What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-11-14 compared with 2022-08-12 · 394 added, 366 removed, 1130 unchanged (40% of the section changed)

3 unchanged sentences

(in thousands, except share and per share amounts) (Unaudited)

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Real estate assets:

6 unchanged sentences

Total real estate assets, net 2,239,784 2,612,606

Investments in unconsolidated entities 96,161 109,547

Real estate-related securities ($ 274,382 and $ 41,981 held at fair value as of June 30, 2022 and December 31, 2021, respectively)

Investment in unconsolidated entities 132,375 109,547

Real estate-related securities ($ 470,121 and $ 41,981 held at fair value as of September 30, 2022 and December 31, 2021, respectively)

470,121 105,471

23 unchanged sentences

Common stock, $ 0.01 par value per share;

490,000,000 shares authorized, 437,311,071 and 437,373,981 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively

490,000,000 shares authorized, 437,262,738 and 437,373,981 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively

Capital in excess of par value 3,529,404 3,529,126

9 unchanged sentences

(in thousands, except share and per share amounts) (Unaudited)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

11 unchanged sentences

Real estate impairment 527 891 19,814 5,268

Increase in provision for credit losses 4,942 123 9,651 691

Increase (decrease) in provision for credit losses 5,664 ( 1,792 ) 15,315 ( 1,101 )

Total operating expenses 49,151 57,949 178,735 192,069

Gain on disposition of real estate and condominium developments, net 4,454 34,033 118,135 80,502

Merger-related expenses, net — ( 398 ) — ( 398 )

Operating income 65,084 66,235 252,872 159,229

1 unchanged sentence

Gain on investment in unconsolidated entities 2,195 — 8,858 —

Unrealized loss on equity security ( 9,030 ) — ( 15,440 ) —

Interest expense and other, net ( 39,366 ) ( 20,381 ) ( 98,453 ) ( 56,863 )

2 unchanged sentences

Net income $ 15,539 $ 42,603 $ 128,253 $ 97,637

Net loss allocated to noncontrolling interest ( 72 ) — ( 63 ) —

Net income allocated to noncontrolling interest 129 — 66 —

Net income attributable to the Company $ 15,410 $ 42,603 $ 128,187 $ 97,637

7 unchanged sentences

(in thousands) (Unaudited)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

4 unchanged sentences

Unrealized gain (loss) on interest rate swaps 78 ( 84 ) 2,361 ( 13 )

Amount of loss reclassified from other comprehensive (loss) income into income as interest expense and other, net 69 71 62 3,203

Amount of (gain) loss reclassified from other comprehensive (loss) income into income as interest expense and other, net ( 2,613 ) ( 170 ) ( 2,551 ) 3,033

Total other comprehensive (loss) income ( 11,244 ) ( 1,067 ) ( 24,686 ) 3,611

Comprehensive income 4,295 41,536 103,567 101,248

Comprehensive loss attributable to noncontrolling interest ( 72 ) — ( 63 ) —

Comprehensive income attributable to noncontrolling interest 129 — 66 —

Comprehensive income attributable to the Company $ 4,166 $ 41,536 $ 103,501 $ 101,248

28 unchanged sentences

Balance as of June 30, 2022 437,311,071 $ 4,373 $ 3,529,285 $ ( 975,820 ) $ ( 10,493 ) $ 2,547,345 $ 980 $ 2,548,325

Issuance of common stock 1,326,177 13 9,535 — — 9,548 — 9,548

Equity-based compensation — — 120 — — 120 — 120

Distributions declared on common stock — $ 0.09 per common share

— — — ( 40,010 ) — ( 40,010 ) — ( 40,010 )

Redemptions of common stock ( 1,374,510 ) ( 13 ) ( 9,884 ) — — ( 9,897 ) — ( 9,897 )

Changes in redeemable common stock — — 348 — — 348 — 348

Distributions to non-controlling interests — — — — — — ( 1,117 ) ( 1,117 )

Comprehensive income (loss) — — — 15,410 ( 11,244 ) 4,166 129 4,295

Balance as of September 30, 2022 437,262,738 $ 4,373 $ 3,529,404 $ ( 1,000,420 ) $ ( 21,737 ) $ 2,511,620 $ ( 8 ) $ 2,511,612

CIM REAL ESTATE FINANCE TRUST, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands, except share amounts) (Unaudited) — Continued

Common Stock Capital in Excess

18 unchanged sentences

Balance as of June 30, 2021 362,923,841 $ 3,629 $ 2,990,971 $ ( 971,826 ) $ 2,631 $ 2,025,405 $ — $ 2,025,405

Issuance of common stock 1,334,145 13 9,591 — — 9,604 — 9,604

Equity-based compensation — — 62 — — 62 — 62

Distributions declared on common stock — $ 0.09 per common share

— — — ( 32,967 ) — ( 32,967 ) — ( 32,967 )

Redemptions of common stock ( 1,712,796 ) ( 17 ) ( 12,315 ) — — ( 12,332 ) — ( 12,332 )

Changes in redeemable common stock — — 2,999 — — 2,999 — 2,999

Comprehensive income (loss) — — — 42,603 ( 1,067 ) 41,536 — 41,536

Balance as of September 30, 2021 362,545,190 $ 3,625 $ 2,991,308 $ ( 962,190 ) $ 1,564 $ 2,034,307 $ — $ 2,034,307

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

2 unchanged sentences

(in thousands) (Unaudited)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from operating activities:

16 unchanged sentences

Amortization of fair value adjustment and gain on interest rate swaps ( 2,417 ) ( 2,887 )

Gain on interest rate caps ( 1,851 ) —

(Gain) loss on interest rate caps ( 4,252 ) 171

Impairment of real estate assets 19,814 5,268

Increase in provision for credit losses 9,651 691

Increase (decrease) in provision for credit losses 15,315 ( 1,101 )

Write-off of deferred financing costs 8,092 2,951

14 unchanged sentences

Investment in corporate senior loans ( 74,801 ) —

Origination and acquisition of loans held-for-investment, net ( 1,223,605 ) ( 533,222 )

Origination and acquisition of loans held-for-investment ( 1,310,406 ) ( 720,134 )

Origination and exit fees received on loans held-for-investment 13,977 7,320

10 unchanged sentences

(in thousands) (Unaudited) — Continued

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from financing activities:

24 unchanged sentences

Mortgage notes payable assumed by buyer in connection with disposition of real estate assets $ ( 356,477 ) $ ( 31,801 )

Equity security received in connection with disposition of real estate assets $ ( 53,388 ) $ —

Change in interest income capitalized to loans held-for-investment $ — $ ( 9,469 )

2 unchanged sentences

Change in fair value of real estate-related securities $ ( 24,497 ) $ 591

Conversion of preferred units to debt $ 68,242 $ —

Conversion of preferred units to loans held-for-investment $ 68,242 $ —

Supplemental Cash Flow Disclosures:

4 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited)

September 30, 2022 (Unaudited)

NOTE 1 — ORGANIZATION AND BUSINESS

2 unchanged sentences

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

The Company operates a diversified portfolio of core commercial real estate primarily consisting of net leased properties located throughout the United States and short duration senior secured loans and other credit investments.

As of June 30, 2022, the Company owned 402 properties, including two properties owned through a consolidated joint venture arrangement (the “Consolidated Joint Venture”), comprised of 12.1 million rentable square feet of commercial space located in 45 states.

As of June 30, 2022, the rentable square feet at these properties was 99.2 % leased, including month-to-month agreements, if any.

As of June 30, 2022, the Company’s loan portfolio consisted of 341 loans with a net book value of $ 3.9 billion, and investments in real estate-related securities of $ 274.4 million.

As of June 30, 2022, the Company owned condominium developments with a net book value of $ 152.5 million.

The Company operates a diversified portfolio of short duration senior secured loans, core commercial real estate primarily consisting of net leased properties located throughout the United States, and other credit investments.

As of September 30, 2022, the Company owned 384 properties, comprised of 11.0 million rentable square feet of commercial space located in 44 states.

As of September 30, 2022, the rentable square feet at these properties was 99.3 % leased, including month-to-month agreements, if any.

As of September 30, 2022, the Company’s loan portfolio consisted of 346 loans with a net book value of $ 4.0 billion, and investments in real estate-related securities of $ 470.1 million.

As of September 30, 2022, the Company owned condominium developments with a net book value of $ 153.6 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.

6 unchanged sentences

The Company relies upon CIM Capital IC Management, LLC, the Company’s investment advisor (the “Investment Advisor”), to provide substantially all of the Company’s day-to-day management with respect to investments in securities and certain other investments.

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 distribution reinvestment plan (“DRIP”) portion of the Offering.

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

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 “Initial Offering”).

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

At the completion of the Initial 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 Initial Offering and approximately 5.1 million shares of common stock issued pursuant to the distribution reinvestment plan (“DRIP”) portion of the Initial Offering.

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

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.

4 unchanged sentences

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”) pursuant to a Registration Statement on Form S-3 (Registration No.

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 Initial 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 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.

Distributions

The Company began to issue shares under the Secondary DRIP Offering on August 2, 2016 and continues 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 Initial Offering in meeting their customer account reporting obligations under Financial Industry Regulatory Authority Rule 2231.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

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

September 30, 2022 (Unaudited) – (Continued)

Distributions are reinvested in shares of the Company’s common stock for participants in 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 share redemption program.

As of June 30, 2022, the estimated per share NAV of the Company’s common stock was $ 7.20 , which was established by the Board on May 25, 2021 using a valuation date of March 31, 2021.

As of September 30, 2022, the estimated per share NAV of the Company’s common stock was $ 7.20 , which was established by the Board on May 25, 2021 using a valuation date of March 31, 2021.

Commencing on May 26, 2021, $ 7.20 served as the per share NAV under the DRIP.

10 unchanged sentences

The condensed consolidated financial statements should also be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in this Quarterly Report on Form 10-Q.

The condensed consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, and the Consolidated Joint Venture in which the Company has a controlling financial interest.

The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries.

All intercompany balances and transactions have been eliminated in consolidation.

2 unchanged sentences

The Company’s ability to correctly assess its influence or control over an entity affects the presentation of these credit and real estate investments on the Company’s condensed consolidated financial statements.

As of June 30, 2022, the Company has determined that the Consolidated Joint Venture is considered a VIE.

Applying the consolidation requirements for VIEs, the Company determined that it is the primary beneficiary based on its power to direct activities through its role as servicer and its obligations to absorb losses and right to receive benefits and therefore met the requirements for consolidation.

During the nine months ended September 30, 2022, the Company disposed of two properties previously owned through a consolidated joint venture arrangement (the “Consolidated Joint Venture”) and therefore determined it no longer had a controlling financial interest in the Consolidated Joint Venture as of September 30, 2022.

See Note 4 — Real Estate Assets for additional information.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

September 30, 2022 (Unaudited) – (Continued)

Reclassifications

1 unchanged sentence

Other than as shown below, these reclassifications had no effect on previously reported totals or subtotals.

The reclassifications have been made to the condensed consolidated balance sheet as of December 31, 2021, and to the condensed consolidated statement of cash flows for the six months ended June 30, 2021 as follows (in thousands):

The reclassifications have been made to the condensed consolidated balance sheet as of December 31, 2021, and to the condensed consolidated statement of cash flows for the nine months ended September 30, 2021 as follows (in thousands):

As of December 31, 2021

3 unchanged sentences

Prepaid expenses and other assets $ 13,759 $ 2,520 $ 16,279

Six Months Ended June 30, 2021

Nine Months Ended September 30, 2021

As previously reported Reclassifications As Revised

25 unchanged sentences

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

During the six months ended June 30, 2022, as part of the Company’s quarterly impairment review procedures, the Company recorded impairment charges of $ 11.3 million related to 18 properties, all of which was due to sales prices that were less than their respective carrying values.

Additionally, during the six months ended June 30, 2022, certain condominium units were deemed

During the nine months ended September 30, 2022, as part of the Company’s quarterly impairment review procedures, the Company recorded impairment charges of $ 11.9 million related to 19 properties, all of which was due to sales prices that were less than their respective carrying values.

Additionally, during the nine months ended September 30, 2022, certain condominium units

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

to be impaired and their carrying values were reduced to their estimated fair value, resulting in impairment charges of $ 7.9 million.

The Company’s impairment assessment as of June 30, 2022 was based on the most current information available to the Company, including expected holding periods.

September 30, 2022 (Unaudited) – (Continued)

were deemed to be impaired and their carrying values were reduced to their estimated fair value, resulting in impairment charges of $ 7.9 million.

The Company’s impairment assessment as of September 30, 2022 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 additional material impairment charges with respect to the Company’s real estate assets will not occur during 2022 or in future periods.

During the six months ended June 30, 2021, the Company recorded impairment charges of $ 4.4 million related to five properties, of which impairment at three properties was due to sales prices that were less than their respective carrying values and impairment at two properties was due to vacancy.

During the nine months ended September 30, 2021, the Company recorded impairment charges of $ 5.3 million related to 11 properties, of which impairment at seven properties was due to sales prices that were less than their respective carrying values and impairment at four properties was due to vacancy.

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.

3 unchanged sentences

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 June 30, 2022, the Company identified four properties with a carrying value of $ 76.6 million as held for sale, one of which is in connection with the Purchase and Sale Agreement (as defined in Note 4 — Real Estate Assets).

The Company had a mortgage note payable of $ 42.8 million that was related to the held for sale property in connection with the Purchase and Sale Agreement, which was assumed by the buyer in connection with the disposition of the underlying held for sale property.

The Company disposed of these properties subsequent to June 30, 2022, as further discussed in Note 17 — Subsequent Events.

As of December 31, 2021, in connection with the Purchase and Sale Agreement, the Company identified 81 properties with a carrying value of $ 1.3 billion as held for sale, of which the sale of 80 such properties closed during the six months ended June 30, 2022.

As of September 30, 2022, there were no assets identified as held for sale.

As of December 31, 2021, in connection with the Purchase and Sale Agreement (as defined in Note 4 — Real Estate Assets), the Company identified 81 properties with a carrying value of $ 1.3 billion as held for sale, all of which were disposed of during the nine months ended September 30, 2022.

Dispositions of Real Estate Assets

1 unchanged sentence

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 Company’s dispositions during the six months ended June 30, 2022 and 2021 did not qualify for discontinued operations presentation and thus, the results of the properties and condominiums that were sold will remain in operating income, and any associated gains or losses from the dispositions are included in gain on disposition of real estate and condominium developments, net.

See Note 4 — Real Estate Assets for a discussion of the disposition of individual properties and condominiums during the six months ended June 30, 2022.

The Company’s dispositions during the nine months ended September 30, 2022 and 2021 did not qualify for discontinued operations presentation and thus, the results of the properties and condominiums that were sold will remain in operating income, and any associated gains or losses from the dispositions are included in gain on disposition of real estate and condominium developments, net.

See Note 4 — Real Estate Assets for a discussion of the disposition of individual properties and condominiums during the nine months ended September 30, 2022.

Allocation of Purchase Price of Real Estate Assets

9 unchanged sentences

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

Investment in Unconsolidated Entities

On March 31, 2022, the Company fully redeemed its $ 60.7 million investment in CIM UII Onshore, L.

(“CIM UII Onshore”).

Prior to redemption, the Company had less than 5 % ownership of CIM UII Onshore and accounted for its

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

Investments in Unconsolidated Entities

On March 31, 2022, the Company fully redeemed its $ 60.7 million investment in CIM UII Onshore, L.

(“CIM UII Onshore”) and received 100% of the $ 60.7 million redemption proceeds as of June 30, 2022.

Prior to redemption, the Company had less than 5 % ownership of CIM UII Onshore and accounted for its investment under the equity method.

September 30, 2022 (Unaudited) – (Continued)

investment under the equity method.

The equity method of accounting requires the investment to be initially recorded at cost, including transaction costs incurred to finalize the investment, and subsequently adjusted for the Company’s share of equity in CIM UII Onshore’s earnings and distributions.

Prior to redemption, the Company recorded its share of CIM UII Onshore’s profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s condensed consolidated balance sheet and such share is recognized as a profit or loss on the condensed consolidated statements of operations.

The Company recorded its share of CIM UII Onshore’s gain, totaling $ 5.2 million during the six months ended June 30, 2022, in the condensed consolidated statements of operations.

During the six months ended June 30, 2022, the Company received distributions of $ 531,000 related to its investment in CIM UII Onshore, all of which was recognized as a return on investment.

The Company recorded its share of CIM UII Onshore’s gain, totaling $ 5.2 million during the nine months ended September 30, 2022, in the condensed consolidated statements of operations.

During the nine months ended September 30, 2022, the Company received distributions of $ 531,000 related to its investment in CIM UII Onshore, all of which was recognized as a return on investment.

As of December 31, 2021, the Company’s investment in CIM UII Onshore had a carrying value of $ 56.0 million.

CMFT MT JV Holdings, LLC, an indirect wholly-owned subsidiary of the Company, is engaged in an unconsolidated joint venture arrangement through CIM NP JV Holdings, LLC (“NP JV Holdings”) (the “Unconsolidated Joint Venture”), of which it owns 50 % of the outstanding equity.

Through the Unconsolidated Joint Venture, which holds 90 % of the membership interest in NewPoint JV, LLC (the “NewPoint JV”) pursuant to the terms of the Operating Agreement entered into between the Unconsolidated Joint Venture and NewPoint Bridge Lending, LLC, the Company indirectly owns 45 % of the outstanding equity of the NewPoint JV on a fully diluted basis.

Through the Unconsolidated Joint Venture, which holds approximately 91 % of the membership interest in NewPoint JV, LLC (the “NewPoint JV”) pursuant to the terms of the Operating Agreement entered into between the Unconsolidated Joint Venture and NewPoint Bridge Lending, LLC, the Company indirectly owns approximately 45 % of the outstanding equity of the NewPoint JV on a fully diluted basis.

The Company accounts for its investment under the equity method.

1 unchanged sentence

The Company records its share of NP JV Holdings’ profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s condensed consolidated balance sheet and such share is recognized as a profit or loss on the condensed consolidated statements of operations.

The Company recorded a gain totaling $ 1.5 million, which represented its share of NP JV Holdings’ gain, during the six months ended June 30, 2022 in the condensed consolidated statements of operations.

During the six months ended June 30, 2022, the Company contributed an additional $ 43.3 million in NP JV Holdings.

As of June 30, 2022, the Company’s aggregate investment in NP JV Holdings of $ 96.2 million is included in investment in unconsolidated entities on the condensed consolidated balance sheets.

The Company received $ 2.1 million in distributions related to its investment in the NP JV Holdings during the six months ended June 30, 2022.

The Company recorded a gain totaling $ 3.7 million, which represented its share of NP JV Holdings’ gain, during the nine months ended September 30, 2022 in the condensed consolidated statements of operations.

During the nine months ended September 30, 2022, the Company contributed an additional $ 79.5 million in NP JV Holdings.

As of September 30, 2022, the Company’s aggregate investment in NP JV Holdings of $ 132.4 million is included in investment in unconsolidated entities on the condensed consolidated balance sheets.

The Company received $ 4.3 million in distributions related to its investment in NP JV Holdings during the nine months ended September 30, 2022.

Noncontrolling Interest in Consolidated Joint Venture

As of June 30, 2022, the Company had a controlling interest in the Consolidated Joint Venture and, therefore, met the requirements for consolidation.

The Company recorded a net loss of $ 63,000 and paid distributions of $ 30,000 to the noncontrolling interest during the six months ended June 30, 2022.

The Company recorded the noncontrolling interest of $ 1.0 million and $ 1.1 million as of June 30, 2022 and December 31, 2021, respectively, on the condensed consolidated balance sheets.

From December 2021 to July 2022, the Company determined it had a controlling interest in the Consolidated Joint Venture and, therefore, met the requirements for consolidation.

During the nine months ended September 30, 2022, the Company recorded net income of $ 66,000 and paid distributions of $ 1.1 million to the noncontrolling interest.

During the nine months ended September 30, 2022, the Company disposed of the underlying properties previously owned through the Consolidated Joint Venture, as further discussed in Note 4 — Real Estate Assets.

Therefore, the Company determined it no longer had a controlling financial interest in the Consolidated Joint Venture as of September 30, 2022.

Restricted Cash

The Company had $ 61.0 million and $ 36.8 million in restricted cash as of June 30, 2022 and December 31, 2021, respectively.

Included in restricted cash was $ 5.7 million and $ 7.8 million held by lenders in lockbox accounts, as of June 30, 2022 and December 31, 2021, respectively.

The Company had $ 62.9 million and $ 36.8 million in restricted cash as of September 30, 2022 and December 31, 2021, respectively.

Included in restricted cash was $ 6.7 million and $ 7.8 million held by lenders in lockbox accounts, as of September 30, 2022 and December 31, 2021, respectively.

As part of certain debt agreements, rents from certain encumbered properties are deposited directly into a lockbox account, from which the monthly debt service payment is disbursed to the lender and the excess is disbursed to the Company.

Also included in restricted cash was $ 55.3 million and $ 29.0 million of construction reserves, amounts 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 June 30, 2022 and December 31, 2021, respectively.

Also included in restricted cash was $ 56.2 million and $ 29.0 million of construction reserves, amounts 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 September 30, 2022 and December 31, 2021, respectively.

Real Estate-Related Securities

1 unchanged sentence

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 June 30, 2022, the Company classified its investments in CMBS as available-for-sale as the Company is not actively trading the securities;

As of September 30, 2022, the Company classified its investments in CMBS 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

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

During the nine

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

estimated fair value with unrealized gains and losses reported in other comprehensive (loss) income.

During the six months ended June 30, 2022, the Company invested $ 259.2 million in CMBS.

As of June 30, 2022, the Company had investments in 10 CMBS with an estimated aggregate fair value of $ 227.4 million.

In addition, the Company had an investment in an equity security with an estimated aggregate fair value of $ 47.0 million as of June 30, 2022, which is comprised of RTL Common Stock (as defined in Note 4 — Real Estate Assets) received as consideration in connection with the Purchase and Sale Agreement.

September 30, 2022 (Unaudited) – (Continued)

months ended September 30, 2022, the Company invested $ 433.2 million in CMBS.

As of September 30, 2022, the Company had investments in 16 CMBS with an estimated aggregate fair value of $ 432.2 million.

In addition, the Company had an investment in an equity security with an estimated aggregate fair value of $ 37.9 million as of September 30, 2022, which is comprised of RTL Common Stock (as defined in Note 4 — Real Estate Assets) received as consideration in connection with the Purchase and Sale Agreement.

These investments are carried at their estimated fair value with unrealized gains and losses reported on the condensed consolidated statements of operations.

Dividends received are recorded in interest income on the condensed consolidated statements of operations.

During the nine months ended September 30, 2022, the Company recorded $ 2.7 million of dividend income on RTL Common Stock, which is included in interest expense and other, net on the condensed consolidated statements of operations.

The Company also recorded $ 15.5 million of unrealized loss on RTL Common Stock during the nine months ended September 30, 2022, which is included in unrealized loss on equity security in the condensed consolidated statements of operations.

The Company monitors its available-for-sale securities for changes in fair value.

5 unchanged sentences

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

During the six months ended June 30, 2022 and 2021, the Company did not record current expected credit losses related to CMBS.

During the nine months ended September 30, 2022 and 2021, the Company did not record current expected credit losses related to CMBS.

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 condensed consolidated statements of operations in interest income.

2 unchanged sentences

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

During the three and six months ended June 30, 2022, the Company capitalized $ 274,000 and $ 546,000 , respectively, of interest income to real estate-related securities.

During the three and six months ended June 30, 2021, the Company capitalized $ 262,000 and $ 435,000 , respectively, of interest income to real estate-related securities.

During the three and nine months ended September 30, 2022, the Company capitalized $ 280,000 and $ 826,000 , respectively, of interest income to real estate-related securities.

During the three and nine months ended September 30, 2021, the Company capitalized $ 268,000 and $ 703,000 , respectively, of interest income to real estate-related securities.

Loans Held-for-Investment

6 unchanged sentences

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

During the three and six months ended June 30, 2022, the Company capitalized $ 62,000 of interest income to loans held-for-investment.

During the nine months ended September 30, 2022, the Company capitalized $ 62,000 of interest income to loans held-for-investment.

Accrual of interest income is suspended on nonaccrual loans.

2 unchanged sentences

Loans may be restored to accrual status when all principal and interest are current and full repayment of the remaining contractual principal and interest are reasonably assured.

As of June 30, 2022, the Company did no t have nonaccrual loans.

As of September 30, 2022, the Company did not have nonaccrual loans.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

Current Expected Credit Losses

1 unchanged sentence

2016-13, Financial Instruments - Credit Losses (Topic 326) (“ASU 2016-13”), on January 1, 2020.

Current expected credit losses (“CECL”) 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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

condensed consolidated balance sheets.

Changes to current expected credit losses are recognized through net income on the Company’s condensed consolidated statements of operations.

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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.

These weaknesses are generally considered correctable by the borrower in the

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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;

1 unchanged sentence

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

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.

19 unchanged sentences

Project costs and expenses, including interest incurred, associated with the development, construction and lease-up of a real estate project are capitalized as construction in progress.

During the six months ended June 30, 2022 and 2021, the Company capitalized $ 7.2 million and $ 4.5 million, respectively, of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets.

Included in the amounts capitalized during the six months ended June 30, 2022 and 2021 was $ 711,000 and $ 1.8 million, respectively, of capitalized interest expense.

During the nine months ended September 30, 2022 and 2021, the Company capitalized $ 10.9 million and $ 5.9 million, respectively, of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets.

Included in the amounts capitalized during the nine months ended September 30, 2022 and 2021 was $ 1.1 million and $ 1.4 million, respectively, of capitalized interest expense.

Revenue Recognition

4 unchanged sentences

The Company defers the recognition of variable rental and other property income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved.

The Company continually reviews whether collection of lease-related receivables, including any straight-line rent, and current and future operating expense reimbursements from tenants are probable.

The determination of whether collectability is probable takes into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

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.

September 30, 2022 (Unaudited) – (Continued)

The Company continually reviews whether collection of lease-related receivables, including any straight-line rent, and current and future operating expense reimbursements from tenants are probable.

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 not probable is recorded on a cash basis until collectability becomes probable.

21 unchanged sentences

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 has evaluated the impact of this ASU’s adoption, and does not believe this ASU will have a material impact on its condensed consolidated financial statements.

The Company currently uses LIBOR and SOFR as its benchmark interest rate for its derivative instruments.

The Company has evaluated the impact of this ASU’s adoption, and has determined that this ASU will not have a material impact on its condensed consolidated financial statements.

In June 2022, the FASB issued ASU No.

4 unchanged sentences

The Company is currently evaluating the impact of this guidance on its condensed consolidated financial statements.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

NOTE 3 — FAIR VALUE MEASUREMENTS

1 unchanged sentence

GAAP emphasizes that fair value is intended to be a market-based measurement, as opposed to a transaction-specific measurement.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

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.

9 unchanged sentences

Depending upon the significance of the fair value inputs used in determining these fair values, these securities are valued using Level 1, Level 2 or Level 3 inputs.

As of June 30, 2022, the Company concluded that $ 193.1 million of its CMBS fell under Level 2 and $ 34.4 million of its CMBS fell under Level 3.

As of September 30, 2022, the Company concluded that $ 401.1 million of its CMBS fell under Level 2 and $ 31.1 million of its CMBS fell under Level 3.

The Company’s equity security investment is valued using Level 1 inputs.

3 unchanged sentences

These financial instruments are valued using Level 2 inputs.

As of June 30, 2022, the estimated fair value of the Company’s debt was $ 4.11 billion, compared to a carrying value of $ 4.25 billion.

As of September 30, 2022, the estimated fair value of the Company’s debt was $ 4.27 billion, compared to a carrying value of $ 4.38 billion.

The estimated fair value of the Company’s debt as of December 31, 2021 was $ 4.11 billion, compared to a carrying value of $ 4.17 billion.

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

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

All derivative instruments are carried at fair value and are valued using Level 2 inputs.

2 unchanged sentences

Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties.

However, as of June 30, 2022 and December 31, 2021, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives.

However, as of September 30, 2022 and December 31, 2021, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives.

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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.

1 unchanged sentence

The Company has determined that its commercial real estate (“CRE”) loans held-for-investment and corporate senior loans are classified in Level 3 of the fair value hierarchy.

The Company’s liquid senior 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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

the measurement date.

As of June 30, 2022, $ 491.3 million and $ 149.2 million of the Company’s liquid senior loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively.

As of September 30, 2022, $ 471.5 million and $ 189.8 million of the Company’s liquid senior loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively.

As of December 31, 2021, $ 560.4 million and $ 94.1 million of the Company’s liquid senior loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively.

As of June 30, 2022, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $ 3.89 billion, which approximated carrying value.

As of September 30, 2022, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $ 4.0 billion, which approximated carrying value.

As of December 31, 2021, the estimated fair value of the Company’s loans held-for-investment was $ 2.63 billion, compared to their carrying value of $ 2.61 billion.

6 unchanged sentences

Items Measured at Fair Value on a Recurring Basis

In accordance with the fair value hierarchy described above, the following tables show the fair value of the Company’s financial assets and liabilities that are required to be measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 (in thousands):

In accordance with the fair value hierarchy described above, the following tables show the fair value of the Company’s financial assets and liabilities that are required to be measured at fair value on a recurring basis as of September 30, 2022 and December 31, 2021 (in thousands):

Balance as of

June 30, 2022 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)

September 30, 2022 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)

Financial assets:

2 unchanged sentences

Interest rate caps 4,705 — 4,705 —

Interest rate swaps 35 — 35 —

Total financial assets $ 474,826 $ 37,926 $ 405,755 $ 31,145

Financial liabilities:

Interest rate swaps $ ( 195 ) $ — $ ( 195 ) $ —

Total financial liabilities $ ( 195 ) $ — $ ( 195 ) $ —

Balance as of

12 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

The following are reconciliations of the changes in financial assets with Level 3 inputs in the fair value hierarchy for the six months ended June 30, 2022 (in thousands):

September 30, 2022 (Unaudited) – (Continued)

The following are reconciliations of the changes in financial assets with Level 3 inputs in the fair value hierarchy for the nine months ended September 30, 2022 (in thousands):

Beginning Balance, January 1, 2022

5 unchanged sentences

Capitalized interest income 826

Ending Balance, June 30, 2022

Ending Balance, September 30, 2022

____________________________________

(1) Reflects the Company’s investment in preferred units which matured during the six months ended June 30, 2022 and was redeemed in exchange for an investment in a first mortgage loan.

(1) Reflects the Company’s investment in preferred units which matured during the nine months ended September 30, 2022 and was redeemed in exchange for an investment in a first mortgage loan.

Refer to Note 8 — Loans Held-For-Investment for further discussion.

2 unchanged sentences

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.

As discussed in Note 4 — Real Estate Assets, during the six months ended June 30, 2022, real estate assets related to 18 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 110.5 million, resulting in impairment charges of $ 11.3 million.

Additionally, during the six months ended June 30, 2022, certain condominium units were deemed to be impaired and their carrying values were reduced to their estimated fair value, resulting in impairment charges of $ 7.9 million.

During the six months ended June 30, 2021, real estate assets related to five properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 31.2 million, resulting in impairment charges of $ 4.4 million.

As discussed in Note 4 — Real Estate Assets, during the nine months ended September 30, 2022, real estate assets related to 19 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 114.1 million, resulting in impairment charges of $ 11.9 million.

Additionally, during the nine months ended September 30, 2022, certain condominium units were deemed to be impaired and their carrying values were reduced to their estimated fair value, resulting in impairment charges of $ 7.9 million.

During the nine months ended September 30, 2021, real estate assets related to 11 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 43.1 million, resulting in impairment charges of $ 5.3 million.

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

7 unchanged sentences

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 six months ended June 30, 2022 and 2021:

Six Months Ended June 30,

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 nine months ended September 30, 2022 and 2021:

Nine Months Ended September 30,

Discount Rate Terminal Capitalization Rate Discount Rate Terminal Capitalization Rate

5 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

The following table presents the impairment charges by asset class recorded during the six months ended June 30, 2022 and 2021 (in thousands):

Six Months Ended June 30,

September 30, 2022 (Unaudited) – (Continued)

The following table presents the impairment charges by asset class recorded during the nine months ended September 30, 2022 and 2021 (in thousands):

Nine Months Ended September 30,

Asset class impaired:

7 unchanged sentences

2022 Property Acquisitions

During the six months ended June 30, 2022, the Company did no t acquire any properties.

During the nine months ended September 30, 2022, the Company did no t acquire any properties.

2022 Condominium Development Project

During the six months ended June 30, 2022, the Company capitalized $ 7.2 million of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets.

During the nine months ended September 30, 2022, the Company capitalized $ 10.9 million of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets.

2022 Condominium Dispositions

During the six months ended June 30, 2022, the Company disposed of condominium units for an aggregate sales price of $ 22.5 million, resulting in proceeds of $ 20.6 million after closing costs and a gain of $ 3.3 million.

During the nine months ended September 30, 2022, the Company disposed of condominium units for an aggregate sales price of $ 24.2 million, resulting in proceeds of $ 22.0 million after closing costs and a gain of $ 3.1 million.

The Company has no continuing involvement that would preclude sale treatment with these condominium units.

The gain on sale of condominium units is included in gain on disposition of real estate and condominium developments, net in the condensed consolidated statements of operations.

2022 Property Dispositions and Real Estate Assets Held for Sale

2022 Property Dispositions

On December 20, 2021, certain subsidiaries of the Company entered into an Agreement of Purchase and Sale, as amended (the “Purchase and Sale Agreement”), with American Finance Trust, Inc.

3 unchanged sentences

The Purchase Price included the Purchaser’s option to seek the assumption of certain existing debt, and Purchaser’s issuance of up to $ 53.4 million in value of RTL’s Class A common stock, par value $ 0.01 per share (“RTL Common Stock”), or Class A units in RTL OP (“RTL OP Units”), subject to certain limits described more fully in the Purchase and Sale Agreement.

During the six months ended June 30, 2022, the Company disposed of 112 properties, including 55 anchored shopping centers, 54 retail properties, two office buildings and one industrial property, and an outparcel of land for an aggregate gross sales price of $ 1.55 billion, resulting in proceeds of $ 1.50 billion after closing costs and a gain of $ 110.4 million.

During the nine months ended September 30, 2022, the Company disposed of 130 properties, including 65 retail properties, 56 anchored shopping centers, six industrial properties and three office buildings, and an outparcel of land for an aggregate gross sales price of $ 1.71 billion, resulting in proceeds of $ 1.67 billion after closing costs and a gain of $ 115.0 million.

Included in this amount of properties disposed were the two properties previously owned through the Consolidated Joint Venture.

The sale of 81 of these properties closed pursuant to the Purchase and Sale Agreement for total consideration of $ 1.33 billion, which consisted of $ 1.28 billion in cash proceeds and $ 53.4 million of RTL Common Stock, which shares are subject to certain registration rights as described in the Purchase and Sale Agreement.

Such shares are included in real estate-related securities in the condensed consolidated balance sheets.

During the six months ended June 30, 2022, the Company recognized earnout income of $ 74.1 million related to the disposition of these properties pursuant to the Purchase and Sale Agreement, and recorded a related receivable of $ 51.0 million in prepaid expenses and other assets in the condensed consolidated balance sheets.

The Company has no continuing involvement that would preclude sale treatment with these properties.

The gain on sale of real estate, including the earnout income, is included in gain on disposition of real estate and condominium developments, net in the condensed consolidated statements of operations.

During the nine months ended September 30, 2022, the Company recognized earnout income of $ 68.7 million related to the disposition of properties pursuant to the Purchase and Sale Agreement, and recorded a related receivable of $ 20.3 million, which is included in prepaid expenses and other assets in the condensed consolidated balance sheets as of September 30, 2022.

The Company has no continuing involvement that would preclude sale

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

As of June 30, 2022, the Company identified four properties with a carrying value of $ 76.6 million as held for sale, one of which is in connection with the Purchase and Sale Agreement.

Subsequent to June 30, 2022, the Company disposed of these properties, as further discussed in Note 17 — Subsequent Events.

September 30, 2022 (Unaudited) – (Continued)

treatment with these properties.

2022 Impairment

1 unchanged sentence

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 six months ended June 30, 2022, 18 properties totaling approximately 800,000 square feet with a carrying value of $ 121.8 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 110.5 million, resulting in impairment charges of $ 11.3 million, which were recorded in the condensed consolidated statements of operations.

During the nine months ended September 30, 2022, 19 properties totaling approximately 832,000 square feet with a carrying value of $ 126.0 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 114.1 million, resulting in impairment charges of $ 11.9 million, which were recorded in the condensed consolidated statements of operations.

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

2021 Property Acquisitions

During the six months ended June 30, 2021, the Company did not acquire any properties.

During the nine months ended September 30, 2021, the Company did not acquire any properties.

2021 Assets Acquired Via Foreclosure

During the six months ended June 30, 2021, the Company completed foreclosure proceedings to take control of the assets which previously secured its eight mezzanine loans, including 75 condominium units and 21 rental units across four buildings, including certain units that are under development.

During the nine months ended September 30, 2021, the Company completed foreclosure proceedings to take control of the assets which previously secured its eight mezzanine loans, including 75 condominium units and 21 rental units across four buildings, including certain units that are under development.

No land was acquired in connection with the foreclosure.

The following table summarizes the purchase price allocation for the real estate acquired via foreclosure (in thousands):

As of June 30, 2021

As of September 30, 2021

Buildings, fixtures and improvements $ 192,182

4 unchanged sentences

2021 Condominium Development Project

During the six months ended June 30, 2021, the Company capitalized $ 4.5 million of expenses as construction in progress associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets.

During the nine months ended September 30, 2021, the Company capitalized $ 5.9 million of expenses as construction in progress associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets.

2021 Condominium Dispositions

During the six months ended June 30, 2021, the Company disposed of condominium units for an aggregate sales price of $ 8.8 million, resulting in proceeds of $ 8.5 million after closing costs and a gain of $ 1.5 million.

During the nine months ended September 30, 2021, the Company disposed of condominium units for an aggregate sales price of $ 28.6 million, resulting in proceeds of $ 26.5 million after closing costs and a gain of $ 4.9 million.

The Company has no continuing involvement that would preclude sale treatment with these condominium units.

1 unchanged sentence

2021 Property Dispositions and Real Estate Assets Held for Sale

During the six months ended June 30, 2021, the Company disposed of 47 retail properties, for an aggregate gross sales price of $ 304.0 million, resulting in proceeds of $ 269.0 million after closing costs and a gain of $ 46.5 million.

During the nine months ended September 30, 2021, the Company disposed of 113 retail properties, for an aggregate gross sales price of $ 484.4 million, resulting in proceeds of $ 470.2 million after closing costs and a gain of $ 75.6 million.

The Company has no continuing involvement that would preclude sale treatment with these properties.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

As of June 30, 2021, there were two properties classified as held for sale with a carrying value of $ 6.1 million included in assets held for sale in the accompanying condensed consolidated balance sheets.

Subsequent to June 30, 2021, the Company disposed of these properties.

September 30, 2022 (Unaudited) – (Continued)

As of September 30, 2021, there was one property classified as held for sale with a carrying value of $ 1.3 million included in assets held for sale in the accompanying condensed consolidated balance sheets.

Subsequent to September 30, 2021, the Company disposed of this property.

2021 Impairment

During the six months ended June 30, 2021, five properties totaling approximately 165,000 square feet with a carrying value of $ 35.5 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 31.2 million, resulting in impairment charges of $ 4.4 million, which were recorded in the condensed consolidated statements of operations.

During the nine months ended September 30, 2021, 11 properties totaling approximately 260,000 square feet with a carrying value of $ 48.4 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 43.1 million, resulting in impairment charges of $ 5.3 million, which were recorded in the condensed consolidated statements of operations.

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

Consolidated Joint Venture

As of June 30, 2022, the Company had an interest in a Consolidated Joint Venture that owned and managed two properties, with total assets of $ 6.8 million, which included $ 7.2 million of land, building and improvements and $ 641,000 of intangible assets, net of accumulated depreciation and amortization of $ 1.2 million, and total liabilities of $ 47,000 .

The Consolidated Joint Venture did not have any debt outstanding as of June 30, 2022.

The Company has the ability to control operating and financial policies of the Consolidated Joint Venture.

There are restrictions on the use of these assets as the Company would generally be required to obtain the approval of the partner (the “Consolidated Joint Venture Partner”) in accordance with the joint venture agreement for any major transactions.

The Company and the Consolidated Joint Venture Partner are subject to the provisions of the joint venture agreement, which includes provisions for when additional contributions may be required to fund certain cash shortfalls.

Subsequent to June 30, 2022, the Company disposed of the two properties previously owned through the Consolidated Joint Venture, as further discussed in Note 17 — Subsequent Events.

NOTE 5 — INTANGIBLE LEASE ASSETS AND LIABILITIES

Intangible lease assets and liabilities consisted of the following as of June 30, 2022 and December 31, 2021 (in thousands, except weighted average life remaining):

June 30, 2022 December 31, 2021

Intangible lease assets and liabilities consisted of the following as of September 30, 2022 and December 31, 2021 (in thousands, except weighted average life remaining):

September 30, 2022 December 31, 2021

Intangible lease assets:

In-place leases and other intangibles, net of accumulated amortization of $ 77,745 and $ 73,923 , respectively (both with a weighted average life remaining of 11.4 years)

In-place leases and other intangibles, net of accumulated amortization of $ 82,454 and $ 73,923 , respectively (with a weighted average life remaining of 11.3 years and 11.4 years, respectively)

$ 182,337 $ 224,931

7 unchanged sentences

Amortization of below-market leases is recorded as an increase to rental and other property income in the accompanying condensed consolidated statements of operations.

The following table summarizes the amortization related to the intangible lease assets and liabilities for the three and six months ended June 30, 2022 and 2021 (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

The following table summarizes the amortization related to the intangible lease assets and liabilities for the three and nine months ended September 30, 2022 and 2021 (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

4 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

As of June 30, 2022, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands):

September 30, 2022 (Unaudited) – (Continued)

As of September 30, 2022, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands):

In-Place Leases and

7 unchanged sentences

Total $ 182,337 $ 11,015 $ 19,512

NOTE 6 — INVESTMENTS IN UNCONSOLIDATED ENTITIES

NOTE 6 — INVESTMENT IN UNCONSOLIDATED ENTITIES

On December 16, 2021, as a result of the merger with CIM Income NAV, Inc.

2 unchanged sentences

(“CIM Urban Income”), which is a private institutional fund that acquires, owns and operates substantially stabilized, diversified real estate and real estate-related assets in urban markets primarily located throughout North America.

During the three and six months ended June 30, 2022, the Company recognized an equity method net gain of $ 5.2 million related to its investment in CIM UII Onshore.

The Company recognized distributions of $ 531,000 related to its investment in CIM UII Onshore during the six months ended June 30, 2022, all of which was recognized as a return on investment.

During the nine months ended September 30, 2022, the Company recognized an equity method net gain of $ 5.2 million related to its investment in CIM UII Onshore.

The Company recognized distributions of $ 531,000 related to its investment in CIM UII Onshore during the nine months ended September 30, 2022, all of which was recognized as a return on investment.

On March 31, 2022, the Company fully redeemed its $ 60.7 million investment in CIM UII Onshore, which represented less than 5 % ownership of CIM UII Onshore and approximated fair value.

As of June 30, 2022, the Company received 100 % of the redemption proceeds.

Additionally, during the year ended December 31, 2021, the Company entered into the Unconsolidated Joint Venture, of which the Company owns 50 % of the outstanding equity.

The Unconsolidated Joint Venture holds 90 % of the membership interest in the NewPoint JV.

The Unconsolidated Joint Venture holds approximately 91 % of the membership interest in the NewPoint JV.

Through the Unconsolidated Joint Venture, the Company has a 45 % interest in the NewPoint JV and accounts for its investment under the equity method.

The primary purpose of the NewPoint JV is to source, underwrite, close and service on an ongoing basis multifamily bridge loans, participation interests, and other debt instruments such as loans.

As of June 30, 2022, the carrying value of the Company’s investment in NP JV Holdings was $ 96.2 million, which approximates fair value and is included in investments in unconsolidated entities on the condensed consolidated balance sheets.

The Company received $ 2.1 million in distributions related to its investment in NP JV Holdings during the six months ended June 30, 2022, $ 1.5 million of which was recognized as a return on investment and $ 614,000 of which was recognized as a return of investment and reduced the invested capital and the carrying amount.

As of September 30, 2022, the carrying value of the Company’s investment in NP JV Holdings was $ 132.4 million, which approximates fair value and is included in investment in unconsolidated entities on the condensed consolidated balance sheets.

The Company received $ 4.3 million in distributions related to its investment in NP JV Holdings during the nine months ended September 30, 2022, $ 3.7 million of which was recognized as a return on investment and $ 625,000 of which was recognized as a return of investment and reduced the invested capital and the carrying amount.

NOTE 7 — REAL ESTATE-RELATED SECURITIES

As of June 30, 2022, the Company had real estate-related securities with an aggregate estimated fair value of $ 274.4 million, which included 10 CMBS investments and an investment in a publicly-traded equity security.

The CMBS mature on various dates from March 2024 through June 2058 and have interest rates ranging from 5.4 % to 7.6 %, with one CMBS earning a zero coupon rate.

The following is a summary of the Company’s real estate-related securities as of June 30, 2022 (in thousands):

As of September 30, 2022, the Company had real estate-related securities with an aggregate estimated fair value of $ 470.1 million, which included 16 CMBS investments and an investment in a publicly-traded equity security.

The CMBS mature on various dates from July 2023 through June 2058 and have interest rates ranging from 6.5 % to 10.2 % as of September 30, 2022, with one CMBS earning a zero coupon rate.

The following is a summary of the Company’s real estate-related securities as of September 30, 2022 (in thousands):

Real Estate-Related Securities

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

The following table provides the activity for the real estate-related securities during the six months ended June 30, 2022 (in thousands):

September 30, 2022 (Unaudited) – (Continued)

The following table provides the activity for the real estate-related securities during the nine months ended September 30, 2022 (in thousands):

Amortized Cost Basis Unrealized Gain (Loss) Fair Value

12 unchanged sentences

— ( 39,936 ) ( 39,936 )

Real estate-related securities as of June 30, 2022

Real estate-related securities as of September 30, 2022

$ 507,282 $ ( 37,161 ) $ 470,121

____________________________________

(1) Included in this balance is $ 68.2 million of the Company’s investment in preferred units which were redeemed during the six months ended June 30, 2022 in exchange for an investment in a first mortgage loan, as further discussed in Note 8 — Loans Held-For-Investment.

During the six months ended June 30, 2022, the Company invested $ 259.2 million in CMBS.

(1) Included in this balance is $ 68.2 million of the Company’s investment in preferred units which were redeemed during the nine months ended September 30, 2022 in exchange for an investment in a first mortgage loan, as further discussed in Note 8 — Loans Held-For-Investment.

During the nine months ended September 30, 2022, the Company invested $ 433.2 million in CMBS.

During the same period, the Company sold one marketable security with an aggregate carrying value of $ 110,000 resulting in net proceeds of $ 132,000 and a gain of $ 22,000 .

The Company also received $ 53.4 million in an equity security during the six months ended June 30, 2022 as consideration in connection with the Purchase and Sale Agreement.

The Company also received $ 53.4 million in an equity security during the nine months ended September 30, 2022 as consideration in connection with the Purchase and Sale Agreement.

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

Unrealized gains and losses on the equity security are reported on the condensed consolidated statements of operations.

During the six months ended June 30, 2022, the Company recorded $ 22.2 million of unrealized loss on its real estate-related securities, $ 15.8 million of which is included in other comprehensive (loss) income in the accompanying condensed consolidated statements of comprehensive income.

The remaining $ 6.4 million of unrealized loss on the Company’s equity security is included in interest expense and other, net in the accompanying condensed consolidated statements of operations.

The scheduled maturities of the Company’s CMBS as of June 30, 2022 are as follows (in thousands):

During the nine months ended September 30, 2022, the Company recorded $ 39.9 million of unrealized loss on its real estate-related securities, $ 24.5 million of which is included in other comprehensive (loss) income in the accompanying condensed consolidated statements of comprehensive income.

The remaining $ 15.4 million of unrealized loss on the Company’s equity security is included in unrealized loss on equity security in the accompanying condensed consolidated statements of operations.

The scheduled maturities of the Company’s CMBS as of September 30, 2022 are as follows (in thousands):

Amortized Cost Estimated Fair Value

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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 June 30, 2022, the Company had no credit losses related to real estate-related securities.

In estimating credit losses related to real estate-related securities, management considers a variety of factors, 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.

As of September 30, 2022, the Company had no credit losses related to real estate-related securities.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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September 30, 2022 (Unaudited) – (Continued)

NOTE 8 — LOANS HELD-FOR-INVESTMENT

The Company’s loans held-for-investment consisted of the following as of June 30, 2022 and December 31, 2021 (in thousands):

As of June 30, As of December 31,

The Company’s loans held-for-investment consisted of the following as of September 30, 2022 and December 31, 2021 (in thousands):

As of September 30, As of December 31,

First mortgage loans (1)

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(1) As of June 30, 2022, first mortgage loans included $ 20.1 million of contiguous mezzanine loan components that, as a whole, have expected credit quality similar to that of a first mortgage loan.

The following table details overall statistics for the Company’s loans held-for-investment as of June 30, 2022 and December 31, 2021 (dollar amounts in thousands):

(1) As of September 30, 2022, first mortgage loans included $ 20.1 million of contiguous mezzanine loan components that, as a whole, have expected credit quality similar to that of a first mortgage loan.

The following table details overall statistics for the Company’s loans held-for-investment as of September 30, 2022 and December 31, 2021 (dollar amounts in thousands):

CRE Loans (1) (2)

Liquid Senior Loans Corporate Senior Loans

June 30, 2022 December 31, 2021 June 30, 2022 December 31, 2021 June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021 September 30, 2022 December 31, 2021

Number of loans 29 22 313 295 4 —

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(1) As of June 30, 2022, 100 % of the Company’s CRE loans by principal balance earned a floating rate of interest, primarily indexed to U.S.

(1) As of September 30, 2022, 100 % of the Company’s CRE loans by principal balance earned a floating rate of interest, primarily indexed to U.S.

dollar LIBOR and the Secured Overnight Financing Rate (“SOFR”).

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

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Activity relating to the Company’s loans held-for-investment portfolio was as follows (in thousands):

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Principal repayments received ( 80,911 ) ( 58,189 ) ( 17,820 ) ( 156,920 )

( 80,911 ) ( 46,140 ) ( 50 ) ( 127,101 )

Capitalized interest 62 — — 62

3 unchanged sentences

Current expected credit losses ( 5,077 ) ( 8,498 ) ( 808 ) ( 14,383 )

Balance, June 30, 2022

Balance, September 30, 2022

$ 3,244,737 $ 691,981 $ 56,424 $ 3,993,142

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(1) The Company’s investment in preferred units, which was previously recorded in real estate-related securities on the accompanying condensed consolidated balance sheets, was redeemed during the six months ended June 30, 2022 in exchange for an investment in a first mortgage loan.

(1) The Company’s investment in preferred units, which was previously recorded in real estate-related securities on the accompanying condensed consolidated balance sheets, was redeemed during the nine months ended September 30, 2022 in exchange for an investment in a first mortgage loan.

The converted investment in preferred units of $ 68.2 million is included in the CRE loans balance with an all-in-rate of 9.4 % and an initial maturity date of October 9, 2023.

(2) Includes the repayment of a $ 80.9 million first mortgage loan prior to the maturity date.

(3) Other items primarily consist of purchase discounts or premiums, accretion of exit fees and deferred origination expenses.

(2) Other items primarily consist of purchase discounts or premiums and deferred origination expenses.

Current Expected Credit Losses

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

The following table presents the activity in the Company’s current expected credit losses by loan type for the six months ended June 30, 2022 (in thousands):

The following table presents the activity in the Company’s current expected credit losses by loan type for the nine months ended September 30, 2022 (in thousands):

First Mortgage Loans Unfunded First Mortgage Loans (1)

5 unchanged sentences

$ 11,242 $ 360 $ 7,852 $ 400 $ 56 $ — $ 19,910

Provision for credit losses 1,832 170 2,338 ( 96 ) 615 83 4,942

Provision for (reversal of) credit losses 1,832 170 2,338 ( 96 ) 615 83 4,942

Current expected credit losses as of June 30, 2022

$ 13,074 $ 530 $ 10,190 $ 304 $ 671 $ 83 $ 24,852

Provision for (reversal of) credit losses 1,933 121 3,579 ( 85 ) 137 ( 21 ) 5,664

Current expected credit losses as of September 30, 2022

$ 15,007 $ 651 $ 13,769 $ 219 $ 808 $ 62 $ 30,516

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(1) Current expected losses for unfunded or unsettled loan commitments are included in accrued expenses and accounts payable in the condensed consolidated balance sheets.

Changes to current expected credit losses are recognized through net income on the Company’s condensed consolidated statements of operations.

Troubled Debt Restructuring

An individual financial instrument is classified as a troubled debt restructuring when there is a reasonable expectation that the financial instrument’s contractual terms will be modified in a manner that grants concessions to the borrower who is experiencing financial difficulties.

Concessions could include term extensions, payment deferrals, interest rate reductions,

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

principal forgiveness, forbearance, or other actions designed to maximize the Company’s collection on the financial instrument.

September 30, 2022 (Unaudited) – (Continued)

Troubled Debt Restructuring

Concessions could include term extensions, payment deferrals, interest rate reductions, principal forgiveness, forbearance, or other actions designed to maximize the Company’s collection on the financial instrument.

Current expected credit losses for financial instruments that are troubled debt restructurings are determined individually.

9 unchanged sentences

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

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (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 June 30, 2022 by year of origination, loan type, and risk rating (dollar amounts in thousands):

The following table presents the net book value of the Company’s loans held-for-investment portfolio as of September 30, 2022 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 June 30, 2022

As of September 30, 2022

Number of Loans 2022 2021 2020 2019 Total

23 unchanged sentences

Weighted Average Risk Rating (2)

CIM REAL ESTATE FINANCE TRUST, INC.

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June 30, 2022 (Unaudited) – (Continued)

____________________________________

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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 six months ended June 30, 2022, one of the Company’s interest rate swap agreements matured, four of the Company’s interest rate cap agreements matured, and the Company terminated one interest rate swap agreement prior to the maturity date.

As of June 30, 2022, the Company had one non-designated interest rate cap agreement and three interest rate swap agreements designated as hedging instruments.

Subsequent to June 30, 2022, one of the Company’s interest rate swap agreements matured, as further discussed in Note 17 — Subsequent Events.

The following table summarizes the terms of the Company’s interest rate cap agreements and interest rate swap agreements as of June 30, 2022 and December 31, 2021 (dollar amounts in thousands):

During the nine months ended September 30, 2022, two of the Company’s interest rate swap agreements matured, four of the Company’s interest rate cap agreements matured, the Company terminated three interest rate swap agreements prior to the maturity dates, and the Company entered into one interest rate cap agreement.

As of September 30, 2022, the Company had two non-designated interest rate cap agreements.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

The following table summarizes the terms of the Company’s interest rate cap agreements as of September 30, 2022 and December 31, 2021 (dollar amounts in thousands):

Outstanding Notional Fair Value of Assets (Liabilities) as of

Balance Sheet Amount as of Interest Effective Maturity June 30, December 31,

Location June 30, 2022 Rates (1)

Balance Sheet Amount as of Interest Effective Maturity September 30, December 31,

Location September 30, 2022 Rates (1)

Dates Dates 2022 2021

Interest Rate Cap Prepaid expenses, derivative assets and other assets $ 650,000 5.99 %

$ 2,030 $ 179

Interest Rate Swaps Prepaid expenses, derivative assets and other assets $ 55,800 3.46 % to 4.04 %

Interest Rate Caps Prepaid expenses, derivative assets and other assets $ 712,000 7.51 % to 7.78 %

7/15/2021 to 9/13/2022

7/15/2023 to 10/9/2023

$ 4,705 $ 179

Interest Rate Swap Deferred rental income, derivative liabilities and other liabilities $ — — %

1 unchanged sentence

____________________________________

(1) The interest rate consists of the underlying index swapped or capped to a fixed rate as of June 30, 2022.

(1) The interest rate consists of the underlying index capped to a fixed rate as of September 30, 2022.

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

3 unchanged sentences

The change in fair value of the derivative instruments that are not designated as hedges is recorded directly to earnings in interest expense and other, net on the accompanying condensed consolidated statements of operations.

During the six months ended June 30, 2022, the Company had interest rate swaps designated as cash flow hedges in order to hedge the variability of the anticipated cash flows on its variable rate debt.

During the nine months ended September 30, 2022, the Company had interest rate swaps designated as cash flow hedges in order to hedge the variability of the anticipated cash flows on its variable rate debt.

The change in fair value of the derivative instruments 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 three and six months ended June 30, 2022, the amount of loss reclassified from other comprehensive (loss) income as an increase to interest expense was $ 69,000 and $ 62,000 , respectively.

For the three and six months ended June 30, 2021, the amount of loss reclassified from other comprehensive (loss) income as an increase to interest expense was $ 71,000 and $ 3.2 million, respectively.

The total unrealized gain on interest rate swaps of $ 2.5 million as of June 30, 2022, and the total unrealized gain on interest rate swaps of $ 152,000 as of December 31, 2021, respectively, is included in accumulated other comprehensive (loss) income in the accompanying condensed consolidated statements of stockholders’ equity.

For the three and nine months ended September 30, 2022, the amount of gain reclassified from other comprehensive (loss) income as a decrease to interest expense was $ 2.6 million for both periods.

For the three months ended September 30, 2021, the amount of gain reclassified from other comprehensive (loss) income as a decrease to interest expense was $ 170,000 .

For the nine months ended September 30, 2021, the amount of loss reclassified from other comprehensive (loss) income as an increase to interest expense was $ 3.0 million.

The total unrealized loss on interest rate swaps of $ 20,000 as of September 30, 2022, and the total unrealized gain on interest rate swaps of $ 152,000 as of December 31, 2021, respectively, is included in accumulated other comprehensive (loss) income in the accompanying condensed consolidated statements of stockholders’ equity.

During the next 12 months, the Company estimates that $ 20,000 will be reclassified from other comprehensive (loss) income as an increase to interest expense.

1 unchanged sentence

The Company has agreements with each of its derivative counterparties that contain provisions whereby if the Company defaults on certain of its unsecured indebtedness, the Company could also be declared in default on its derivative obligations, resulting in an acceleration of payment.

If the Company had breached any of these provisions, it could have been required to

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

settle its obligations under the agreements at their aggregate termination value, inclusive of interest payments and accrued interest of $ 210,000 as of June 30, 2022.

If the Company had breached any of these provisions, it could have been required to settle its obligations under the agreements at their aggregate termination value, inclusive of interest payments and accrued interest.

In addition, the Company is exposed to credit risk in the event of non-performance by its derivative counterparties.

1 unchanged sentence

The Company records credit risk valuation adjustments on its derivative instruments based on the credit quality of the Company and the respective counterparty.

There were no events of default related to the derivative instruments as of June 30, 2022.

There were no events of default related to the derivative instruments as of September 30, 2022.

NOTE 10 — REPURCHASE FACILITIES, CREDIT FACILITIES AND NOTES PAYABLE

As of June 30, 2022, the Company had $ 4.2 billion of debt outstanding, including net deferred financing costs, with a weighted average years to maturity of 3.2 years and a weighted average interest rate of 3.3 %.

As of September 30, 2022, the Company had $ 4.4 billion of debt outstanding, including net deferred financing costs, with a weighted average years to maturity of 3.3 years and a weighted average interest rate of 4.5 %.

The weighted average years to maturity is computed using the scheduled repayment date as specified in each loan agreement where applicable.

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

The following table summarizes the debt balances as of June 30, 2022 and December 31, 2021, and the debt activity for the six months ended June 30, 2022 (in thousands):

During the Six Months Ended June 30, 2022

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

The following table summarizes the debt balances as of September 30, 2022 and December 31, 2021, and the debt activity for the nine months ended September 30, 2022 (in thousands):

During the Nine Months Ended September 30, 2022

Balance as of December 31, 2021 Debt Issuances & Assumptions (1)

1 unchanged sentence

Accretion & (Amortization) Balance as of

June 30, 2022

September 30, 2022

Notes payable – fixed rate debt $ 471,967 $ — $ ( 435,320 ) (4)

13 unchanged sentences

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

(2) In connection with the repayment of certain mortgage notes, the Company recognized a loss on extinguishment of debt of $ 16.2 million during the six months ended June 30, 2022.

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

(2) In connection with the repayment of certain mortgage notes, the Company recognized a loss on extinguishment of debt of $ 19.6 million during the nine months ended September 30, 2022.

(3) Deferred costs related to the term portion of the CIM Income NAV Credit Facility and the CMFT Credit Facility (both defined below).

(4) Includes mortgage notes of $ 356.5 million that were assumed by buyer in connection with disposition of real estate assets.

Notes Payable

As of June 30, 2022, the fixed rate debt outstanding of $ 95.3 million included $ 15.8 million of variable rate debt that is fixed through interest rate swap agreements, which has the effect of fixing the variable interest rates per annum through the maturity date of the variable rate debt.

As of September 30, 2022, the Company had fixed rate debt outstanding of $ 36.6 million.

The fixed rate debt has interest rates ranging from 4.1 % to 4.5 % per annum.

The fixed rate debt outstanding matures on various dates from July 2022 through February 2025.

The fixed rate debt outstanding matures on various dates from December 2024 through February 2025.

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 $ 173.4 million as of June 30, 2022.

The aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the fixed rate debt outstanding was $ 59.4 million as of September 30, 2022.

Each of the mortgage notes payable comprising the fixed rate debt is secured by the respective properties on which the debt was placed.

As of June 30, 2022, the Company had $ 364.2 million of variable rate debt outstanding, which included $ 314.9 million of borrowings financed through a note on note financing arrangement with Massachusetts Mutual Life Insurance Company (the “Mass Mutual Financing”).

In addition, upon completing foreclosure proceedings to take control of the assets which previously

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

secured the Company’s mezzanine loans in January 2021, the Company assumed $ 102.6 million in variable rate debt related to the underlying properties.

The variable rate debt outstanding had a weighted average interest rate of 3.8 % as of June 30, 2022, and matures on various dates from July 2022 to October 2027.

As of September 30, 2022, the Company had $ 470.9 million of variable rate debt outstanding, which included $ 421.5 million of borrowings financed through a note on note financing arrangement with Massachusetts Mutual Life Insurance Company (the “Mass Mutual Financing”).

In addition, upon completing foreclosure proceedings to take control of the assets which previously secured the Company’s mezzanine loans in January 2021, the Company assumed $ 102.6 million in variable rate debt related to the underlying properties (the “Assumed Variable Rate Debt”).

During the nine months ended September 30, 2022, the Company refinanced the Assumed Variable Rate Debt and paid down the outstanding balance.

The amended borrowing agreement related to the refinanced Assumed Variable Rate Debt provides for borrowings up to $ 62.0 million.

As of September 30, 2022, the amount outstanding on the refinanced Assumed Variable Rate Debt totaled $ 49.4 million.

The Company’s outstanding variable rate debt had a weighted average interest rate of 5.3 % as of September 30, 2022, and matures on various dates from October 2024 to January 2028.

First Lien Mortgage Loan

1 unchanged sentence

Limited originated a $ 650.0 million first lien mortgage loan (the “Mortgage Loan”) to 114 single purpose entities (the “Borrowers”), each of which is an affiliate of the Company and is managed on a day-to-day basis by affiliates of CIM.

As of June 30, 2022, the Mortgage Loan is secured by, among other things, cross-collateralized and cross-defaulted first priority mortgages, deeds of trust, security agreements or other similar security instruments on the Borrowers’ fee simple interests in 53 properties, comprised of 52 single-tenant retail properties and one office property.

As of June 30, 2022, the aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the notes was $ 333.9 million.

Amounts outstanding on the Mortgage Loan totaled $ 135.3 million with a weighted average interest rate of 6.0 % as of June 30, 2022.

As of September 30, 2022, the Mortgage Loan is secured by, among other things, cross-collateralized and cross-defaulted first priority mortgages, deeds of trust, security agreements or other similar security instruments on the Borrowers’ fee simple interests in 51

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September 30, 2022 (Unaudited) – (Continued)

properties, comprised of 50 single-tenant retail properties and one office property.

As of September 30, 2022, the aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the notes was $ 332.1 million.

Amounts outstanding on the Mortgage Loan totaled $ 134.0 million with a weighted average interest rate of 7.5 % as of September 30, 2022.

The Mortgage Loan is a floating-rate, interest-only, non-recourse loan with a two-year initial term ending on August 9, 2023, with three one-year extension options, subject to certain conditions.

12 unchanged sentences

The aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the Class A Notes was $ 977.3 million.

As of June 30, 2022, amounts outstanding on the Class A Notes totaled $ 766.9 million with a weighted average interest rate of 2.8 %.

As of September 30, 2022, amounts outstanding on the Class A Notes totaled $ 765.0 million with a weighted average interest rate of 2.8 %.

The Company may prepay the Class A Notes in full on or after the payment date beginning in July 2026 for the Class A-1 (AAA) Notes, the Class A-3 (AA) Notes and the Class A-5 (A) Notes, and on or after the payment date in July 2028 for the Class A-2 (AAA) Notes, the Class A-4 (AA) Notes and the Class A-6 (A) Notes.

Credit Facilities

On December 16, 2021, as a result of the CIM Income NAV Merger, a subsidiary of the Company assumed CIM Income NAV’s obligations pursuant to the credit agreement by and among CIM Income NAV Operating Partnership, LP, the operating partnership of CIM Income NAV (“CIM Income NAV OP”), JPMorgan Chase, as administrative agent, and the lender parties thereto (the “CIM Income NAV Credit Agreement”), including as guarantor under a guaranty provided by CIM Income NAV, and as modified by a modification agreement dated as of September 6, 2017 and subsequently modified following the consummation of the CIM Income NAV Merger by a second modification agreement on December 16, 2021.

The CIM Income NAV Credit Agreement allowed for borrowings of up to $ 425.0 million (the “CIM Income NAV Credit Facility”), including $ 212.5 million in term loans (the “CIM Income NAV Term Loans”) and up to $ 212.5 million in revolving loans (the “CIM Income NAV Revolving Loans”).

The CIM Income NAV Term Loans and the CIM Income NAV Revolving Loans had a maturity date of September 6, 2022.

The Company paid down the $ 212.5 million outstanding balance under the CIM Income NAV Credit Facility and terminated the CIM Income NAV Credit Facility subsequent to June 30, 2022, as further discussed in Note 17 — Subsequent Events.

CMFT SCF Borrower, LLC, an indirect wholly owned subsidiary of the Company (the “CMFT Borrowing Sub”), has a credit agreement (the “Credit Agreement”) with the lenders from time to time parties thereto, JPMorgan Chase, as administrative agent, letter of credit issuer and syndication agent, and PNC Bank, N.A., as syndication agent, which provides for borrowings in the initial amount of $ 300.0 million (the “CMFT Credit Facility”), which includes a $ 100.0 million term loan facility (the “CMFT Term Loan”) and the ability to borrow up to $ 200.0 million in revolving loans (the “CMFT Revolving Loans”) under a revolving credit facility (the “CMFT Revolving Facility”) with a $ 30.0 million letter of credit subfacility.

The CMFT Term Loan and the CMFT Revolving Facility both mature on July 15, 2025.

Borrowings under the Credit Agreement bear interest at rates depending upon the type of loan specified by the CMFT Borrowing Sub, the interest period, and the Company’s adjusted leverage ratio.

For alternate base rate (“ABR”) loans, the interest rate will be equal to the greater of:

(a) JPMorgan Chase’s prime rate (as defined in the Credit Agreement), (b) the NYFRB Rate (as defined in the Credit Agreement) plus 0.50 %, and (c) the Adjusted Term SOFR Rate (as defined in the Credit Agreement) plus 1.0 % for the interest period plus the applicable rate.

For term benchmark (“Term Benchmark”) loans and risk-free rate (“RFR”) loans, the interest rate is based on the Adjusted Term SOFR Rate or Adjusted Daily Simple SOFR (as defined in the Credit Agreement), respectively, for the applicable interest period plus the applicable rate.

The applicable rate is based upon the adjusted leverage ratio, and for ABR Loans, ranges from 0.50 % at an adjusted leverage ratio below 2.50 :1.00 to 1.375 % at an adjusted leverage ratio greater than 3.50 :1.00.

For Term Benchmark loans and RFR loans, the applicable rate is 1.00 % higher than for ABR loans at each adjusted leverage ratio range.

In connection with the CMFT Credit Facility, certain subsidiaries of the Company, including the CMFT Borrowing Sub, entered into a collateral assignment of equity interest and security agreement, by which certain subsidiaries of the Company, including the CMFT Borrowing Sub, pledged equity interests in certain property-owning subsidiaries as collateral to secure on a first priority basis the obligations under the CMFT Credit Facility.

The Company and certain subsidiaries of the Company

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

As of June 30, 2022, the CIM Income NAV Term Loans outstanding totaled $ 212.5 million, $ 140.0 million of which was 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 4.6 %.

As of June 30, 2022, the Company had $ 212.5 million outstanding under the CIM Income NAV Credit Facility at a weighted average interest rate of 4.2 % and $ 212.5 million in unused capacity, subject to borrowing availability.

September 30, 2022 (Unaudited) – (Continued)

also entered into a guaranty with the lenders, under which the Company and certain subsidiaries agreed to guarantee the CMFT Borrowing Sub’ obligations under the Credit Agreement.

As of September 30, 2022, the CMFT Term Loan and CMFT Revolving Loans outstanding totaled $ 100.0 million and $ 50.0 million, respectively.

As of September 30, 2022, the Company had $ 150.0 million outstanding under the CMFT Credit Facility at a weighted average interest rate of 4.5 % and $ 150.0 million in unused capacity, subject to borrowing availability.

The Company had available borrowings of $ 150.0 million as of September 30, 2022.

The Company had a credit agreement (the “CIM Income NAV Credit Agreement”) with JPMorgan Chase, as administrative agent, and the lender parties thereto, that provided for borrowings of up to $ 425.0 million (the “CIM Income NAV Credit Facility”).

The CIM Income NAV Credit Facility was set to mature on September 6, 2022.

During the nine months ended September 30, 2022, the Company paid down the $ 212.5 million outstanding balance under the CIM Income NAV Credit Facility with proceeds from the closing of the CMFT Credit Facility and terminated the CIM Income NAV Credit Facility.

CMFT Corporate Credit Securities, LLC, an indirect wholly-owned, bankruptcy-remote subsidiary of the Company, has a revolving credit and security agreement (the “Third Amended Credit and Security Agreement”) with the lenders from time to time parties thereto, Citibank, N.A.

2 unchanged sentences

The Credit Securities Revolver may be increased from time to time pursuant to the Third Amended Credit and Security Agreement.

As of June 30, 2022, the amounts borrowed and outstanding under the Credit Securities Revolver totaled $ 521.5 million at a weighted average interest rate of 3.4 %.

As of September 30, 2022, the amounts borrowed and outstanding under the Credit Securities Revolver totaled $ 541.5 million at a weighted average interest rate of 5.2 %.

Borrowings under the Third Amended Credit and Security Agreement will bear interest equal to the one-month Term SOFR (as defined in the Third Amended Credit and Security Agreement) for the relevant interest period, plus an applicable rate.

The applicable rate is dependent on the type of loan being financed, which includes broadly syndicated, private and middle market loans meeting certain criteria as set forth in the Third Amended Credit and Security Agreement and ranges from 1.90 % to 2.75 % per annum during the first two years of the reinvestment period and 2.00 % to 2.85 % during the last year of the reinvestment period and 2.10 % to 2.95 % per annum during the amortization period (and, in each case, an additional 2.00 % per annum following an event of default under the Third Amended Credit and Security Agreement).

The reinvestment period began on December 31, 2019 (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 began on December 31, 2019 (the “Closing Date”) and concludes on the earlier of (i) the date that is three years after June 23, 2022, the date the third amendment became effective, (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:

1 unchanged sentence

Borrowings under the Third Amended Credit and Security Agreement are secured by substantially all of the assets held by CMFT Corporate Credit Securities, LLC, which shall primarily consist of liquid senior secured loans subject to certain eligibility criteria under the Third Amended Credit and Security Agreement.

The Company believes it was in compliance with the financial covenants under the Company’s various fixed and variable rate debt agreements, as of June 30, 2022.

The Company believes it was in compliance with the financial covenants under the Company’s various fixed and variable rate debt agreements, as of September 30, 2022.

Repurchase Facilities

As of June 30, 2022, indirect wholly-owned subsidiaries of the Company (collectively, the “CMFT Lending Subs”), had Master Repurchase Agreements with Citibank, Barclays Bank PLC (“Barclays”), Wells Fargo Bank, N.A.

As of September 30, 2022, indirect wholly-owned subsidiaries of the Company (collectively, the “CMFT Lending Subs”), had Master Repurchase Agreements with Citibank, Barclays Bank PLC (“Barclays”), Wells Fargo Bank, N.A.

(“Wells Fargo”), Deutsche Bank AG (“Deutsche Bank”), and J.P.

1 unchanged sentence

Morgan”) (collectively, the “Repurchase Agreements”) to provide financing primarily through each bank’s purchase of the Company’s CRE mortgage loans and CMBS and future funding advances (the “Repurchase Facilities”).

The following table is a summary of the Repurchase Facilities as of June 30, 2022 (dollar amounts in thousands):

The following table is a summary of the Repurchase Facilities as of September 30, 2022 (dollar amounts in thousands):

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

Repurchase Facility Date of Agreement Maturity Date (1)

13 unchanged sentences

__________________________________

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

(1) The repurchase facilities with Citibank, Barclays, and Wells Fargo are set to mature on various dates between May 2024 and September 2024, with up to two one-year extension options, while the repurchase facility with Deutsche Bank (“Deutsche Bank Repurchase Facility”) is set to mature on October 8, 2022, with four one-year extension options, all of which are subject to certain conditions set forth in the Repurchase Agreements .

Subsequent to June 30, 2022, the Company exercised the Deutsche Bank Repurchase Facility’s first extension option, extending the date of maturity to October 8, 2023, as discussed in Note 17 — Subsequent Events.

(2) During the six months ended June 30, 2022 , the Company increased the repurchase facility with Barclays (the “Barclays Repurchase Facility”) and Wells Fargo (the “Wells Fargo Repurchase Facility”) to provide up to $ 1.25 billion and $ 750.0 million, respectively, in financing.

(3) Advances under the repurchase agreement accrue interest at per annum rates based on the one-month LIBOR, Term SOFR (as such term is defined in the applicable Repurchase Agreement), 30-day SOFR average, or the daily compounded SOFR plus a spread ranging from 1.25 % to 2.15 % to be determined on a case-by-case basis between Citibank, Barclays or Wells Fargo and the CMFT Lending Subs.

(1) The repurchase facilities with Citibank and Barclays are set to mature in August 2024 and September 2024, with up to two one-year extension options.

The repurchase facility with Wells Fargo was set to mature on May 19, 2024, with up to two one-year extension options.

During the nine months ended September 30, 2022, the Company extended the initial facility termination date to August 30, 2025 under the Third Amendment to the Master Repurchase Agreement with Wells Fargo.

The repurchase facility with Deutsche Bank (“Deutsche Bank Repurchase Facility”) was set to mature on October 8, 2022, with four one-year extension options, all of which are subject to certain conditions set forth in the Repurchase Agreements .

During the nine months ended September 30, 2022, the Company exercised the Deutsche Bank Repurchase Facility’s first extension option, extending the date of maturity to October 8, 2023.

Subsequent to September 30, 2022, the Company extended the current maturity date under the repurchase facility with Barclays (the “Barclays Repurchase Facility”), extending the maturity date to September 22, 2025, as discussed in Note 17 — Subsequent Events.

(2) During the nine months ended September 30, 2022 , the Company increased the Barclays Repurchase Facility and the repurchase facility with Wells Fargo (the “Wells Fargo Repurchase Facility”) to provide up to $ 1.25 billion and $ 750.0 million, respectively, in financing.

(3) Advances under the Repurchase Agreements accrue interest at per annum rates based on the one-month LIBOR, Term SOFR (as such term is defined in the applicable Repurchase Agreement), 30-day SOFR average, or the daily compounded SOFR plus a spread ranging from 1.25 % to 2.15 % to be determined on a case-by-case basis between Citibank, Barclays or Wells Fargo and the CMFT Lending Subs.

(4) Under the Amended and Restated Master Repurchase Agreement with Deutsche Bank, advances under the repurchase agreement may be made based on one-month Term SOFR plus a spread designated by Deutsche Bank, and the interest rate used for certain existing advances under the existing Deutsche Bank Repurchase Facility may be converted from the one-month LIBOR to one-month SOFR plus a spread ranging from 1.90 % to 2.75 %.

(5) Facilities under the Master Repurchase Agreement with J.P.

Morgan carry a rolling term which is reset monthly.

(5) Facilities under the repurchase facility with J.P.

Morgan (“J.P.

Morgan Repurchase Facility”) carry a rolling term which is reset monthly.

Such facilities carry no maximum facility size.

1 unchanged sentence

Morgan, advances under the repurchase agreement may be made based on one-month Term SOFR plus a spread designated by J.P.

Morgan ranging from 1.20 % to 1.35 %.

Morgan, which as of September 30, 2022, ranges from 1.10 % to 1.35 %.

The Repurchase Agreements provide for simultaneous agreements by Citibank, Barclays, Wells Fargo, Deutsche Bank and J.P.

7 unchanged sentences

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 June 30, 2022.

The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to June 30, 2022 (in thousands):

The Company believes it was in compliance with the financial covenants under the Repurchase Agreements as of September 30, 2022.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to September 30, 2022 (in thousands):

Principal Repayments

3 unchanged sentences

Total $ 4,380,577

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

NOTE 11 — COMMITMENTS AND CONTINGENCIES

2 unchanged sentences

Unfunded Commitments

As of June 30, 2022, the Company had $ 370.9 million of unfunded loan commitments related to its existing CRE loans held-for-investment and corporate senior loans, and $ 115.7 million of unfunded commitments related to the NewPoint JV.

As of September 30, 2022, the Company had $ 344.7 million of unfunded loan commitments related to its existing CRE loans held-for-investment, corporate senior loans, and liquid senior loans, and $ 79.5 million of unfunded commitments related to the NewPoint JV.

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

Unfunded Liquid Senior Loans

As of June 30, 2022, the Company had $ 2.0 million of unfunded liquid senior loans and $ 22.4 million of unsettled liquid senior loan acquisitions, $ 14.8 million of which settled subsequent to June 30, 2022.

As of September 30, 2022, the Company had $ 6.3 million of unsettled liquid senior loan acquisitions, $ 5.8 million of which settled subsequent to September 30, 2022.

Unsettled acquisitions are included in cash and cash equivalents in the accompanying condensed consolidated balance sheet.

11 unchanged sentences

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).

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

CMFT Securities has an investment advisory and management agreement dated December 6, 2019 (the “Investment Advisory and Management Agreement”) with the Investment Advisor.

4 unchanged sentences

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.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

In addition, the Investment Advisor has a sub-advisory agreement dated December 6, 2019 (the “Sub-Advisory Agreement”) with OFS Capital Management, LLC (the “Sub-Advisor”) to act as an investment sub-advisor to CMFT Securities.

5 unchanged sentences

CMFT Management is entitled to receive incentive compensation, payable with respect to each quarter, which is generally equal to the excess of (a) the product of (i) 20 % and (ii) the excess of (A) Core Earnings (as defined in the Management Agreement) of the Company for the previous 12-month period, over (B) the product of (1) the Company’s Consolidated Equity (as defined in the Management Agreement) in the previous 12-month period, and (2) 7 % per annum, over (b) the sum of any incentive compensation paid to CMFT Management with respect to the first three calendar quarters of such previous 12-month period (or such lesser number of completed calendar quarters preceding the applicable period, if applicable).

During the three and six months ended June 30, 2022 and 2021, no incentive compensation fees were incurred.

During the three and nine months ended September 30, 2022 and 2021, 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.

4 unchanged sentences

The Company recorded fees and expense reimbursements as shown in the table below for services provided by CMFT Management or its affiliates related to the services described above during the periods indicated (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

3 unchanged sentences

____________________________________

(1) During the six months ended June 30, 2022, the Company paid $ 461,000 of expense reimbursements attributable to earnout leasing costs under the Purchase and Sale Agreement, which are included in gain on disposition of real estate and condominium developments, net in the condensed consolidated statements of operations.

(1) During the nine months ended September 30, 2022, the Company paid $ 984,000 of expense reimbursements attributable to earnout leasing costs under the Purchase and Sale Agreement, which are included in gain on disposition of real estate and condominium developments, net in the condensed consolidated statements of operations.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

Due to Affiliates

Of the amounts shown above, $ 14.4 million and $ 16.0 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 six months ended June 30, 2022 and 2021, respectively, and such amounts were recorded as liabilities of the Company as of such dates.

Of the amounts shown above, $ 14.6 million and $ 15.1 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 nine months ended September 30, 2022 and 2021, respectively, and such amounts were recorded as liabilities of the Company as of such dates.

Development Management Agreements

On January 7, 2021, the Company completed foreclosure proceedings to take control of the assets which previously secured its mezzanine loans, including 75 condominium units and 21 rental units across four buildings in New York.

Upon foreclosure, and with the approval of the valuation, compensation and affiliate transactions committee of the Board, CIM NY Management, LLC, an affiliate of the Company’s manager, CMFT Management, entered into a Development Management Agreement with the indirect wholly owned subsidiaries of the Company that own each of the four buildings (the “Building Owners”), wherein CIM NY Management, LLC will act as project manager in overseeing the development and construction of property improvements in accordance with each respective Development Management Agreement (the “Development

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

In consideration for the Development Services, CIM NY Management, LLC will receive a development management fee from the Building Owners equal to 4 % of the aggregate gross project costs expended during the term of the Development Management Agreement, subject to the conditions in each respective Development Management Agreement.

During the six months ended June 30, 2022 and 2021, the Company recorded $ 234,000 and $ 56,000 , respectively, in development management fees.

During the nine months ended September 30, 2022 and 2021, the Company recorded $ 337,000 and $ 85,000 , respectively, in development management fees.

Additionally, CIM NY Management, LLC is reimbursed by the Building Owners for expenses incurred in connection with the Development Services, including services provided that are incidental to but not part of the Development Services.

2 unchanged sentences

In September 2021, the Company co-invested $ 68.4 million in preferred units and $ 138.8 million in a mortgage loan to a third-party for the purchase of a multi-family, office and retail building in Fort Lauderdale, Florida with CIM Real Assets & Credit Fund, a fund that is advised by affiliates of CMFT Management (“CIM RACR”).

During the six months ended June 30, 2022, the Company and CIM RACR upsized their investment in the preferred units with an additional $ 4.8 million and $ 364,000 , respectively, and upsized their investment in the mortgage loan with an additional $ 6.4 million and $ 490,000 , respectively.

The Company subsequently redeemed its investment in the preferred units during the six months ended June 30, 2022 in exchange for an investment in a first mortgage loan.

As a result of the upsize and the conversion of preferred units, as of June 30, 2022, the Company had $ 203.6 million invested in the mortgage loan.

During the nine months ended September 30, 2022, the Company and CIM RACR upsized their investment in the preferred units with an additional $ 4.8 million and $ 364,000 , respectively, and upsized their investment in the mortgage loan with an additional $ 6.4 million and $ 490,000 , respectively.

The Company subsequently redeemed its investment in the preferred units during the nine months ended September 30, 2022 in exchange for an investment in a first mortgage loan.

As a result of the upsize and the conversion of preferred units, as of September 30, 2022, the Company had $ 203.6 million invested in the mortgage loan.

In October 2021, the Company invested in a $ 130.0 million first mortgage loan, with an initial advance of $ 119.0 million, to a third-party, the proceeds of which were used to finance the acquisition of a property from a fund that is advised by an affiliate of CMFT Management.

As of June 30, 2022, $ 121.2 million of the first mortgage loan was outstanding.

As of September 30, 2022, $ 122.4 million of the first mortgage loan was outstanding.

An affiliate of CMFT Management serves as the property manager for this property and has entered into a subordination agreement with the Company in connection with the loan.

3 unchanged sentences

In December 2021, the Company invested in a $ 155.0 million first mortgage loan, with an initial advance of $ 154.0 million, to a third-party, the proceeds of which were used to finance the acquisition of a property from a fund that is advised by an affiliate of CMFT Management.

As of June 30, 2022, $ 154.0 million of the first mortgage loan was outstanding.

During the six months ended June 30, 2022, the Company invested in a $ 147.0 million first mortgage loan, with an initial advance of $ 143.0 million, to a third-party, which was previously funded by a fund that is advised by an affiliate of CMFT Management.

As of June 30, 2022, $ 143.3 million of the first mortgage loan was outstanding.

As a result of the CIM Income NAV Merger, the Company had an investment in CIM UII Onshore, a fund that is advised by an affiliate of CMFT Management, which was fully redeemed for $ 60.7 million during the six months ended June 30, 2022.

As of September 30, 2022, $ 154.0 million of the first mortgage loan was outstanding.

During the nine months ended September 30, 2022, the Company invested in a $ 147.0 million first mortgage loan, with an initial advance of $ 143.0 million, to a third-party, which was previously funded by a fund that is advised by an affiliate of CMFT Management.

As of September 30, 2022, $ 144.7 million of the first mortgage loan was outstanding.

See Note 2 — Summary of Significant Accounting Policies for more information on the CIM UII Onshore investment.

During the six months ended June 30, 2022, the Company and CIM RACR co-invested $ 55.9 million and $ 12.2 million, respectively, in four corporate senior loans to a third-party.

As of June 30, 2022, $ 55.8 million of the corporate senior loans was outstanding.

Subsequent to June 30, 2022, the Company and CIM RACR co-invested $ 20.0 million and $ 2.5 million, respectively, in a corporate senior loan to a third-party.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

During the nine months ended September 30, 2022, the Company and CIM RACR co-invested $ 75.9 million and $ 14.7 million, respectively, in five corporate senior loans to a third-party.

As of September 30, 2022, $ 58.0 million of the corporate senior loans was outstanding.

The Sub-Advisor provided investment management services related to these corporate senior loans pursuant to the Sub-Advisory Agreement.

3 unchanged sentences

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 CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

NOTE 14 — STOCKHOLDERS’ EQUITY

Equity-Based Compensation

On August 10, 2018, the Board approved the adoption of the Company’s 2018 Equity Incentive Plan (the “2018 Plan”), under which 400,000 of the Company’s shares of common stock were reserved for issuance and awards of approximately 284,000 shares of common stock were available for future grant at June 30, 2022.

On April 27, 2022, the Board and the compensation committee of the Board approved the Amended and Restated CIM Real Estate Finance Trust, Inc.

2022 Equity Incentive Plan (the “2022 Plan”) and the 2022 Plan was approved by the Company’s stockholders at the Company’s 2022 Annual Meeting of Stockholders held on July 12, 2022.

The 2022 Plan supersedes and replaces the 2018 Plan.

The 2022 Plan superseded and replaced the 2018 Plan.

Awards that are granted on or after the effective date of the 2022 Plan are subject to the terms and provisions of the 2022 Plan.

The total number of shares of Company common stock reserved and available for issuance under the 2022 Plan at any time during the term of the 2022 Plan are 250,000 shares, which is a reduction from 400,000 shares authorized for issuance under the 2018 Plan, and awards of approximately 250,000 shares of common stock were available for future grant at September 30, 2022.

Under the 2022 Plan, the Board or the compensation committee of the Board has the authority to grant certain awards to employees, non-employee directors, and consultants or advisors of the Company, including stock option awards, restricted stock awards or deferred stock awards, which awards will further align such persons’ interests with the interests of the Company’s stockholders.

1 unchanged sentence

The 2022 Plan may be amended or terminated by the Board or the compensation committee of the Board at any time, subject to the right of the Company’s stockholders to approve certain amendments.

As of June 30, 2022, the Company has granted awards of approximately 116,000 restricted shares in the aggregate to the independent members of the Board under the 2018 Plan.

As of June 30, 2022, 73,000 of the restricted shares had vested based on one year of continuous service.

The remaining 43,000 restricted shares issued had not vested or been forfeited as of June 30, 2022.

As of September 30, 2022, the Company has granted awards of approximately 116,000 restricted shares in the aggregate to the independent members of the Board under the 2018 Plan.

As of September 30, 2022, 73,000 of the restricted shares had vested based on one year of continuous service, and on October 1, 2022, 43,000 of the restricted shares vested based on one year of continuous service.

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 $ 120,000 and $ 157,000 for the three and six months ended June 30, 2022, respectively, and $ 49,000 and $ 89,000 for the three and six months ended June 30, 2021, respectively, related to the restricted shares, which is included in general and administrative expenses in the accompanying condensed consolidated statements of operations.

As of June 30, 2022, there was $ 285,000 of total unrecognized compensation expense related to these restricted shares, which will be recognized ratably over the applicable remaining service period.

The Company recorded compensation expense of $ 120,000 and $ 277,000 for the three and nine months ended September 30, 2022, respectively, and $ 62,000 and $ 151,000 for the three and nine months ended September 30, 2021, respectively, related to the restricted shares, which is included in general and administrative expenses in the accompanying condensed consolidated statements of operations.

All compensation expense related to these restricted shares was recognized ratably over the period of service prior to September 30, 2022.

On October 1, 2022, as part of the annual retainers paid to the independent members of the Board and pursuant to the 2022 Plan, the independent members of the Board were each granted 11,111 restricted shares.

The restricted shares will vest on October 1, 2023.

NOTE 15 — LEASES

5 unchanged sentences

Non-lease components are considered to be variable rental and other property income and are recognized in the period incurred.

As of June 30, 2022, the Company’s leases had a weighted-average remaining term of 10.6 years.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

As of September 30, 2022, the Company’s leases had a weighted-average remaining term of 10.7 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.

1 unchanged sentence

The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

As of June 30, 2022, 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):

As of September 30, 2022, 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):

Future Minimum Rental Income

4 unchanged sentences

These contingent rents are subject to the tenant achieving periodic revenues in excess of specified levels.

For the three and six months ended June 30, 2022 and 2021, the amount of the contingent rent earned by the Company was not significant .

Rental and other property income during the three and six months ended June 30, 2022 and 2021 consisted of the following (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

For the three and nine months ended September 30, 2022 and 2021, the amount of the contingent rent earned by the Company was not significant .

Rental and other property income during the three and nine months ended September 30, 2022 and 2021 consisted of the following (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

10 unchanged sentences

This reflects the Company’s incremental borrowing rate, which was calculated based on the interest rate the Company would incur to borrow on a fully collateralized basis over a term similar to the lease.

The Company recognized $ 63,000 and $ 125,000 of ground lease expense during the three and six months ended June 30, 2022, of which $ 61,000 and $ 121,000 was paid in cash during the period it was recognized.

As of June 30, 2022, the Company’s scheduled future minimum rental payments related to its operating ground lease is approximately $ 125,000 for the remainder of 2022, $ 250,000 annually for 2023 through 2027, and $ 1.4 million thereafter through the maturity date of the lease in August 2033.

The Company recognized $ 63,000 and $ 188,000 of ground lease expense during the three and nine months ended September 30, 2022, of which $ 61,000 and $ 182,000 was paid in cash during the period it was recognized.

As of September 30, 2022, the Company’s scheduled future minimum rental payments related to its operating ground lease is approximately $ 63,000 for the remainder of 2022, $ 250,000 annually for 2023 through 2027, and $ 1.4 million thereafter through the maturity date of the lease in August 2033.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

NOTE 16 — SEGMENT REPORTING

4 unchanged sentences

Prior period amounts have been revised to conform to the current year presentation shown below.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

The following tables present segment reporting for the three and six months ended June 30, 2022 and 2021 (in thousands):

The following tables present segment reporting for the three and nine months ended September 30, 2022 and 2021 (in thousands):

Real Estate Credit Corporate/Other (1)

Company Total

Three Months Ended June 30, 2022

Three Months Ended September 30, 2022

Rental and other property income $ 43,465 $ — $ 94 $ 43,559

15 unchanged sentences

Gain on investment in unconsolidated entities — 2,195 — 2,195

Unrealized (loss) on equity security — ( 9,030 ) — ( 9,030 )

Interest expense and other, net ( 4,517 ) ( 32,152 ) ( 2,697 ) ( 39,366 )

Loss on extinguishment of debt ( 2,257 ) — ( 3,112 ) ( 5,369 )

(Loss) gain on extinguishment of debt ( 5,615 ) — 2,271 ( 3,344 )

Segment net income (loss) $ 11,902 $ 13,428 $ ( 9,791 ) $ 15,539

1 unchanged sentence

Segment net income (loss) attributable to the Company 11,773 13,428 ( 9,791 ) 15,410

Total assets as of June 30, 2022

Total assets as of September 30, 2022

$ 2,189,724 $ 4,725,858 $ 209,196 $ 7,124,778

3 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

September 30, 2022 (Unaudited) – (Continued)

Real Estate Credit Corporate/Other (1) (2)

Company Total

Six Months Ended June 30, 2022

Nine Months Ended September 30, 2022

Rental and other property income

24 unchanged sentences

Gain on investment in unconsolidated entities — 3,686 5,172 8,858

Unrealized (loss) gain on equity security — ( 15,462 ) 22 ( 15,440 )

Interest expense and other, net

6 unchanged sentences

Segment net income (loss) attributable to the Company 132,621 31,563 ( 35,997 ) 128,187

Total assets as of June 30, 2022

Total assets as of September 30, 2022

$ 2,189,724 $ 4,725,858 $ 209,196 $ 7,124,778

4 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

September 30, 2022 (Unaudited) – (Continued)

Real Estate Credit Corporate/Other (1)

Company Total

Three Months Ended June 30, 2021

Three Months Ended September 30, 2021

Rental and other property income

16 unchanged sentences

Real estate impairment 891 — — 891

Increase in provision for credit losses — 123 — 123

Decrease in provision for credit losses — ( 1,792 ) — ( 1,792 )

Total operating expenses

1 unchanged sentence

Gain on disposition of real estate and condominium developments, net 30,657 — 3,376 34,033

Merger-related expenses, net — — ( 398 ) ( 398 )

Operating income (loss)

6 unchanged sentences

$ 40,905 $ 13,175 $ ( 11,477 ) $ 42,603

Total assets as of June 30, 2021

Total assets as of September 30, 2021

$ 2,947,031 $ 1,866,913 $ 266,915 $ 5,080,859

3 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

September 30, 2022 (Unaudited) – (Continued)

Real Estate Credit Corporate/Other (1)

Company Total

Six Months Ended June 30, 2021

Nine Months Ended September 30, 2021

Rental and other property income

16 unchanged sentences

Real estate impairment 5,268 — — 5,268

Increase in provision for credit losses — 691 — 691

Decrease in provision for credit losses — ( 1,101 ) — ( 1,101 )

Total operating expenses

1 unchanged sentence

Gain on disposition of real estate and condominium developments, net 75,633 — 4,869 80,502

Merger-related expenses, net — — ( 398 ) ( 398 )

Operating income (loss)

6 unchanged sentences

$ 126,095 $ 27,828 $ ( 56,286 ) $ 97,637

Total assets as of June 30, 2021

Total assets as of September 30, 2021

$ 2,947,031 $ 1,866,913 $ 266,915 $ 5,080,859

3 unchanged sentences

Redemptions of Shares of Common Stock

Subsequent to June 30, 2022, the Company redeemed approximately 1.3 million shares for $ 9.4 million (at a redemption price of $ 7.20 per share).

The remaining redemption requests received during the three months ended June 30, 2022 totaling approximately 23.1 million shares went unfulfilled.

Subsequent to September 30, 2022, the Company redeemed approximately 1.3 million shares for $ 9.6 million (at a redemption price of $ 7.20 per share).

The remaining redemption requests received during the three months ended September 30, 2022 totaling approximately 23.9 million shares went unfulfilled.

Investment and Disposition Activity

Subsequent to June 30, 2022, the Company’s investment and disposition activity included the following:

• Disposed of the final property under contract for sale pursuant to the Purchase and Sale Agreement for total consideration of $ 68.3 million.

• In addition to the property disposed of pursuant to the Purchase and Sale Agreement, the Company disposed of seven properties and condominium units for an aggregate gross sales price of $ 36.9 million, resulting in net proceeds of $ 33.3 million after closing costs and a net gain of approximately $ 1.6 million.

• Invested $ 20.0 million in a corporate senior loan to a third-party and received principal repayments of $ 17.6 million.

Subsequent to September 30, 2022, the Company’s investment and disposition activity included the following:

• Disposed of one property and condominium units for an aggregate gross sales price of $ 14.1 million, resulting in net proceeds of $ 12.8 million after closing costs and a net gain of approximately $ 627,000 .

• Purchased $ 55.0 million in CMBS.

• Settled $ 37.7 million of liquid senior loan transactions, $ 14.1 million of which were traded as of June 30, 2022.

• Contributed an additional $ 5.4 million in capital to NP JV Holdings.

• Settled $ 6.3 million of liquid senior loan purchases, $ 5.8 million of which were traded as of September 30, 2022, and sold $ 3.3 million of liquid senior loans.

• The extension option was exercised on two of the Company’s first mortgage loans for $ 101.4 million that were initially set to mature on November 7, 2022, extending the date of maturity to November 7, 2023.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 30, 2022 (Unaudited) – (Continued)

September 30, 2022 (Unaudited) – (Continued)

Financing Activity

Subsequent to June 30, 2022, the Company’s financing activity included the following:

• Financed one of the Company’s first mortgage loans under the Mass Mutual Financing arrangement for $ 60.8 million.

• Extended the maturity date on $ 49.3 million of its mortgage note payable that was set to mature in July 2022, extending the date of maturity to September 1, 2022.

• Exercised the Deutsche Bank Repurchase Facility’s first extension option which was set to mature on October 8, 2022, extending the date of maturity to October 8, 2023.

• Paid down the $ 212.5 million outstanding balance under the CIM Income NAV Credit Facility and terminated the CIM Income NAV Credit Facility.

In connection with the facility pay down and termination, the Company terminated two interest rate swap agreements that held an aggregate notional value of $ 140.0 million upon termination.

• Entered into a credit agreement with JPMorgan Chase, which provides for borrowings of $ 300.0 million, which includes a $ 100.0 million term loan facility and the ability to borrow up to $ 200.0 million in revolving loans under a revolving credit facility with a $ 30.0 million letter of credit subfacility.

The term loan and the revolving facility both mature on July 15, 2025.

• Borrowed $ 215.0 million under the credit agreement entered into with JPMorgan Chase subsequent to June 30, 2022 and repaid $ 100.0 million of such borrowings.

• One of the Company’s interest rate swap agreements matured and the Company repaid in full $ 15.8 million of the underlying mortgage notes payable.

Subsequent to September 30, 2022, the Company’s financing activity included the following:

• Extended the Barclays Repurchase Facility’s initial maturity date which was set to mature on September 21, 2024, to September 22, 2025.

• Borrowed $ 35.0 million under the CMFT Credit Facility.

• Financed CMBS under the J.P.

Morgan Repurchase Facility for $ 31.3 million and repaid $ 5.3 million of borrowings under the J.P.

Morgan Repurchase Facility.

• Increased borrowings on first mortgage loans under the Deutsche Bank Repurchase Facility for $ 1.7 million.

• Repaid $ 10.8 million of borrowings under the Mortgage Loan.

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-Q

Item 1. Financial Statements