIM is headquartered in Los Angeles, California and has offices in Oakland, California;

Bethesda, Maryland;

Dallas, Texas;

New York, New York;

Chicago, Illinois;

and Phoenix, Arizona.

CCO Group, LLC owns and controls CMFT Management, the Company’s advisor, and is the indirect owner of CCO Capital, LLC (“CCO Capital”), the Company’s dealer manager, and CREI Advisors, LLC (“CREI Advisors”), the Company’s property manager.

CCO Group, LLC and its subsidiaries (collectively, “CCO Group”) serve as the Company’s sponsor and as a sponsor to Cole Credit Property Trust V, Inc.

(“CCPT V”), Cole Office & Industrial REIT (CCIT II), Inc.

(“CCIT II”), Cole Office & Industrial REIT (CCIT III), Inc.

(“CCIT III”) and CIM Income NAV, Inc.

The Company intends to continue to pursue a more diversified investment strategy across the capital structure by balancing the Company’s existing core of commercial real estate assets leased to creditworthy tenants under long-term net leases with a portfolio of commercial mortgage loans and other credit investments in which the Company’s sponsor and its affiliates have expertise.

As of December 31, 2020, the Company’s loan portfolio consisted of 206 loans with a net book value of $ 892.3 million, and investments in real estate-related securities of $ 38.2 million.

A majority of the Company’s business is conducted through CIM Real Estate Finance Operating Partnership, LP, a Delaware limited partnership, of which the Company is the sole general partner and owns, directly or indirectly, 100 % of the partnership interests.

The Company is externally managed by CIM Real Estate Finance Management, LLC, a Delaware limited liability company (“CMFT Management”), which is an affiliate of CIM Group, LLC (“CIM”).

CIM is a community-focused real estate and infrastructure owner, operator, lender and developer.

Headquartered in Los Angeles, California, CIM has offices across the United States and in Tokyo, Japan.

CCO Group, LLC owns and controls CMFT Management, the Company’s manager, and is the indirect owner of CCO Capital, LLC (“CCO Capital”), the Company’s dealer manager, and CREI Advisors, LLC (“CREI Advisors”), the Company’s property manager.

CCO Group, LLC and its subsidiaries (collectively, “CCO Group”) serve as the Company’s sponsor and as a sponsor to CIM Income NAV, Inc.

(“CIM Income NAV”).

The Company relies upon CIM Capital IC Management, LLC, our investment advisor with respect to investments in securities, to provide substantially all of our day-to-day management.

On January 26, 2012, the Company commenced its initial public offering on a “best efforts” basis of up to a maximum of $ 2.975 billion in shares of common stock (the “Offering”).

The Company ceased issuing shares in the Offering on April 4, 2014.

At the completion of the Offering, a total of approximately 297.4 million shares of common stock had been issued, including approximately 292.3 million shares of common stock sold to the public pursuant to the primary portion of the Offering and approximately 5.1 million shares of common stock issued pursuant to the DRIP portion of the Offering.

The remaining approximately 404,000 unsold shares from the Offering were deregistered.

The Company registered $247.0 million of shares of common stock under a distribution reinvestment plan (the “DRIP”) (the “Initial DRIP Offering”), which was filed with the U.S.

The Company registered $ 247.0 million of shares of common stock under the DRIP (the “Initial DRIP Offering”) pursuant to a Registration Statement on Form S-3 (Registration No.

333-192958), which was filed with the U.S.

Securities and Exchange Commission (the “SEC”) on December 19, 2013 and automatically became effective with the SEC upon filing.

The Company ceased issuing shares under the Initial DRIP Offering effective as of June 30, 2016.

At the completion of the Initial DRIP Offering, a total of approximately $241.7 million of common stock had been issued.

At the completion of the Initial DRIP Offering, a total of approximately $ 241.7 million of shares of common stock had been issued.

The remaining $ 5.3 million of unsold shares from the Initial DRIP Offering were deregistered.

The Company registered an additional $600.0 million of shares of common stock under the DRIP (the “Secondary DRIP Offering,” and together with the Initial DRIP Offering, the “DRIP Offerings,” and the DRIP Offerings collectively with the Offering, the “Offerings”), which was filed with the SEC on August 2, 2016 and automatically became effective with the SEC upon filing.

The Company began to issue shares under the Secondary DRIP Offering on August 2, 2016 and will continue to issue shares under the Secondary DRIP Offering.

The Company’s board of directors (the “Board”) establishes an updated estimated per share net asset value (“NAV”) of the Company’s common stock on at least an annual basis for purposes of assisting broker-dealers that participated in the Offering in meeting their customer account reporting obligations under Financial Industry Regulatory Authority Rule 2231.

The Company registered an additional $ 600.0 million of shares of common stock under the DRIP (the “Secondary DRIP Offering,” and together with the Initial DRIP Offering, the “DRIP Offerings,” and the DRIP Offerings collectively with the Offering, the “Offerings”) pursuant to a Registration Statement on Form S-3 (Registration No.

333-212832), which was filed with the SEC on August 2, 2016 and automatically became effective with the SEC upon filing.

The Company began to issue shares under the Secondary DRIP Offering on August 2, 2016 and continued to issue shares under the Secondary DRIP Offering until, on August 30, 2020, the Company’s board of directors (the “Board”) suspended the Secondary DRIP Offering in connection with the entry of the Company into the Merger Agreements (as defined below).

On March 25, 2021, the Board reinstated the Secondary DRIP Offering, effective April 1, 2021.

The Board establishes an updated estimated per share net asset value (“NAV”) of the Company’s common stock on at least an annual basis for purposes of assisting broker-dealers that participated in the Offering in meeting their customer account reporting obligations under Financial Industry Regulatory Authority Rule 2231.

Distributions are reinvested in shares of the Company’s common stock under the DRIP at the estimated per share NAV as determined by the Board.

Additionally, the estimated per share NAV as determined by the Board serves as the per share NAV for purposes of the

Additionally, the

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share redemption program.

As of December 31, 2019 , the estimated per share NAV was $8.65 per share, which was established on March 20, 2019 using a valuation date of December 31, 2018.

On March 25, 2020 , the Board established an updated estimated per share NAV of the Company’s common stock, using a valuation date of December 31, 2019.

Commencing on March 30, 2020, distributions are reinvested in shares of the Company’s common stock under the DRIP at a price of $7.77 per share.

The Board previously established per share NAVs as of August 31, 2015, September 30, 2016, December 31, 2016, December 31, 2017 and December 31, 2018.

estimated per share NAV as determined by the Board serves as the per share NAV for purposes of the share redemption program.

As of December 31, 2020, the estimated per share NAV of the Company’s common stock was $ 7.31 , which was established by the Board on August 11, 2020 using a valuation date of June 30, 2020.

Commencing on August 14, 2020, $ 7.31 served as the per share NAV under the DRIP.

The Board previously established a per share NAV as of August 31, 2015, September 30, 2016, December 31, 2016, December 31, 2017, December 31, 2018, December 31, 2019 and March 31, 2020.

The Company’s estimated per share NAVs are not audited or reviewed by its independent registered public accounting firm.

Completed Mergers

On December 21, 2020, the Company completed the mergers previously disclosed in the Current Report on Form 8-K filed with the SEC on August 31, 2020, with Cole Office & Industrial REIT (CCIT III), Inc.

(“CCIT III”) and Cole Credit Property Trust V, Inc.

(“CCPT V”), pursuant to (i) the Agreement and Plan of Merger, dated August 30, 2020 (as amended on November 3, 2020, the “CCIT III Merger Agreement”), by and among the Company, Thor III Merger Sub, LLC, a wholly owned subsidiary of the Company (“CCIT III Merger Sub”), and CCIT III, with CCIT III Merger Sub surviving as a wholly owned subsidiary of the Company (the “CCIT III Merger”), and (ii) the Agreement and Plan of Merger, dated August 30, 2020 (as amended on each of October 22, 2020, October 24, 2020 and October 29, 2020, the “CCPT V Merger Agreement,” and together with the CCIT III Merger Agreement, the “Merger Agreements”), by and among the Company, Thor V Merger Sub, LLC, a wholly owned subsidiary of the Company (“CCPT V Merger Sub”), and CCPT V, with CCPT V Merger Sub surviving as a wholly owned subsidiary of the Company (the “CCPT V Merger,” and collectively with the CCIT III Merger, the “Mergers”).

In accordance with the applicable provisions of the Maryland General Corporation Law (the “MGCL”), the separate existence of CCIT III and CCPT V ceased.

Through the Mergers, the Company acquired 146 properties with a total of 3.8 million square feet, all of which had an aggregate gross real estate value of approximately $ 763.0 million.

The combined company after the Mergers retained the name “CIM Real Estate Finance Trust, Inc.” Each Merger qualified as a “reorganization” under, and within the meaning of, Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”).

For more information on the Mergers, see Note 4 — Real Estate Assets.

At the effective time of the Mergers and subject to the terms and conditions of the Merger Agreements, each issued and outstanding share of common stock of CCIT III and CCPT V was converted into the right to receive 1.098 and 2.892 shares of the Company’s common stock, $ 0.01 par value per share, respectively, subject to the treatment of fractional shares in accordance with the Merger Agreements (the “Merger Consideration”).

At the effective time of the Mergers and subject to the terms and conditions of the Merger Agreements, each issued and outstanding share of common stock granted under CCIT III’s and CCPT V’s respective 2018 Equity Incentive Plans, whether vested or unvested, was cancelled in exchange for an amount equal to the applicable Merger Consideration.

Concurrently with the entry into the Merger Agreements, (i) CCIT III and its advisor entered into a Termination Agreement (the “CCIT III Termination Agreement”) pursuant to which the Advisory Agreement, dated September 22, 2016, by and between CCIT III and its advisor terminated at the effective time of the CCIT III Merger, and (ii) CCPT V and its advisor entered into a Termination Agreement (the “CCPT V Termination Agreement” and, together with the CCIT III Termination Agreement, the “Termination Agreements”) pursuant to which the Advisory Agreement, dated March 17, 2014, by and between CCPT V and its advisor terminated at the effective time of the CCPT V Merger.

Pursuant to the Termination Agreements, each of CCIT III’s advisor and CCPT V’s advisor agreed to waive any subordinated performance fee or disposition fee it otherwise would have been entitled to pursuant to the applicable advisory agreement related to the CCIT III Merger or CCPT V Merger, as applicable.

In order to manage the financial health of the Company, the Board approved and adopted a Second Amended and Restated Distribution Reinvestment Plan (the “Amended DRIP”) and an amended and restated share redemption program (the “Amended Share Redemption Program”) that, among other changes, provides that the Amended DRIP and the Amended Share Redemption Program may be suspended at any time by majority vote of the Board without prior notice if the Board believes such action is in the best interest of the Company and its stockholders.

In connection with the entry of the Company into the Merger Agreements, on August 30, 2020, the Board approved the suspension of the Amended DRIP, and therefore, distributions paid after that date were paid in cash to all stockholders until the Amended DRIP was reinstated, effective April 1, 2021, by the Board on March 25, 2021.

Additionally, on August 30, 2020, the Board approved the suspension of the Company’s Amended Share Redemption Program, and therefore, no shares were redeemed from the Company’s stockholders after that date until the Amended Share Redemption Program was reinstated, effective April 1, 2021, by the Board on March 25, 2021.

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Terminated Merger Agreement

On August 30, 2020, the Company, Cole Office & Industrial REIT (CCIT II), Inc.

(“CCIT II”) and Thor II Merger Sub, LLC, a wholly owned subsidiary of the Company (“CCIT II Merger Sub”), entered into an Agreement and Plan of Merger (the “CCIT II Merger Agreement”).

Subject to the terms and conditions of the CCIT II Merger Agreement, CCIT II would have merged with and into CCIT II Merger Sub (the “CCIT II Merger”), with CCIT II Merger Sub surviving the CCIT II Merger, such that following the CCIT II Merger, the surviving entity would continue as a wholly owned subsidiary of the Company.

On October 29, 2020, CCIT II terminated the CCIT II Merger Agreement pursuant to Sections 9.1(c)(ii) and 9.2 of the CCIT II Merger Agreement and entered into an agreement (the “Termination Notice”) with the Company reflecting such termination and pursuant to which, among other things, CCIT II paid the termination fee equal to $ 7.38 million to the Company in accordance with the CCIT II Merger Agreement, and agreed to pay to the Company the amount of its expenses up to $ 3.69 million, required to be paid pursuant to the terms of the CCIT II Merger Agreement (such amounts together, the “CCIT II Termination Payment”).

During the year ended December 31, 2020, the Company incurred $ 2.0 million in CCIT II merger-related expenses, $ 1.8 million of which was reimbursed by CCIT II as of December 31, 2020.

Subsequent to December 31, 2020, the Company received the remaining $ 173,000 in reimbursements from CCIT II.

These reimbursements are included as a reduction to merger-related expenses on the consolidated statements of operations.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

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As of December 31, 2018, the Company determined that it had a controlling interest in nine properties owned through a consolidated joint venture arrangement (the “Consolidated Joint Venture”) and therefore met the GAAP requirements for consolidation.

During the year ended December 31, 2019 , the Company disposed of the nine properties previously owned through the Consolidated Joint Venture and therefore determined it no longer had a controlling financial interest in the Consolidated Joint Venture as of December 31, 2019 .

During the year ended December 31, 2019, the Company disposed of the nine properties previously owned through the Consolidated Joint Venture and therefore determined it no longer had a controlling financial interest in the

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Consolidated Joint Venture as of December 31, 2019.

See Note 4 — Real Estate Assets for a further discussion of this disposition.

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Certain amounts in the Company’s prior period consolidated financial statements have been reclassified to conform to the current period presentation.

The Company combined rental income of $371.2 million and tenant reimbursement income of $58.4 million for the year ended December 31, 2018 , and rental income of $371.9 million and tenant reimbursement income of $52.2 million for the year

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

ended December 31, 2017 , into a single financial statement line item, rental and other property income, in the consolidated statements of operations.

The Company has chosen to break out loss on extinguishment of debt of $46,000 from interest expense and other, net for the year ended December 31, 2018 , and loss on extinguishment of debt of $896,000 from interest expense and other, net for the year ended December 31, 2017 , which was previously reported in total as $97.9 million and $90.7 million in the Company’s consolidated statements of operations for the years ended December 31, 2018 and 2017, respectively.

The Company has chosen to break out capital expenditures of $7.3 million from investment in real estate assets of $11.9 million for the year ended December 31, 2018 , and capital expenditures of $13.3 million from investment in real estate assets of $307.4 million for the year ended December 31, 2017 , which was previously reported in total as $19.2 million and $320.7 million in the Company’s consolidated statements of cash flows for the years ended December 31, 2018 and 2017, respectively.

Additionally, the Company is combining bad debt expense of $522,000 and straight-line rental income of $8.1 million for the year ended December 31, 2018 , and bad debt expense of $1.9 million and straight-line rental income of $10.1 million for the year ended December 31, 2017 into a single line item, straight-line rental income, net, in the consolidated statements of cash flows.

These reclassifications had no effect on previously reported totals or subtotals.

The Company is separately presenting the write-offs for uncollectible lease-related receivables of $ 952,000 and $ 522,000 for the years ended December 31, 2019 and 2018, respectively, which were previously included in straight-line rental income, net in the consolidated statements of cash flows.

The Company combined investment in real estate assets of $ 6.2 million and capital expenditures of $ 17.7 million for the year ended December 31, 2019, and investment in real estate assets of $ 11.9 million and capital expenditures of $ 7.3 million for the year ended December 31, 2018 into a single financial statement line item, investment in real estate assets and capital expenditures, in the consolidated statements of cash flows.

Use of Estimates

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The estimated useful lives of the Company’s real estate assets by class are generally as follows:

Site improvements

Tenant improvements

Lesser of useful life or lease term

Intangible lease assets

Buildings 40 years

Site improvements 15 years

Tenant improvements Lesser of useful life or lease term

Intangible lease assets Lease term

Recoverability of Real Estate Assets

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Impairment indicators that the Company considers include, but are not limited to:

bankruptcy or other credit concerns of a property’s major tenant, such as a history of late payments, rental concessions and other factors;

bankruptcy or other credit concerns of a property’s major tenant, such as a history of late payments, lease concessions and other factors;

a significant decrease in a property’s revenues due to lease terminations;

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changes in anticipated holding periods.

or other circumstances.

When indicators of potential impairment are present, the Company assesses the recoverability of the assets by determining whether the carrying amount of the assets will be recovered through the undiscounted future cash flows expected from the use of the assets and their eventual disposition.

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Generally, fair value is determined using a discounted cash flow analysis and recent comparable sales transactions.

During the year ended December 31, 2019 , as part of the Company’s quarterly impairment review procedures, the Company recorded impairment charges of $72.9 million related to 27 properties with revised expected holding periods and seven properties with vacancies.

During the year ended December 31, 2020, as part of the Company’s quarterly impairment review procedures, the Company recorded impairment charges of $ 16.7 million related to 11 properties due to revised cash flow estimates as a result of market conditions and one property due to a tenant bankruptcy.

The Company’s impairment assessment as of December 31, 2020 was based on the most current information available to the Company, including expected holding periods.

If the Company’s expected holding periods for assets change, subsequent tests for impairment could result in additional impairment charges in the future.

The Company cannot provide any assurance that material impairment charges with respect to the Company’s real estate assets will not occur during 2020 or future periods.

The Company cannot provide any assurance that additional material impairment charges with respect to the Company’s real estate assets will not occur during 2021 or in future periods.

During the year ended December 31, 2019, the Company recorded impairment charges of $ 72.9 million related to 27 properties with revised expected holding periods and seven properties with vacancies.

During the year ended December 31, 2018, the Company recorded impairment charges of $ 33.0 million related to 20 properties with revised expected holding periods and two properties with vacancies.

During the year ended December 31, 2017 , the Company recorded impairment charges of $2.9 million related to four properties as a result of delinquent rental payments and two tenants who had previously filed for bankruptcy.

The assumptions and uncertainties utilized in the evaluation of the impairment of real estate assets are

The assumptions and uncertainties utilized in the evaluation of the impairment of real estate assets are discussed in detail in Note 3 — Fair Value Measurements.

See also Note 4 — Real Estate Assets for further discussion regarding real estate investment activity.

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discussed in detail in Note 3 — Fair Value Measurements .

See also Note 4 — Real Estate Assets for further discussion regarding real estate investment activity.

Within the next 24 months, the Company expects to sell a substantial portion of its anchored shopping center portfolio and certain single tenant properties.

These will be sold in pools or on a standalone basis.

As of December 31, 2019 , the Company intended to sell properties with a net book value of at least $1.7 billion , subject to market conditions.

Assets Held for Sale

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If, in management’s opinion, the fair value, net of selling costs, of the asset is less than the carrying amount of the asset, an adjustment to the carrying amount is then recorded to reflect the estimated fair value of the property, net of selling costs.

As of December 31, 2019 , the Company identified 29 properties with a carrying value of $351.9 million as held for sale, 12 of which were sold subsequent to December 31, 2019 .

The Company has mortgage notes payable of $126.7 million that are related to the held for sale properties, which the Company expects to repay in connection with the disposition of the underlying held for sale properties.

As of December 31, 2018 , the Company identified one property with a carrying value of $6.8 million as held for sale, which was sold subsequent to December 31, 2018 .

As of December 31, 2019, the Company identified 29 properties with a fair value of $ 351.9 million as held for sale, and expected to sell a substantial portion of its anchored-shopping center portfolio and certain single-tenant properties within the next 24 months, subject to market conditions.

As the Company could not provide assurance that these properties would be sold within a 24-month period , the Company placed 15 properties with a fair value of $ 228.4 million that were previously classified as held for sale back in service as real estate assets in the consolidated balance sheets during the year ended December 31, 2020.

The remaining 14 properties were sold during the year ended December 31, 2020.

As of December 31, 2020, the Company identified one property with a fair value of $ 3.5 million as held for sale, which was sold subsequent to December 31, 2020.

Disposition of Real Estate Assets

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A discontinued operation includes only the disposal of a component of an entity and represents a strategic shift that has (or will have) a major effect on an entity’s financial results.

The disposition of 497 and 21 of the Company’s individual properties during the years ended December 31, 2019 and 2018 , respectively, did not qualify for discontinued operations presentation and thus, the results of the properties that were sold will remain in operating income, and any associated gains or losses from the disposition are included in gain on disposition of real estate, net.

The Company’s property dispositions during the years ended December 31, 2020 and 2019 did not qualify for discontinued operations presentation and thus, the results of the properties that were sold will remain in operating income, and any associated gains or losses from the disposition are included in gain on disposition of real estate, net.

See Note 4 — Real Estate Assets to the consolidated financial statements in this Annual Report on Form 10-K for a discussion of the disposition of individual properties during the year ended December 31, 2020.

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The fair values of in-place leases include estimates of direct costs associated with obtaining a new tenant and opportunity costs associated with lost rental and other property income, which are avoided by acquiring a property with an in-place lease.

Direct costs associated with obtaining a new tenant include leasing commissions, legal and other related expenses and are estimated in part by utilizing information obtained from independent appraisals and management’s consideration of current

The intangible values of opportunity costs, which are calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease, are capitalized as intangible lease assets and are amortized to expense over the remaining term of the respective leases.

If a lease were to be

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market costs to execute a similar lease.

If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed.

terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed.

The Company has acquired, and may continue to acquire, certain properties subject to contingent consideration arrangements that may obligate the Company to pay additional consideration to the seller based on the outcome of future events.

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The outcome may result in the release of all or a portion of the escrowed funds to the Company or the seller or a combination thereof.

Prior to the adoption of ASU 2017-01 (as defined below) in April 2017, contingent consideration arrangements, including amounts funded through an escrow account, were recorded upon acquisition of the respective property at their estimated fair value, and any changes to the estimated fair value subsequent to acquisition were reflected in the accompanying consolidated statements of operations in acquisition-related fees and expenses.

Upon adoption of ASU 2017-01 in April 2017, contingent consideration arrangements for asset acquisitions are recognized when the contingency is resolved.

The determination of the amount of contingent consideration arrangements is based on the probability of several possible outcomes as identified by management.

The Company estimates the fair value of assumed mortgage notes payable based upon indications of current market pricing for similar types of debt financing with similar maturities.

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The use of alternative estimates may result in a different allocation of the Company’s purchase price, which could materially impact the Company’s results of operations.

In April 2017, the Company elected to early adopt Accounting Standards Update (“ASU”) No.

2017-01, Business Combinations (Topic 805):

Clarifying the Definition of a Business (“ASU 2017-01”), which clarifies the definition of a business by adding guidance to assist entities in evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses.

Beginning in April 2017, all real estate acquisitions qualified as asset acquisitions, and as such, acquisition-related fees and certain acquisition-related expenses related to these asset acquisitions are now capitalized and allocated to tangible and intangible assets and liabilities as described above.

Other acquisition-related expenses, such as advisor reimbursements, continue to be expensed as incurred and are included in transaction-related expenses in the accompanying consolidated statements of operations.

Prior to the adoption of ASU 2017-01 in April 2017, all of the Company’s real estate acquisitions were accounted for as business combinations and, as such, acquisition-related expenses related to these business combination acquisitions were expensed as incurred.

Prior to April 2017, acquisition-related expenses included within transaction-related expenses in the Company’s consolidated statements of operations primarily consisted of legal, deed transfer and other costs related to real estate purchase transactions, including costs incurred for deals that were not consummated.

The Company expects its future acquisitions to qualify as asset acquisitions and, as such, the Company will allocate the purchase price to acquired tangible assets and identified intangible assets and liabilities on a relative fair value basis.

Acquisition-related fees and certain acquisition-related expenses related to asset acquisitions are capitalized and allocated to tangible and intangible assets and liabilities, as described above.

Other acquisition-related expenses, such as manager reimbursements, continue to be expensed as incurred and are included in transaction-related expenses in the accompanying consolidated statements of operations.

Redeemable Noncontrolling Interest in Consolidated Joint Venture

On June 27, 2014 , the Company completed the formation of the Consolidated Joint Venture.

Pursuant to the joint venture agreement, the joint venture partner has a right to exercise an option (the “Option”), which became effective on June 27, 2016, whereby the Company will be required to purchase the ownership interest of the joint venture partner at fair market value.

From June 2014 to December 2019, the Company determined it had a controlling interest in the Consolidated Joint Venture and, therefore, met the GAAP requirements for consolidation.

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Therefore, the Company determined it no longer had a controlling financial interest as of December 31, 2019.

The Company recorded the noncontrolling interest of $2.3 million as of December 31, 2018 , as temporary equity in the mezzanine section of the consolidated balance sheets, due to the ability to exercise the Option being outside the control of the Company.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Cash and Cash Equivalents and Restricted Cash

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Although the Company bears risk on amounts in excess of those insured by the FDIC, it has not experienced and does not anticipate any losses due to the high quality of the institutions where the deposits are held.

Included in cash and cash equivalents was $126.8 million reserved for settlement of broadly syndicated loan purchases as of December 31, 2019 , as further discussed in Note 10 — Commitments and Contingencies .

Included in cash and cash equivalents was $ 41.0 million and $ 126.8 million of unsettled broadly syndicated loan purchases as of December 31, 2020 and 2019, respectively.

The Company had $ 7.0 million and $ 7.3 million in restricted cash as of December 31, 2020 and December 31, 2019, respectively.

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Also included in restricted cash was $ 3.4 million and $ 4.2 million held by lenders in escrow accounts for real estate taxes and other lender reserves for certain properties, in accordance with the associated lender’s loan agreement as of December 31, 2020 and 2019, respectively.

Real Estate-Related Securities

Real estate-related securities consists primarily of the Company’s investment in commercial mortgage-backed securities (“CMBS”).

The Company determines the appropriate classification for real estate-related securities at the time of purchase and reevaluates such designation as of each balance sheet date.

As of December 31, 2020, the Company classified its investments as available-for-sale as the Company is not actively trading the securities;

however, the Company may sell them prior to their maturity.

These investments are carried at their estimated fair value with unrealized gains and losses reported in other comprehensive (loss) income.

During the year ended December 31, 2020, the Company invested $ 76.6 million in CMBS.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

During the same period, the Company sold $ 37.1 million in CMBS resulting in net proceeds of $ 37.6 million and a gain of $ 510,000 .

As of December 31, 2020, the Company had investments in four CMBS with an estimated aggregate fair value of $ 38.2 million.

The Company monitors its available-for-sale securities for impairment.

An allowance for credit losses is recorded when the Company acquires CMBS, and any subsequent impairment is recognized when the Company determines that a decline in the estimated fair value of a security below its amortized cost has resulted from a credit loss or other factors.

The Company records impairments related to credit losses through an allowance for credit losses.

However, the allowance is limited by the amount that the fair value is less than the amortized cost basis.

The Company considers many factors in determining whether a credit loss exists, including, but not limited to, the extent to which the fair value is less than the amortized cost basis, recent events specific to the security, industry or geographic area, the payment structure of the security, the failure of the issuer of the security to make scheduled interest or principal payments, and external credit ratings and recent changes in such ratings.

The analysis of determining whether a credit loss exists requires significant judgments and assumptions.

The use of alternative judgments and assumptions could result in a different conclusion.

The amortized cost of real estate-related securities is adjusted for amortization of premiums and accretion of discounts to maturity computed under the effective interest method and is recorded in the accompanying consolidated statements of operations in interest and other expense, net.

Upon the sale of a security, the realized net gain or loss is computed on the specific identification method.

Loans Held-for-Investment

The Company has acquired, and may continue to acquire, loans related to real estate assets.

Additionally, we may invest in first and second lien mortgage loans, mezzanine loans, bridge loans, wraparound mortgage loans, construction mortgage loans on real property, loans on leasehold interest mortgages and broadly syndicated loans.

Additionally, the Company may acquire and originate credit investments, including commercial mortgage loans, mezzanine loans, preferred equity, and other loans and securities related to commercial real estate assets, as well as corporate loan opportunities that are consistent with the Company’s investment strategy and objectives.

The Company intends to hold the loans held-for-investment for the foreseeable future or until maturity.

Loans held-for-investment are carried on the Company’s consolidated balance sheets at amortized cost, net of any allowance for loans receivable losses.

Discounts or premiums, origination fees and exit fees are amortized as a component of interest income using the effective interest method over the life of the respective loans.

Loan acquisition fees paid to CMFT Management or its affiliates are expensed as incurred and are included in transaction-related expenses in the accompanying consolidated statements of operations.

Loans held-for-investment are carried on the Company’s consolidated balance sheets at amortized cost, net of any allowance for credit losses.

Discounts or premiums, origination fees and exit fees are amortized as a component of interest income using the effective interest method over the life of the respective loans, or on a straight-line basis when it approximates the effective interest method.

Upon the sale of a loan, the realized net gain or loss is computed on the specific identification method.

Interest earned is either received in cash or capitalized to loans held-for-investment and related receivables, net in the Company’s consolidated balance sheets.

Interest is capitalized when certain conditions are met as specified in each loan agreement.

For the year ended December 31, 2019 , the Company recorded $20.1 million in interest income, of which $8.5 million was capitalized to loans held-for-investment and related receivables, net.

During the year ended December 31, 2020, the Company recorded $ 29.4 million in interest income, of which $ 539,000 was capitalized to loans held-for-investment and related receivables, net.

Accrual of interest income is suspended on nonaccrual loans.

Loans that are past due 90 days or more as to principal or interest, or where reasonable doubt exists as to timely collection, are generally considered nonperforming and placed on nonaccrual.

Loans that are past due 90 days or more as to principal or interest, or where reasonable doubt exists as to timely collection, are generally considered nonperforming and placed on nonaccrual status.

Interest collected is recognized on a cash basis by crediting income when received.

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As of December 31, 2020, the Company’s eight mezzanine loans with a net book value of $ 89.4 million were nonaccrual loans.

Generally, an allowance for loan losses is provided when management determines that the Company will be unable to collect any remaining amounts due under the loan agreement.

The Company evaluates the collectability of its loans held-for-investment at least quarterly.

The evaluation of collectability involves judgment, estimates, and a review of the ability of the borrower to make principal and interest payments and the underlying collateral.

For the year ended December 31, 2019 , the Company recorded no impairment on its loans held-for-investment.

During the year ended December 31, 2020, the Company recorded $ 565,000 in interest income related to the nonaccrual loans.

Subsequent to December 31, 2020, the Company completed foreclosure proceedings to take control of the assets securing the mezzanine loans.

Allowance for Credit Losses

The Company adopted Accounting Standards Update (“ASU”) No.

2016-13, Financial Instruments - Credit Losses (Topic 326) (“ASU 2016-13”), as further described in “Recent Accounting Pronouncements,” on January 1, 2020.

The allowance for credit losses required under ASU 2016-13 reflects the Company’s current estimate of potential credit losses related to the Company’s loans held-for-investment included in the consolidated balance sheets.

The initial allowance for credit losses recorded on January 1, 2020 is reflected as a direct charge to retained earnings on the Company’s consolidated statements of stockholders’ equity;

however, subsequent changes to the allowance for credit losses are recognized through net income on the Company’s consolidated statements of operations.

While ASU 2016-13 does not require any particular method for determining the allowance for credit losses, it does specify the allowance should be based on relevant information about past events, including historical loss experience, current portfolio and market conditions, and reasonable and supportable forecasts for the duration of each respective loan.

In addition, other than a few narrow exceptions, ASU 2016-13 requires that all financial instruments subject to the credit loss model have some amount of loss reserve to reflect the GAAP principal underlying the

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

credit loss model that all loans, debt securities, and similar assets have some inherent risk of loss, regardless of credit quality, subordinate capital, or other mitigating factors.

The Company has elected to use a discounted cash flow model to estimate the allowance for credit losses.

This model requires the Company to develop cash flows which project estimated credit losses over the life of the loan and discount these cash flows at the asset’s effective interest rate.

The Company then records an allowance for credit losses equal to the difference between the amortized cost basis of the asset and the present value of the expected cash flows.

The Company considers loan investments that are both (i) expected to be substantially repaid through the operation or sale of the underlying collateral, and (ii) for which the borrower is experiencing financial difficulty, to be “collateral-dependent” loans.

For such loans that the Company determines that foreclosure of the collateral is probable, the Company measures the expected losses based on the difference between the fair value of the collateral less costs to sell and the amortized cost basis of the loan as of the measurement date.

For collateral-dependent loans that the Company determines foreclosure is not probable, the Company applies a practical expedient to estimate expected losses using the difference between the collateral’s fair value (less costs to sell the asset if repayment is expected through the sale of the collateral) and the amortized cost basis of the loan.

For the Company’s broadly syndicated loans, the Company uses a probability of default and loss given default method using an underlying third-party CMBS/Commercial Real Estate (“CRE”) loan database with historical loan losses from 1998 to 2019.

The Company may use other acceptable alternative approaches in the future depending on, among other factors, the type of loan, underlying collateral, and availability of relevant historical market loan loss data.

The Company adopted ASU 2016-13 using the modified retrospective method for all financial assets measured at amortized cost.

Prior to adoption, the Company had no allowance for credit losses on its consolidated balance sheets.

The Company recorded a cumulative-effective adjustment to the opening retained earnings in its consolidated statement of stockholders’ equity as of January 1, 2020 of $ 2.0 million.

Quarterly, the Company evaluates the risk of all loans and assigns a risk rating based on a variety of factors, grouped as follows:

(i) loan and credit structure, including the as-is loan-to-value (“LTV”) ratio and structural features;

(ii) quality and stability of real estate value and operating cash flow, including debt yield, dynamics of the geography, property type and local market, physical condition, stability of cash flow, leasing velocity and quality and diversity of tenancy;

(iii) performance against underwritten business plan;

and (iv) quality, experience and financial condition of sponsor, borrower and guarantor(s).

Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from least risk to greatest risk, respectively, which ratings are defined as follows:

1- Outperform — Most satisfactory asset quality and liquidity, good leverage capacity.

A “1” rating maintains predictable and strong cash flows from operations.

The trends and outlook for the credit's operations, balance sheet, and industry are neutral to favorable.

Collateral, if appropriate, exceeds performance metrics;

2- Meets or Exceeds Expectations — Acceptable asset quality, moderate excess liquidity, modest leverage capacity.

A “2” rating could have some financial/non-financial weaknesses which are offset by strengths;

however, the credit demonstrates an ample current cash flow from operations.

The trends and outlook for the credit's operations, balance sheet, and industry are generally positive or neutral.

Collateral performance, if appropriate, meets or exceeds substantially all performance metrics included in original or current underwriting / business plan;

3- Satisfactory — Acceptable asset quality, somewhat strained liquidity, minimal leverage capacity.

A “3” rating is at times characterized by acceptable cash flows from operations.

The trends and conditions of the credit's operations and balance sheet are neutral.

Collateral performance, if appropriate, meets or is on track to meet underwriting;

business plan can reasonably be achieved;

4- Underperformance — The debt investment possesses credit deficiencies or potential weaknesses which deserve management’s close and continued attention.

The portfolio company’s operations and/or balance sheet have demonstrated an adverse trend or deterioration which, while serious, has not reached the point where the liquidation of debt is jeopardized.

These weaknesses are generally considered correctable by the borrower in the normal course of business but may weaken the asset or inadequately protect the Company’s credit position if not checked or corrected.

Collateral performance, if appropriate, falls short of original underwriting, material differences exist from business plan, or both;

technical milestones have been missed;

defaults may exist, or may soon occur absent material improvement;

5- Default/Possibility of Loss — The debt investment is protected inadequately by the current enterprise value or paying capacity of the obligor or of the collateral, if any.

The underlying company’s operations has well-defined weaknesses based upon objective evidence, such as recurring or significant decreases in revenues and cash flows.

Major variance from business plan;

loan covenants or technical milestones have been breached;

timely exit from

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

loan via sale or refinancing is questionable;

risk of principal loss.

Collateral performance, if appropriate, is significantly worse than underwriting.

The Company generally assigns a risk rating of “3” to all newly originated or acquired loans-held-for-investment during a most recent quarter, except in the case of specific circumstances warranting an exception.

Deferred Financing Costs

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Debt issuance costs related to securing a revolving line of credit are presented as an asset and amortized ratably over the term of the line of credit arrangement.

As such, the Company’s current and corresponding prior period total deferred costs, net in the accompanying consolidated balance sheets relate only to the revolving loan portion of the credit facilities and the historical presentation, amortization and treatment of unamortized costs are still

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

As of December 31, 2020 and 2019, the Company had $ 4.3 million and $ 2.3 million, respectively, of deferred financing costs, net of accumulated amortization, related to the revolving loan portion of the credit facilities.

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Accounting for changes in the fair value of a derivative instrument depends on the intended use of the derivative instrument and the designation of the derivative instrument.

The change in fair value of the derivative instrument that is designated as a hedge is recorded as other comprehensive income.

The change in fair value of the derivative instrument that is designated as a cash flow hedge is recorded as other comprehensive income.

The changes in fair value for derivative instruments that are not designated as hedges or that do not meet the hedge accounting criteria are recorded as a gain or loss to operations.

Redeemable Common Stock

Under the Company’s share redemption program, the Company’s obligation to redeem shares of its outstanding common stock is limited, among other things, to the net proceeds received by the Company from the sale of shares under the DRIP, net of shares redeemed to date.

The Company records the maximum amount that is redeemable under the share redemption program as redeemable common stock outside of permanent equity in its consolidated balance sheets.

Under the Company’s Amended Share Redemption Program, the Company’s obligation to redeem shares of its outstanding common stock is limited, among other things, to the net proceeds received by the Company from the sale of shares under the Amended DRIP, net of shares redeemed to date.

The Company records the maximum amount that is redeemable under the Amended Share Redemption Program as redeemable common stock outside of permanent equity in its consolidated balance sheets.

Changes in the amount of redeemable common stock from period to period are recorded as an adjustment to capital in excess of par value.

The Company adopted ASU No.

2016-02, Leases, (Topic 842) (“ASC 842”), on January 1, 2019 using the optional alternative transition method for financial information and related disclosures.

The Company elected the “package of practical expedients,” which permits the Company to not reassess under the new standard prior conclusions about lease identification, lease classification and initial direct costs.

As of December 31, 2020, there was no redeemable common stock, as the Board approved the suspension of the share redemption program on August 30, 2020 in connection with our entry into the Merger Agreements.

The Company has lease agreements with lease and non-lease components.

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Significant judgments and assumptions are inherent in not only determining if a contract contains a lease, but also the lease classification, terms, payments, and, if needed, discount rates.

Judgments include the nature of any options, including if they will be exercised, evaluation of implicit discount rates and the assessment and consideration of “fixed” payments for straight-line rent revenue calculations.

Judgments include the nature of any options, including if they

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

will be exercised, evaluation of implicit discount rates and the assessment and consideration of “fixed” payments for straight-line rent revenue calculations.

The Company has an investment in a real estate property that is subject to a ground lease, for which a lease liability and right of use (“ROU”) asset of $ 2.4 million was recorded as of December 31, 2020.

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Costs related to salaries and benefits, supervision, administration, unsuccessful origination efforts and other activities not directly related to completed lease agreements are expensed as incurred.

Leasing commissions subsequent to successful lease execution are capitalized.

Upon successful lease execution, leasing commissions are capitalized.

Revenue Recognition

Revenue from leasing activities

Rental and other property income is primarily derived from fixed contractual payments from operating leases and, therefore, is generally recognized on a straight-line basis over the term of the lease, which typically begins the date the tenant

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

takes control of the space.

When the Company acquires a property, the terms of existing leases are considered to commence as of the acquisition date for the purpose of this calculation.

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Upon the determination that the collectability of a receivable is not probable, the Company will record a reduction to rental and other property income for amounts previously recorded and a decrease in the outstanding receivable.

Revenue from leases where collection is deemed to be less than probable is recorded on a cash basis until collectability becomes probable.

Management’s estimate of the collectability of lease-related receivables is based on the best information available to management at the time of evaluation.

Revenue from leases where collection is deemed to be not probable is recorded on a cash basis until collectability becomes probable.

Management’s estimate of the collectability of lease-related receivables is based on the best information available at the time of estimate.

The Company does not use a general reserve approach and lease-related receivables are adjusted and taken against rental and other property income only when collectability becomes not probable.

During the year ended December 31, 2020, the Company identified certain tenants where collection was no longer considered probable.

For these tenants, the Company made the determination to record revenue on a cash basis and wrote off total outstanding receivables of $ 5.6 million for the year ended December 31, 2020, which included $ 206,000 of straight-line rental income and $ 1.0 million related to certain tenant reimbursements that were written off during the year ended December 31, 2020.

These write-offs reduced rental and other property income during the year ended December 31, 2020.

Revenue from lending activities

Interest income from our loans held-for-investment is comprised of interest earned on loans and the accretion and amortization of net loan origination fees and discounts.

Interest income from the Company’s loans held-for-investment and real estate-related securities is comprised of interest earned on loans and the accretion and amortization of net loan origination fees and discounts.

Interest income on loans is accrued as earned, with the accrual of interest suspended when the related loan becomes a nonaccrual loan.

Interest income on the Company’s broadly syndicated loans is accrued as earned beginning on the settlement date.

The Company elected to be taxed, and currently qualifies, as a REIT for federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, commencing with the taxable year ended December 31, 2012.

The Company elected to be taxed, and currently qualifies, as a REIT for federal income tax purposes under Sections 856 through 860 of the Code, commencing with the taxable year ended December 31, 2012.

The Company will generally not be subject to federal corporate income tax to the extent it distributes its taxable income to its stockholders, and so long as it, among other things, distributes at least 90% of its annual taxable income (computed without regard to the dividends paid deduction and excluding net capital gains).

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Even if the Company maintains its qualification for taxation as a REIT, it or its subsidiaries may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed income.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Earnings (Loss) and Distributions Per Share

Earnings (loss) per share are calculated based on the weighted average number of common shares outstanding during each period presented.

Diluted income (loss) per share considers the effect of any potentially dilutive share equivalents, of which the Company had none for each of the years ended December 31, 2019 , 2018 or 2017 .

Diluted income (loss) per share considers the effect of any potentially dilutive share equivalents, of which the Company had no ne for each of the years ended December 31, 2020, 2019 or 2018.

Distributions per share are calculated based on the authorized daily distribution rate.

Reportable Segment

The Company’s commercial real estate assets consist of income-producing necessity retail properties that are primarily single-tenant or anchored shopping centers, which are leased to creditworthy tenants under long-term net leases.

Reportable Segments

During the year ended December 31, 2020, the Company realigned the business and reportable segment information to reflect how the chief operating decision makers regularly review and manage the business and determined that it has two reportable segments:

Credit — engages primarily in acquiring and originating loans related to real estate assets.

The Company may acquire first and second lien mortgage loans, mezzanine loans, bridge loans, wraparound mortgage loans, construction mortgage loans on real property and loans on leasehold interest mortgages.

This segment also includes investments in CMBS and broadly syndicated loans.

Real estate — engages primarily in acquiring and managing income-producing retail properties that are primarily single-tenant properties or anchored shopping centers, which are leased to creditworthy tenants under long-term net leases.

The commercial properties are geographically diversified throughout the United States and have similar economic characteristics.

The Company’s management evaluates operating performance on an overall portfolio level;

therefore, the Company’s properties are one reportable segment.

See Note 17 — Segment Reporting for a further discussion regarding these segments.

Recent Accounting Pronouncements

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Except as otherwise stated below, the Company is currently evaluating the effect that certain new accounting requirements may have on the Company’s accounting and related reporting and disclosures in the Company’s consolidated financial statements.

In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU No.

2016-13, Financial Instruments - Credit Losses (Topic 326) (“ASU 2016-13”), which was subsequently amended by ASU No.

2018-19, Codification

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Improvements to Topic 326, Financial Instruments - Credit Losses (“ASU 2018-19”), in November 2018.

In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, which was subsequently amended by ASU No.

2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses (“ASU 2018-19”), in November 2018.

Subsequently, the FASB issued ASU No.

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2019-05, ASU No.

2019-10, ASU No.

2019-11 and ASU No.

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ASU 2018-19 clarified that receivables arising from operating leases are not within the scope of Topic 326.

Instead, impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases.

Instead, impairment of receivables arising from operating leases should be accounted for in accordance with ASU No.

2016-02, Leases (Topic 842) (“ASC 842”) .

ASU 2016-13 and ASU 2018-19 are effective for fiscal years, and interim periods within those years, beginning after December 15, 2019.

Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018.

The Company will adopt this ASU during the first quarter of fiscal year 2020 and does not expect it will have a material impact on its consolidated financial statements.

The Company adopted ASU 2016-13 during the first quarter of fiscal year 2020.

See Note 7 — Loans Held-For-Investment for a further discussion on the impact of the adoption of ASU 2016-13.

In August 2018, the FASB issued ASU No.

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The remaining provisions of ASU 2018-13 are to be applied retrospectively, and early adoption is permitted.

The Company will adopt this ASU during the first quarter of fiscal year 2020 and does not expect it will have a material impact on its consolidated financial statements.

In October 2018, the FASB issued ASU No.

2018-16, Inclusion of the Secured Overnight Financing Rate (“SOFR”) Overnight Index Swap (“OIS”) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes (“ASU 2018-16”).

The amendments in this ASU permit the use of the OIS rate based on SOFR as a U.S.

benchmark interest rate for hedge accounting purposes or another acceptable benchmark.

The SOFR is a volume-weighted median interest rate that is calculated daily based on overnight transactions from the prior day’s activity in specified segments of the U.S.

Treasury repo market.

It has been selected as the preferred replacement for the U.S.

dollar London Interbank Offered Rate (“LIBOR”), which will be phased out by the end of 2021.

ASU 2018-16 is effective for public entities for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.

ASU 2018-16 is required to be adopted on a prospective basis for qualifying new or redesignated hedging relationships entered into on or after the date of adoption.

The Company currently uses LIBOR as its benchmark interest rate in the Company’s interest rate swaps associated with the Company’s LIBOR-based variable rate borrowings.

The Company has not entered into any new or redesignated hedging relationships on or after the date of adoption of ASU 2018-16.

The Company evaluated the effect of this new benchmark interest rate option, and does not believe this ASU will have a material impact on its consolidated financial statements.

The Company adopted ASU 2018-13 during the first quarter of fiscal year 2020 and has concluded that there is no material impact on its consolidated financial statements.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

In October 2018, the FASB issued ASU 2018-17, Consolidation (Topic 810):

Targeted Improvements to Related Party Guidance for Variable Interest Entities .

Targeted Improvements to Related Party Guidance for Variable Interest Entities (“ASU 2018-17”).

The guidance changes the guidance for determining whether a decision-making fee is a variable interest.

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Such indirect interests were previously treated the same as direct interests.

This ASU is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years.

ASU 2018-17 is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years.

The Company adopted ASU 2018-17 during the first quarter of fiscal year 2020, and has concluded that there is no material impact on its consolidated financial statements.

In April 2020, the FASB issued a question and answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of the COVID-19 pandemic.

Due to the business disruptions and challenges severely affecting the global economy caused by the COVID-19 pandemic, many lessors may be required to provide rent deferrals and other lease concessions to lessees.

While the lease modification guidance in ASC 842 addresses routine changes to lease terms resulting from negotiations between the lessee and the lessor, this guidance did not contemplate concessions being so rapidly executed to address the sudden liquidity constraints of some lessees arising from COVID-19 related impacts.

Under existing lease guidance, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant (treated within the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (precluded from applying the lease modification accounting framework).

The Lease Modification Q&A allows the Company, if certain criteria have been met, to bypass the lease by lease analysis, and instead elect to either apply the lease modification accounting framework or not, with such election applied consistently to leases with similar characteristics and similar circumstances.

The Company has elected to apply this guidance to avoid performing a lease by lease analysis for the lease concessions that (1) were granted as relief due to COVID-19 related impacts and (2) result in the cash flows remaining substantially the same or less than the original contract and will account for these lease concessions as if no changes were made to the leases.

During the year ended December 31, 2020, the Company provided lease concessions, either in the form of rental deferrals or abatements, to certain tenants in response to the impact of the COVID-19 pandemic on those tenants.

As of December 31, 2020, the Company had granted rent deferrals of $ 4.8 million.

The deferral of rental payments affects the timing, but not the amount, of the lease payments and resulted in an increase of $ 4.8 million to the Company’s lease-related receivables balance as of December 31, 2020.

Additionally, as of December 31, 2020, the Company had granted rental abatements of $ 407,000 .

In addition, the Company entered into lease amendments during the year ended December 31, 2020 that provided for lease concessions, through rent abatements or rent deferrals, that represented substantive changes to the consideration in the original lease.

These lease amendments extended the lease periods ranging from 12 months to 84 months.

For these leases, the Company applied the lease modification accounting framework pursuant to ASC 842.

As of December 31, 2020 , these lease amendments resulted in rent abatements of $ 3.7 million and deferred rental income of $ 1.3 million.

As of March 24, 2021, the Company has collected approximately 98 % of rental payments billed to tenants during the three months ended December 31, 2020 .

In January 2021, the FASB issued ASU No.

2021-01, Reference Rate Reform (Topic 848) (“ASU 2021-01”).

The amendments in ASU 2021-01 clarify that certain optional expedients and exceptions for contract modifications and hedge accounting apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of the discontinuation of the use of LIBOR as a benchmark interest rate due to reference rate reform.

ASU 2021-01 is effective immediately for all entities with the option to apply retrospectively as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, and can be applied prospectively to any new contract modifications made on or after January 7, 2021.

The Company currently uses LIBOR as its benchmark interest rate for its derivative instruments, and has not entered into any new contracts on or after the effective date of ASU 2021-01.

The Company is evaluating the impact of this ASU’s adoption, and does not believe this ASU will have a material impact on its consolidated financial statements.

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Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions.

Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate the fair value.

Assets and liabilities are measured using inputs from three levels of the fair value hierarchy, as follows:

Depending on the nature of

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

the asset or liability, various techniques and assumptions can be used to estimate the fair value.

Assets and liabilities are measured using inputs from three levels of the fair value hierarchy, as follows:

Level 1 — Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.

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The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities:

Real estate-related securities — The Company generally determines the fair value of its real estate-related securities by utilizing broker-dealer quotations, reported trades or valuation estimates from pricing models to determine the reported price.

Pricing models for real estate-related securities are generally discounted cash flow models that usually consider the attributes applicable to a particular class of security (e.g., credit rating, seniority), current market data, and estimated cash flows for each class and incorporate deal collateral performance such as prepayment speeds and default rates, as available.

Depending upon the significance of the fair value inputs used in determining these fair values, these securities are valued using either Level 2 or Level 3 inputs.

As of December 31, 2020, the Company concluded that $ 27.5 million of real estate-related securities fell under Level 2 and $ 10.7 million of real estate-related securities fell under Level 3.

Credit facilities and notes payable — The fair value is estimated by discounting the expected cash flows based on estimated borrowing rates available to the Company as of the measurement date.

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These financial instruments are valued using Level 2 inputs.

As of December 31, 2019 , the estimated fair value of the Company’s debt was $1.60 billion , compared to the carrying value of $1.61 billion .

The estimated fair value of the Company’s debt as of December 31, 2018 was $2.46 billion , compared to the carrying value of $2.53 billion .

As of December 31, 2020, the estimated fair value of the Company’s debt was $ 2.14 billion, compared to a carrying value of $ 2.15 billion.

The estimated fair value of the Company’s debt as of December 31, 2019 was $ 1.60 billion, compared to a carrying value of $ 1.61 billion.

Derivative instruments — The Company’s derivative instruments are comprised of interest rate swaps.

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As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy.

Revenue bonds — The Company’s revenue bonds were acquired in connection with the purchase of an anchored shopping center.

The bonds have a 9.0% interest rate and mature on November 1, 2044.

These investments are initially recognized in interest receivable, prepaid expenses and other assets on the consolidated balance sheets and are subsequently measured using amortized cost.

The fair value estimates of the Company’s revenue bonds are based on assumptions that management believes market participants would use in pricing, using widely accepted valuation techniques including discounted cash flow analysis.

This analysis reflects the contractual terms of the bonds, including the period to maturity, and uses unobservable market-based inputs, including discount rates ranging from 7.75% to 9.0% .

As a result, the Company has determined that its revenue bonds are classified in Level 3 of the fair value hierarchy.

As of December 31, 2019 , the estimated fair value of the Company’s revenue bonds was $2.0 million .

The Company has these investments classified as held-to-maturity securities.

The Company’s investments in revenue bonds are reviewed for impairment, including the evaluation of changes in events or circumstances that may indicate that the carrying amount of the investment may not be recoverable.

Loans held-for-investment — The Company’s loans held-for-investment are recorded at cost upon origination and adjusted by net loan origination fees and discounts.

The Company estimates the fair value of its loans held-for-investment by performing a present value analysis for the anticipated future cash flows using an appropriate market discount rate taking into consideration the credit risk.

As a result, the Company has determined that its loans held-for-investment are classified in Level 3 of the fair value hierarchy.

The Company has determined that its CRE loans held-for-investment are classified in Level 3 of the fair value hierarchy.

The Company’s broadly syndicated loans are classified as Level 2 or Level 3 depending on the number of market quotations or indicative prices from pricing services that are available, and whether the depth of the market is sufficient to transact at those prices in amounts approximating the Company’s investment position at the measurement date.

As of December 31, 2020, $ 359.6 million and $ 114.1 million of the Company’s broadly syndicated loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively.

As of December 31, 2020, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $ 907.8 million, compared to its carrying value of $ 892.3 million.

As of December 31, 2019, the estimated fair value of the Company’s loans held-for-investment was $ 302.0 million, compared to its carrying value of $ 301.6 million.

As of December 31, 2018, the Company determined that the estimated fair value of its loans held-for-investment was equal to its carrying value given that the loans were originated during the fourth quarter of 2018.

Other financial instruments — The Company considers the carrying values of its cash and cash equivalents, restricted cash, tenant receivables, accounts payable and accrued expenses, other liabilities, due to affiliates and distributions payable to approximate their fair values because of the short period of time between their origination and their expected realization as well

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

as their highly-liquid nature.

Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments.

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Balance as of

December 31, 2019

Quoted Prices in

December 31, 2020 Quoted Prices in

Active Markets for

Identical Assets

Significant Other

(Level 1) Significant Other

Observable Inputs

(Level 2) Significant

Financial assets:

Interest rate swaps

CMBS $ 38,194 $ — $ 27,461 $ 10,733

Total financial assets

Financial liability:

Interest rate swap

Total financial liability

$ 38,194 $ — $ 27,461 $ 10,733

Financial liabilities:

Interest rate swaps $ ( 12,308 ) $ — $ ( 12,308 ) $ —

Total financial liabilities $ ( 12,308 ) $ — $ ( 12,308 ) $ —

Balance as of

December 31, 2018

Quoted Prices in

December 31, 2019 Quoted Prices in

Active Markets for

Identical Assets

Significant Other

(Level 1) Significant Other

Observable Inputs

(Level 2) Significant

Financial assets:

Interest rate swaps

$ 261 $ — $ 261 $ —

Total financial assets

$ 261 $ — $ 261 $ —

Financial liability:

Interest rate swap $ ( 4,181 ) $ — $ ( 4,181 ) $ —

Total financial liability $ ( 4,181 ) $ — $ ( 4,181 ) $ —

The following are reconciliations of the changes in financial assets with Level 3 inputs in the fair value hierarchy for the year ended December 31, 2020 (in thousands):

Beginning Balance, January 1, 2020

Total gains and losses:

Unrealized gain included in other comprehensive income, net

Purchases and payments received:

Premiums (discounts), net

Principal payments received

Ending Balance, December 31, 2020

Items Measured at Fair Value on a Non-Recurring Basis (Including Impairment Charges)

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The Company’s process for identifying and recording impairment related to real estate assets and intangible assets is discussed in Note 2 — Summary of Significant Accounting Policies.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

As discussed in Note 4 — Real Estate Assets, during the year ended December 31, 2020, real estate assets related to 12 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 86.4 million, resulting in impairment charges of $ 16.7 million.

During the year ended December 31, 2019, real estate assets related to 34 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 384.4 million, resulting in impairment charges of $ 72.9 million.

During the year ended December 31, 2017 , real estate assets related to four properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $4.3 million , resulting in impairment charges of $2.9 million .

During the year ended December 31, 2018, real estate assets related to 22 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 332.4 million, resulting in impairment charges of $ 33.0 million.

The Company estimates fair values using Level 3 inputs and using a combined income and market approach, specifically using discounted cash flow analysis and recent comparable sales transactions.

6 unchanged sentences

There are inherent uncertainties in making these estimates such as market conditions and the future performance and sustainability of the Company’s tenants.

For the Company’s impairment tests for the real estate assets during the year ended December 31, 2019 , the Company used a range of discount rates from 7.4% to 9.5% and terminal capitalization rates from 5.5% to 9.2% .

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The Company determined that the selling prices used to determine the fair values were Level 2 inputs.

The following summarizes the ranges of discount rates and terminal capitalization rates used for the Company’s impairment test for the real estate assets during the year ended December 31, 2020 :

Year Ended December 31, 2020

Discount Rate Terminal Capitalization Rate

7.9 % - 9.7 %

7.4 % - 9.2 %

The following table presents the impairment charges by asset class recorded during the years ended December 31, 2020, 2019 and 2018 (in thousands):

Year Ended December 31,

2020 2019 2018

Asset class impaired:

Land $ 3,738 $ 12,648 $ 6,436

Buildings, fixtures and improvements 12,310 56,572 25,299

3 unchanged sentences

NOTE 4 — REAL ESTATE ASSETS

2020 Property Acquisitions

During the year ended December 31, 2020, the Company acquired 150 commercial properties, including 146 properties acquired in connection with the Mergers, for an aggregate purchase price of $ 798.5 million (the “2020 Property Acquisitions”), which includes $ 7.9 million of external acquisition-related expenses that were capitalized.

The Company funded the 2020 Property Acquisitions acquired in connection with the Mergers with the Merger Consideration, and funded the remaining acquisitions with proceeds from real estate dispositions and available borrowings.

The following table summarizes the purchase price allocation for the 2020 Property Acquisitions (in thousands):

2020 Property Acquisitions

Land $ 166,395

Buildings, fixtures and improvements 571,777

Acquired in-place leases and other intangibles (1)

Acquired above-market leases (2)

Intangible lease liabilities (3)

Total purchase price $ 798,500

______________________

(1) The amortization period for acquired in-place leases and other intangibles is 8.9 years.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(2) The amortization period for acquired above-market leases is 6.5 years.

(3) The amortization period for acquired intangible lease liabilities is 9.7 years.

2020 Property Dispositions and Real Estate Asset Held for Sale

During the year ended December 31, 2020, the Company disposed of 30 properties, consisting of 20 retail properties and 10 anchored shopping centers for an aggregate gross sales price of $ 270.4 million, resulting in net proceeds of $ 263.8 million after closing costs and disposition fees due to CMFT Management or its affiliates, and a recorded gain of $ 27.5 million.

The Company has no continuing involvement with these properties.

The gain on sale of real estate is included in gain on disposition of real estate, net in the consolidated statements of operations.

As of December 31, 2020, there was one property classified as held for sale with a carrying value of $ 3.5 million included in assets held for sale in the accompanying consolidated balance sheets.

Subsequent to December 31, 2020, the Company disposed of the property, as further discussed in Note 19 — Subsequent Events.

2020 Impairment

The Company performs quarterly impairment review procedures, primarily through continuous monitoring of events and changes in circumstances that could indicate that the carrying value of certain of its real estate assets may not be recoverable.

See Note 2 — Summary of Significant Accounting Policies for a discussion of the Company’s accounting policies regarding impairment of real estate assets.

During the year ended December 31, 2020, 12 properties totaling approximately 824,000 square feet with a carrying value of $ 103.1 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 86.4 million, resulting in impairment charges of $ 16.7 million, which were recorded in the consolidated statements of operations.

See Note 3 — Fair Value Measurements for a further discussion regarding these impairment charges.

2019 Property Acquisition

11 unchanged sentences

O) (the “Purchaser”), an unaffiliated company, to sell approximately 452 single-tenant properties, including nine properties previously owned through the Consolidated Joint Venture, encompassing approximately 5.1 million gross rentable square feet of commercial space across 41 states.

Pursuant to the Purchase and Sale Agreement, the sale of 444 properties closed in December 2019 for total consideration of $1.2 billion , including the assumption by the Purchaser of existing mortgage debt totaling $130.8 million and the repayment of $532.3 million in debt, as further discussed in Note 8 — Credit Facilities and Notes Payable .

The remaining properties closed subsequent to December 31, 2019, for consideration of $26.3 million , as discussed in Note 17 — Subsequent Events .

During the year ended December 31, 2019 , the Company disposed of a total of 497 properties, consisting of 482 retail properties, one industrial property and 14 anchored shopping centers, excluding a related outparcel of land, for an aggregate gross sales price of $1.65 billion , resulting in net proceeds of $1.40 billion after closing costs and disposition fees due to CMFT Management or its affiliates, and a gain of $180.7 million .

Pursuant to the Purchase and Sale Agreement, the sale of 444 properties closed in December 2019 for total consideration of $ 1.2 billion, including the assumption by the Purchaser of existing mortgage debt totaling $ 130.8 million and the repayment of $ 532.3 million in debt, as further discussed in Note 9 — Credit Facilities, Notes Payable and Repurchase Facilities.

The remaining properties closed subsequent to December 31, 2019, for consideration of $ 26.3 million, as discussed in “2020 Property Dispositions” above.

During the year ended December 31, 2019, the Company disposed of a total of 497 properties, consisting of 482 retail properties, one industrial property and 14 anchored shopping centers, excluding a related outparcel of land, for an aggregate gross sales price of $ 1.65 billion, resulting in net proceeds of $ 1.40 billion after closing costs and disposition fees due to CMFT

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Management or its affiliates, and a recorded gain of $ 180.7 million.

The Company has no continuing involvement with these properties.

The gain on sale of real estate is included in gain on disposition of real estate, net in the consolidated statements of operations.

The disposition of these properties did not qualify to be reported as discontinued operations since the disposition did not represent a strategic shift that had a major effect on the Company’s operations and financial results.

Accordingly, the operating results of these disposed properties are reflected in the Company’s results from continuing operations for all periods presented through their respective date of disposition.

As of December 31, 2019, there were 29 properties classified as held for sale with a carrying value of $ 351.9 million included in assets held for sale in the consolidated balance sheets.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

As of December 31, 2019, the Company had mortgage notes payable of $ 126.7 million that are related to the held for sale properties, which the Company expects to repay in connection with the disposition of the underlying held for sale properties.

2019 Impairment

See Note 2 — Summary of Significant Accounting Policies for a discussion of the Company’s accounting policies regarding impairment of real estate assets.

During the year ended December 31, 2019, 34 properties totaling approximately 3.4 million square feet with a carrying value of $ 457.3 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 384.4 million, resulting in impairment charges of $ 72.9 million, which were recorded in the consolidated statements of operations.

1 unchanged sentence

2018 Property Acquisition

During the year ended December 31, 2018 , the Company acquired a 100% interest in one commercial property for an aggregate purchase price of $11.9 million (the “ 2018 Acquisition”), which includes $277,000 of external acquisition-related expenses that were capitalized in accordance with ASU 2017-01.

Prior to the adoption of ASU 2017-01, costs related to property acquisitions were expensed as incurred.

During the year ended December 31, 2018, the Company acquired a 100 % interest in one commercial property for an aggregate purchase price of $ 11.9 million (the “2018 Acquisition”), which includes $ 277,000 of external acquisition-related expenses that were capitalized.

The Company funded the 2018 Acquisition with net cash provided by operations and available borrowings.

12 unchanged sentences

The gain on sale of real estate is included in gain on disposition of real estate, net in the consolidated statements of operations.

2018 Impairment

1 unchanged sentence

See Note 3 — Fair Value Measurements for a further discussion regarding these impairment charges.

2017 Property Acquisitions

During the year ended December 31, 2017 , the Company acquired 42 commercial properties for an aggregate purchase price of $307.4 million (the “ 2017 Acquisitions”), of which 38 were determined to be asset acquisitions and four were accounted for as business combinations as they were acquired prior to the Company’s adoption of ASU 2017-01 in April 2017.

The Company funded the 2017 Acquisitions with net cash provided by operations and available borrowings.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table summarizes the consideration transferred for the properties purchased during the year ended December 31, 2017 (in thousands):

2017 Acquisitions

Real estate assets:

Purchase price of asset acquisitions

Purchase price of business combinations

Total purchase price of real estate assets acquired (1)

____________________________________

The weighted average amortization period for the 2017 Acquisitions was 16.9 years for acquired in-place leases and other intangibles, 13.6 years for acquired above-market leases and 8.5 years for acquired intangible lease liabilities.

During the year ended December 31, 2017 , the Company acquired a 100% interest in 38 commercial properties for an aggregate purchase price of $252.0 million , which were accounted for as asset acquisitions (the “2017 Asset Acquisitions”).

The aggregate purchase price includes $6.1 million of external acquisition-related expenses that were capitalized in accordance with ASU 2017-01.

Prior to the adoption of ASU 2017-01, costs related to property acquisitions were expensed as incurred.

The following table summarizes the purchase price allocation for the 2017 Asset Acquisitions purchased during the year ended December 31, 2017 (in thousands):

2017 Asset Acquisitions

Buildings, fixtures and improvements

Acquired in-place leases and other intangibles

Acquired above-market leases

Revenue bonds

Intangible lease liabilities

Total purchase price

During the year ended December 31, 2017 , the Company acquired a 100% interest in four commercial properties for an aggregate purchase price of $55.4 million , which were accounted for as business combinations (the “2017 Business Combination Acquisitions”).

The Company allocated the purchase price of these properties to the fair value of the assets acquired and liabilities assumed.

The following table summarizes the purchase price allocations for the 2017 Business Combination Acquisitions purchased during the year ended December 31, 2017 (in thousands):

2017 Business Combination Acquisitions

Buildings, fixtures and improvements

Acquired in-place leases and other intangibles

Acquired above-market leases

Intangible lease liabilities

Total purchase price

The Company recorded revenue for the year ended December 31, 2017 of $5.1 million and net income for the year ended December 31, 2017 of $708,000 related to the 2017 Business Combination Acquisitions.

In addition, the Company recorded $1.3 million of acquisition-related expenses for the year ended December 31, 2017 , which is included in transaction-related expenses on the consolidated statements of operations.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table summarizes selected financial information of the Company as if all of the 2017 Business Combination Acquisitions were completed on January 1, 2016 for each period presented below.

The table below presents the Company’s estimated revenue and net income, on a pro forma basis, for the years ended December 31, 2017 and 2016 (in thousands):

Year Ended December 31,

Pro forma basis (unaudited):

The unaudited pro forma information for the year ended December 31, 2017 was adjusted to exclude $1.3 million of acquisition-related fees and expenses recorded during the year ended December 31, 2017 related to the 2017 Business Combination Acquisitions.

Accordingly, these costs were instead recognized in the unaudited pro forma information for the year ended December 31, 2016.

The unaudited pro forma information is presented for informational purposes only and may not be indicative of what actual results of operations would have been had the transactions occurred at the beginning of 2016, nor does it purport to represent the results of future operations.

2017 Property Dispositions

During the year ended December 31, 2017 , the Company disposed of 14 retail properties and one industrial property for an aggregate gross sales price of $100.6 million , resulting in net proceeds of $65.9 million after closing costs and the repayment of the $33.0 million variable rate debt secured by one of the disposed properties and a gain of $17.0 million .

No disposition fees were paid to CMFT Management or its affiliates in connection with the sale of the properties and the Company has no continuing involvement with these properties.

The gain on sale of real estate is included in gain (loss) on disposition of real estate, net in the consolidated statements of operations.

2017 Impairment

During the year ended December 31, 2017 , four properties totaling approximately 33,000 square feet with a carrying value of $7.2 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $4.3 million , resulting in impairment charges of $2.9 million , which were recorded in the consolidated statements of operations.

See Note 3 — Fair Value Measurements for a further discussion regarding these impairment charges.

NOTE 5 — INTANGIBLE LEASE ASSETS AND LIABILITIES

3 unchanged sentences

In-place leases and other intangibles, net of accumulated amortization of $ 132,967 and $ 111,670 , respectively (with a weighted average life remaining of 9.7 years and 10.4 years, respectively)

$ 217,431 $ 164,724

Acquired above-market leases, net of accumulated amortization of $ 22,054 and $ 19,310 , respectively (with a weighted average life remaining of 7.6 years and 7.9 years, respectively)

17,112 17,423

Total intangible lease assets, net $ 234,543 $ 182,147

1 unchanged sentence

Acquired below-market leases, net of accumulated amortization of $ 31,933 and $ 25,800 , respectively (with a weighted average life remaining of 7.5 years and 7.3 years, respectively)

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

$ 32,718 $ 20,523

Amortization of the above-market leases is recorded as a reduction to rental and other property income, and amortization expense for the in-place leases and other intangibles is included in depreciation and amortization in the accompanying consolidated statements of operations.

2 unchanged sentences

Year Ended December 31,

2020 2019 2018

In-place lease and other intangible amortization $ 23,262 $ 32,058 $ 45,559

2 unchanged sentences

As of December 31, 2020, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands):

Year Ending December 31,

In-Place Leases and Other Intangibles

Above-Market Leases

Below-Market Leases

Year Ending December 31, In-Place Leases and Other Intangibles Above-Market Leases Below-Market Leases

2021 $ 30,108 $ 2,489 $ 5,499

2022 $ 27,756 $ 2,345 $ 4,770

2023 $ 24,547 $ 2,086 $ 4,101

2024 $ 21,317 $ 1,576 $ 3,138

2025 $ 17,534 $ 1,334 $ 2,779

Thereafter $ 96,169 $ 7,282 $ 12,431

Total $ 217,431 $ 17,112 $ 32,718

NOTE 6 — REAL ESTATE-RELATED SECURITIES

As of December 31, 2020, the Company had investments in four CMBS investment securities with an aggregate estimated fair value of $ 38.2 million.

The CMBS mature on various dates from January 2024 through March 2034 and have interest rates ranging from 4.0 % to 13.0 %.

The following is a summary of the Company’s real estate-related securities as of December 31, 2020 (in thousands):

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Real Estate-Related Securities

Amortized Cost Basis Unrealized Gain Fair Value

CMBS $ 37,047 $ 1,147 $ 38,194

Total real estate-related securities $ 37,047 $ 1,147 $ 38,194

The following table provides the activity for the real estate-related securities during the year ended December 31, 2020 (in thousands):

Amortized Cost Basis Unrealized Gain Fair Value

Real estate-related securities as of January 1, 2020

Face value of real estate-related securities acquired

91,440 — 91,440

Premiums and discounts on purchase of real estate-related securities , net of acquisition costs

( 14,796 ) — ( 14,796 )

Amortization of discount (premium) on real estate-related securities 57 — 57

Principal payments received on real estate-related securities

( 2,571 ) — ( 2,571 )

Sale of real estate-related securities ( 37,083 ) ( 510 ) ( 37,593 )

Unrealized gain on real estate-related securities

— 1,657 1,657

Real estate-related securities as of December 31, 2020

$ 37,047 $ 1,147 $ 38,194

During the year ended December 31, 2020, the Company invested $ 76.6 million in CMBS.

During the same period, the Company sold $ 37.1 million in CMBS resulting in net proceeds of $ 37.6 million and a gain of $ 510,000 .

Unrealized gains and losses on real estate-related securities are recorded in other comprehensive (loss) income, with a portion of the amount subsequently reclassified into interest expense and other, net in the accompanying consolidated statements of operations as securities are sold and gains and losses are recognized.

During the year ended December 31, 2020, the Company recorded $ 1.7 million of unrealized gains on its real estate-related securities included in accumulated other comprehensive (loss) income in the accompanying consolidated statement of stockholders’ equity.

The scheduled maturities of the Company’s real estate-related securities as of December 31, 2020 are as follows (in thousands):

Available-for-sale securities

Amortized Cost Estimated Fair Value

Due within one year $ — $ —

Due after one year through five years 27,061 27,461

Due after five years through ten years — —

Due after ten years 9,986 10,733

Total $ 37,047 $ 38,194

Actual maturities of real estate-related securities can differ from contractual maturities because borrowers on certain corporate credit securities may have the right to prepay their respective debt obligations at any time.

In addition, factors such as prepayments and interest rates may affect the yields on such securities.

In estimating credit losses related to real estate-related securities, management considers a variety of factors, including (1) whether the Company has the intent to sell the impaired security before the recovery of its amortized cost basis, (2) whether the Company expects to hold the investment for a period of time sufficient to allow for anticipated recovery in fair value, and (3) whether the Company expects to recover the entire amortized cost basis of the security.

As of December 31, 2020, the Company had no credit losses related to real estate-related securities.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 7 — LOANS HELD-FOR-INVESTMENT

2 unchanged sentences

Mezzanine loans $ 147,475 $ 146,060

Total CRE loans-held-for-investment

Senior loans 341,546 152,820

Total CRE loans-held-for-investment and related receivables, net 489,021 298,880

Broadly syndicated loans 473,603 2,750

Loans held-for-investment and related receivables, net $ 962,624 $ 301,630

Allowance for credit losses $ ( 70,358 ) $ —

Total loans-held-for-investment and related receivable, net $ 892,266 $ 301,630

During the year ended December 31, 2019 , the Company acquired four mezzanine loans, originated three senior loans and acquired one broadly syndicated loan.

As of December 31, 2019 , the Company had $16.2 million of unfunded commitments related to Commercial Real Estate (“CRE”) loans held-for-investment, the funding of which is subject to satisfaction of borrower milestones.

During the year ended December 31, 2020, the Company invested $ 582.7 million in broadly syndicated loans.

During the same period, the Company received $ 71.8 million of principal payments on broadly syndicated loans and sold $ 42.0 million of broadly syndicated loans, resulting in proceeds of $ 39.9 million after closing costs and a loss of $ 737,000 .

The loss was recorded as an increase to interest expense and other, net in the consolidated statements of operations.

As of December 31, 2020, the Company had $ 41.0 million of unsettled broadly syndicated loan purchases included in cash and cash equivalents in the accompanying consolidated balance sheet.

As of December 31, 2020, the Company had $ 169.1 million of unfunded commitments related to CRE loans held-for-investment, the funding of which is subject to the satisfaction of borrower milestones.

These commitments are not reflected in the accompanying consolidated balance sheet.

During the year ended December 31, 2019 , the borrower on the Company’s eight mezzanine loans, which represent approximately 4.0% of total assets as of December 31, 2019 , became delinquent on certain required reserve payments.

To the extent that the delinquencies remain outstanding and uncured, subsequent tests for impairments could result in impairment charges in the future.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table details overall statistics for the Company’s CRE loans held-for-investment as of December 31, 2019 (dollar amounts in thousands):

As of December 31,

The following table details overall statistics for the Company’s loans held-for-investment as of December 31, 2020 and 2019 (dollar amounts in thousands):

CRE Loans (1) (2)

Broadly Syndicated Loans

As of December 31, As of December 31,

2020 2019 2020 2019

Number of loans 12 11 194 1

7 unchanged sentences

(2) Maximum maturity date assumes all extension options are exercised by the borrowers;

however, the Company’s loans may be repaid prior to such date.

Activity relating to the Company’s CRE loans held-for-investment portfolio was as follows for the years ended December 31, 2019 and 2018 (dollar amounts in thousands):

Principal Balance

Deferred Fees / Other Items (1)

Loan Fees Receivable

Net Book Value

however, the Company’s CRE loans may be repaid prior to such date.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Activity relating to the Company’s loans held-for-investment portfolio was as follows for the years ended December 31, 2020 and 2019 (dollar amounts in thousands):

Principal Balance Deferred Fees / Other Items (1)

Loan Fees Receivable Net Book Value

Balance, January 1, 2019 $ 89,679 $ ( 6,540 ) $ 6,623 $ 89,762

Loan fundings

Loan originations and acquisitions 219,096 ( 417 ) 1,085 219,764

Principal repayments received

( 17,186 ) — — ( 17,186 )

Capitalized interest (2)

8,546 — — 8,546

Deferred fees and other items

— ( 1,531 ) ( 166 ) ( 1,697 )

Accretion and amortization of fees and other items

— 2,441 — 2,441

Balance, December 31, 2019

Loan fundings

$ 300,135 $ ( 6,047 ) $ 7,542 $ 301,630

Loan originations and acquisitions 820,015 ( 5 ) 5 820,015

Cure payments receivable (3)

— 7,351 — 7,351

Sale of loans ( 42,031 ) 1,392 — ( 40,639 )

Principal repayments received (4)

( 119,443 ) — — ( 119,443 )

Capitalized interest (2)

1 unchanged sentence

Accretion and amortization of fees and other items — 2,520 — 2,520

Allowance for credit losses (5)

— ( 70,358 ) — ( 70,358 )

Balance, December 31, 2020 $ 959,215 $ ( 74,116 ) $ 7,167 $ 892,266

2 unchanged sentences

(2) Represents accrued interest on loans whose terms do not require a current cash payment of interest.

(3) Represents operating expenses related to the mezzanine loans paid by the Company on the borrower’s behalf in connection with the foreclosure proceedings that commenced during the year ended December 31, 2020, as further discussed below in “Allowance for Credit Losses.”

(4) Includes the repayment of a $ 40.8 million senior loan prior to the maturity date.

(5) Includes the initial allowance for credit losses against the loans held-for-investment recorded on January 1, 2020 and the increase in allowance for credit losses related to its loans held-for-investment during the year ended December 31, 2020, as further discussed below in “Allowance for Credit Losses.”

Allowance for Credit Losses

The allowance for credit losses reflects the Company’s current estimate of potential credit losses related to the loans held-for-investment included in the Company’s consolidated balance sheets.

Refer to Note 2 — Summary of Significant Accounting Policies for further discussion of the Company’s allowance for credit losses.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table presents the activity in the Company’s allowance for credit losses by loan type for the year ended December 31, 2020 (dollar amounts in thousands):

Mezzanine Loans Senior Loans Broadly Syndicated Loans Total

Allowance for credit losses as of December 31, 2019 $ — $ — $ — $ —

Transition adjustment on January 1, 2020

1,494 468 40 2,002

Provision for credit losses

13,047 341 4,389 17,777

Allowance for credit losses as of March 31, 2020 14,541 809 4,429 19,779

Provision for credit losses

6,728 ( 317 ) 1,494 7,905

Allowance for credit losses as of June 30, 2020 21,269 492 5,923 27,684

Provision for credit losses

3,601 1,390 2,364 7,355

Allowance for credit losses as of September 30, 2020 24,870 1,882 8,287 35,039

Provision for credit losses 33,168 708 1,443 35,319

Allowance for credit losses as of December 31, 2020 $ 58,038 $ 2,590 $ 9,730 $ 70,358

The Company’s initial allowance for credit losses against the loans held-for-investment of $ 2.0 million recorded on January 1, 2020 is reflected as a direct charge to retained earnings on the Company’s consolidated statements of stockholders’ equity;

however, subsequent changes to the allowance for credit losses are recognized through net income on the Company’s consolidated statements of operations.

During the year ended December 31, 2020, the Company recorded a $ 68.4 million increase in allowance for credit losses related to its loans held-for-investment, bringing the total allowance for credit losses to $ 70.4 million as of December 31, 2020.

During the year ended December 31, 2019, the borrower on the Company’s eight mezzanine loans, which represents approximately 3.3 % of total assets as of December 31, 2020, became delinquent on certain required reserve payments.

During the three months ended March 31, 2020, the borrower remained delinquent on the required reserve payments and became delinquent on principal and interest.

Additionally, during the three months ended June 30, 2020, the fair value of the collateral, which is based on comparable market sales, further decreased compared to the amortized cost basis.

During the three months ended September 30, 2020, the Company commenced foreclosure proceedings to take control of the condominium properties in New York securing the mezzanine loans.

As a result of this activity related to the Company’s mezzanine loans, the Company recorded a net increase to its provision for credit losses on the four loans of $ 58.0 million during the year ended December 31, 2020 to reflect the estimated fair value of the collateral, which included a $ 7.4 million provision for credit losses associated with a cure payments receivable for operating expenses paid by the Company on the borrower’s behalf during the year ended December 31, 2020.

Subsequent to December 31, 2020, the Company completed foreclosure proceedings to take control of the properties securing its mezzanine loans, as discussed in Note 19 — Subsequent Events.

As further described in Note 2 — Summary of Significant Accounting Policies, the Company evaluates its loans-held-for-investment portfolio on a quarterly basis.

Each quarter, the Company assesses the risk factors of each loan, and assigns a risk rating based on several factors.

Factors considered in the assessment include, but are not limited to, loan and credit structure, current LTV, debt yield, collateral performance, and the quality and condition of the sponsor, borrower, and guarantor(s).

Loans are rated “1” (less risk) through “5” (greater risk), which ratings are defined in Note 2 — Summary of Significant Accounting Policies.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The Company’s primary credit quality indicator is its risk ratings, which are further discussed above.

The following table presents the net book value of the Company’s loans-held-for-investment portfolio as of December 31, 2020 by year of origination, loan type, and risk rating (dollar amounts in thousands):

Amortized Cost of Loans Held-For-Investment by Year of Origination (1)

As of December 31, 2020

Number of Loans 2020 2019 2018 Total

Mezzanine loans by internal risk rating:

1 — $ — $ — $ — $ —

5 8 — 57,045 90,430 147,475

Total mezzanine loans 8 — 57,045 90,430 147,475

Senior loans by internal risk rating:

3 4 225,822 115,724 — 341,546

Total senior loans 4 225,822 115,724 — 341,546

Broadly syndicated loans by internal risk rating:

2 3 6,880 — — 6,880

3 189 456,711 2,739 — 459,450

4 2 7,273 — — 7,273

Total broadly syndicated loans 194 470,864 2,739 — 473,603

Allowance for credit losses ( 70,358 )

Total loans-held-for-investment and related receivables, net

206 $ 892,266

Weighted Average Risk Rating (2)

____________________________________

(1) Date loan was originated or acquired by the Company.

Origination dates are subsequently updated to reflect material loan modifications.

(2) Weighted average risk rating calculated based on carrying value at period end.

NOTE 8 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

In the normal course of business, the Company uses certain types of derivative instruments for the purpose of managing or hedging its interest rate risk.

During the year ended December 31, 2019 , one of the Company’s interest rate swap agreements matured.

In addition, three of the Company’s interest rate swap agreements were terminated prior to the maturity date due to the disposition of the underlying properties, resulting in a gain of $118,000 .

The gain was recorded as a decrease to interest expense and other, net included in the accompanying consolidated statements of operations.

As of December 31, 2019 , the Company had three executed interest rate swap agreements.

During the year ended December 31, 2020, one of the Company’s interest rate swap agreements was partially terminated prior to the maturity date, resulting in a loss of $ 97,000 .

The loss was recorded as an increase to interest expense and other, net included in the accompanying consolidated statements of operations.

In addition, the Company assumed two interest rate swap agreements in connection with the Mergers.

As of December 31, 2020, the Company had five interest rate swap agreements designated as hedging instruments.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table summarizes the terms of the Company’s executed interest rate swap agreements designated as hedging instruments as of December 31, 2019 and 2018 (dollar amounts in thousands):

Outstanding Notional

Fair Value of Assets (Liability)

Balance Sheet

December 31, 2019

Interest Rate Swaps

Interest receivable, prepaid expenses and other assets

2.55% to 3.62%

3/14/2016 to 6/29/2016

4/5/2021 to 7/1/2021

Interest Rate Swap

Deferred rental income, derivative liability and other liabilities

The following table summarizes the terms of the Company’s interest rate swap agreements designated as hedging instruments as of December 31, 2020 and 2019 (dollar amounts in thousands):

Outstanding Notional Fair Value of Liabilities as of

Balance Sheet Amount as of Interest Effective Maturity December 31, December 31,

Location December 31, 2020 Rates (1)

Dates Dates 2020 2019 (2)

Interest Rate Swaps Derivative liabilities, deferred rental income and other liabilities $ 1,085,266

$ ( 12,308 ) $ ( 4,181 )

____________________________________

(1) The interest rates consist of the underlying index swapped to a fixed rate and the applicable interest rate spread as of December 31, 2020.

(2) As of December 31, 2019, the Company had two interest rate swap agreements in an asset position with a notional amount of $ 60.0 million and a fair value of $ 261,000 included in prepaid expenses and other assets on the consolidated balance sheets.

Additional disclosures related to the fair value of the Company’s derivative instruments are included in Note 3 — Fair Value Measurements.

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The change in fair value of the derivative instruments that are designated as hedges is recorded in other comprehensive (loss) income, with a portion of the amount subsequently reclassified to interest expense as interest payments are made on the Company’s variable rate debt.

For the years ended December 31, 2019 and 2018 , the amount of gains reclassified from other comprehensive (loss) income as a decrease to interest expense was $3.5 million and $4.3 million , respectively.

For the year ended December 31, 2020, the amount of loss reclassified from other comprehensive (loss) income as an increase to interest expense was $ 12.3 million.

For the years ended December 31, 2019 and 2018, the amount of gains reclassified from other comprehensive (loss) income as a decrease to interest expense was $ 3.5 million and $ 4.3 million, respectively.

The total unrealized loss on interest rate swaps of $ 12.3 million and $ 3.9 million as of December 31, 2020 and 2019, respectively, and the total unrealized gain on interest rate swaps of $ 11.0 million as of December 31, 2018 is included in accumulated other comprehensive income (loss) in the accompanying consolidated statement of stockholders’ equity.

During the next 12 months, the Company estimates that $ 3.3 million will be reclassified from other comprehensive (loss) income as an increase to interest expense.

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There were no termination events or events of default related to the interest rate swaps as of December 31, 2020.

NOTE 8 — CREDIT FACILITIES AND NOTES PAYABLE

NOTE 9 — CREDIT FACILITIES, NOTES PAYABLE AND REPURCHASE FACILITIES

As of December 31, 2020, the Company had $ 2.1 billion of debt outstanding, including net deferred financing costs, with a weighted average years to maturity of 1.9 years and a weighted average interest rate of 3.4 %.

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The weighted average interest rate is computed using the interest rate in effect until the scheduled repayment date.

Should a loan not be repaid by its scheduled repayment date, the applicable interest rate will increase as specified in the respective loan agreement.

CIM REAL ESTATE FINANCE TRUST, INC.

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During the Year Ended December 31, 2020

Balance as of December 31, 2018

Debt Issuances & Assumptions (1)

Balance as of December 31, 2019 Debt Issuances & Assumptions (1)

Repayments & Modifications (2)

Accretion & (Amortization)

Balance as of December 31, 2019

Fixed rate debt

Variable rate debt

Credit facility

Accretion & (Amortization) Balance as of December 31, 2020

Notes payable $ 726,261 $ 92,212 (5) $ ( 240,377 ) $ — $ 578,096

Credit facilities 885,000 629,025 (6) ( 177,525 ) — 1,336,500

Repurchase facilities — 235,380 — — 235,380

1,611,261 956,617 ( 417,902 ) — 2,149,976

Net premiums (3)

241 — — ( 92 ) 149

Deferred costs – credit facility (4)

( 3,933 ) ( 1,440 ) — (7) 1,830 ( 3,543 )

Deferred costs – fixed rate debt ( 2,709 ) — 186 (7) 934 ( 1,589 )

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$ 1,604,860 $ 955,177 $ ( 417,716 ) $ 2,672 $ 2,144,993

____________________________________

(1) Includes deferred financing costs incurred during the period.

Includes the assumption of $205.8 million of fixed rate debt related to property dispositions during the year ended December 31, 2019 .

(2) In connection with the repayment of certain mortgage notes, the Company recognized a loss on extinguishment of debt of $ 4.8 million during the year ended December 31, 2020.

(3) Net premiums on mortgage notes payable were recorded upon the assumption of the respective debt instruments.

Amortization of these net premiums is recorded as a reduction to interest expense over the remaining term of the respective debt instruments using the effective-interest method.

Deferred costs related to the term portion of the Credit Facility (as defined below).

(4) Deferred costs related to the term portion of the CMFT Credit Facility (as defined below).

(5) Represents fixed rate debt assumed upon completion of the Mergers during the year ended December 31, 2020.

(6) Includes credit facility borrowings of $ 287.5 million assumed upon completion of the Mergers during the year ended December 31, 2020.

(7) Represents deferred financing costs written off during the period resulting from debt repayments prior to the respective maturity dates.

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The fixed rate debt has interest rates ranging from 2.6 % to 5.0 % per annum.

The fixed rate debt outstanding matures on various dates from April 1, 2020 through May 10, 2024 .

The aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the fixed rate debt outstanding was $1.3 billion as of December 31, 2019 .

The fixed rate debt outstanding matures on various dates from April 2021 through December 2024.

Should a loan not be repaid by its scheduled repayment date, the applicable interest rate may increase as specified in the respective loan agreement.

The aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the fixed rate debt outstanding was $ 981.8 million as of December 31, 2020.

Each of the mortgage notes payable comprising the fixed rate debt, is secured by the respective properties on which the debt was placed.

Subsequent to December 31, 2019 , the Company repaid $97.0 million of mortgage notes due to the disposition of the underlying properties, as discussed in Note 17 — Subsequent Events .

With respect to the Company’s $115.2 million of debt maturing within the next 12 months following the date these financial statements are issued, the Company believes cash on hand, proceeds from real estate asset dispositions, net cash provided by operations, borrowings available under the Credit Facility or the entry into new financing arrangements will be sufficient in order to meet its debt obligations.

Pursuant to the Purchase and Sale Agreement described in Note 4 — Real Estate Assets , total consideration for the sale of 444 properties during the year ended December 31, 2019 included the assumption by the Purchaser of existing mortgage debt totaling $130.8 million , the repayment of $101.3 million of certain mortgage notes due to the disposition of the underlying properties, the repayment of $165.0 million on the unsecured term loan balance and repayment of $266.0 million on the unsecured revolving loan balance.

Credit Facilities

The Company has a second amended and restated unsecured credit agreement (the “Second Amended and Restated Credit Agreement”) with JPMorgan Chase Bank, N.A.

as administrative agent (“JPMorgan Chase”), and the other lenders party thereto that provided for borrowings of up to $1.24 billion as of December 31, 2019 , which included a $885.0 million unsecured term loan (the “Term Loan”) and up to $350.0 million in unsecured revolving loans (the “Revolving Loans” and collectively, with the Term Loan, the “Credit Facility”).

The Term Loan matures on March 15, 2022 and the Revolving Loans mature on March 15, 2021 ;

however, the Company has the right to extend the maturity date of the Revolving Loans to March 15, 2022 .

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Depending upon the type of loan specified and overall leverage ratio, the Credit Facility bears interest at (i) the one-month, two-month, three-month or six-month LIBOR multiplied by the statutory reserve rate (the “Eurodollar Rate”) plus an interest rate spread ranging from 1.65% to 2.25% or (ii) a base rate, ranging from 0.65% to 1.25% , plus the greater of:

The Company has a second amended and restated unsecured credit agreement (the “CMFT Second Amended and Restated Credit Agreement”) with JPMorgan Chase Bank, N.A.

as administrative agent (“JPMorgan Chase”), and the other lenders party thereto that provides for borrowings of up to $ 1.24 billion as of December 31, 2020, which includes an $ 885.0 million unsecured term loan (the “CMFT Term Loan”) and up to $ 350.0 million in unsecured revolving loans (the “CMFT Revolving Loans” and collectively, with the CMFT Term Loan, the “CMFT Credit Facility”).

The CMFT Credit Facility matures on March 15, 2022.

Depending upon the type of loan specified and overall leverage ratio, the CMFT Credit Facility bears interest at (i) the one-month, two-month, three-month or six-month LIBOR multiplied by the statutory reserve rate (the “Eurodollar Rate”) plus an interest rate spread ranging from 1.65 % to 2.25 % or (ii) a base rate, ranging from 0.65 % to 1.25 %, plus the greater of:

(a) JPMorgan Chase’s prime rate;

(b) the Federal Funds Effective Rate (as defined in the Second Amended and Restated Credit Agreement) plus 0.50% ;

(b) the Federal Funds Effective Rate (as defined in the CMFT Second Amended and Restated Credit Agreement) plus 0.50 %;

or (c) the one-month LIBOR multiplied by the statutory reserve rate plus 1.00 %.

As of December 31, 2019 , there were no amounts outstanding under the Revolving Loans.

As of December 31, 2019 , the Term Loan outstanding totaled $885.0 million , $811.7 million of which is subject to interest rate swap agreements (the “Swapped Term Loan”).

The interest rate swap agreements had the effect of fixing the Eurodollar Rate per annum of the Swapped Term Loan at an all-in rate of 4.0% .

As of December 31, 2019 , the Company had $885.0 million outstanding under the Credit Facility at a weighted average interest rate of 4.0% and $349.4 million in unused capacity, subject to borrowing availability.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

On December 21, 2020, as a result of the CCPT V Merger, a subsidiary of the Company assumed CCPT V’s obligations pursuant to the credit agreement by and among Cole Operating Partnership V, LP, the operating partnership of CCPT V (“CCPT V OP”), JPMorgan Chase, as administrative agent, and the lender parties thereto (the “CCPT V Credit Agreement”), including as guarantor under a guaranty provided by CCPT V, and as modified by a modification agreement dated as of May 31, 2018 and subsequently modified following the consummation of the CCPT V Merger by a second modification agreement on December 21, 2020.

The CCPT V Credit Agreement allows for borrowings of up to $ 350.0 million (the “CCPT V Credit Facility”).

The CCPT V Credit Facility includes $ 220.0 million in term loans (the “CCPT V Term Loans”) and up to $ 130.0 million in revolving loans (the “CCPT V Revolving Loans”).

The CCPT V Credit Facility matures on March 15, 2022.

Depending upon the type of loan specified and overall leverage ratio, the CCPT V Credit Facility bears interest at (i) the one-month, two-month, three-month or six-month LIBOR multiplied by the statutory reserve rate (the “Adjusted LIBO Rate”) for the interest period plus an applicable rate ranging from 1.30 % to 1.70 %;

or (ii) a base rate ranging from 0.30 % to 0.70 %, plus the greater of:

(a) JPMorgan Chase’s Prime Rate (as defined in the CCPT V Credit Agreement);

(b) the NYFRB Rate (as defined in the CCPT V Credit Agreement) plus 0.50 %;

or (c) the Adjusted LIBO Rate for a period of one month plus 1.0 %.

As of December 31, 2020, there were no amounts outstanding under the CMFT Revolving Loans or the CCPT V Revolving Loans (collectively, the “Revolving Loans”).

As of December 31, 2020, the CMFT Term Loan and CCPT V Term Loans (collectively, the “Term Loans”) outstanding totaled $ 1.1 billion, $ 1.0 billion of which is subject to interest rate swap agreements (the “Swapped Term Loans”).

The interest rate swap agreements had the effect of fixing the Eurodollar Rate per annum of the Swapped Term Loans at an all-in rate of 3.9 %.

As of December 31, 2020, the Company had $ 1.1 billion outstanding under the CMFT Credit Facility and CCPT V Credit Facility (collectively, the “Credit Facilities”) at a weighted average interest rate of 3.7 % and $ 480.0 million in unused capacity, subject to borrowing availability.

The Company had available borrowings of $ 135.5 million as of December 31, 2020.

The Second Amended and Restated Credit Agreement contains provisions with respect to covenants, events of default and remedies customary for facilities of this nature.

In particular, the Second Amended and Restated Credit Agreement requires the Company to maintain a minimum consolidated net worth greater than or equal to the sum of (i) $2.0 billion plus (ii) 75% of the equity issued minus (iii) the aggregate amount of any redemptions or similar transaction from the date of the Second Amended and Restated Credit Agreement, a leverage ratio less than or equal to 60% , a fixed charge coverage ratio greater than 1.50 , an unsecured debt to unencumbered asset value ratio equal to or less than 60% , an unsecured debt service coverage ratio greater than 1.75 , a secured debt ratio equal to or less than 40% and the amount of secured debt that is recourse debt at no greater than 15% of total asset value.

The Company believes it was in compliance with the financial covenants under the Second Amended and Restated Credit Agreement, as well as the financial covenants under the Company’s various fixed and variable rate debt agreements, as of December 31, 2019 , with the exception of one mortgage note where the Company failed to meet the debt service coverage ratio covenant under the mortgage at December 31, 2019 .

Pursuant to the loan agreement, non-compliance with the debt service coverage ratio covenant triggers a cash sweep of the underlying property’s operating cash flow.

As of December 31, 2019 , a cash sweep of the underlying property’s operating cash flow had not been initiated.

The CMFT Second Amended and Restated Credit Agreement and the CCPT V Credit Agreement (collectively, the “Credit Agreements”) contain provisions with respect to covenants, events of default and remedies customary for facilities of this nature.

In particular, the CMFT Second Amended and Restated Credit Agreement requires the Company to maintain a minimum consolidated net worth greater than or equal to the sum of (i) $ 1.75 billion under the CMFT Second Amended and Restated Credit Agreement and a leverage ratio less than or equal to 60 %.

The CCPT V Credit Agreement requires the Company to maintain a minimum consolidated net worth not less than $ 225.0 million plus 75 % of the equity issued by the Company and a net leverage ratio less than or equal to 60 %.

Each of the Credit Agreements require the Company to maintain a fixed charge coverage ratio greater than 1.50 , an unsecured debt to unencumbered asset value ratio equal to or less than 60 %, an unsecured debt service coverage ratio greater than 1.75 , a secured debt ratio equal to or less than 40 % and the amount of secured debt that is recourse debt at no greater than 15 % of total asset value.

The Company believes it was in compliance with the financial covenants under the CMFT Second Amended and Restated Credit Agreement and the CCPT V Credit Agreement, as well as the financial covenants under the Company’s various fixed and variable rate debt agreements, as of December 31, 2020, with the exception of one mortgage note serviced by PNC Bank, N.A (“PNC Bank”) where the Company failed to meet the debt service coverage ratio covenant under the mortgage at December 31, 2020.

Additionally, the Company previously failed to meet the debt service coverage ratio covenant under one mortgage note serviced by Wells Fargo, N.A.

(“Wells Fargo”) as of September 30, 2020, but subsequently passed and was in compliance with this covenant as of December 31, 2020.

Pursuant to the loan agreements, non-compliance with the debt service coverage ratio covenant triggers a cash sweep of the underlying property’s operating cash flow, which was waived by PNC Bank during the year ended December 31, 2020.

As of December 31, 2020, Wells Fargo had not initiated a cash sweep of the underlying property’s operating cash flow.

On December 31, 2019 (the “Closing Date”), CMFT Corporate Credit Securities, LLC, an indirect wholly-owned, bankruptcy-remote subsidiary of the Company, entered into a revolving credit and security agreement (the “Credit and Security Agreement”) with the lenders from time to time parties thereto, Citibank, N.A.

1 unchanged sentence

The Credit and Security Agreement provides for borrowings in an aggregate principal amount up to $ 500.0 million (the “Credit Securities Revolver”), which may be increased from time to time pursuant to the Credit and Security Agreement.

As of December 31, 2019 , there were no amounts borrowed or outstanding under the Credit Securities Revolver.

As of December 31, 2020, the amounts borrowed and outstanding under the Credit Securities Revolver totaled $ 231.5 million at a weighted average interest rate of 1.9 %.

Borrowings under the Credit and Security Agreement will bear interest equal to the three-month LIBOR for the relevant interest period, plus an applicable rate.

The applicable rate is 1.70 % per annum during the reinvestment period and 2.00 % per annum during the amortization period (and, in each case, an additional 2.00 % per annum following an event of default under the Credit and Security Agreement).

The reinvestment period begins on the Closing Date and concludes on the earlier of (i) the date that is three years after the Closing Date, (ii) the final maturity date and (iii) the date on which the total assets under management of the Company and its wholly-owned subsidiaries is less than $1.25 billion (the “Reinvestment Period”).

The reinvestment period begins on the Closing Date and concludes on the earlier of (i) the

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

date that is three years after the Closing Date, (ii) the final maturity date and (iii) the date on which the total assets under management of the Company and its wholly-owned subsidiaries is less than $ 1.25 billion (the “Reinvestment Period”).

The final maturity date is the earliest to occur of:

(i) the date that the Credit Securities Revolver is paid down and (ii) the second anniversary after the Reinvestment Period concludes.

The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt as of December 31, 2019 for each of the five succeeding fiscal years and the period thereafter (in thousands):

Borrowings under the Credit and Security Agreement are secured by substantially all of the assets held by CMFT Corporate Credit Securities, LLC, which shall primarily consist of broadly-syndicated senior secured loans subject to certain eligibility criteria under the Credit and Security Agreement.

Repurchase Facilities

On June 4, 2020, CMFT RE Lending RF Sub CB, LLC, an indirect wholly-owned subsidiary of the Company, entered into a Master Repurchase Agreement with Citibank (the “Citibank Repurchase Agreement”), which provides up to $ 300.0 million of financing primarily through Citibank’s purchase of the Company’s CRE mortgage loans and future funding advances (the “Citibank Repurchase Facility”).

Additionally, on September 21, 2020, CMFT RE Lending RF Sub BB, LLC, an indirect wholly-owned subsidiary of the Company, entered into a second Master Repurchase Agreement with Barclays Bank PLC (“Barclays”) (the “Barclays Repurchase Agreement”), which provides up to $ 500.0 million of financing primarily through Barclays’ purchase of the Company’s CRE mortgage loans and future funding advances (the “Barclays Repurchase Facility”, and collectively with the Citibank Repurchase Facility, the “Repurchase Facilities”).

The Citibank Repurchase Agreement and the Barclays Repurchase Agreement (collectively, the “Repurchase Agreements”) provide for simultaneous agreements by Citibank and Barclays to re-sell such purchased CRE mortgage loans back to CMFT RE Lending RF Sub CB, LLC and CMFT RE Lending RF Sub BB, LLC (collectively, the “CMFT Lending Subs”) at a certain future date or upon demand.

Advances under the Repurchase Agreements accrue interest at per annum rates based on the one-month LIBOR, plus a spread ranging from 2.00 % to 2.40 % to be determined on a case-by-case basis between Citibank or Barclays and the CMFT Lending Subs.

The Repurchase Facilities mature on various dates between June 2023 and September 2023, with two one-year extension options, subject to certain conditions set forth in the Repurchase Agreements.

In connection with the Repurchase Agreements, the Company (as the guarantor) entered into guaranties with Citibank and Barclays (the “Guaranties”), under which the Company agreed to guarantee up to 25 % of the CMFT Lending Subs’ obligations under the Repurchase Agreements.

As of December 31, 2020, the Company had four senior loans with an aggregate carrying value of $ 341.5 million financed with $ 235.4 million under the Repurchase Facilities, $ 109.1 million of which was financed under the Barclays Repurchase Facility at a weighted average interest rate of 2.9 %, and $ 126.3 million of which was financed under the Citibank Repurchase Facility at a weighted average interest rate of 2.3 %.

The Repurchase Agreements and the Guaranties contain representations, warranties, covenants, conditions precedent to funding, events of default and indemnities that are customary for agreements of these types.

In addition, the Guaranties contains financial covenants that require the Company to maintain:

(i) minimum liquidity of not less than the lower of (a) $ 50.0 million and (b) the greater of (A) $ 10.0 million and (B) 5 % of the Company’s recourse indebtedness, as defined in the Guaranties;

(ii) minimum consolidated net worth greater than or equal to $ 1.0 billion plus (a) 75 % of the equity issued by the Company following the respective closing dates of the Repurchase Agreements (the “Repurchase Closing Dates”) minus (b) the aggregate amount of any redemptions or similar transaction by the Company from the Repurchase Closing Dates;

(iii) maximum leverage ratio of total indebtedness to total equity less than or equal to 80 %;

and (iv) minimum interest coverage ratio of EBITDA (as defined in the Guaranties) to interest expense equal to or greater than 1.40 .

The Company believes it was in compliance with the financial covenants under the Repurchase Agreements as of December 31, 2020.

Liquidity and Financial Condition — As of December 31, 2020, the Company had $ 1.2 billion of debt maturing within the next 12 months following the date these financial statements are issued.

The Company expects to enter into new financing arrangements or refinance existing arrangements to meet its obligations as they become due, which management believes is probable based on the current loan-to-value ratios, the occupancy of the Company’s properties and assessment of the current lending environment.

The Company believes cash on hand, proceeds from real estate asset dispositions, net cash provided by operations, borrowings available under the credit facilities or the entry into new financing arrangements will be sufficient to meet its obligations as they become due in the ordinary course of business for at least 12 months following the date these financial statements are issued.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Year Ending December 31,

Principal Repayments

The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to December 31, 2020 (in thousands):

Year Ending December 31, Principal Repayments

2021 $ 138,210

2022 1,134,391

Total $ 2,149,976

NOTE 10 — SUPPLEMENTAL CASH FLOW DISCLOSURES

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Year Ended December 31,

2020 2019 2018

Supplemental Disclosures of Non-Cash Investing and Financing Activities:

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Common stock issued through distribution reinvestment plan $ 34,191 $ 82,388 $ 91,764

Common stock issued in connection with the Mergers $ 384,319 $ — $ —

Change in fair value of interest rate swaps $ 727 $ ( 14,913 ) $ 3,875

Interest rate swaps assumed in the Mergers $ ( 9,115 ) $ — $ —

Mortgage notes assumed by buyer in real estate disposition $ — $ ( 205,765 ) $ —

Debt assumed in the Mergers $ 379,737 $ — $ —

Real estate assets acquired in the Mergers $ 761,326 $ — $ —

Assets assumed in the Mergers $ 4,424 $ — $ —

Liabilities assumed in the Mergers $ 6,389 $ — $ —

Supplemental Cash Flow Disclosures:

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Unfunded Commitments

As of December 31, 2019 , the Company had $16.2 million of unfunded commitments related to loans held-for-investment.

As of December 31, 2020, the Company had $ 169.1 million of unfunded commitments related to its existing CRE loans held-for-investment.

These commitments are not reflected in the accompanying consolidated balance sheet.

Unsettled Broadly Syndicated Loans

As of December 31, 2019 , the Company had $126.8 million reserved for settlement of broadly syndicated loan purchases included in cash and cash equivalents in the accompanying consolidated balance sheet, of which $122.9 million settled subsequent to December 31, 2019 .

As of December 31, 2020, the Company had $ 41.0 million of unsettled broadly syndicated loan acquisitions and $ 2.6 million of unsettled broadly syndicated loan sales, none of which settled subsequent to December 31, 2020.

Unsettled acquisitions are included in cash and cash equivalents in the accompanying consolidated balance sheet.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Environmental Matters

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Additionally, in connection with the purchase of certain properties, the respective sellers and/or tenants may agree to indemnify the Company against future remediation costs.

The Company also carries environmental liability insurance on its properties that provides limited coverage for any remediation

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

liability and/or pollution liability for third-party bodily injury and/or property damage claims for which the Company may be liable.

The Company also carries environmental liability insurance on its properties that provides limited coverage for any remediation liability and/or pollution liability for third-party bodily injury and/or property damage claims for which the Company may be liable.

The Company is not aware of any environmental matters which it believes are reasonably likely to have a material effect on its results of operations, financial condition or liquidity.

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provided, however, that the limits on reimbursement for organization and offering expenses, acquisition expenses and operating expenses as defined and provided in the Prior Advisory Agreement shall no longer be applicable.

Management fees

Management and investment advisory fees

Pursuant to the Management Agreement, beginning on August 20, 2019, the Company pays CMFT Management a management fee, payable quarterly in arrears, equal to the greater of (a) $ 250,000 per annum ($ 62,500 per quarter) and (b) 1.50 % per annum ( 0.375 % per quarter) of the Company’s Equity (as defined in the Management Agreement).

On December 6, 2019, CMFT Securities Investments, LLC (“CMFT Securities”), which is a wholly owned subsidiary of the Company, entered into an investment advisory and management agreement (the “Investment Advisory and Management Agreement”) with CIM Capital IC Management, LLC (the “Investment Advisor”).

CMFT Securities was formed for the purpose of holding any securities investments made by the Company.

The Investment Advisor, a wholly-owned subsidiary of CIM, is registered as an investment advisor under the Investment Advisers Act of 1940, as amended (the “Advisers Act”).

Pursuant to the Investment Advisory and Management Agreement, the Investment Advisor manages the day-to-day business affairs of CMFT Securities and its investments in corporate credit and real estate-related securities (collectively, the “Managed Assets”), subject to the supervision of the Board.

In connection with the services provided by the Investment Advisor, CMFT Securities pays the Investment Advisor an investment advisory fee (the “Investment Advisory Fee”), payable quarterly in arrears, equal to 1.50 % per annum ( 0.375 % per quarter) of CMFT Securities’ Equity (as defined in the Investment Advisory and Management Agreement).

Because the Managed Assets are excluded from the calculation of management fees payable by the Company to CMFT Management pursuant to the Management Agreement, the total management and advisory fees payable by the Company to its external advisors are not increased as a result of the Investment Advisory and Management Agreement.

In addition, on December 6, 2019, the Investment Advisor entered into a sub-advisory agreement (the “Sub-Advisory Agreement”) with OFS Capital Management, LLC (the “Sub-Advisor”) to act as an investment sub-advisor to CMFT Securities.

The Sub-Advisor is registered as an investment adviser under the Advisers Act and is an affiliate of the Investment Advisor.

The Sub-Advisor is responsible for providing investment management services with respect to the corporate credit-related securities held by CMFT Securities.

On a quarterly basis, the Investment Advisor designates 50 % of the sum of the Investment Advisory Fee and incentive compensation payable to the Investment Advisor as sub-advisory fees.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Incentive compensation

1 unchanged sentence

During the year ended December 31, 2020, no incentive compensation fees were incurred.

In addition, the Investment Advisor is eligible to receive a portion of the incentive compensation payable to CMFT Management pursuant to the Management Agreement.

In the event that the incentive compensation is earned and payable with respect to any quarter, CMFT Management calculates the portion of the incentive compensation that was attributable to the Managed Assets and payable to the Investment Advisor.

Pursuant to the Investment Advisory and Management Agreement, CMFT Securities reimburses the Investment Advisor for costs and expenses incurred by the Investment Advisor on its behalf.

Acquisition fees and expenses

7 unchanged sentences

Advisory fees and expenses

Pursuant to the Prior Advisory Agreement, through August 20, 2019, the Company paid CMFT Management a monthly advisory fee based upon the Company’s monthly average invested assets, which, effective January 1, 2019, was based on the estimated market value of such assets used to determine the Company’s estimated per share NAV as of December 31, 2018, as discussed in Note 1 — Organization and Business , and for those assets acquired subsequent to December 31, 2018, was based on the purchase price.

Pursuant to the Prior Advisory Agreement, through August 20, 2019, the Company paid CMFT Management a monthly advisory fee based upon the Company’s monthly average invested assets, which, effective January 1, 2019, was based on the estimated market value of such assets used to determine the Company’s estimated per share NAV as of December 31, 2018, and for those assets acquired subsequent to December 31, 2018, was based on the purchase price.

The monthly advisory fee was equal to the following amounts:

2 unchanged sentences

and (3) an annualized rate of 0.65 % paid on the Company’s average invested assets that are over $ 4.0 billion.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Operating expenses

6 unchanged sentences

Pursuant to the Prior Advisory Agreement, through August 20, 2019, if CMFT Management or its affiliates provided a substantial amount of services (as determined by a majority of the Company’s independent directors) in connection with the sale of one or more properties (or the Company’s entire portfolio), the Company paid CMFT Management or its affiliates a disposition fee in an amount equal to up to one-half of the real estate or brokerage commission paid by the Company to third parties on the sale of such property, not to exceed 1.0 % of the contract price of the property sold;

provided, however, in no event would the total disposition fees paid to CMFT Management, its affiliates and unaffiliated third parties exceed the lesser of the customary competitive real estate commission or an amount equal to 6.0% of the contract sales price.

provided, however, in no

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

event would the total disposition fees paid to CMFT Management, its affiliates and unaffiliated third parties exceed the lesser of the customary competitive real estate commission or an amount equal to 6.0 % of the contract sales price.

For the Company’s properties under contract to be sold or specifically identified in a broker agreement as being marketed for sale as of August 20, 2019, CMFT Management may be entitled to receive a disposition fee in accordance with the terms of the Prior Advisory Agreement.

6 unchanged sentences

Year Ended December 31,

2020 2019 2018

Management fees and expenses $ 44,744 $ 16,350 (1) $ —

4 unchanged sentences

____________________________________

Includes advisor reimbursements incurred subject to the Management Agreement.

Of the amounts shown above, $14.5 million and $5.2 million had been incurred, but not yet paid, for services provided by CMFT Management or its affiliates in connection with the acquisition, disposition and operating activities during the years ended December 31, 2019 and 2018 , respectively, and such amounts were recorded as liabilities of the Company as of such dates.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(1) Includes manager reimbursements incurred subject to the Management Agreement.

(2) Includes $ 308,000 of merger-related expenses incurred subject to the Merger Agreements and the terminated CCIT II Merger Agreement, net of $ 260,000 which was reimbursed by CCIT II.

Of the amounts shown above, $ 14.7 million and $ 14.5 million had been incurred, but not yet paid, for services provided by CMFT Management or its affiliates in connection with the management and operating activities during the years ended December 31, 2020 and 2019, respectively, and such amounts were recorded as liabilities of the Company as of such dates.

Due to Affiliates

As of December 31, 2019 and 2018 , $14.5 million and $5.2 million , respectively, had been incurred primarily for management fees, disposition fees and operating expenses by CMFT Management or its affiliates, but had not yet been reimbursed by the Company.

As of December 31, 2020 and 2019, $ 14.7 million and $ 14.5 million, respectively, had been incurred primarily for operating expenses by CMFT Management or its affiliates, but had not yet been reimbursed by the Company.

These amounts were included in due to affiliates in the consolidated balance sheets for such periods .

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In the event that these companies are unable to provide the Company with these services, the Company would be required to find alternative providers of these services.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 14 — STOCKHOLDERS’ EQUITY

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On February 1, 2018, the ownership of such shares was transferred by VEREIT OP to CMFT Management.

On December 21, 2020, in connection with the consummation of the Mergers, the Company issued 52.6 million shares of common stock for consideration of $ 7.31 per share.

Distribution Reinvestment Plan

Pursuant to the DRIP, the Company allows stockholders to elect to have their distributions reinvested in additional shares of the Company’s common stock at the most recent estimated per share NAV as determined by the Board.

Pursuant to the Amended DRIP, the Company allows stockholders to elect to have their distributions reinvested in additional shares of the Company’s common stock at the most recent estimated per share NAV as determined by the Board.

The Board may terminate or amend the Secondary DRIP Offering at the Company’s discretion at any time upon ten days ’ prior written notice to the stockholders.

During the years ended December 31, 2019 , 2018 and 2017 , approximately 9.3 million , 9.6 million and 10.1 million shares were purchased under the DRIP Offerings for approximately $82.4 million , $91.8 million and $101.3 million , respectively, which were recorded as redeemable common stock on the consolidated balance sheets.

In connection with the Mergers, on August 30, 2020, the Board approved the suspension of the Amended DRIP, and, therefore, distributions paid after that date were paid in cash to all stockholders until the Amended DRIP was reinstated, effective April 1, 2021, by the Board on March 25, 2021.

During the years ended December 31, 2020, 2019 and 2018, approximately 4.2 million, 9.3 million and 9.6 million shares were purchased under the DRIP Offerings for approximately $ 34.2 million, $ 82.4 million and $ 91.8 million, respectively, which were recorded as redeemable common stock on the consolidated balance sheets prior to the suspension of the Amended Share Redemption Program.

Share Redemption Program

The Company’s share redemption program permits its stockholders to sell their shares back to the Company after they have held them for at least one year, subject to the significant conditions and limitations described below.

The share redemption program provides that the Company will redeem shares of its common stock from requesting stockholders, subject to the terms and conditions of the share redemption program.

The Company will limit the number of shares redeemed pursuant to the share redemption program as follows:

The Company’s Amended Share Redemption Program permits its stockholders to sell their shares back to the Company after they have held them for at least one year , subject to the significant conditions and limitations described below.

The Amended Share Redemption Program provides that the Company will redeem shares of its common stock from requesting stockholders, subject to the terms and conditions of the Amended Share Redemption Program.

The Company will limit the number of shares redeemed pursuant to the Amended Share Redemption Program as follows:

(1) the Company will not redeem in excess of 5 % of the weighted average number of shares outstanding during the trailing 12 months prior to the end of the fiscal quarter for which the redemptions are being paid;

3 unchanged sentences

The redemption price will be adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Company’s common stock if any such event is not already reflected in the per share value shown on the stockholder’s most recent customer account statement.

See the discussion of the updated estimated per share NAV of the Company’s common stock effective March 25, 2020 in Note 17 — Subsequent Events .

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Upon receipt of a request for redemption, the Company may conduct a Uniform Commercial Code search to ensure that no liens are held against the shares.

4 unchanged sentences

Unfulfilled requests for redemption will not be carried over automatically to subsequent redemption periods.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The Company redeems shares no later than the end of the month following the end of each fiscal quarter.

Requests for redemption must be received on or prior to the end of the fiscal quarter in order for the Company to repurchase the shares in the month following the end of that fiscal quarter.

The Board may amend, suspend or terminate the share redemption program at any time upon 30 days’ prior written notice to the stockholders.

During the years ended December 31, 2019 , 2018 and 2017 , the Company redeemed approximately 9.5 million , 9.8 million and 10.3 million shares, respectively, under the share redemption program for $84.1 million , $93.8 million and $103.7 million , respectively.

The Board may amend, suspend or terminate the Amended Share Redemption Program at any time upon 30 days’ prior written notice to the stockholders.

In connection with the Mergers, the Board approved the suspension of the Company’s Amended Share Redemption Program on August 30, 2020, and, therefore, no shares were redeemed from the Company’s stockholders after that date until the Amended Share Redemption Program was reinstated, effective April 1, 2021, by the Board on March 25, 2021.

During the years ended December 31, 2020, 2019 and 2018, the Company redeemed approximately 6.0 million, 9.5 million and 9.8 million shares, respectively, under the share redemption program then in effect for $ 48.1 million, $ 84.1 million and $ 93.8 million, respectively.

During the year ended December 31, 2020, redemption requests relating to approximately 44.5 million shares went unfulfilled.

Distributions Payable and Distribution Policy

The Board authorized a daily distribution, based on 365 days in the calendar year, of $0.001711452 per share for stockholders of record as of the close of business on each day of the period commencing on January 1, 2018 and ending on December 31, 2019.

The Board authorized a daily distribution, based on 366 days in the calendar year, of $0.001706776 per share for stockholders of record as of the close of business on each day of the period commencing on January 1, 2020 and ending on March 31, 2020 .

Prior to April 1, 2020, on a quarterly basis, the Board authorized a daily distribution for the succeeding quarter.

The Board authorized the following daily distribution amounts per share for the periods indicated below:

Period Commencing Period Ending Daily Distribution Amount

April 14, 2012 December 31, 2012 $ 0.001707848

January 1, 2013 December 31, 2015 $ 0.001712523

January 1, 2016 December 31, 2016 $ 0.001706776

January 1, 2017 December 31, 2019 $ 0.001711452

January 1, 2020 March 31, 2020 $ 0.001706776

On April 20, 2020, the Board decided to make a determination as to the amount and timing of distributions on a monthly, instead of a quarterly, basis until such time that the Company has greater visibility into the impact that the COVID-19 pandemic will have on tenants’ ability to continue to pay rent on their leases on a timely basis or at all, the degree to which federal, state or local governmental authorities grant rent relief or other relief or amnesty programs applicable to the Company’s tenants, the Company’s ability to access the capital markets, and on the United States and worldwide financial markets and economy.

On March 25, 2021, the Board resumed declaring distributions on a quarterly basis by declaring a monthly per share distribution for the months of March, April, May and June 2021.

Since April 1, 2020, the Board authorized the following monthly distribution amounts per share for the periods indicated below:

Record Date Distribution Amount

April 30, 2020 $ 0.0130

May 31, 2020 $ 0.0130

June 30, 2020 $ 0.0161

July 30, 2020 $ 0.0304

August 28, 2020 $ 0.0303

September 29, 2020 $ 0.0303

October 29, 2020 $ 0.0303

November 27, 2020 $ 0.0303

December 30, 2020 $ 0.0303

January 28, 2021 $ 0.0303

February 25, 2021 $ 0.0303

March 29, 2021 $ 0.0303

April 29 2021 $ 0.0303

May 28, 2021 $ 0.0303

June 29, 2021 $ 0.0303

As of December 31, 2020, the Company had distributions payable of $ 11.0 million.

Subsequent to December 31, 2019 , the Board reaffirmed the declaration and payment of distributions for the month of March 2020 at the rate previously declared on November 5, 2019, which distributions will be paid on or around April 1, 2020.

Given the impact of the novel strain of coronavirus (“COVID-19”) outbreak, the Board has decided to defer making a determination as to the amount and timing of distributions for the second quarter of 2020 until such time that the Company has greater visibility into the impact that the COVID-19 outbreak will have on the Company’s tenants’ ability to continue to pay rent on their leases on a timely basis or at all, the degree to which federal, state or local governmental authorities grant rent relief or other relief or amnesty programs applicable to the Company’s tenants, the Company’s ability to access the capital markets, and on the United States and worldwide financial markets and economy.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Equity-Based Compensation

On August 10, 2018, the Board approved the adoption of the Company’s 2018 Equity Incentive Plan (the “Plan”), under which 400,000 of the Company’s common shares were reserved for issuance and share awards of approximately 367,500 are available for future grant at December 31, 2019 .

On August 10, 2018, the Board approved the adoption of the Company’s 2018 Equity Incentive Plan (the “Plan”), under which 400,000 of the Company’s shares of common stock were reserved for issuance and awards of approximately 345,000 shares of common stock are available for future grant at December 31, 2020.

Under the Plan, the Board or a committee designated by the Board has the authority to grant restricted stock awards or deferred stock awards to non-employee directors of the Company, which will further align such directors’ interests with the interests of the Company’s stockholders.

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The remaining 22,000 restricted shares issued had not vested or been forfeited as of December 31, 2020.

The fair value of the Company’s share awards is determined using the Company’s NAV per share on the date of grant.

The fair value of the Company’s share awards is determined using the Company’s per share NAV on the date of grant.

Compensation expense related to the restricted shares is recognized over the vesting period.

The Company recorded compensation expense of $138,000 and $33,000 for the years ended December 31, 2019 and 2018 , respectively, related to the restricted shares included in general and administrative expenses in the accompanying consolidated statement of operations.

As of December 31, 2019 , there was $120,000 of total unrecognized compensation expense related to shares, which will be recognized ratably over the remaining period of service prior to October 2020.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The Company recorded compensation expense of $ 160,000 and $ 138,000 for the years ended December 31, 2020 and 2019, respectively, related to the restricted shares which is included in general and administrative expenses in the accompanying consolidated statements of operations.

As of December 31, 2020, there was $ 121,000 of total unrecognized compensation expense related to these restricted shares, which will be recognized ratably over the remaining period of service prior to October 2021.

NOTE 15 — INCOME TAXES

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Character of Distributions:

2020 2019 2018

Ordinary dividends — % 39 % 52 %

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Capital gain distributions — % 54 % — %

During the years ended December 31, 2019 , 2018 and 2017 , the Company incurred state and local income and franchise taxes of $1.5 million , $1.4 million , and $1.6 million , respectively, which were recorded in general and administrative expenses in the consolidated statements of operations.

Total 100 % 100 % 100 %

During the years ended December 31, 2020, 2019 and 2018, the Company incurred state and local income and franchise taxes of $ 568,000 , $ 1.5 million, and $ 1.4 million, respectively, which were recorded in general and administrative expenses in the consolidated statements of operations.

The Company had no unrecognized tax benefits as of or during the years ended December 31, 2020 and 2019.

6 unchanged sentences

To determine whether a contract contains a lease, the Company reviews contracts to determine if the agreement conveys the right to control the use of an asset.

The Company adopted ASC 842, using the optional alternative transition method and used the effective date as the date of initial application.

Consequently, financial information was not updated and the disclosures required under the new standard are not provided for dates and periods before January 1, 2019.

The Company elected to apply the practical expedient for all of the Company’s leases to account for the lease and non-lease components as a single, combined operating lease component under ASC 842.

The Company accounts for lease and non-lease components as a single, combined operating lease component.

Non-lease components primarily consist of maintenance services, including CAM, real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee.

Non-lease components are considered to be variable rental and other property income and are recognized in the period incurred.

As of December 31, 2019 , the leases had a weighted-average remaining term of 8.6 years.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

As of December 31, 2020, the Company’s leases had a weighted-average remaining term of 8.8 years.

Certain leases include provisions to extend the lease agreements, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other negotiated terms and conditions.

2 unchanged sentences

As of December 31, 2020, the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, was as follows (in thousands):

Year Ending December 31,

Future Minimum Rental Income

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

As previously disclosed in our 2018 Annual Report on Form 10-K and under the previous lease accounting standard, Topic 840, the following table summarizes the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, as of December 31, 2018 (in thousands):

Year Ending December 31,

Future Minimum Rental Income

Year Ending December 31, Future Minimum Rental Income

2021 $ 255,071

Thereafter 1,242,601

Total $ 2,385,061

A certain amount of the Company’s rental and other property income is from tenants with leases which are subject to contingent rent provisions.

1 unchanged sentence

For the years ended December 31, 2020, 2019 and 2018, the amount of the contingent rent earned by the Company was not significant.

Rental and other property income during years ended December 31, 2019 , 2018 and 2017 consisted of the following (in thousands):

Rental and other property income during the years ended December 31, 2020, 2019 and 2018 consisted of the following (in thousands):

Year Ended December 31,

2020 2019 2018

Fixed rental and other property income (1)

$ 221,445 $ 342,453 $ 368,847

Variable rental and other property income (2)

40,085 50,771 60,789

Total rental and other property income $ 261,530 $ 393,224 $ 429,636

__________________________________

Consists primarily of fixed contractual payments from operating leases with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above- and below-market leases.

Consists primarily of tenant reimbursements for recoverable real estate taxes and property operating expenses, and percentage rent, net of bad debt expense.

The Company has one property subject to a non-cancelable operating ground lease with a remaining term of 13.7 years.

Upon initial adoption of ASC 842, the Company recognized a lease liability (in deferred rental income and other liabilities) and a related ROU asset (in prepaid expenses, derivative assets and other assets) of $2.7 million in the consolidated balance sheets.

(1) Consists primarily of fixed contractual payments from operating leases with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above- and below-market leases, and is net of uncollectible lease-related receivables.

(2) Consists primarily of tenant reimbursements for recoverable real estate taxes and property operating expenses, and percentage rent.

The Company has one property subject to a non-cancelable operating ground lease with a remaining term of 12.7 years, with a lease liability (in deferred rental income and other liabilities) and a related ROU asset (in prepaid expenses, derivative assets and other assets ) of $ 2.7 million in the consolidated balance sheets.

The lease liability and ROU asset were initially measured at the present value of the future minimum lease payments using a discount rate of 4.3 %.

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As of December 31, 2020, the Company’s scheduled future minimum rental payments related to its operating ground lease is approximately $ 250,000 annually for 2021 through 2025, and $ 1.9 million thereafter through the maturity date of the lease in August 2033.

NOTE 17 — SEGMENT REPORTING

As of December 31, 2020, the Company determined that it has two reportable segments:

real estate and credit.

Corporate/other represents all corporate level and unallocated items and includes the Company’s other asset management activities and operating expenses.

There were no changes in the structure of the Company’s internal organization that prompted the change in reportable segments.

Prior period amounts have been revised to conform to the current year presentation shown below.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following tables present segment reporting for the years ended December 31, 2020, 2019 and 2018 (in thousands):

Year Ended December 31, 2020

Real Estate Credit Corporate/Other Company Total

Rental and other property income $ 261,530 $ — $ — $ 261,530

Interest income — 29,393 — 29,393

Total revenues 261,530 29,393 — 290,923

General and administrative 291 2,080 13,014 15,385

Property operating 23,399 — — 23,399

Real estate tax 27,691 — — 27,691

Management and advisory fees and expenses 32,164 7,861 4,718 44,743

Transaction-related 346 9 550 905

Depreciation and amortization 80,973 — — 80,973

Impairment 16,737 — — 16,737

Provision for credit losses — 68,356 — 68,356

Total operating expenses 181,601 78,306 18,282 278,189

Gain on disposition of real estate, net 27,518 — — 27,518

Merger-related expenses — — ( 2,193 ) ( 2,193 )

Merger termination fee income — — 7,380 7,380

Operating income (loss) 107,447 ( 48,913 ) ( 13,095 ) 45,439

Other expense:

Interest expense and other, net ( 21,380 ) ( 5,101 ) ( 37,635 ) ( 64,116 )

Loss on extinguishment of debt ( 4,394 ) — ( 447 ) ( 4,841 )

Segment net income (loss) $ 81,673 $ ( 54,014 ) $ ( 51,177 ) $ ( 23,518 )

Total assets as of December 31, 2020 $ 3,405,590 $ 949,764 $ 104,255 $ 4,459,609

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Year Ended December 31, 2019

Real Estate Credit Corporate/Other Company Total

Rental and other property income $ 393,224 $ — $ — $ 393,224

Interest income — 20,132 — 20,132

Total revenues 393,224 20,132 — 413,356

General and administrative 428 10 13,291 13,729

Property operating 33,462 — — 33,462

Real estate tax 32,196 — — 32,196

Management and advisory fees and expenses 35,557 1,688 5,094 42,339

Transaction-related 288 1,242 748 2,278

Depreciation and amortization 107,867 — — 107,867

Impairment 72,939 — — 72,939

Total operating expenses 282,737 2,940 19,133 304,810

Gain on disposition of real estate, net 180,666 — — 180,666

Operating income (loss) 291,153 17,192 ( 19,133 ) 289,212

Other expense:

Interest expense and other, net ( 45,606 ) ( 19 ) ( 53,340 ) ( 98,965 )

Loss on extinguishment of debt ( 6,482 ) — ( 745 ) ( 7,227 )

Segment net income (loss) 239,065 17,173 ( 73,218 ) 183,020

Segment net income (loss) attributable to non-controlling interest 121 — — 121

Segment net income (loss) attributable to the Company $ 238,944 $ 17,173 $ ( 73,218 ) $ 182,899

Total assets as of December 31, 2019 $ 2,895,609 $ 551,805 $ 221,209 $ 3,668,623

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Year Ended December 31, 2018

Real Estate Credit Corporate/Other Company Total

Rental and other property income $ 429,636 $ — $ — $ 429,636

Interest income — 1,640 — 1,640

Total revenues 429,636 1,640 — 431,276

General and administrative 502 — 13,625 14,127

Property operating 30,267 — — 30,267

Real estate tax 37,898 — — 37,898

Management and advisory fees and expenses 38,032 53 5,314 43,399

Transaction-related 85 1,786 730 2,601

Depreciation and amortization 140,979 — — 140,979

Impairment 32,975 — — 32,975

Total operating expenses 280,738 1,839 19,669 302,246

Gain on disposition of real estate, net 6,299 — — 6,299

Operating income (loss) 155,197 ( 199 ) ( 19,669 ) 135,329

Other expense:

Interest expense and other, net ( 49,458 ) — ( 48,413 ) ( 97,871 )

Loss on extinguishment of debt ( 46 ) — — ( 46 )

Segment net income (loss) 105,693 ( 199 ) ( 68,082 ) 37,412

Segment net income (loss) attributable to non-controlling interest 134 — — 134

Segment net income (loss) attributable to the Company $ 105,559 $ ( 199 ) $ ( 68,082 ) $ 37,278

Total assets as of December 31, 2018 $ 4,502,999 $ 90,788 $ 23,584 $ 4,617,371

NOTE 18 — QUARTERLY RESULTS (UNAUDITED)

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In the opinion of management, the information for the interim periods presented includes all adjustments which are of a normal and recurring nature, necessary to present a fair presentation of the results for each period.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

December 31, 2020

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

Net income attributable to the Company

Basic and diluted net income per common share (1)

First Quarter Second Quarter Third Quarter Fourth Quarter

Revenues $ 74,007 $ 67,296 $ 72,642 $ 76,978

Net (loss) income $ ( 12,175 ) $ ( 3,746 ) $ 4,179 $ ( 11,776 )

Basic and diluted net (loss) income per common share (1)

$ ( 0.04 ) $ ( 0.01 ) $ 0.01 $ ( 0.04 )

The Company calculates net income per share based on the weighted-average number of outstanding shares of common stock during the reporting period.

____________________________________

(1) The Company calculates net (loss) income per share based on the weighted-average number of outstanding shares of common stock during the reporting period.

The average number of shares fluctuates throughout the year and can therefore produce a full year result that does not agree to the sum of the individual quarters.

December 31, 2019

First Quarter

Second Quarter

Third Quarter

Fourth Quarter

Net income (loss)

Net income (loss) attributable to the Company

Basic and diluted net income (loss) per common share (1)

First Quarter Second Quarter Third Quarter Fourth Quarter

Revenues $ 109,260 $ 105,529 $ 105,479 $ 93,088

Net income $ 8,851 $ 9,006 $ 2,573 $ 162,590

Net income attributable to the Company $ 8,817 $ 8,973 $ 2,541 $ 162,568

Basic and diluted net income per common share (1)

$ 0.03 $ 0.03 $ 0.01 $ 0.52

The Company calculates net income (loss) per share based on the weighted-average number of outstanding shares of common stock during the reporting period.

____________________________________

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

(1) The Company calculates net income per share based on the weighted-average number of outstanding shares of common stock during the reporting period.

The average number of shares fluctuates throughout the year and can therefore produce a full year result that does not agree to the sum of the individual quarters.

NOTE 19 — SUBSEQUENT EVENTS

Subsequent to December 31, 2019 , there was a global outbreak of COVID-19.

The global and domestic response to the COVID-19 outbreak continues to rapidly evolve.

Thus far, certain responses to the COVID-19 outbreak have included mandates from federal, state and/or local authorities that required temporary closure of or imposed limitations on the operations of certain non-essential retailers.

The COVID-19 outbreak and associated responses could negatively impact future tenant sales and operations at the Company’s properties, which could result in material impact to the Company’s future results of operations, cash flows and financial condition.

The Company is unable to estimate the impact the novel coronavirus will have on its financial results at this time.

Redemption of Shares of Common Stock

Subsequent to December 31, 2019 , the Company redeemed approximately 2.3 million shares pursuant to the Company’s share redemption program for $19.5 million (at an average price per share of $8.65 ).

Management, in its discretion, limited the amount of shares redeemed for the three months ended December 31, 2019 to an amount equal to net proceeds the Company received from the sale of shares in the DRIP Offerings during the respective period.

The remaining redemption requests received during the three months ended December 31, 2019 totaling approximately 20.6 million shares went unfulfilled.

Property Dispositions

Subsequent to December 31, 2019 , the Company disposed of 12 properties for an aggregate gross sales price of $129.0 million , including seven properties disposed of for $26.3 million pursuant to the Purchase and Sales Agreement discussed in Note 4 — Real Estate Assets .

The property dispositions resulted in proceeds of $127.0 million after closing costs and disposition fees to CMFT Management or its affiliates and a gain of approximately $13.1 million .

The Company has no continuing involvement with these properties.

Notes Payable

Subsequent to December 31, 2019 , the Company repaid $97.0 million of mortgage note due to the disposition of the underlying properties.

Distribution Reinvestment Plan and Share Redemption Program

On March 25, 2021, the Board reinstated the Amended DRIP and Amended Share Redemption Program, effective April 1, 2021.

Property Disposition

Subsequent to December 31, 2020, the Company disposed of one property for an aggregate gross sales price of $ 3.7 million, resulting in net proceeds of $ 3.5 million after closing costs.

The Company has no continuing involvement with this property.

Foreclosure of Mezzanine Loans

On January 7, 2021, the Company completed foreclosure proceedings to take control of the assets securing its mezzanine loans, which are comprised of 75 condominium units and 21 rental units across four buildings totaling approximately 164,000 square feet.

Broadly Syndicated Loans

Subsequent to December 31, 2019 , the Company settled $328.8 million of broadly syndicated loans.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Credit Securities Revolver

Subsequent to December 31, 2019 , the Company received borrowings under the Credit Securities Revolver in an aggregate principal amount of $100.0 million .

The Credit Securities Revolver bears interest equal to the three-month LIBOR for the relevant interest period, plus an applicable rate of 1.70% per annum during the Reinvestment Period and 2.00% per annum during the amortization period, as discussed in Note 8 — Credit Facilities and Notes Payable .

Estimated Per Share NAV

On March 25, 2020 , the Board established an updated estimated per share NAV of the Company’s common stock as of December 31, 2019 , of $7.77 per share.

Commencing on March 30, 2020 , distributions will be reinvested in shares of the Company’s common stock under the Secondary DRIP Offering at a price of $7.77 per share.

Pursuant to the terms of the Company’s share redemption program, commencing on March 30, 2020 , the updated estimated per share NAV of $7.77 , as of December 31, 2019 , will serve as the most recent estimated value for purposes of the share redemption program going forward, until such time as the Board determines a new estimated per share NAV.

Subsequent to December 31, 2020, the Company settled $ 37.4 million of net broadly syndicated loan transactions that were traded subsequent to December 31, 2020.

Repurchase Facilities

Subsequent to December 31, 2020, the Company received borrowings under the Repurchase Facilities in an aggregate amount of $ 122.3 million.

Advances under the Repurchase Agreements accrue interest at per annum rates based on the one-month LIBOR, plus a spread to be determined on a case-by-case basis between Citibank or Barclays and the CMFT Lending Subs, as discussed in Note 9 — Credit Facilities, Notes Payable and Repurchase Facilities.

CMBS Purchase

Subsequent to December 31, 2020, the Company invested $ 28.5 million in CMBS.

CIM REAL ESTATE FINANCE TRUST, INC.

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(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried

At December 31, 2019

Description (a)

Real Estate Held for Investment:

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Real Estate Held for Investment the Company has Invested in Under Operating Leases:

10 Box Cost Plus:

Russellville, AR

Conway, AR (h) $ 733 $ 1,654 $ — $ 2,387 $ 170 9/5/2017 1989

Russellville, AR (h) 990 1,470 — 2,460 177 3/20/2017 1989

Aaron’s Rents:

Arkadelphia, AR $ — 183 491 — 674 1 12/21/2020 2014

Academy Sports:

Clarksville, TN

Cookeville, TN

Douglasville, GA

Greenville, NC

McDonough, GA

Advance Auto:

Cartersville, GA — 4,517 4,574 — 9,091 7 12/21/2020 2014

Cookeville, TN (h) — 23,847 73,371 97,218 11,933 9/30/2014 2015

Greenville, NC (h) 1,968 7,054 — 9,022 847 1/12/2017 2016

McDonough, GA (h) 1,846 5,626 — 7,472 1,047 4/24/2014 2010

Valdosta, GA 5,838 2,482 5,922 — 8,404 1,343 5/10/2013 2012

Actuant Campus:

Columbus, WI — 2,090 14,633 — 16,723 19 12/21/2020 2014

Advance Auto Parts:

Fairmont, NC — 253 868 — 1,121 1 12/21/2020 2004

Hampton,VA — 645 655 — 1,300 1 12/21/2020 2015

Mattoon, IL (h) 261 1,063 — 1,324 134 12/4/2015 2015

Stratford,CT — 755 1,736 — 2,491 2 12/21/2020 1994

Willmar, MN (h) 200 1,279 — 1,479 187 3/25/2015 2014

Albany Square:

Albany, GA 4,600 1,606 7,113 373 9,092 1,610 2/26/2014 2013

Almeda Crossing:

Sheffield, OH

Bass Pro Shops:

Tallahassee, FL

Houston, TX (h) 4,738 26,245 ( 8,732 ) 22,251 415 8/7/2014 2006

Aspen Dental:

Rogers,AR — 289 1,611 — 1,900 2 12/21/2020 2015

Pearland, TX — 3,663 10,305 — 13,968 14 12/21/2020 1994

Sheffield, OH (h) 815 — 770 1,585 125 10/15/2014 2014

Bass Pro Shop:

Portage, IN — 1,428 8,414 — 9,842 14 12/21/2020 1983

Tallahassee, FL (h) 945 5,713 — 6,658 1,190 8/20/2013 2013

Beavercreek Shopping Center:

Beavercreek, OH

Bed Bath & Beyond/La-Z-Boy:

Beavercreek, OH (h) 5,504 25,178 554 31,236 5,130 10/31/2013 2013

Becton, Dickinson and Company:

Broken Bow, NE (h) 244 1,733 — 1,977 333 6/19/2014 2007

Bed Bath & Beyond/Golf Smith:

Schaumburg, IL 7,300 4,786 6,149 ( 1,065 ) 9,870 458 3/8/2013 1997

Austintown, OH

Birch Run, MI

Chillicothe, OH

Eldersburg, MD

Huntersville, NC

Hurricane, WV

Monroeville, PA

Nicholasville, KY

North Canton, OH

Tipp City, OH

BJ's Wholesale Club:

Fort Myers, FL — 5,331 21,692 — 27,023 25 12/21/2020 2018

Roanoke, VA — 4,509 14,545 — 19,054 49 11/25/2020 2018

Blankenbaker Plaza:

Louisville, KY — 4,861 10,497 — 15,358 16 12/21/2020 2007

Akron, OH (h) 447 1,537 — 1,984 176 4/28/2017 2007

Anderson, IN (h) 912 1,455 — 2,367 170 4/28/2017 1984

Austintown, OH (h) 305 1,426 — 1,731 176 4/28/2017 1995

Birch Run, MI (h) 733 1,192 — 1,925 143 4/28/2017 2008

Blue Ash, OH (h) 628 1,429 — 2,057 190 4/28/2017 1994

Chardon, OH (h) 333 682 — 1,015 89 4/28/2017 2003

Chillicothe, OH (h) 557 1,524 — 2,081 182 4/28/2017 1998

Columbus, OH (h) 523 1,376 — 1,899 170 4/28/2017 2003

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried

At December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Bob Evans (continued):

Dayton, OH (h) $ 325 $ 1,438 $ — $ 1,763 $ 182 4/28/2017 1998

Florence, KY (h) 496 1,876 — 2,372 232 4/28/2017 1991

Gallipolis, OH $ — 529 2,963 — 3,492 3 12/21/2020 2003

Hagerstown, MD — 490 2,789 — 3,279 3 12/21/2020 1989

Holland, MI (h) 314 1,367 — 1,681 168 4/28/2017 2004

Huntersville, NC (h) 751 657 — 1,408 78 4/28/2017 2008

Hurricane, WV (h) 297 1,654 — 1,951 185 4/28/2017 1993

Mansfield, OH — 495 2,423 — 2,918 3 12/21/2020 2004

Milford, OH (h) 271 1,498 — 1,769 186 4/28/2017 1987

Monroe, MI — 623 2,177 — 2,800 3 12/21/2020 1998

Monroeville, PA (h) 1,340 848 — 2,188 96 4/28/2017 1995

Nicholasville, KY (h) 731 693 — 1,424 80 4/28/2017 1989

North Canton, OH (h) 859 1,393 — 2,252 172 4/28/2017 2006

Northwood, OH — 514 2,760 — 3,274 3 12/21/2020 1998

Peoria, IL — 620 524 — 1,144 1 12/21/2020 1995

Piqua, OH — 413 2,187 — 2,600 3 12/21/2020 1989

Ripley, WV (h) 269 1,304 — 1,573 156 4/28/2017 1988

Tipp City, OH (h) 554 1,120 — 1,674 142 4/28/2017 1989

Warsaw, IN (h) 684 1,222 — 1,906 145 4/28/2017 1993

Boston Commons:

Springfield, MA

Springfield, MA (h) 3,101 7,042 280 10,423 1,292 8/19/2014 2004

Bottom Dollar Grocery:

Bryan Crossing:

Sun Prairie, WI

Ambridge, PA — 519 2,985 — 3,504 548 11/5/2013 2012

Brynwood Square:

Rockford, IL — 1,747 11,393 — 13,140 25 12/21/2020 1999

Yukon, OK — 500 1,141 — 1,641 1 12/21/2020 1989

Burlington Coat Factory:

Bangor, ME — 1,820 2,549 — 4,369 5 12/21/2020 2014

Acworth, GA (h) 4,979 18,775 — 23,754 1,694 9/25/2017 2014

Avon, OH (h) 2,755 10,751 — 13,506 986 9/25/2017 2016

La Vista, NE (h) 3,260 16,923 — 20,183 1,468 9/25/2017 2006

Sun Prairie, WI (h) 3,373 14,058 — 17,431 1,338 9/25/2017 2015

Caliber Collision Center:

Las Cruces, NM

Midwest City, OK

Fredericksburg, VA (h) 1,807 2,292 — 4,099 32 7/22/2020 2019

Frisco, TX (h) 1,484 2,038 — 3,522 369 9/16/2014 2014

Lake Jackson,TX — 800 2,974 — 3,774 4 12/21/2020 2006

Las Cruces, NM (h) 673 1,949 — 2,622 334 3/21/2014 2014

Richmond, VA (h) 1,453 3,323 — 4,776 48 7/30/2020 2020

San Antonio,TX — 691 4,458 — 5,149 6 12/21/2020 2019

San Antonio, TX (h) 622 832 — 1,454 139 6/4/2014 2014

Williamsburg, VA (h) 1,418 2,800 — 4,218 45 6/12/2020 2020

Wylie, TX (h) 816 2,690 — 3,506 454 2/10/2015 2014

Camping World:

Pensacola, FL

Fort Myers, FL — 3,226 11,832 — 15,058 16 12/21/2020 1987

Pensacola, FL (h) 2,152 3,831 ( 1,307 ) 4,676 109 4/29/2014 2014

Canton Marketplace:

Canton, GA 31,801 8,310 48,667 930 57,907 12,023 3/28/2013 2009

Carlisle Crossing:

Hanover Township, NJ

Chestnut Square:

Dickson City, PA

Carlisle, PA — 4,491 15,817 41 20,349 2,943 9/18/2014 2006

CIM REAL ESTATE FINANCE TRUST, INC.

SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued)

(in thousands)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Cash & Carry:

Salt Lake City, UT $ — $ 863 $ 4,149 $ — $ 5,012 $ 5 12/21/2020 2006

Hanover Township, NJ (h) 2,192 — — 2,192 — 12/18/2013 2012

Tallahassee, FL 5,146 9,497 — — 9,497 — 12/11/2012 2006

2 unchanged sentences

Coventry Crossing:

Hagerstown, MD

Coventry , RI 6,000 3,462 5,899 ( 2,292 ) 7,069 137 9/12/2013 2008

Hagerstown, MD (h) 12,285 14,359 ( 971 ) 25,673 2,937 9/30/2014 2000

Crossroads Annex:

Lafayette, LA

Lafayette, LA (h) 1,659 7,091 — 8,750 1,431 12/4/2013 2013

Crossroads Commons:

Asheville, NC

Plover, WI (h) 1,000 4,515 75 5,590 1,068 12/10/2013 2012

Arnold, MO (h) 2,043 2,367 — 4,410 429 12/13/2013 2013

Asheville, NC (h) 1,108 1,084 — 2,192 248 4/26/2012 1998

Austin, TX (h) 1,076 3,475 — 4,551 626 12/13/2013 2013

Bloomington, IN (h) 1,620 2,957 — 4,577 536 12/13/2013 2012

Blue Springs, MO (h) 395 2,722 — 3,117 493 12/13/2013 2013

Bridgeton, MO (h) 2,056 2,362 — 4,418 428 12/13/2013 2013

Charleston, SC (h) 869 1,009 — 1,878 232 4/26/2012 1998

Chesapeake, VA (h) 1,044 3,053 — 4,097 564 12/13/2013 2013

Chicago, IL (h) 1,832 4,255 — 6,087 829 3/20/2013 2008

Cicero, IN (h) 487 3,099 — 3,586 561 12/13/2013 2013

Corpus Christi, TX (h) 648 2,557 — 3,205 566 4/19/2012 1998

Danville, IN (h) 424 2,105 76 2,605 371 7/16/2014 1998

Eminence, KY (h) 872 2,511 — 3,383 449 12/13/2013 2013

Goose Creek, SC (h) 1,022 1,980 — 3,002 355 12/13/2013 2013

Greenwood, IN (h) 912 3,549 61 4,522 671 7/11/2013 1999

Hanover Township, NJ (h) 4,746 — — 4,746 — 12/18/2013 2012

Hazlet, NJ (h) 3,047 3,610 — 6,657 650 12/13/2013 2013

Honesdale, PA (h) 1,206 3,342 — 4,548 620 12/13/2013 2013

Independence, MO (h) 359 2,242 — 2,601 407 12/13/2013 2013

Indianapolis, IN (h) 1,110 2,484 — 3,594 450 12/13/2013 2013

Irving, TX (h) 745 3,034 — 3,779 640 10/5/2012 2000

Janesville, WI (h) 736 2,545 — 3,281 460 12/13/2013 2013

Katy, TX (h) 1,149 2,462 — 3,611 436 12/13/2013 2013

Lincoln, NE (h) 2,534 3,014 — 5,548 544 12/13/2013 2013

London, KY (h) 1,445 2,661 — 4,106 499 9/10/2013 2013

Middletown, NY (h) 665 5,483 — 6,148 979 12/13/2013 2013

North Wilkesboro, NC (h) 332 2,369 73 2,774 435 10/25/2013 1999

Poplar Bluff, MO (h) 1,861 2,211 — 4,072 402 12/13/2013 2013

Riverton, NJ — 1,217 5,553 — 6,770 6 12/21/2020 2007

Salem, NH (h) 3,456 2,351 — 5,807 421 11/18/2013 2013

San Antonio, TX (h) 1,893 1,848 — 3,741 339 12/13/2013 2013

Sand Springs, OK (h) 1,765 2,283 — 4,048 416 12/13/2013 2013

Santa Fe, NM (h) 2,243 4,619 — 6,862 823 12/13/2013 2013

Sedalia, MO (h) 466 2,318 — 2,784 421 12/13/2013 2013

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried

At December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

CVS (continued):

Bloomington, IN

Blue Springs, MO

Bridgeton, MO

Charleston, SC

Chesapeake, VA

Corpus Christi, TX

Goose Creek, SC

Greenwood, IN

Hanover Township, NJ

Honesdale, PA

Independence, MO

Indianapolis, IN

Janesville, WI

Middletown, NY

North Wilkesboro, NC

Poplar Bluff, MO

San Antonio, TX

Sand Springs, OK

Temple Hills, MD

Waynesboro, VA

West Monroe, LA

John, MO (h) $ 1,546 $ 2,601 $ — $ 4,147 $ 471 12/13/2013 2013

Temple Hills, MD (h) 1,817 2,989 71 4,877 552 9/30/2013 2001

Vineland, NJ (h) 813 2,926 — 3,739 546 12/13/2013 2010

Waynesboro, VA (h) 986 2,708 — 3,694 490 12/13/2013 2013

West Monroe, LA (h) 1,738 2,136 — 3,874 389 12/13/2013 2013

Darien Towne Center:

Darien, IL (h) 6,718 11,951 915 19,584 3,143 12/17/2013 1994

Decatur Commons:

Decatur, AL $ 7,000 2,478 9,333 860 12,671 2,066 7/10/2013 2004

Derby Marketplace:

Derby, KS — 3,169 6,494 — 9,663 12 12/21/2020 2015

Dick’s Petsmart Center:

Oshkosh, WI (h) 1,445 6,599 ( 1,722 ) 6,322 138 9/23/2016 2015

Dick’s Sporting Goods:

Oklahoma City, OK

Oklahoma City, OK (h) 685 10,587 — 11,272 2,371 12/31/2012 2012

Dollar General:

Akron, OH (h) 112 1,099 — 1,211 221 11/1/2013 2013

Athens, WV — 270 1,364 — 1,634 2 12/21/2020 2015

Autaugaville, AL — 103 951 — 1,054 2 12/21/2020 1995

Bluefield, WV — 290 1,135 — 1,425 2 12/21/2020 2015

Buffalo, NY (h) 122 1,099 — 1,221 177 12/5/2014 2014

Charleston, WV — 340 1,184 — 1,524 2 12/21/2020 2014

Charleston, WV — 370 1,135 — 1,505 2 12/21/2020 2014

Charleston, WV — 341 1,039 — 1,380 2 12/21/2020 2015

Collinsville, AL — 194 1,003 — 1,197 2 12/21/2020 2014

Columbus, OH (h) 279 1,248 — 1,527 251 11/7/2013 2013

Des Moines, IA (h) 166 943 — 1,109 188 8/9/2013 2012

Elmwood, IL — 173 941 — 1,114 2 12/21/2020 2012

Glouster, OH — 220 1,276 — 1,496 2 12/21/2020 2015

Houston (Gears), TX (h) 255 1,393 — 1,648 259 10/18/2013 2013

Huntington, WV — 260 1,182 — 1,442 2 12/21/2020 2014

Huntington, WV — 240 1,276 — 1,516 2 12/21/2020 2014

Junction City, OH — 171 847 — 1,018 1 12/21/2020 2014

Kansas City, MO (h) 283 1,068 — 1,351 207 10/18/2013 2013

Kansas City, MO (h) 233 1,054 — 1,287 202 11/1/2013 2013

Lansing, MI (h) 232 939 — 1,171 157 6/25/2014 2014

Lineville, AL — 257 1,217 — 1,474 2 12/21/2020 2014

Logansport, IN — 181 977 — 1,158 2 12/21/2020 2014

Mission, TX (h) 182 858 — 1,040 146 9/5/2014 2014

Mobile, AL (h) 410 1,059 — 1,469 219 6/17/2013 2013

Moundridge, KS — 415 526 — 941 1 12/21/2020 2014

Parchment, MI (h) 168 1,162 — 1,330 193 6/25/2014 2014

Pipestone, MN — 204 1,034 — 1,238 2 12/21/2020 2014

Pueblo, CO (h) 144 909 — 1,053 187 1/4/2013 2012

Ridgeley, WV — 211 1,157 — 1,368 2 12/21/2020 2014

Romulus, MI (h) 274 1,171 — 1,445 205 3/7/2014 2013

Russell, KS (h) 54 899 — 953 156 8/5/2014 2014

Selma, AL — 164 858 — 1,022 1 12/21/2020 2014

Semmes, AL — 196 952 — 1,148 2 12/21/2020 2014

Sissonville, WV — 261 1,088 — 1,349 2 12/21/2020 2015

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried

At December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Dollar General (continued):

Des Moines, IA

Kansas City, MO

Leicester, NC

Nashville, MI

Parchment, MI

Springfield, IL

East Manchester Village Center:

Manchester, PA

Spring, TX (h) $ 277 $ 1,132 $ — $ 1,409 $ 213 9/30/2013 2013

Springfield, IL (h) 205 934 — 1,139 153 9/17/2014 2014

Louis, MO (h) 229 1,102 — 1,331 207 12/31/2013 2013

Louis, MO (h) 240 1,118 — 1,358 208 1/15/2014 2013

Talladega, AL $ — 161 859 — 1,020 2 12/21/2020 2014

Wakarusa, IN — 243 1,073 — 1,316 2 12/21/2020 2012

Weslaco, TX (h) 141 848 — 989 144 9/5/2014 2014

Wolcottville, IN — 183 1,012 — 1,195 2 12/21/2020 2013

Duluth Trading:

Denton, TX — 1,662 2,918 — 4,580 4 12/21/2020 2017

Madison, AL — 1,174 3,603 — 4,777 5 12/21/2020 2019

Noblesville, IN — 1,212 3,436 — 4,648 5 12/21/2020 2003

East West Commons:

Austell, GA 13,000 10,094 16,034 3,943 30,071 3,370 9/30/2014 2002

Evergreen Marketplace:

Evergreen Park, IL

Evergreen Park, IL (h) 2,823 6,239 — 9,062 1,487 9/6/2013 2013

Fairlane Green II:

Allen Park, MI — 1,409 14,634 — 16,043 18 12/21/2020 2015

Family Dollar:

Birmingham, AL

Brooksville, FL

Cathedral City, CA

Coachella, CA

Lauderdale, FL

Holtville, CA

Irvington, AL

Jonesboro, GA

Adelanto, CA (h) 463 1,711 — 2,174 274 11/14/2014 2014

Bearden, AR — 52 760 — 812 1 12/21/2020 2014

Bessemer, AL (h) 201 1,043 — 1,244 196 12/27/2013 2013

Birmingham, AL (h) 500 831 — 1,331 159 12/27/2013 2013

Brooksville, FL (h) 206 791 — 997 150 12/18/2013 2013

Cabot, AR — 231 1,137 — 1,368 2 12/21/2020 2014

Cathedral City, CA (h) 658 1,908 — 2,566 315 9/19/2014 2014

Cheyenne, WY (h) 148 986 — 1,134 176 4/23/2014 2014

Coachella, CA (h) 450 1,634 — 2,084 293 2/19/2014 2013

Columbus, OH — 252 1,251 — 1,503 2 12/21/2020 2014

Empire, CA (h) 239 1,527 — 1,766 261 6/27/2014 2014

Lauderdale, FL (h) 443 1,361 — 1,804 245 12/18/2013 2013

Fresno, CA (h) 488 1,553 — 2,041 282 2/19/2014 2013

Hobbs, NM — 243 1,084 — 1,327 2 12/21/2020 2006

Holtville, CA (h) 317 1,609 — 1,926 289 2/19/2014 2013

Indio, CA (h) 393 1,636 — 2,029 279 6/25/2014 2014

Irvington, AL (h) 217 814 — 1,031 157 12/27/2013 2013

Jay, FL (h) 190 1,002 — 1,192 195 2/25/2014 2013

Jonesboro, GA (h) 297 1,098 — 1,395 202 2/14/2014 2013

Kissimmee, FL (h) 622 1,226 — 1,848 211 8/27/2014 2014

LaBelle, FL (h) 268 1,037 — 1,305 199 2/28/2014 2014

Lake Elsinor, CA (h) 417 1,682 — 2,099 298 3/3/2014 2013

Lakeland, FL (h) 353 937 — 1,290 167 6/30/2014 2014

Lewiston, ME — 271 1,157 — 1,428 2 12/21/2020 2014

Little Rock, CA (h) 499 1,730 — 2,229 267 2/19/2015 2014

Melbourne, FL (h) 362 883 — 1,245 162 2/28/2014 2014

Morgan, UT — 235 1,068 — 1,303 2 12/21/2020 2013

New Roads, LA — 190 674 — 864 1 12/21/2020 2015

Oshkosh, WI (h) 361 815 — 1,176 151 2/25/2014 2013

Palmdale, CA (h) 372 1,822 — 2,194 275 3/30/2015 2014

Pensacola, FL (h) 509 791 — 1,300 147 3/27/2014 2014

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried

At December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Family Dollar (continued):

Kissimmee, FL

Lake Elsinor, CA

Little Rock, CA

Melbourne, FL

Pensacola, FL

Pine Lake, GA

Riverside, CA

San Jacinto, CA

Statesboro, GA

Terra Bella, CA

Tuscaloosa, AL

Pine Lake, GA (h) $ 639 $ 897 $ — $ 1,536 $ 157 8/26/2014 2014

Riverside, CA (h) 736 1,558 — 2,294 273 4/4/2014 2014

Roswell, NM $ — 199 921 — 1,120 2 12/21/2020 2014

Salina, UT — 211 1,262 — 1,473 2 12/21/2020 2014

San Antonio, TX — 409 914 — 1,323 1 12/21/2020 2014

San Antonio, TX — 347 1,148 — 1,495 2 12/21/2020 1995

San Jacinto, CA (h) 430 1,682 — 2,112 283 7/18/2014 2014

Statesboro, GA (h) 347 800 — 1,147 150 2/14/2014 2013

Stockton, CA (h) 202 1,817 — 2,019 297 9/19/2014 2014

Taft, CA (h) 255 1,422 — 1,677 275 8/23/2013 2013

Talladega, AL — 222 951 — 1,173 2 12/21/2020 2014

Tampa (Cragmont), FL (h) 563 737 — 1,300 141 12/18/2013 2013

Tampa (Forest), FL (h) 482 920 — 1,402 173 12/18/2013 2013

Tenn Colony, TX — 150 834 — 984 1 12/21/2020 2014

Terra Bella, CA (h) 332 1,394 — 1,726 251 2/19/2014 2013

Tuscaloosa, AL (h) 534 817 — 1,351 157 12/27/2013 2013

Valley, AL — 180 983 — 1,163 2 12/21/2020 2014

Walthourville, GA — 290 1,058 — 1,348 2 12/21/2020 1995

Warrenville, SC — 207 986 — 1,193 2 12/21/2020 2013

Flower Foods:

Orlando, FL (h) 418 387 — 805 65 9/11/2014 2013

Waldorf, MD (h) 398 1,045 — 1,443 194 9/11/2014 2013

Atwater, CA (h) 1,383 5,271 — 6,654 1,068 11/27/2013 2002

Fountain Square:

Brookfield, WI

Brookfield, WI (h) 6,508 28,634 25 35,167 3,689 1/17/2017 2006

Fourth Creek Landing:

Statesville, NC

Statesville, NC (h) 1,375 7,795 — 9,170 2,076 3/26/2013 2012

Fresenius Medical Care:

West Plains, MI

West Plains, MO (h) 557 3,097 — 3,654 520 7/2/2014 2014

Fresh Market Center:

Glen Ellyn, IL 4,750 2,767 6,403 ( 3,494 ) 5,676 153 9/30/2014 2014

Indianapolis, IN

Northville, MI

Indianapolis, IN (h) 1,087 6,019 — 7,106 1,089 10/31/2014 2014

Lafayette, IN — 1,173 6,316 — 7,489 7 12/21/2020 2006

Northville, MI (h) 1,598 7,796 — 9,394 1,094 12/21/2015 2015

Ypsilanti, MI — 3,168 5,719 — 8,887 7 12/21/2020 2017

Fresh Thyme & DSW:

Fort Wayne, IN

Seven Fields, PA

Fort Wayne, IN (h) 1,740 4,153 612 6,505 836 9/30/2014 1985

Seven Fields, PA (h) 1,574 13,659 — 15,233 2,345 5/7/2014 2005

Harbor Town Center:

1 unchanged sentence

Haverty Furniture:

Waxahachie, TX

Midland, TX (h) 709 1,294 — 2,003 384 8/7/2013 2012

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried

At December 31, 2019

Description (a)

Hickory Flat Commons:

Lewisville, TX

North Canton, OH

Plainwell, MI

Inglewood Plaza:

Inglewood, CA

Plainfield, IL

Chartlottesville, VA

Whitehall, OH

Bloomfield Township, MI

New Lenox, IL

Riverside, CA

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Waxahachie, TX $ 7,000 $ 3,465 $ 7,952 $ 273 $ 11,690 $ 1,817 6/27/2012 1997

Lewisville, TX (h) 2,184 8,977 — 11,161 1,758 11/26/2013 2013

Lincoln, NE (h) 6,339 5,937 — 12,276 832 10/22/2015 1993

North Canton, OH (h) 2,203 12,012 360 14,575 2,621 12/20/2012 1998

Houma Crossing:

Houma, LA 12,264 1,076 20,028 — 21,104 28 12/21/2020 2008

Omaha, NE — 1,842 7,909 — 9,751 11 12/21/2020 2016

Plainfield, IL (h) — — 11,151 11,151 578 11/14/2018 2001

Dothan, AL (h) 486 946 — 1,432 211 8/5/2014 2014

Chartlottesville, VA (h) 3,929 12,280 — 16,209 2,057 7/28/2014 2011

Eagan, MN — 3,581 3,751 — 7,332 6 12/21/2020 1996

Easton, MD (h) 2,962 2,661 — 5,623 335 12/2/2015 1992

Bay City, MI — 718 5,058 — 5,776 8 12/21/2020 1994

Shelton, WA (h) 1,180 11,040 — 12,220 2,150 4/30/2014 1994

Whitehall, OH (h) 581 6,628 224 7,433 1,363 12/16/2013 1994

Conway, AR (h) 510 2,577 — 3,087 428 6/13/2014 2014

Bloomfield Township, MI (h) 2,287 10,075 — 12,362 2,141 6/21/2013 2008

Columbus, OH (h) 1,013 6,734 — 7,747 1,059 4/29/2015 2014

Garland, TX (h) 2,005 6,861 41 8,907 1,267 12/20/2013 2013

Houston, TX (h) 5,764 5,994 — 11,758 1,161 9/30/2013 2013

New Lenox, IL (h) 1,965 6,257 — 8,222 823 12/21/2015 2015

Riverside, CA (h) 2,557 9,951 — 12,508 1,976 8/2/2013 2010

Lafayette Pavilions:

Lafayette, IN

Logan’s Roadhouse:

Lancaster, TX

Lafayette, IN (h) 7,632 42,497 ( 3,245 ) 46,884 1,067 2/6/2015 2006

Lawton Marketplace:

Lawton, OK 19,247 3,598 25,228 3 28,829 43 12/21/2020 2001

Lord Salisbury Center:

Salisbury, MD

Alpharetta, GA

Cincinnati, OH

Covington, LA

Mansfield, OH

Salisbury, MD (h) 6,949 12,179 ( 2,319 ) 16,809 370 3/11/2016 2005

Adrian, MI (h) 2,604 5,036 30 7,670 1,274 9/27/2013 1996

Alpharetta, GA (h) 7,979 9,630 403 18,012 1,588 5/29/2015 1998

Asheboro, NC (h) 1,098 6,722 — 7,820 1,187 6/23/2014 1994

Cincinnati, OH (h) 14,092 — — 14,092 — 2/10/2014 2001

Columbia, SC (h) 3,943 6,353 750 11,046 1,467 9/12/2013 1994

Covington, LA (h) 10,233 — — 10,233 — 8/20/2014 2002

Hermitage, PA — 2,279 12,580 — 14,859 16 12/21/2020 2016

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried At

December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Lowe’s (continued):

Tuscaloosa, AL

Woodstock, GA

Zanesville, OH

Market Heights Shopping Center:

Harker Heights, TX

Marketplace at the Lakes:

West Covina, CA

Lilburn, GA (h) $ 8,817 $ 9,380 $ 385 $ 18,582 $ 1,539 5/29/2015 1999

Mansfield, OH (h) 873 8,256 26 9,155 1,492 6/12/2014 1992

Marietta, GA (h) 7,471 8,404 392 16,267 1,400 5/29/2015 1997

Oxford, AL (h) 1,668 7,622 369 9,659 1,804 6/28/2013 1999

Tuscaloosa, AL (h) 4,908 4,786 9 9,703 986 10/29/2013 1993

Woodstock, GA (h) 7,316 8,879 392 16,587 1,476 5/29/2015 1997

Zanesville, OH (h) 2,161 8,375 297 10,833 1,626 12/11/2013 1995

Mattress Firm:

Ashtabula, OH

Ashtabula, OH (h) 301 1,965 ( 453 ) 1,813 36 3/23/2016 2015

Draper, UT $ — 860 1,419 — 2,279 2 12/21/2020 2014

Lake City, FL — 517 1,241 — 1,758 2 12/21/2020 2004

Mattress Firm & Aspen Dental:

Vienna, WV — 774 2,466 — 3,240 521 9/15/2014 2014

Mattress Firm & Five Guys:

Muskegon, MI (h) 813 1,766 ( 314 ) 2,265 33 8/29/2014 2014

McAlister's Deli:

Lawton, OK (h) 805 1,057 — 1,862 194 5/1/2014 2013

McGowin Park:

Mobile, AL 42,765 2,243 69,357 — 71,600 8,187 4/26/2017 2016

Melody Mountain:

Ashland, KY 5,940 1,286 9,879 ( 1,874 ) 9,291 231 9/1/2015 2013

Merchants Tire & Auto:

Wake Forest, NC

Wake Forest, NC (h) 782 1,730 — 2,512 241 9/1/2015 2005

Mister Car Wash:

Hartselle, AL

Athens, AL (h) 383 1,150 — 1,533 109 9/12/2017 2008

Decatur, AL (h) 257 559 — 816 57 9/12/2017 2005

Decatur, AL (h) 486 1,253 — 1,739 136 9/12/2017 2014

Decatur, AL (h) 359 1,152 — 1,511 124 9/12/2017 2007

Hartselle, AL (h) 360 569 — 929 60 9/12/2017 2007

Madison, AL (h) 562 1,139 — 1,701 126 9/12/2017 2012

Morganton Heights:

1 unchanged sentence

National Tire & Battery:

Cedar Hill, TX

Flower Mound, TX

Fort Worth, TX

Montgomery, IL

North Richland Hills, TX

Cedar Hill, TX (h) 469 1,951 — 2,420 402 12/18/2012 2006

Cypress, TX (h) 910 2,224 — 3,134 332 9/1/2015 2005

Flower Mound, TX (h) 779 2,449 — 3,228 351 9/1/2015 2005

Fort Worth, TX (h) 936 1,234 — 2,170 242 8/23/2013 2005

Fort Worth, TX (h) 730 2,309 — 3,039 331 9/1/2015 2005

Frisco, TX (h) 844 1,608 — 2,452 313 8/23/2013 2007

Montgomery, IL (h) 516 2,494 — 3,010 517 1/15/2013 2007

North Richland Hills, TX (h) 513 2,579 — 3,092 380 9/1/2015 2005

Pasadena, TX (h) 908 2,307 — 3,215 344 9/1/2015 2005

Pearland, TX (h) 1,016 2,040 — 3,056 298 9/1/2015 2005

Plano, TX (h) 1,292 2,197 — 3,489 320 9/1/2015 2005

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried At

December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

National Tire & Battery (continued):

Tomball, TX (h) $ 838 $ 2,229 $ — $ 3,067 $ 322 9/1/2015 2005

Natural Grocers:

Idaho Falls, ID

Idaho Falls, ID (h) 833 2,316 — 3,149 422 2/14/2014 2013

Waupaca, WI $ — 1,286 3,727 — 5,013 5 12/21/2020 2017

Nordstrom Rack:

North Logan Commons:

Loganville, GA

O’Reilly Auto Parts:

Owensboro Towne Center:

Tampa, FL 6,880 3,371 6,402 1,583 11,356 1,748 4/16/2012 2010

O'Reilly Automotive:

Bennettsville, SC — 361 1,207 — 1,568 2 12/21/2020 2015

Calyton, GA (h) 501 945 — 1,446 121 1/29/2016 2015

Flowood, MS — 506 1,288 — 1,794 2 12/21/2020 2014

Iron Mountain, MI — 249 1,400 — 1,649 2 12/21/2020 2014

Owenboro Towne Center:

Owensboro, KY 14,160 3,807 16,259 862 20,928 2,474 1/12/2016 1996

Enterprise, AL

Parkway Centre South:

1 unchanged sentence

Pecanland Plaza:

Wilkesboro, NC

Monroe, LA (h) 2,206 18,957 ( 3,265 ) 17,898 334 10/13/2015 2008

Wilkesboro, NC (h) 447 1,710 — 2,157 402 4/13/2012 2011

Petsmart/Old Navy:

1 unchanged sentence

Pick 'N Save:

Sheboygan, WI

South Milwaukee, WI

Plainfield Plaza:

Plainfield, IL

Heber City, UT — 1,160 9,111 — 10,271 12 12/21/2020 2016

Pewaukee, WI (h) 1,323 6,761 257 8,341 1,311 8/13/2014 1999

Sheboygan, WI (h) 2,003 10,695 — 12,698 2,341 9/6/2012 2012

South Milwaukee, WI (h) 1,126 5,706 — 6,832 1,056 11/6/2013 2005

Waterford, WI — 731 4,078 — 4,809 5 12/21/2020 2017

Plainfield Marketplace:

Plainfield, IL (h) 3,167 14,788 ( 3,827 ) 14,128 — 12/3/2015 2002

Plaza San Mateo:

Albuquerque, NM — 2,867 11,582 ( 4,011 ) 10,438 311 5/2/2014 2014

Independence, MO

Independence, MO (h) 333 680 — 1,013 115 6/27/2014 2005

Poplar Springs Plaza:

Duncan, SC 5,000 1,862 5,277 517 7,656 1,270 5/24/2013 1995

Raising Cane's:

Murphy, TX — 495 2,854 — 3,349 3 12/21/2020 1994

Reno, NV — 1,841 2,259 — 4,100 3 12/21/2020 2014

Rolling Acres Plaza:

Lady Lake, FL 21,930 7,540 26,839 ( 4,093 ) 30,286 1,302 9/1/2016 2005

Fort Worth, TX

Rushmore Crossing:

Rapid City, SD 22,046 7,066 33,019 ( 12,059 ) 28,026 569 1/2/2014 2012

Rapid City, SD

Sherwin-Williams:

Rapid City, SD (h) 883 4,128 ( 1,348 ) 3,663 87 1/2/2014 2012

Juneau, AK — 6,174 8,792 — 14,966 11 12/21/2020 2017

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried At

December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Sherwin Williams:

Macon, GA (h) $ 59 $ 659 $ — $ 718 $ 98 4/16/2015 2015

Shippensburg Market Place:

Shippensburg, PA

Shippensburg, PA (h) 1,917 9,263 ( 3,530 ) 7,650 185 9/18/2014 2002

Shoe Carnival & Buffalo Wild Wings:

Salina, KS $ — 991 1,909 — 2,900 3 12/21/2020 2014

Shoppes at Stroud:

Stroud Township, PA

Stroud Township, PA (h) 3,754 22,614 ( 2,220 ) 24,148 1,226 10/29/2014 2007

Shoppes of Gary Farms:

Bowling Green, KY — 3,529 14,197 — 17,726 20 12/21/2020 2005

Shops at Abilene:

Abilene, TX 14,989 5,142 19,684 — 24,826 30 12/21/2020 2014

Milford, OH — 4,137 23,153 — 27,290 42 12/21/2020 1991

Southwest Plaza:

Springfield, IL

Simpsonville, SC

Springfield, IL (h) 2,992 48,935 ( 23,580 ) 28,347 1,360 9/18/2014 2003

Simpsonville, SC (h) 591 969 — 1,560 194 1/24/2013 2012

Springfield Commons:

Springfield, OH 11,250 3,745 15,049 ( 4,182 ) 14,612 168 5/5/2015 1995

Bixby, OK (h) 1,320 7,117 — 8,437 1,367 7/26/2013 2013

Lawrence, KS — 762 8,111 — 8,873 10 12/21/2020 2001

Greenfield, WI — 1,783 7,643 — 9,426 9 12/21/2020 1991

Stoneridge Village:

Jefferson City, MO 6,500 1,830 9,351 1 11,182 1,886 6/30/2014 2012

North Kingstown, RI — 639 2,057 — 2,696 2 12/21/2020 1979

Summerfield Crossing:

1 unchanged sentence

Sunbelt Rentals:

Palm Beach Gardens, FL

Palm City, FL

Palm Springs, FL

Sebastian, FL

Titusville, FL

Canton, OH (h) 147 1,679 138 1,964 415 10/24/2013 2013

Palm Beach Gardens, FL (h) 1,050 2,667 — 3,717 515 4/12/2013 2009

Palm City, FL (h) 667 1,698 — 2,365 329 4/12/2013 2011

Palm Springs, FL (h) 580 1,907 — 2,487 369 4/12/2013 2011

Sebastian, FL (h) 490 2,128 — 2,618 412 4/12/2013 2009

Titusville, FL (h) 626 2,534 — 3,160 490 4/12/2013 2009

Sutters Creek:

Rocky Mount, NC

Rocky Mount, NC (h) 1,458 2,616 283 4,357 607 1/31/2014 2012

Andrews, TX — 230 862 — 1,092 1 12/21/2020 1994

Bedford, TX — 283 837 — 1,120 1 12/21/2020 2009

Burleson, TX — 471 936 — 1,407 1 12/21/2020 1994

CIM REAL ESTATE FINANCE TRUST, INC.

SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued)

(in thousands)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Take 5 (continued):

Burleson, TX $ — $ 201 $ 837 $ — $ 1,038 $ 1 12/21/2020 2010

Burleson, TX — 394 407 — 801 1 12/21/2020 2003

Cedar Hill, TX — 250 705 — 955 1 12/21/2020 1985

Hereford, TX — 50 995 — 1,045 1 12/21/2020 1993

Irving, TX — 120 445 — 565 1 12/21/2020 1989

Irving, TX — 210 818 — 1,028 1 12/21/2020 1987

Lubbock, TX — 151 1,428 — 1,579 2 12/21/2020 2002

Midland, TX — 192 1,861 — 2,053 2 12/21/2020 1995

Mineral Wells, TX — 131 1,263 — 1,394 1 12/21/2020 2019

Target Center:

Columbia, SC (h) 3,234 7,297 ( 651 ) 9,880 394 3/31/2014 2012

Terrell Mill Village:

Marieta, GA (h) 3,079 11,185 14 14,278 2,205 1/31/2014 2012

TGI Friday's:

Chesapeake, VA

Wilmington, DE

Cheseapeake, VA (h) 1,217 1,388 — 2,605 242 6/27/2014 2003

Wilmington, DE (h) 1,685 969 — 2,654 172 6/27/2014 1991

The Center at Hobbs Brook:

1 unchanged sentence

The Market at Clifty Crossing:

Columbus, IN (h) 2,669 16,308 113 19,090 4,509 10/31/2014 1989

The Market at Polaris:

Columbus, OH (h) 11,828 41,702 ( 36,715 ) 16,815 284 12/6/2013 2005

Williamsburg, VA 8,556 2,615 11,406 — 14,021 2,609 9/21/2012 2007

San Jose, CA 123,000 67,596 108,203 583 176,382 24,218 4/15/2013 2008

The Ridge at Turtle Creek:

Hattiesburg, MS 9,900 2,749 12,434 ( 3,482 ) 11,701 267 2/27/2015 2011

CIM REAL ESTATE FINANCE TRUST, INC.

SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION – (Continued)

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried At

December 31, 2019

Description (a)

Tire Kingdom (continued):

Summerville, SC

Tarpon Springs, FL

Tire Kingdom:

Bluffton, SC (h) 645 1,688 — 2,333 235 9/1/2015 2005

Summerville, SC (h) 1,208 1,233 — 2,441 178 9/1/2015 2005

Tire Kingdom & Starbucks:

1 unchanged sentence

Tractor Supply:

Cambridge, MN

Canon City, CO

Lumberton, NC

Monticello, FL

South Hill, VA

Weaverville, NC

Ashland, VA (h) 500 2,696 — 3,196 510 11/22/2013 2013

Augusta, KS (h) 407 2,315 — 2,722 430 1/10/2014 2013

Blytheville, AR — 780 2,660 — 3,440 4 12/21/2020 2002

Cambridge, MN (h) 807 1,272 28 2,107 339 5/14/2012 2012

Canon City, CO (h) 597 2,527 — 3,124 513 11/30/2012 2012

Carlyle, IL — 707 2,386 — 3,093 4 12/21/2020 2015

Fortuna, CA (h) 568 3,819 — 4,387 675 6/27/2014 2014

Logan, WV — 597 3,232 — 3,829 4 12/21/2020 2006

Lumberton, NC (h) 611 2,007 — 2,618 438 5/24/2013 2013

Marion, IN (h) 1,536 1,099 — 2,635 216 2/19/2014 2004

Midland, NC — 865 2,182 — 3,047 3 12/21/2020 2013

CIM REAL ESTATE FINANCE TRUST, INC.

SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued)

(in thousands)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Tractor Supply (continued):

Monticello, FL (h) $ 448 $ 1,916 $ — $ 2,364 $ 415 6/20/2013 2013

Shelbyville, IL $ — 586 2,576 — 3,162 4 12/21/2020 2017

South Hill, VA (h) 630 2,179 — 2,809 445 6/24/2013 2011

Weaverville, NC (h) 867 3,138 — 4,005 624 9/13/2013 2006

Woodward, OK (h) 446 1,973 — 2,419 402 11/19/2013 2013

Trader Joe's:

Asheville, NC

Wilmington, NC

Asheville, NC (h) 2,770 3,766 — 6,536 744 10/22/2013 2013

Columbia, SC (h) 2,308 2,597 — 4,905 594 3/28/2013 2012

Wilmington, NC (h) 2,016 2,519 — 4,535 630 6/27/2013 2012

Turfway Crossing:

Bellflower, CA

Escondido, CA

Inglewood, CA

Florence, KY 8,280 2,261 10,323 418 13,002 2,180 5/27/2014 2002

Albany, GA (h) 441 1,757 — 2,198 313 5/8/2014 2013

Greeley, CO (h) 596 2,035 — 2,631 315 3/31/2015 2014

Bellflower, CA (h) 1,246 788 — 2,034 125 9/30/2014 2001

Brea, CA (h) 2,393 658 — 3,051 104 9/30/2014 1984

Carson, CA — 2,354 4,821 — 7,175 6 12/21/2020 1958

El Cajon, CA (h) 1,533 568 — 2,101 90 9/30/2014 2008

El Cajon, CA (h) 1,225 368 — 1,593 58 9/30/2014 2000

El Monte, CA (h) 766 510 — 1,276 80 9/30/2014 1994

Escondido, CA (h) 3,514 1,062 — 4,576 168 9/30/2014 2002

Fallbrook, CA — 1,266 3,458 — 4,724 4 12/21/2020 1958

Glendale, CA (h) 4,871 795 — 5,666 126 9/30/2014 1999

Harbor City, CA — 1,359 3,047 — 4,406 3 12/21/2020 2014

Hawthorne, CA — 896 1,764 — 2,660 2 12/21/2020 2001

Inglewood, CA (h) 1,809 878 — 2,687 139 9/30/2014 1997

La Habra, CA (h) 1,971 571 — 2,542 90 9/30/2014 2000

Lakewood, CA — 2,499 2,400 — 4,899 3 12/21/2020 1973

Lawndale, CA (h) 1,462 862 — 2,324 136 9/30/2014 2001

Long Beach, CA — 1,088 2,582 — 3,670 3 12/21/2020 1990

Los Angeles, CA

Long Beach, CA (h) 2,778 883 — 3,661 140 9/30/2014 1972

Los Angeles, CA (h) 2,334 717 — 3,051 113 9/30/2014 2002

Los Angeles, CA (h) 3,552 1,242 — 4,794 196 9/30/2014 2002

Los Angeles, CA (h) 2,745 669 — 3,414 106 9/30/2014 1998

Los Angeles, CA (h) 3,930 428 — 4,358 68 9/30/2014 2005

Los Angeles, CA (h) 1,927 1,484 — 3,411 235 9/30/2014 2007

Los Angeles, CA (h) 2,182 701 — 2,883 111 9/30/2014 1964

Los Angeles, CA — 2,435 2,614 — 5,049 3 12/21/2020 1982

Los Angeles, CA — 2,016 3,486 — 5,502 4 12/21/2020 1965

Madera, CA (h) 1,500 3,804 — 5,304 265 9/27/2019 2018

Norco, CA (h) 1,852 1,489 — 3,341 235 9/30/2014 1995

Poway, CA (h) 3,072 705 — 3,777 111 9/30/2014 1960

San Clemente, CA — 2,036 3,561 — 5,597 4 12/21/2020 1973

San Diego, CA — 1,362 1,662 — 3,024 2 12/21/2020 1959

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried At

December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

United Oil (continued):

1 unchanged sentence

San Diego, CA — 2,409 4,105 — 6,514 5 12/21/2020 1976

San Diego, CA

Santa Clarita, CA

San Diego, CA (h) 2,977 1,448 — 4,425 229 9/30/2014 1984

San Diego, CA (h) 1,877 883 — 2,760 139 9/30/2014 2006

San Diego, CA (h) 1,824 382 — 2,206 61 9/30/2014 2006

Santa Ana, CA — 1,629 1,767 — 3,396 2 12/21/2020 2000

Santa Clarita, CA (h) 4,787 733 — 5,520 116 9/30/2014 2001

Sun City, CA (h) 1,136 1,421 — 2,557 224 9/30/2014 1984

Vista, CA (h) 2,063 334 — 2,397 53 9/30/2014 1986

Vista (Vista), CA (h) 2,028 418 — 2,446 66 9/30/2014 2010

Whittier, CA (h) 1,629 985 — 2,614 156 9/30/2014 1997

University Marketplace:

Marion, IN (h) 850 6,722 121 7,693 1,831 3/22/2013 2012

Urban Air Adventure Park:

Broken Bow, NE

Georgetown, KY

Greenville, SC

Valentine, NE

Waukesha, WI (h) 3,408 12,918 666 16,992 2,057 9/29/2014 2007

Appleton, WI (h) 895 1,026 ( 1,194 ) 727 9 11/18/2015 2015

Cherokee, IA (h) 217 3,326 ( 2,654 ) 889 11 12/23/2015 2015

Cokato, MN (h) 358 3,229 ( 2,280 ) 1,307 8 12/23/2015 2015

Danville, VA (h) 274 1,514 ( 1,062 ) 726 36 4/29/2014 2014

Dickson City, PA — 1,113 7,946 ( 7,817 ) 1,242 221 6/30/2014 2013

Eldersburg, MD (h) 557 876 — 1,433 102 4/28/2017 2000

Lancaster, TX (h) 1,203 1,620 — 2,823 361 10/23/2012 2011

Nampa, ID (h) 449 2,213 ( 1,482 ) 1,180 36 3/31/2014 1972

Raleigh, NC — 329 556 — 885 1 12/21/2020 2014

Sanford, FL (h) 1,031 1,807 ( 1,861 ) 977 14 10/23/2012 1999

Troy, OH (h) 992 1,577 ( 1,383 ) 1,186 88 10/23/2012 2011

Valentine, NE (h) 395 3,549 ( 2,403 ) 1,541 57 6/30/2014 2014

Walker, LA (h) 900 3,909 — 4,809 657 6/27/2014 1999

Ventura Place:

Albuquerque, NM

Village at Hereford Farms:

Grovetown, GA

Albuquerque, NM (h) 5,203 7,998 ( 5,050 ) 8,151 196 4/29/2015 2008

Vitamin Shoppe:

Taylor, MI — 631 767 — 1,398 1 12/21/2020 1995

Anderson, SC (h) 2,424 9,719 — 12,143 1,251 11/5/2015 2015

Florence, SC (h) 2,013 9,225 — 11,238 1,182 11/5/2015 2015

Perry, GA (h) 2,270 11,053 — 13,323 2,364 6/4/2013 1999

Summerville, SC 4,300 2,410 2,098 — 4,508 309 9/18/2015 2015

Tallahassee, FL

Austintown, OH

Connelly Springs, NC

Dearborn Heights, MI

East Chicago, IN

Fort Madison, IA

Tallahassee, FL (h) 14,823 — — 14,823 — 12/11/2012 2008

York, SC (h) 1,913 11,410 — 13,323 2,425 6/4/2013 1998

Austintown, OH (h) 637 4,173 — 4,810 779 8/19/2013 2002

Baton Rouge, LA — 1,015 4,671 — 5,686 6 12/21/2020 2006

Chicopee, MA (h) 2,094 4,945 — 7,039 772 10/23/2014 2008

Clinton, MI 4,209 1,977 4,232 — 6,209 5 12/21/2020 1997

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands)

Initial Costs to Company

Gross Amount at

Which Carried At

December 31, 2019

Description (a)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Walgreens (continued):

Connelly Springs, NC (h) $ 1,349 $ 3,628 $ — $ 4,977 $ 694 8/27/2013 2012

Danville, VA (h) 989 4,547 — 5,536 979 12/24/2012 2012

Dearborn Heights, MI (h) 2,236 3,411 — 5,647 657 7/9/2013 2008

East Chicago, IN (h) 331 5,242 — 5,573 839 8/8/2014 2005

Fort Madison, IA (h) 514 3,723 — 4,237 700 9/20/2013 2008

Greenville, OH $ — 542 4,063 — 4,605 5 12/21/2020 2014

Harrison, AR 4,750 1,237 5,424 — 6,661 6 12/21/2020 2007

Hickory, NC (h) 1,100 4,241 — 5,341 867 2/28/2013 2009

Huntsville, AL 3,273 1,931 2,457 97 4,485 533 3/15/2013 2001

Kannapolis, NC

Las Vegas, NV

Little Rock, AR

Metropolis, IL

Pine Bluff, AR

Sacramento, CA

Springfield, IL

Indianapolis, IN 4,602 1,212 5,484 — 6,696 6 12/21/2020 1996

Kannapolis, NC (h) 1,480 5,031 — 6,511 976 6/12/2013 2012

Kilgore, TX — 821 5,601 — 6,422 6 12/21/2020 2007

Kokomo, IN — — — — — — 12/21/2020 2014

Las Vegas, NV (h) 2,325 3,262 70 5,657 622 9/26/2013 1999

Lawton, OK (h) 860 2,539 106 3,505 494 7/3/2013 1998

Lees Summit, MO 4,184 1,205 4,884 — 6,089 6 12/21/2020 2014

Little Rock, AR (h) 548 4,676 — 5,224 768 6/30/2014 2011

Lubbock, TX (h) 565 3,257 103 3,925 689 10/11/2012 2000

Lubbock, TX (h) 531 2,951 102 3,584 620 10/11/2012 1998

Metropolis, IL (h) 284 4,991 — 5,275 798 8/8/2014 2009

Mobile, AL (h) 1,603 3,161 — 4,764 591 11/7/2013 2013

Pine Bluff, AR (h) 248 5,229 — 5,477 982 9/17/2013 2012

Richmond, IN — 965 4,685 — 5,650 5 12/21/2020 2006

Sacramento, CA (h) 324 2,669 — 2,993 458 6/30/2014 2008

San Antonio, TX — 1,417 7,932 — 9,349 9 12/21/2020 2005

Siloam Springs, AR 3,839 936 4,367 — 5,303 5 12/21/2020 1999

Slidell, LA 3,027 757 3,557 — 4,314 4 12/21/2020 2000

Springfield, IL (h) 830 3,619 — 4,449 803 5/14/2012 2007

Suffolk, VA (h) 1,261 3,461 — 4,722 807 5/14/2012 2007

Sun City, AZ (h) 837 2,484 245 3,566 455 5/6/2014 2000

Tarboro, NC (h) 755 3,634 — 4,389 594 8/22/2014 2014

Whiteville, NC — 829 4,090 — 4,919 5 12/21/2020 2007

Walgreens/KeyBank:

Newburgh, NY 5,000 3,280 5,441 — 8,721 992 9/16/2013 2010

Wallace Commons:

1 unchanged sentence

Wallace Commons II:

Salisbury, NC

Warrenton Highlands:

Warrenton, OR

Salisbury, NC (h) 2,231 8,479 — 10,710 1,639 2/28/2014 2013

Waterford South Park:

Clarksville, IN 7,200 2,946 8,564 45 11,555 2,075 4/12/2013 2006

Westminster, CO

Panama City, FL

Pensacola, FL

Grafton, VA (h) 539 894 — 1,433 153 6/27/2014 1985

Westminster, CO (h) 596 1,108 — 1,704 189 6/27/2014 1986

Western Crossing:

Jacksonville, NC — 3,382 7,775 — 11,157 12 12/21/2020 1995

CIM REAL ESTATE FINANCE TRUST, INC.

SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued)

(in thousands)

Initial Costs to Company Gross Amount at

Buildings, Total Which Carried Accumulated

Fixtures and Adjustment At December 31, 2020 Depreciation Date Date

Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed

Chicago, IL $ — $ 4,442 $ 8,698 $ — $ 13,140 $ 10 12/21/2020 2005

Panama City, FL (h) 676 2,219 — 2,895 399 4/24/2015 2014

Pensacola, FL (h) 1,107 3,398 — 4,505 595 2/27/2015 2015

Westover Market:

San Antonio, TX

San Antonio, TX (h) 2,705 7,959 ( 6,264 ) 4,400 159 7/10/2013 2013

Amite, LA — 1,479 1,691 — 3,170 4 12/21/2020 2000

$ 578,096 $ 901,859 $ 2,533,704 $ ( 63,637 ) $ 3,371,926 $ 298,364

(a) As of December 31, 2019 , the Company owned 334 retail properties, 59 anchored shopping centers and three industrial and distribution properties.

____________________________________

(a) Initial costs exclude subsequent impairment charges.

(b) Consists of capital expenditures and real estate development costs, and impairment charges.

CIM REAL ESTATE FINANCE TRUST, INC.

SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION – (Continued)

(in thousands)

(d) The following is a reconciliation of total real estate carrying value for the years ended December 31 (in thousands):

2020 2019 2018

Balance, beginning of period $ 2,530,311 $ 4,444,041 $ 4,564,592

Joint Venture Purchased

Adjustment to basis

Acquisitions 738,172 5,305 11,151

Improvements 192,591 13,832 6,135

Assets placed back into service 200,758 — —

Total additions $ 1,131,521 $ 19,137 $ 17,286

Cost of real estate sold 83,144 1,448,915 61,891

Adjustment to basis

Other (including provisions for impairment of real estate assets) 206,762 483,952 75,946

2 unchanged sentences

(e) Gross intangible lease assets of $ 389.6 million and the associated accumulated amortization of $ 155.0 million are not reflected in the table above.

CIM REAL ESTATE FINANCE TRUST, INC.

SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued)

(in thousands)

(f) The following is a reconciliation of accumulated depreciation for the years ended December 31 (in thousands):

2020 2019 2018

Balance, beginning of period $ 243,122 $ 385,245 $ 334,476

8 unchanged sentences

Generally, buildings are depreciated over 40 years, site improvements are amortized over 15 years and tenant improvements are amortized over the remaining life of the lease or the useful life, whichever is shorter.

(h) Property is included in the Credit Facility’s borrowing base.

As of December 31, 2019 , the Company had $885.0 million outstanding under the Credit Facility.

Asset held for sale or partially held for sale as of December 31, 2019.

(h) Includes 56 anchored shopping centers.

CIM REAL ESTATE FINANCE TRUST, INC.

2 unchanged sentences

Loans Subject

to Delinquent

Mezzanine Loans:

Astor — New York, New York

88 Lex — New York, New York

90 Lex — New York, New York

Metro — New York, New York

Astor — New York, New York

88 Lex — New York, New York

90 Lex — New York, New York

Metro — New York, New York

Senior Loans:

Lucero — Austin, Texas

Satellite Place — Duluth, Georgia

Yoo on the Park — Atlanta, Georgia

Final Periodic Face Carrying to Delinquent

Interest Maturity Payment Prior Amount of Amount of Principal or

Loan Type Description / Location Rate (a)

Date Terms (b)

Liens Mortgages Mortgages "Interest"

Mezzanine loan Condo / New York, New York L + 14.85 %

5/9/2021 P/I N/A $ 34,904 $ 35,888 $ —

Mezzanine loan Condo / New York, New York L + 14.85 %

5/9/2021 P/I N/A 22,480 23,218 —

Mezzanine loan Condo / New York, New York L + 14.85 %

5/9/2021 P/I N/A 13,906 14,350 —

Mezzanine loan Condo / New York, New York L + 14.85 %

5/9/2021 P/I N/A 9,131 9,624 —

Mezzanine loan Condo / New York, New York L + 8.00 %

5/9/2021 P/I N/A 22,104 22,373 —

Mezzanine loan Condo / New York, New York L + 8.00 %

5/9/2021 P/I N/A 16,681 16,880 —

Mezzanine loan Condo / New York, New York L + 8.00 %

5/9/2021 P/I N/A 10,034 10,153 —

Mezzanine loan Condo / New York, New York L + 8.00 %

5/9/2021 P/I N/A 7,549 7,639 —

Senior loan Office / Duluth, Georgia L + 3.15 %

2/1/2025 P/I N/A 46,935 46,486 —

Senior loan Multifamily / Atlanta, Georgia L + 2.75 %

1/9/2024 P/I N/A 69,500 69,238 —

Senior loan Office / Dallas, Texas L + 4.50 %

9/8/2023 P/I N/A 155,899 154,168 —

Senior loan Office / Orlando, Florida L + 4.00 %

10/9/2023 P/I N/A 72,315 71,653 —

Total loans $ 481,438 $ 481,670 $ —

Cure payments receivable (c)

Allowance for credit losses (b)

— ( 60,628 ) —

Total loans, net $ 481,438 $ 428,393 $ —

____________________________________

(a) L = one month LIBOR rate.

(b) P/I = principal and interest.

(c) Represents operating expenses related to the mezzanine loans paid by the Company on the borrower’s behalf in connection with the foreclosure proceedings that commenced during the year ended December 31, 2020.

(d) As of December 31, 2020, the Company’s allowance for credit losses related to its loans held-for-investment totaled $ 70.4 million, $ 60.6 million of which was related to the CRE loans.

The following table reconciles mortgage loans on real estate for the years ended December 31 (in thousands):

Year Ended December 31,

2020 2019 2018

Balance, beginning of period $ 298,880 $ 89,762 $ —

Additions during period:

New loans 231,212 217,014 89,295

Capitalized interest 539 8,546 384

6 unchanged sentences

Balance, end of period $ 481,670 $ 298,880 $ 89,762

Cure payments receivable 7,351 — —

Allowance for credit losses ( 60,628 ) — —

Net balance, end of period $ 428,393 $ 298,880 $ 89,762

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures