CIM GROUP, INC. 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms, and that such information is accumulated and communicated to us, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, we recognize that no controls and procedures, no matter how well designed and operated, can provide absolute assurance of achieving the desired control objectives. As required by Rules 13a-15(b) and 15d-15(b) of the Exchange Act, an evaluation as of December 31, 2022 was conducted under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures, as of December 31, 2022, were effective at a reasonable assurance level. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected. Under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management has concluded that our internal control over financial reporting was effective as of December 31, 2022. Changes in Internal Control Over Financial Reporting No change occurred in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended December 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION Amended and Restated Management Agreement and Amended Bylaws On March 24, 2023, the Company and CMFT Management entered into the second amended and restated management agreement (the “Amended Management Agreement”), which amended the Management Agreement between the parties dated August 20, 2019. The amendments include a change to the definition of “Equity” to include equity securities and clarifications to the language regarding reimbursements to include the Company’s allocable share of the cost per employee for the Company’s chief financial officer. The foregoing description of the Amended Management Agreement does not purport to be complete and is qualified in its entirety by the full text of the Amended Management Agreement, which is attached hereto as Exhibit 10.1 to this Annual Report on Form 10-K and is incorporated herein by reference. On March 22, 2023, our Board approved and adopted our Second Amended and Restated Bylaws (as so amended and restated, the “Amended Bylaws”) to, among other things, update provisions relating to stockholder meetings to ensure compliance with federal proxy rules, including Rule 14a-19 under the Exchange Act. The Amended Bylaws became effective upon adoption by our Board. 74 Table of Contents The Amended Bylaws include the following amendments, among other updates: • Amend language to ensure that any stockholder casting a vote by proxy complies with Maryland law and our Amended Bylaws; • Reflect the requirement that any stockholder directly or indirectly soliciting proxies from other stockholders must use a proxy card color other than white, with the white proxy card being reserved for exclusive use by our Board; • Update the provisions related to the information required to be included in a stockholder’s notice of nomination of individuals for election as a director and the information required to be included in any notice of other business that the stockholder proposes to bring before a meeting; • Require a stockholder submitting a director nomination to make a written undertaking that such stockholder intends to solicit the holders of shares of our stock representing at least 67% of the voting power of shares of stock entitled to vote on the election of directors in support of the director nomination; • Update the accompanying certifications made by a stockholder submitting a notice of nomination of an individual for election as a director; • Clarify that a stockholder may not nominate more individuals than there are directors to be elected or substitute or replace a proposed director nominee without compliance with the requirements for nomination in the Amended Bylaws, including compliance with any applicable deadlines; and • Reflect that we will disregard any proxy authority granted in favor of, or votes for, any proposed director nominee if the stockholder soliciting proxies in support of such proposed director nominee abandons the solicitation or does not comply with Rule 14a-19 under the Exchange Act. The amendments also include various conforming and technical changes, including updates to provisions relating to virtual meetings to align with changes to the MGCL statutory language. The foregoing description of the Amended Bylaws does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Amended Bylaws, a copy of which is filed as Exhibit 3.2 to this Annual Report on Form 10-K, and is incorporated herein by reference. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable. Table of Contents PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information required by this Item will be presented in our definitive proxy statement for our 2023 annual meeting of stockholders, which is expected to be filed with the SEC within 120 days after December 31, 2022, and is incorporated herein by reference. ITEM 11. EXECUTIVE COMPENSATION The information required by this Item will be presented in our definitive proxy statement for our 2023 annual meeting of stockholders, which is expected to be filed with the SEC within 120 days after December 31, 2022, and is incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS The information required by this Item will be presented in our definitive proxy statement for our 2023 annual meeting of stockholders, which is expected to be filed with the SEC within 120 days after December 31, 2022, and is incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE The information required by this Item will be presented in our definitive proxy statement for our 2023 annual meeting of stockholders, which is expected to be filed with the SEC within 120 days after December 31, 2022, and is incorporated herein by reference. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The information required by this Item will be presented in our definitive proxy statement for our 2023 annual meeting of stockholders, which is expected to be filed with the SEC within 120 days after December 31, 2022, and is incorporated herein by reference. 76 Table of Contents PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES Financial Statements The list of the consolidated financial statements contained herein is set forth on page F-1 hereof. Financial Statement Schedules Schedule III – Real Estate Assets and Accumulated Depreciation is set forth beginning on page S-1 hereof. Schedule IV – Mortgage Loans on Real Estate is set forth beginning on page S- 13 hereof. All other schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are not applicable and therefore have been omitted. Exhibits The following exhibits are included, or incorporated by reference, in this Annual Report on Form 10-K for the year ended December 31, 2022 (and are numbered in accordance with Item 601 of Regulation S-K). Incorporated by Reference Exhibit No. Description Form File No. Exhibit Filing Date 2.1 Agreement and Plan of Merger, dated as of August 30, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor II Merger Sub, LLC and Cole Office & Industrial REIT (CCIT II), Inc. 8-K 000-54939 2.1 8/31/2020 2.1.1 Amendment to Agreement and Plan of Merger, dated as of October 22, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor II Merger Sub, LLC and Cole Office & Industrial REIT (CCIT II), Inc. 8-K 000-54939 2.3 10/28/2020 2.1.2 Amendment to Agreement and Plan of Merger, dated as of October 24, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor II Merger Sub, LLC and Cole Office & Industrial REIT (CCIT II), Inc. 8-K 000-54939 2.4 10/28/2020 2.2 Agreement and Plan of Merger, dated as of August 30, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor III Merger Sub, LLC and Cole Office & Industrial REIT (CCIT III), Inc. 8-K 000-54939 2.2 8/31/2020 2.2.1 Amendment No. 1 to Agreement and Plan of Merger, dated as of November 3, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor III Merger Sub, LLC and Cole Office & Industrial REIT (CCIT III), Inc. 8-K 000-54939 2.1 11/4/2020 2.3 Agreement and Plan of Merger, dated as of August 30, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor V Merger Sub, LLC and Cole Credit Property Trust V, Inc. 8-K 000-54939 2.3 8/31/2020 2.3.1 Amendment to Agreement and Plan of Merger, dated as of October 22, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor V Merger Sub, LLC and Cole Credit Property Trust V, Inc. 8-K 000-54939 2.1 10/28/2020 2.3.2 Amendment to Agreement and Plan of Merger, dated as of October 24, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor V Merger Sub, LLC and Cole Credit Property Trust V, Inc. 8-K 000-54939 2.2 10/28/2020 2.3.3 Amendment No. 3 to Agreement and Plan of Merger, dated as of October 29, 2020, by and among CIM Real Estate Finance Trust, Inc., Thor V Merger Sub, LLC and Cole Credit Property Trust V, Inc. 8-K 000-54939 2.1 11/2/2020 2.4 Agreement and Plan of Merger, dated as of September 21, 2021, by and among CIM Real Estate Finance Trust, Inc., Cypress Merger Sub, LLC and CIM Income NAV, Inc. 8-K 000-54939 2.1 9/22/2021 3.1 Articles of Amendment and Restatement of CIM Real Estate Finance Trust, Inc. 8-K 000-54939 3.1 8/20/2019 3.2* Second Amended and Restated Bylaws of CIM Real Estate Finance Trust, Inc. 4.1 Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. 10-K 000-54939 4.1 3/30/2020 4.2 Second Amended and Restated Distribution Reinvestment Plan. 8-K 000-54939 4.1 5/1/2020 4.3 Master Indenture, dated as of July 28, 2021, by and among CMFT Net Lease Master Issuer, LLC, as issuer, and Citibank N.A., as indenture trustee. 8-K 000-54939 4.1 8/3/2021 4.4 Series 2021-1 Indenture Supplement, dated as of July 28, 2021, by and among CMFT Net Lease Master Issuer, LLC, as issuer, and Citibank N.A., as indenture trustee. 8-K 000-54939 4.2 8/3/2021 10.1* Second Amended and Restated Management Agreement by and between CIM Real Estate Finance Trust, Inc. and CIM Real Estate Finance Management, LLC, dated March 22, 2023. 10.2 Amended and Restated Agreement of Limited Partnership of Cole Operating Partnership IV, LP, by and between Cole Credit Property Trust IV, Inc. and the limited partners thereto. S-11 333-169533 10.2 1/24/2012 10.3 First Amendment to the Amended and Restated Agreement of Limited Partnership of CIM Real Estate Finance Operating Partnership, LP, dated August 15, 2019. 8-K 000-54939 10.2 8/20/2019 10.4 Credit and Security Agreement, dated December 31, 2019, by and between CMFT Corporate Credit Securities, LLC, as borrower, CMFT Securities Investments, LLC, as collateral manager and equityholder, the lenders from time to time party thereto, Citibank, N.A., as administrative agent, Citibank, N.A. (acting through its Agency & Trust division), as custodian and as collateral agent, and Virtus Group, LP, as collateral administrator. 8-K 000-54939 10.1 1/7/2020 10.4.1 Amendment No. 1 to Credit and Security Agreement, dated March 19, 2020, by and between CMFT Corporate Credit Securities, LLC, as borrower, CMFT Securities Investments, LLC, as collateral manager and equityholder, Citibank, N.A., as administrative agent and as lender, Citibank, N.A. (acting through its Agency & Trust division), as collateral custodian and as collateral agent, and Virtus Group, LP, as collateral administrator. 8-K 000-54939 10.1 3/24/2020 10.4.2 Amendment No. 2 to Credit and Security Agreement, dated October 4, 2021, by and between CMFT Corporate Credit Securities, LLC, as borrower, CMFT Securities Investments, LLC, as collateral manager and equityholder, Citibank, N.A., as administrative agent and as lender, Citibank, N.A. (acting through its Agency & Trust division), as collateral custodian and as collateral agent, and Virtus Group, LP, as collateral administrator. 8-K 000-54939 10.1 10/8/2021 10.4.3 Amendment No. 3 to Credit and Security Agreement, dated June 23, 2022, by and between CMFT Corporate Credit Securities, LLC, as borrower, CMFT Securities Investments, LLC, as collateral manager and equityholder, Citibank, N.A., as administrative agent and as lender, Citibank, N.A. (acting through its Agency & Trust division), as collateral custodian and as collateral agent, and Virtus Group, LP, as collateral administrator. 8-K 000-54939 10.1 6/29/2022 10.5 Credit Agreement, dated as of July 15, 2022, among CMFT SCF Borrower, LLC, as the Borrower, JPMorgan Chase Bank, N.A., as Administrative Agent, L/C Issuer and Syndication Agent and the lenders party thereto and PNC Bank, N.A., as Syndication Agent. 8-K 000-54939 10.1 7/21/2022 10.6 Continuing Guaranty, dated as of July 15, 2022, by CMFT SCF Borrower, LLC. 8-K 000-54939 10.2 7/21/2022 10.7 Amended and Restated CIM Real Estate Finance Trust, Inc. 2022 Equity Incentive Plan. 10-Q 000-54939 10.5 8/12/2022 10.8 Investment Advisory and Management Agreement by and between CMFT Securities Investments, LLC and CIM Capital IC Management, LLC, dated December 6, 2019. 8-K 000-54939 10.1 12/12/2019 10.9 Sub-Advisory Agreement by and between CIM Capital IC Management, LLC and OFS Capital Management, LLC, dated December 6, 2019. 8-K 000-54939 10.2 12/12/2019 10.10 Form of Indemnification Agreement. 8-K 000-54939 10.1 8/14/2020 10.11 Master Repurchase Agreement, dated June 4, 2020, by and between CMFT RE Lending RF Sub CB, LLC and Citibank, N.A. 8-K 000-54939 10.1 6/9/2020 10.11.1 First Amendment to Master Repurchase Agreement, dated August 17, 2021, by and between CMFT RE Lending RF Sub CB, LLC and Citibank, N.A. 8-K 000-54939 10.1 8/23/2021 10.11.2 Second Amendment to Master Repurchase Agreement, dated January 27, 2022, by and between CMFT RE Lending RF Sub CB, LLC and Citibank, N.A. 8-K 000-54939 10.1 2/1/2022 10.12 Guaranty, dated as of June 4, 2020, by CIM Real Estate Finance Trust, Inc. for the benefit of Citibank, N.A. 8-K 000-54939 10.2 6/9/2020 10.13 Guaranty, dated as of July 28, 2021, by CIM Real Estate Finance Operating Partnership, LP for the benefit of Citibank N.A., as indenture trustee. 8-K 000-54939 10.1 8/3/2021 10.14 Master Repurchase Agreement, dated September 21, 2020, by and between CMFT RE Lending RF Sub BB, LLC and Barclays Bank PLC. 8-K 000-54939 10.1 9/24/2020 10.14.1 First Amendment to Master Repurchase Agreement, dated July 27, 2021, by and between CMFT RE Lending RF Sub BB, LLC and Barclays Bank PLC. 8-K 000-54939 10.1 8/2/2021 10.14.2 Second Amendment to Master Repurchase Agreement, dated February 23, 2022, by and between CMFT RE Lending RF Sub BB, LLC and Barclays Bank PLC. 8-K 000-54939 10.1 3/1/2022 10.14.3 Third Amendment to Master Repurchase Agreement, dated October 7, 2022, by and between CMFT RE Lending RF Sub BB, LLC and Barclays Bank PLC. 8-K 000-54939 10.1 10/13/2022 10.15 Guaranty, dated as of September 21, 2020, by CIM Real Estate Finance Trust, Inc. for the benefit of Barclays Bank PLC. 8-K 000-54939 10.2 9/24/2020 10.16 Master Repurchase Agreement, dated May 20, 2021, by and between CMFT RE Lending RF Sub WF, LLC and Wells Fargo Bank, N.A. 8-K 000-54939 10.1 5/26/2021 10.16.1 First Amendment to Master Repurchase Agreement, dated October 28, 2021, by and between CMFT RE Lending RF Sub WF, LLC and Wells Fargo Bank, N.A. 8-K 000-54939 10.1 11/3/2021 10.16.2 Second Amendment to Master Repurchase Agreement, dated March 4 , 2022, by and between CMFT RE Lending RF Sub WF, LLC and Wells Fargo Bank, N.A. 8-K 000-54939 10.1 3/10/2022 10.16.3 Third Amendment t o Master Repurchase and Securities Contract a nd Termination o f Preferred Equity Related Pledge a nd Security Agreement, dated August 31, 2022, by and among CMFT RE Lending RF Sub WF, LLC, as seller, Wells Fargo Bank, N.A., as buyer, and CMFT Securities Investments, LLC, and preferred equity pledgor. 8-K 000-54939 10.1 9/7/2022 10.17 Guaranty and Subordination Agreement, dated as of May 20, 2021, by CIM Real Estate Finance Trust, Inc. for the benefit of Wells Fargo Bank, N.A. 8-K 000-54939 10.2 5/26/2021 10.18 Loan Agreement, dated as of July 15, 2021, by and between the Borrowers identified on Schedule 1.1(A) thereto, and JPMorgan Chase Bank, National Association and DBR Investments Co. Limited. 8-K 000-54939 10.1 7/21/2021 10.19 Guaranty Agreement, dated July 15, 2021, by CIM Real Estate Finance Trust, Inc. for the benefit of JPMorgan Chase Bank, National Association and DBR Investments Co. Limited. 8-K 000-54939 10.2 7/21/2021 10.20 Loan and Servicing Agreement, dated as of March 16, 2022, among CMFT RE Lending Sub MM Holdco, LLC, as Holdings, CMFT RE Lending Sub MM, LLC, as the Borrower, Massachusetts Mutual Life Insurance Company and the other lenders from time to time party hereto, Trimont Real Estate Advisors, LLC, as the Administrative Agent, Massachusetts Mutual Life Insurance Company, as the Facility Servicer, and CMFT RE Lending Sub MM, LLC, as the Portfolio Asset Servicer. 10-Q 000-54939 10.6 8/12/2022 10.21 Property Management Agreement, dated as of July 28, 2021, by and among CMFT Net Lease Master Issuer, LLC, as issuer, CIM Real Estate Finance Operating Partnership, LP, as issuer manager, CREI Advisors, LLC, as property manager and special servicer, KeyBank National Association, as back-up manager, and Citibank N.A., as indenture trustee. 8-K 000-54939 10.2 8/3/2021 10.22 Master Repurchase Agreement, dated October 8, 2021, by and between CMFT RE Lending RF Sub DB, LLC and Deutsche Bank AG, New York Branch. 8-K 000-54939 10.1 10/14/2021 10.22.1 Amended and Restated Master Repurchase Agreement, dated December 23, 2021, by and between CMFT RE Lending RF Sub DB, LLC and Deutsche Bank AG, New York Branch. 8-K 000-54939 10.1 12/29/2021 10.23 Guaranty, dated as of October 8, 2021, by CIM Real Estate Finance Trust, Inc. for the benefit of Deutsche Bank AG, New York Branch. 8-K 000-54939 10.2 10/14/2021 10.24 Master Repurchase Agreement, dated June 1, 2022, by and between CMFT Real Estate Securities I, LLC and J.P. Morgan Securities LLC. 8-K 000-54939 10.1 6/2/2022 10.25 Modification Agreement and Limited Consent, dated December 21, 2020 by and between Cole Operating Partnership V, LP, the Lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the Lenders. 10-K 000-54939 10.17 3/31/2021 10.26 Modification Agreement and Limited Consent, dated December 21, 2020 by and between CIM Real Estate Finance Operating Partnership, LP, the Lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent for the Lenders. 10-K 000-54939 10.18 3/31/2021 10.27 Modification Agreement and Limited Consent, dated December 16, 2021, by and among CIM Income NAV Operating Partnership, LP, the Lenders party thereto, and JPMorgan Chase, N.A., as administrative agent for the Lenders. 10-Q 000-54939 10.4 5/11/2022 10.28 Agreement of Purchase and Sale, dated as of December 20, 2021, by and among certain indirect subsidiaries of CIM Real Estate Finance Trust, Inc., American Finance Operating Partnership, L.P., ARG SSSTRPA001, LLC, ARG SMSHPPA001, LLC, ARG CCCARPA001, LLC and American Finance Trust, Inc. 8-K 000-54939 10.1 12/20/2021 10.29 Agreement of Purchase and Sale, dated as of December 29, 2022, by and between certain indirect subsidiaries of CIM Real Estate Finance Trust, Inc. and certain subsidiaries of Realty Income Corporation. 8-K 000-54939 10.1 12/30/2022 21.1* Subsidiaries of the Registrant. 23.1* Consent of Deloitte & Touche LLP, Independent Registered Public Accounting Firm. 31.1* Certifications of the Principal Executive Officer of the Company pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2* Certifications of the Principal Financial Officer of the Company pursuant to Exchange Act Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1** Certifications of the Principal Executive Officer and Principal Financial Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101.INS* XBRL Instance Document. 101.SCH* XBRL Taxonomy Extension Schema Document. 101.CAL* XBRL Taxonomy Extension Calculation Linkbase Document. 101.DEF* XBRL Taxonomy Extension Definition Linkbase Document. 101.LAB* XBRL Taxonomy Extension Label Linkbase Document. 101.PRE* XBRL Taxonomy Extension Presentation Linkbase Document. 104* Cover Page Interactive Data File (formatted as InLine XBRL and contained in Exhibit 101). ____________________________________ * Filed herewith. ** In accordance with Item 601(b)(32) of Regulation S-K, this Exhibit is not deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section. Such certifications will not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference. ITEM 16. FORM 10-K SUMMARY None. 77 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized this 28 th day of March, 2023. CIM Real Estate Finance Trust, Inc. (Registrant) By: /s/ NATHAN D. DEBACKER Nathan D. DeBacker Chief Financial Officer, Principal Accounting Officer and Treasurer (Principal Financial Officer and Principal Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated. Signature Title Date /s/ RICHARD S. RESSLER Chairman of the Board of Directors, Chief Executive Officer and President March 28, 2023 Richard S. Ressler (Principal Executive Officer) /s/ NATHAN D. DEBACKER Chief Financial Officer, Principal Accounting Officer and Treasurer March 28, 2023 Nathan D. DeBacker (Principal Financial Officer and Principal Accounting Officer) /s/ T. PATRICK DUNCAN Independent Director March 28, 2023 T. Patrick Duncan /s/ ALICIA K. HARRISON Independent Director March 28, 2023 Alicia K. Harrison /s/ W. BRIAN KRETZMER Independent Director March 28, 2023 W. Brian Kretzmer /s/ HOWARD A. SILVER Independent Director March 28, 2023 Howard A. Silver /s/ CALVIN E. HOLLIS Independent Director March 28, 2023 Calvin E. Hollis /s/ ROGER D. SNELL Independent Director March 28, 2023 Roger D. Snell /s/ JASON SCHREIBER Director March 28, 2023 Jason Schreiber /s/ EMILY VANDE KROL Director March 28, 2023 Emily Vande Krol /s/ AVRAHAM SHEMESH Director March 28, 2023 Avraham Shemesh 78 Table of Contents INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Financial Statements Page Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34 ) F- 2 Consolidated Balance Sheets as of December 31, 2 022 and 2021 F- 4 Consolidated Statements of Operations for the Years Ended December 31, 2022, 2021 and 2020 F- 5 Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2022, 2021 and 2020 F- 6 Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2022, 2021 and 2020 F- 7 Consolidated Statements of Cash Flows for the Years Ended December 31, 2022, 2 021 and 2020 F- 8 Notes to Consolidated Financial Statements F- 10 Schedule III - Real Estate Assets and Accumulated Depreciation S- 1 Schedule IV - Mortgage Loans on Real Estate S- 13 F-1 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the shareholders and the Board of Directors of CIM Real Estate Finance Trust, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of CIM Real Estate Finance Trust, Inc. and subsidiaries (the “Company”) as of December 31, 2022 and 2021, the related consolidated statements of operations, comprehensive income (loss), stockholder’s equity, and cash flows, for each of the three years in the period ended December 31, 2022, and the related notes and the schedules listed in the Index at Item 15 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Real Estate Assets: Determination of Impairment Indicators — Refer to Notes 2 and 4 to the financial statements Critical Audit Matter Description The Company’s evaluation of real estate assets for impairment involves an initial assessment of each real estate asset to determine whether events or changes in circumstances exist that may indicate that the carrying amounts of real estate assets are no longer recoverable. Possible indications of impairment may include bankruptcy or other credit concerns of a property’s major tenants, vacancies, changes in anticipated holding periods, a reduction in prevailing market values for assets being considered for disposition, or other circumstances. When events or changes in circumstances exist, the Company evaluates its real estate assets for impairment by comparing undiscounted future cash flows expected to be generated over the life of each asset to the respective carrying amount. If the carrying amount of an asset exceeds the undiscounted future cash flows, an analysis is performed to determine the fair value of the asset. The Company makes significant assumptions to evaluate real estate assets for possible indications of impairment. Changes in these assumptions could result in additional impairment charges in the future. Given the Company’s evaluation of possible indications of impairment of real estate assets requires management to make significant assumptions, performing audit procedures to evaluate whether management appropriately identified events or F-2 Table of Contents changes in circumstances indicating that the carrying amounts of real estate assets may not be recoverable required a high degree of auditor judgment. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the evaluation of real estate assets for possible indications of impairment included the following, among others: • We evaluated management’s impairment indicator analysis by testing real estate assets for possible indications of impairment, including searching for adverse asset-specific and/or market conditions, such as vacancies, tenant bankruptcies and other credit concerns, among others, as well as assessing changes in holding periods, including expected asset dispositions. • We independently searched market values for assets considered for disposition, to determine whether a reduction in market values was present and indicative of impairment. • We performed inquiries with management, including property accounting and portfolio oversight, to determine whether factors were identified in the current period that may be an impairment indicator, including changes in expected holding periods, or changes in market rental rates, and corroborated these inquiries through review of third-party market reports and inspection of meeting minutes of the Board of Directors . Assessment of Current Expected Credit Losses (“CECL”) Reserve – Refer to Notes 2 and 8 to the financial statements Critical Audit Matter Description The Company estimates its CECL reserve using the Weighted Average Remaining Maturity (“WARM”) method for its first mortgage loans, and the probability of default and loss given default method for its liquid corporate senior loans and corporate senior loans. Significant judgments are required in estimating the CECL reserve, including the evaluation of historical loan loss data, the evaluation of expected repayments of each loan, and the impact of expected economic conditions on the loan portfolio. We identified the assessment of the CECL reserve as a critical audit matter because of the subjectivity, complexity, and estimation uncertainty in determining the impact of the significant judgment required when determining the CECL reserve. This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our credit specialists when evaluating the CECL methodology, analytical models, and key inputs and assumptions used in the models. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the CECL reserve for the loans held-for-investment portfolio included the following, among others: • We tested the accuracy and evaluated the appropriateness of the historical loan loss data as an input to each applicable model. • We tested the evaluation of expected loan repayments, the impact of expected economic conditions on the loan portfolio, and other assumptions used in determining the CECL reserve. • We evaluated the service auditor's report for the third-party WARM method CECL model, which is used to calculate the expected loss for its first mortgage loans. • We evaluated the appropriateness of each model and significant assumptions used and independently calculated each model’s computational accuracy, and utilized our credit specialists to assist us with these evaluations specific to the WARM method CECL model. /s/ Deloitte & Touche LLP Tempe, Arizona March 28, 2023 We have served as the Company’s auditor since 2010. F-3 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts) December 31, 2022 December 31, 2021 ASSETS Real estate assets: Land $ 578,970 $ 655,273 Buildings, fixtures and improvements 1,462,726 1,706,902 Intangible lease assets 276,684 314,832 Condominium developments 130,494 171,080 Total real estate assets, at cost 2,448,874 2,848,087 Less: accumulated depreciation and amortization ( 270,946 ) ( 235,481 ) Total real estate assets, net 2,177,928 2,612,606 Investment in unconsolidated entities 100,604 109,547 Real estate-related securities ($ 576,391 and $ 41,981 held at fair value as of December 31, 2022 and December 31, 2021, respectively) 576,391 105,471 Loans held-for-investment and related receivables, net 4,043,898 2,624,101 Less: Current expected credit losses ( 42,344 ) ( 15,201 ) Total loans held-for-investment and related receivables, net 4,001,554 2,608,900 Cash and cash equivalents 118,978 107,381 Restricted cash 57,616 36,792 Rents and tenant receivables, net 33,968 58,948 Prepaid expenses, derivative assets and other assets 26,243 11,829 Deferred costs, net 16,429 7,214 Accrued interest receivable 22,343 4,450 Assets held for sale — 1,299,638 Total assets $ 7,132,054 $ 6,962,776 LIABILITIES AND STOCKHOLDERS’ EQUITY Repurchase facilities, notes payable and credit facilities, net $ 4,422,833 $ 4,143,205 Accrued expenses and accounts payable 25,666 45,872 Due to affiliates 16,086 14,594 Intangible lease liabilities, net 19,054 24,896 Distributions payable 14,828 13,252 Deferred rental income, derivative liabilities and other liabilities 7,274 21,282 Total liabilities 4,505,741 4,263,101 Commitments and contingencies (Note 12) Redeemable common stock 170,238 170,714 STOCKHOLDERS’ EQUITY Preferred stock, $ 0.01 par value per share; 10,000,000 shares authorized, none issued and outstanding — — Common stock, $ 0.01 par value per share; 490,000,000 shares authorized, 437,397,414 and 437,373,981 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively 4,373 4,374 Capital in excess of par value 3,529,523 3,529,126 Accumulated distributions in excess of earnings ( 1,029,287 ) ( 1,008,561 ) Accumulated other comprehensive (loss) income ( 48,526 ) 2,949 Total stockholders’ equity 2,456,083 2,527,888 Non-controlling interests ( 8 ) 1,073 Total equity 2,456,075 2,528,961 Total liabilities, redeemable common stock, non-controlling interests and stockholders’ equity $ 7,132,054 $ 6,962,776 The accompanying notes are an integral part of these consolidated financial statements. F-4 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share amounts) Year Ended December 31, 2022 2021 2020 Revenues: Rental and other property income $ 213,389 $ 295,164 $ 261,530 Interest income 238,757 70,561 29,393 Total revenues 452,146 365,725 290,923 Operating expenses: General and administrative 15,364 15,078 12,042 Property operating 20,790 47,559 23,399 Real estate tax 12,612 34,943 27,691 Expense reimbursements to related parties 16,567 11,624 8,920 Management fees 52,564 47,020 40,025 Transaction-related 534 315 355 Depreciation and amortization 70,606 95,190 80,973 Real estate impairment 32,321 18,078 16,737 Increase in provision for credit losses 29,476 2,881 68,356 Total operating expenses 250,834 272,688 278,498 Gain on disposition of real estate and condominium developments, net 121,902 83,045 27,518 Merger-related expenses, net — ( 1,404 ) ( 1,884 ) Merger termination fee income — — 7,380 Operating income 323,214 174,678 45,439 Other income (expense) Gain on investment in unconsolidated entities 11,952 606 — Unrealized loss on equity security ( 15,117 ) — — Interest expense and other, net ( 156,539 ) ( 83,899 ) ( 64,116 ) Loss on extinguishment of debt ( 19,644 ) ( 4,895 ) ( 4,841 ) Total other expense ( 179,348 ) ( 88,188 ) ( 68,957 ) Net income (loss) 143,866 86,490 ( 23,518 ) Net income allocated to non-controlling interest 66 — — Net income (loss) attributable to the Company $ 143,800 $ 86,490 $ ( 23,518 ) Weighted average number of common shares outstanding: Basic and diluted 437,343,624 365,726,453 311,808,605 Net income (loss) per common share: Basic and diluted $ 0.33 $ 0.24 $ ( 0.08 ) The accompanying notes are an integral part of these consolidated financial statements. F-5 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in thousands) Year Ended December 31, 2022 2021 2020 Net income (loss) $ 143,866 $ 86,490 $ ( 23,518 ) Other comprehensive (loss) income Unrealized (loss) gain on real estate-related securities ( 51,304 ) 231 1,657 Reclassification adjustment for realized gain (loss) included in income as other income — 1,419 ( 510 ) Unrealized gain (loss) on interest rate swaps 2,361 32 ( 11,607 ) Amount of (gain) loss reclassified from other comprehensive (loss) income into income as interest expense and other, net ( 2,532 ) 3,314 12,321 Total other comprehensive (loss) income ( 51,475 ) 4,996 1,861 Comprehensive income (loss) 92,391 91,486 ( 21,657 ) Comprehensive income allocated to non-controlling interest 66 — — Comprehensive income (loss) attributable to the Company $ 92,325 $ 91,486 $ ( 21,657 ) The accompanying notes are an integral part of these consolidated financial statements. F-6 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (in thousands, except share amounts) Common Stock Capital in Excess of Par Value Accumulated Distributions in Excess of Earnings Accumulated Other Comprehensive (Loss) Income Total Stockholders’ Equity Non-Controlling Interests Total Equity Number of Shares Par Value Balance, January 1, 2020 311,207,725 $ 3,112 $ 2,606,925 $ ( 816,181 ) $ ( 3,908 ) $ 1,789,948 $ — $ 1,789,948 Cumulative effect of accounting changes — — — ( 2,002 ) — ( 2,002 ) — ( 2,002 ) Issuance of common stock 4,211,747 42 34,149 — — 34,191 — 34,191 Issuance of common stock in connection with the CCPT V and CCIT III Mergers 52,574,431 526 383,793 — — 384,319 — 384,319 Equity-based compensation 22,059 — 160 — — 160 — 160 Distributions declared on common stock — $ 0.38 per common share — — — ( 119,305 ) — ( 119,305 ) — ( 119,305 ) Redemptions of common stock ( 6,013,994 ) ( 60 ) ( 48,006 ) — — ( 48,066 ) — ( 48,066 ) Changes in redeemable common stock — — 180,838 — — 180,838 — 180,838 Comprehensive (loss) income — — — ( 23,518 ) 1,861 ( 21,657 ) — ( 21,657 ) Balance, December 31, 2020 362,001,968 $ 3,620 $ 3,157,859 $ ( 961,006 ) $ ( 2,047 ) $ 2,198,426 $ — $ 2,198,426 Issuance of common stock 3,574,120 36 25,748 — — 25,784 — 25,784 Issuance of common stock in connection with the CIM Income NAV Merger 74,819,899 748 537,955 — — 538,703 — 538,703 Equity-based compensation 39,000 — 289 — — 289 — 289 Distributions declared on common stock — $ 0.364 per common share — — — ( 134,045 ) — ( 134,045 ) — ( 134,045 ) Redemptions of common stock ( 3,061,006 ) ( 30 ) ( 22,011 ) — — ( 22,041 ) — ( 22,041 ) Changes in redeemable common stock — — ( 170,714 ) — — ( 170,714 ) — ( 170,714 ) Non-controlling interests assumed in connection with the CIM Income NAV Merger — — — — — — 1,073 1,073 Comprehensive income — — — 86,490 4,996 91,486 — 91,486 Balance, December 31, 2021 437,373,981 $ 4,374 $ 3,529,126 $ ( 1,008,561 ) $ 2,949 $ 2,527,888 $ 1,073 $ 2,528,961 Issuance of common stock 5,404,510 54 38,858 — — 38,912 — 38,912 Equity-based compensation 89,559 — 397 — — 397 — 397 Distributions declared on common stock — $ 0.376 per common share — — — ( 164,526 ) — ( 164,526 ) — ( 164,526 ) Redemptions of common stock ( 5,470,636 ) ( 55 ) ( 39,334 ) — — ( 39,389 ) — ( 39,389 ) Changes in redeemable common stock — — 476 — — 476 — 476 Distributions to non-controlling interests — — — — — — ( 1,147 ) ( 1,147 ) Comprehensive income (loss) — — — 143,800 ( 51,475 ) 92,325 66 92,391 Balance, December 31, 2022 437,397,414 $ 4,373 $ 3,529,523 $ ( 1,029,287 ) $ ( 48,526 ) $ 2,456,083 $ ( 8 ) $ 2,456,075 The accompanying notes are an integral part of these consolidated financial statements. F-7 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Year Ended December 31, 2022 2021 2020 Cash flows from operating activities: Net income (loss) $ 143,866 $ 86,490 $ ( 23,518 ) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization, net 70,688 92,988 79,546 Amortization of deferred financing costs 12,143 10,073 4,245 Amortization of fair value adjustments of mortgage notes payable assumed — ( 149 ) ( 92 ) Amortization and accretion on deferred loan fees ( 9,896 ) ( 2,998 ) ( 1,909 ) Amortization of premiums and discounts on credit investments ( 11,609 ) ( 8,144 ) ( 668 ) Capitalized interest income on real estate-related securities and loans held-for-investment ( 1,172 ) ( 974 ) ( 539 ) Equity-based compensation 397 289 160 Straight-line rental income ( 6,149 ) ( 5,723 ) ( 6,738 ) Write-offs for uncollectible lease-related receivables ( 894 ) ( 694 ) 5,664 Gain on disposition of real estate assets and condominium developments, net ( 121,902 ) ( 83,045 ) ( 27,518 ) Loss on sale of credit investments, net 1,057 1,378 227 Gain on investment in unconsolidated entities ( 11,952 ) ( 606 ) — Gain on sale of marketable security ( 22 ) — — Unrealized loss on equity security 15,139 — — Amortization of fair value adjustment and gain on interest rate swaps ( 2,398 ) ( 2,814 ) ( 13 ) Impairment of real estate assets 32,321 18,078 16,737 Increase in provision for credit losses 29,476 2,881 68,356 (Gain) loss on interest rate caps ( 4,586 ) 42 — Return on investment in unconsolidated entities 7,312 497 — Write-off of deferred financing costs 8,100 3,815 633 Changes in assets and liabilities: Rents and tenant receivables, net 68,172 28,109 ( 10,435 ) Prepaid expenses and other assets ( 10,172 ) 67 ( 692 ) Accrued interest receivable ( 17,893 ) ( 2,484 ) ( 133 ) Accrued expenses and accounts payable ( 1,277 ) 8,388 8,420 Deferred rental income and other liabilities ( 11,542 ) 3,541 ( 508 ) Due to affiliates 1,492 ( 831 ) ( 656 ) Net cash provided by operating activities 178,699 148,174 110,569 Cash flows from investing activities: Cash acquired in connection with mergers — 10,244 13,810 Investment in unconsolidated entities ( 86,300 ) ( 53,525 ) — Return of investment in unconsolidated entities 39,221 — — Investment in real estate-related securities ( 558,218 ) ( 321,169 ) ( 76,644 ) Investment in liquid corporate senior loans ( 179,714 ) ( 406,694 ) ( 582,654 ) Investment in corporate senior loans ( 74,801 ) — — Investment in real estate assets and capital expenditures ( 23,776 ) ( 76,283 ) ( 48,995 ) Origination and acquisition of loans held-for-investment ( 1,333,298 ) ( 1,805,324 ) ( 238,563 ) Origination and exit fees received on loans held-for-investment 13,978 17,030 3,200 Principal payments received on loans held-for-investment 172,602 326,062 119,443 Principal payments received on real estate-related securities 17,161 38 2,571 Net proceeds from sale of real estate-related securities 132 256,841 37,593 Net proceeds from disposition of real estate assets and condominium developments 1,315,176 513,528 263,797 Net proceeds from sale of liquid corporate senior loans 60,027 69,959 39,902 Redemption of investment in unconsolidated entities 60,663 — — Payment of property escrow deposits — — ( 875 ) Refund of property escrow deposits — — 875 Proceeds from the settlement of insurance claims 619 63 400 Net cash used in investing activities ( 576,528 ) ( 1,469,230 ) ( 466,140 ) F-8 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) — Continued Year Ended December 31, 2022 2021 2020 Cash flows from financing activities: Redemptions of common stock $ ( 39,389 ) $ ( 22,041 ) $ ( 48,066 ) Distributions to stockholders ( 124,038 ) ( 105,978 ) ( 90,655 ) Proceeds from borrowings 2,492,110 3,159,650 576,880 Repayments of borrowings, and prepayment penalties ( 1,874,690 ) ( 1,648,775 ) ( 422,110 ) Termination of interest rate swaps ( 239 ) ( 6,401 ) — Payment of loan deposits — ( 800 ) ( 65 ) Refund of loan deposits — 865 — Deferred financing costs paid ( 22,357 ) ( 39,699 ) ( 5,360 ) Distributions to non-controlling interests ( 1,147 ) — — Net cash provided by financing activities 430,250 1,336,821 10,624 Net increase (decrease) in cash and cash equivalents and restricted cash 32,421 15,765 ( 344,947 ) Cash and cash equivalents and restricted cash, beginning of period 144,173 128,408 473,355 Cash and cash equivalents and restricted cash, end of period $ 176,594 $ 144,173 $ 128,408 Reconciliation of cash and cash equivalents and restricted cash to the consolidated balance sheets: Cash and cash equivalents $ 118,978 $ 107,381 $ 121,385 Restricted cash 57,616 36,792 7,023 Total cash and cash equivalents and restricted cash $ 176,594 $ 144,173 $ 128,408 The accompanying notes are an integral part of these consolidated financial statements. F-9 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1 — ORGANIZATION AND BUSINESS CIM Real Estate Finance Trust, Inc. (the “Company”) is a non-exchange traded real estate investment trust (“REIT”) formed as a Maryland corporation on July 27, 2010, that elected to be taxed, and operates its business to qualify, as a REIT for U.S. federal income tax purposes beginning with its taxable year ended December 31, 2012. The Company seeks to attain attractive risk-adjusted returns and create long term value for its investors by investing in a diversified portfolio of senior secured mortgage loans, credit worthy long-term net-leased property investments and other senior loan and liquid credit investments. As of December 31, 2022, the Company owned 380 properties, comprising 10.9 million rentable square feet of commercial space located in 43 states. As of December 31, 2022, the rentable square feet at these properties was 99.2 % leased, including month-to-month agreements, if any. As of December 31, 2022, the Company’s loan portfolio consisted of 350 loans with a net book value of $ 4.0 billion, and investments in real estate-related securities of $ 576.4 million. As of December 31, 2022, the Company owned condominium developments with a net book value of $ 130.5 million. A majority of the Company’s business is conducted through CIM Real Estate Finance Operating Partnership, LP, a Delaware limited partnership, of which the Company is the sole general partner and owns, directly or indirectly, 100 % of the partnership interests. The Company is externally managed by CIM Real Estate Finance Management, LLC, a Delaware limited liability company (“CMFT Management”), which is an affiliate of CIM Group, LLC (“CIM Group”). CIM Group is a community-focused real estate and infrastructure owner, operator, lender and developer. CIM is headquartered in Los Angeles, CA, with offices in Atlanta, GA, Bethesda, MD, Chicago, IL, Dallas, TX, New York, NY, Orlando, FL, Phoenix, AZ and Tokyo, Japan. CIM Group also maintains additional offices across the Unites States, as well as in Korea, Hong Kong and the United Kingdom to support its platform. 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. Collectively, CMFT Management, the Company’s manager, and the Investment Advisor, together with certain other affiliates of CIM Group, serve as the Company’s sponsor, which is referred to as the Company’s “sponsor” or “CIM”. 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. 333-192958), which was filed with the U.S. Securities and Exchange Commission (the “SEC”) on December 19, 2013 and automatically became effective with the SEC upon filing. The Company ceased issuing shares under the Initial DRIP Offering effective as of June 30, 2016. At the completion of the Initial DRIP Offering, a total of approximately $ 241.7 million of shares of common stock had been issued. The remaining $ 5.3 million of unsold shares from the Initial DRIP Offering were deregistered. The Company registered an additional $ 600.0 million of shares of common stock under the DRIP (the “Secondary DRIP Offering,” and together with the Initial DRIP Offering, the “DRIP Offerings,” and the DRIP Offerings collectively with the 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 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. Distributions are reinvested in shares of the Company’s common stock for participants in the DRIP at the estimated per share F-10 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) 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 December 31, 2022, the estimated per share NAV of the Company’s common stock was $ 6.57 , which was established by the Board on December 19, 2022 using a valuation date of September 30, 2022. Commencing on December 21, 2022, $ 6.57 served as the per share NAV, including for shares issued pursuant to the DRIP. The Board previously established a per share NAV as of August 31, 2015, September 30, 2016, December 31, 2016, December 31, 2017, December 31, 2018, December 31, 2019, March 31, 2020, June 30, 2020 and March 31, 2021. The Company’s estimated per share NAVs are not audited or reviewed by its independent registered public accounting firm. Purchase and Sale Agreement On December 29, 2022, certain subsidiaries of the Company entered into an Agreement of Purchase and Sale (the “Realty Income Purchase and Sale Agreement”) with certain subsidiaries of Realty Income Corporation (NYSE: O) (“Realty Income”), to sell to Realty Income 185 single-tenant net lease properties encompassing approximately 4.6 million gross rentable square feet of commercial space across 34 states for total consideration of $ 894.0 million. The consideration is to be paid in cash. During December 2022, a cash deposit of $ 20.0 million was placed in escrow by Realty Income in connection with the Realty Income Purchase and Sale Agreement, which became non-refundable to Realty Income upon the expiration of the due diligence period on March 7, 2023. Subsequent to December 31, 2022, the sale of 151 of the properties under contract for sale pursuant to the Realty Income Purchase and Sale Agreement closed for total consideration of $ 779.0 million and a gain of approximately $ 19.6 million. The remaining properties are expected to close in the second quarter of 2023, although no assurances can be made that the Company will complete the sale of the remaining properties within that timeframe, or at all. NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The summary of significant accounting policies presented below is designed to assist in understanding the Company’s consolidated financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) in all material respects, and have been consistently applied in preparing the accompanying consolidated financial statements. Principles of Consolidation and Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In determining whether the Company has controlling interests in an entity and is required to consolidate the accounts in that entity, the Company analyzes its credit and real estate investments in accordance with standards set forth in GAAP to determine whether the entities are variable interest entities (“VIEs”), and if so, whether the Company is the primary beneficiary. The Company’s judgment with respect to its level of influence or control over an entity and whether the Company is the primary beneficiary of a VIE involves consideration of various factors, including the form of the Company’s ownership interest, the Company’s voting interest, the size of the Company’s investment (including loans), and the Company’s ability to participate in major policy-making decisions. 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 consolidated financial statements. During the year ended December 31, 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 December 31, 2022. See Note 4 — Real Estate Assets for additional information. Reclassifications Certain amounts in the Company’s prior period consolidated financial statements have been reclassified to conform to the current period presentation. The Company has chosen to break out the details of $ 4.5 million of accrued interest receivable from prepaid expenses, derivative assets and other assets in the Company’s consolidated balance sheet for the year ended December 31, 2021. In addition, $ 2.5 million was reclassified from rents and tenant receivables, net to prepaid expenses and other assets in the Company’s consolidated balance sheet for the year ended December 31, 2021. These reclassifications had no effect on F-11 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) previously reported totals or subtotals. The resulting impacts from the consolidated balance sheet reclassifications to the consolidated statements of cash flows for the years ended December 31, 2021 and 2020 are as follows (in thousands): Year Ended December 31, 2021 Year Ended December 31, 2020 As previously reported Reclassifications As Revised As previously reported Reclassifications As Revised Consolidated Statements of Cash Flows Rents and tenant receivables, net $ 28,230 $ ( 121 ) $ 28,109 $ ( 12,536 ) $ 2,101 $ ( 10,435 ) Prepaid expenses and other assets $ ( 2,538 ) $ 2,605 $ 67 $ 1,276 $ ( 1,968 ) $ ( 692 ) Accrued interest receivable $ — $ ( 2,484 ) $ ( 2,484 ) $ — $ ( 133 ) $ ( 133 ) Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Real Estate Assets Real estate assets are stated at cost, less accumulated depreciation and amortization. The Company considers the period of future benefit of each respective asset to determine the appropriate useful life. The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term Recoverability of Real Estate Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of its real estate assets may not be recoverable. Impairment indicators that the Company considers include, but are not limited to: bankruptcy or other credit concerns of a property’s major tenant, such as a history of late payments, lease concessions and other factors; a significant decrease in a property’s revenues due to lease terminations; vacancies; co-tenancy clauses; reduced lease rates; changes in anticipated holding periods; significant increases to budgeted costs for units under development; and a reduction in prevailing market values for assets being considered for disposition. When indicators of potential impairment are present, the Company assesses the recoverability of the assets by determining whether the carrying amount of the assets will be recovered through the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying amount, the Company will adjust the real estate assets to their respective fair values and recognize an impairment loss. Generally, fair value is determined using a discounted cash flow analysis and recent comparable sales transactions. During the year ended December 31, 2022, as part of the Company’s quarterly impairment review procedures, the Company recorded impairment charges of $ 16.2 million related to 23 properties, all of which were due to sales prices that were less than their respective carrying values. Additionally, during the year ended December 31, 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 $ 16.1 million primarily due to a decrease in list prices and an increase in budgeted costs for certain units under development. The Company’s impairment assessment as of December 31, 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 2023 or in future periods. During the year ended December 31, 2021, the Company recorded impairment charges of $ 6.0 million related to 12 properties, of which impairment at eight properties was due to sales prices that were less than their respective carrying values and impairment at four properties was due to vacancy. Additionally, the Company recorded impairment charges of $ 12.1 million during the year ended December 31, 2021, related to condominium units due to an increase in budgeted costs for certain units under development. The assumptions and uncertainties utilized in the evaluation of the impairment of real estate assets are discussed in detail in Note 3 — Fair Value Measurements. See also Note 4 — Real Estate Assets for further discussion regarding real estate investment activity. F-12 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Assets Held for Sale When a real estate asset is identified by the Company as held for sale, the Company will cease recording depreciation and amortization of the assets related to the property and estimate its fair value, net of selling costs. If, in management’s opinion, the fair value, net of selling costs, of the asset is less than the carrying amount of the asset, an adjustment to the carrying amount is then recorded to reflect the estimated fair value of the property, net of selling costs. As of December 31, 2022, there were no assets identified as held for sale. As of December 31, 2021, in connection with the RTL Purchase and Sale Agreement (as defined in Note 4 — Real Estate Assets), the Company identified 81 properties with a carrying v alue of $ 1.3 billion as held for sale, which were disposed of during the year ended December 31, 2022 . Dispositions of Real Estate Assets Gains and losses from dispositions are recognized once the various criteria relating to the terms of sale and any subsequent involvement by the Company with the asset sold are met. 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 years ended December 31, 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 year ended December 31, 2022. Allocation of Purchase Price of Real Estate Assets Upon the acquisition of real properties, the Company allocates the purchase price to acquired tangible assets, consisting of land, buildings and improvements, and to identified intangible assets and liabilities, consisting of the value of above- and below-market leases and the value of in-place leases and other intangibles, based in each case on their relative fair values. The Company utilizes independent appraisals to assist in the determination of the fair values of the tangible assets of an acquired property (which includes land and buildings). The information in the appraisal, along with any additional information available to the Company’s management, is used in estimating the amount of the purchase price that is allocated to land. Other information in the appraisal, such as building value and market rents, may be used by the Company’s management in estimating the allocation of purchase price to the building and to intangible lease assets and liabilities. The appraisal firm has no involvement in management’s allocation decisions other than providing this market information. The fair values of above- and below-market lease intangibles are recorded based on the present value (using a discount rate which reflects the risks associated with the leases acquired) of the difference between (1) the contractual amounts to be paid pursuant to the in-place leases and (2) an estimate of fair market lease rates for the corresponding in-place leases, which is generally obtained from independent appraisals, measured over a period equal to the remaining non-cancelable term of the lease including, for below-market leases, any bargain renewal periods. The above- and below-market lease intangibles are capitalized as intangible lease assets or liabilities, respectively. Above-market leases are amortized as a reduction to rental income over the remaining terms of the respective leases. Below-market leases are amortized as an increase to rental income over the remaining terms of the respective leases, including any bargain renewal periods. In considering whether or not the Company expects a tenant to execute a bargain renewal option, the Company evaluates economic factors and certain qualitative factors at the time of acquisition, such as the financial strength of the tenant, the remaining lease term, the tenant mix of the leased property, the Company’s relationship with the tenant and the availability of competing tenant space. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above- or below-market lease intangibles relating to that lease would be recorded as an adjustment to rental income. The fair values of in-place leases include estimates of direct costs associated with obtaining a new tenant and opportunity costs associated with lost rental and other property income, which are avoided by acquiring a property with an in-place lease. Direct costs associated with obtaining a new tenant include leasing commissions, legal and other related expenses and are estimated in part by utilizing information obtained from independent appraisals and management’s consideration of current market costs to execute a similar lease. The intangible values of opportunity costs, which are calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease, are capitalized as intangible lease assets and are amortized to expense over the remaining term of the respective leases. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed. The Company has acquired, and may continue to acquire, certain properties subject to contingent consideration arrangements that may obligate the Company to pay additional consideration to the seller based on the outcome of future F-13 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) events. Additionally, the Company may acquire certain properties for which it funds certain contingent consideration amounts into an escrow account pending the outcome of certain future events. The outcome may result in the release of all or a portion of the escrowed funds to the Company or the seller or a combination thereof. The Company estimates the fair value of assumed mortgage notes payable based upon indications of current market pricing for similar types of debt financing with similar maturities. Assumed mortgage notes payable are initially recorded at their estimated fair value as of the assumption date, and any difference between such estimated fair value and the mortgage note’s outstanding principal balance is amortized or accreted to interest expense over the term of the respective mortgage note payable. The determination of the fair values of the real estate assets and liabilities acquired requires the use of significant assumptions with regard to the current market rental rates, rental growth rates, capitalization and discount rates, interest rates and other variables. The use of alternative estimates may result in a different allocation of the Company’s purchase price, which could materially impact the Company’s results of operations. Certain acquisition-related expenses related to asset acquisitions are capitalized and allocated to tangible and intangible assets and liabilities, as described above. Acquisition-related manager expense reimbursements are expensed as incurred and are included in expense reimbursements to related parties in the accompanying consolidated statements of operations. Other acquisition-related expenses continue to be expensed as incurred and are included in transaction-related expenses in the accompanying consolidated statements of operations. Investment in Unconsolidated Entities 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 approximately 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 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. The equity method of accounting requires the investment to be initially recorded at cost, including transaction costs incurred to finalize the investment, and is subsequently adjusted for the Company’s share of equity in NP JV Holdings’ earnings and distributions, including unrealized gains and losses as a result of changes in fair value of the NewPoint JV. 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 consolidated balance sheet and such share is recognized as a profit or loss on the consolidated statements of operations. The Company recorded a gain totaling $ 6.8 million, which represented its share of NP JV Holdings’ gain, during the year ended December 31, 2022 in the consolidated statements of operations. During the year ended December 31, 2022, the Company contributed an additional $ 86.3 million in NP JV Holdings, $ 39.9 million of which was returned as a return of capital and can be called back by NewPoint JV through NP JV Holdings as a capital call on a future date. As of December 31, 2022, the Company’s aggregate investment in NP JV Holdings of $ 100.6 million is included in investment in unconsolidated entities on the consolidated balance sheets. For more information, refer to Note 6 — Investment in Unconsolidated Entities. On March 31, 2022, the Company fully redeemed its $ 60.7 million investment in CIM UII Onshore, L.P. (“CIM UII Onshore”). Prior to redemption, the Company had less than 5 % ownership of CIM UII Onshore and accounted for its 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 consolidated balance sheet and such share is recognized as a profit or loss on the consolidated statements of operations. The Company recorded its share of CIM UII Onshore’s gain totaling $ 5.2 million during the year ended December 31, 2022 in the consolidated statements of operations. During the year ended December 31, 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. Non-controlling Interest in Consolidated Joint Venture 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 year ended December 31, 2022, the Company recorded net income of $ 66,000 and paid distributions of $ 1.1 million to the non-controlling interest. F-14 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) During the year ended December 31, 2022, the Company disposed of the underlying properties previously owned through the Consolidated Joint Venture, as further discussed in Note 4 — Real Estate Assets. Cash and Cash Equivalents and Restricted Cash Cash and cash equivalents include cash in bank accounts, as well as investments in highly-liquid money market funds. The Company deposits cash with several high quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Company (“FDIC”) up to an insurance limit of $250,000. At times, the Company’s cash and cash equivalents may exceed federally insured levels. Although the Company bears risk on amounts in excess of those insured by the FDIC, it has not experienced and does not anticipate any losses due to the high quality of the institutions where the deposits are held. Included in cash and cash equivalents was $ 19.8 million and $ 36.5 million of unsettled liquid corporate senior loan purchases as of December 31, 2022 and 2021, respectively. The Company had $ 57.6 million and $ 36.8 million in restricted cash as of December 31, 2022 and December 31, 2021, respectively. Included in restricted cash was $ 15.4 million and $ 7.8 million held by lenders in lockbox accounts, as of December 31, 2022 and 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 $ 22.6 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 December 31, 2022 and 2021, respectively. In addition, the Company had a $ 19.6 million deposit held as cash collateral included in restricted cash as of December 31, 2022 to be applied by Barclays Bank PLC (“Barclays”) as repayment of certain eligible assets transferred under the Master Repurchase Agreement (as defined below in Note 10 — Repurchase Facilities, Notes Payable and Credit Facilities) with Barclays. Real Estate-Related Securities Real estate-related securities consists primarily of the Company’s investments in commercial mortgage-backed securities (“CMBS”) and equity securities. The Company determines the appropriate classification for real estate-related securities at the time of purchase and reevaluates such designation as of each balance sheet date. As of December 31, 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 estimated fair value with unrealized gains and losses reported in other comprehensive (loss) income. During the year ended December 31, 2022, the Company invested $ 558.2 million in CMBS. As of December 31, 2022, the Company had investments in 20 CMBS with an estimated aggregate fair value of $ 538.1 million. In addition, the Company had an investment in an equity security with an estimated aggregate fair value of $ 38.2 million as of December 31, 2022, which is comprised of RTL Common Stock (as defined in Note 4 — Real Estate Assets) received as consideration in connection with the RTL Purchase and Sale Agreement. This investment is carried at its estimated fair value with unrealized gains and losses reported on the consolidated statements of operations. During the year ended December 31, 2022, the Company recorded $ 4.1 million of dividend income on RTL Common Stock, which is included in interest expense and other, net on the consolidated statements of operations. The Company also recorded $ 15.1 million of unrealized loss on RTL Common Stock during the year ended December 31, 2022, which is included in unrealized loss on equity security on the consolidated statements of operations. The Company monitors its available-for-sale securities for changes in fair value. A loss is recognized when the Company determines that a decline in the estimated fair value of a security below its amortized cost has resulted from a credit loss or other factors. The Company records impairments related to credit losses through current expected credit losses. However, the allowance is limited by the amount that the fair value is less than the amortized cost basis. For additional information regarding the Company’s process for estimating current expected credit losses for its real estate-related securities, see the Current Expected Credit Losses section below. The amortized cost of real estate-related securities is adjusted for amortization of premiums and accretion of discounts to maturity computed under the effective interest method and is recorded in the accompanying consolidated statements of operations in interest income. Upon the sale of a security, the realized net gain or loss is computed on the specific identification method. Interest earned is either received in cash or capitalized to real estate-related securities in the Company’s consolidated balance sheets. Interest is capitalized when certain conditions are met as specified in each security agreement. During the years F-15 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) ended December 31, 2022 and 2021, the Company capitalized $ 1.1 million and $ 974,000 , respectively, of interest income to real estate-related securities. Loans Held-for-Investment The Company’s loans held-for-investment include loans related to real estate assets, as well as credit investments, including commercial mortgage loans and other loans and securities related to commercial real estate assets, as well as corporate loan opportunities that are consistent with the Company’s investment strategy and objectives. The Company intends to hold the loans held-for-investment for the foreseeable future or until maturity. Loans held-for-investment are carried on the Company’s consolidated balance sheets at amortized cost, net of any current expected credit losses. Discounts or premiums, origination fees and exit fees are amortized as a component of interest income using the effective interest method over the life of the respective loans, or on a straight-line basis when it approximates the effective interest method. Upon the sale of a loan, the realized net gain or loss is computed on the specific identification method. Interest earned is either received in cash or capitalized to loans held-for-investment and related receivables, net in the Company’s consolidated balance sheets. Interest is capitalized when certain conditions are met as specified in each loan agreement. During the year ended December 31, 2022, the Company capitalized $ 62,000 of interest income to loans held-for-investment. Accrual of interest income is suspended on nonaccrual loans. Loans that are past due 90 days or more as to principal or interest, or where reasonable doubt exists as to timely collection, are generally considered nonperforming and placed on nonaccrual status. Interest collected is recognized on a cash basis by crediting income when received. 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 December 31, 2022, one of the Company’s liquid corporate senior loan investments was on nonaccrual status with a carrying value of $ 2.9 million, which represented less than 1 % of the carrying value of the Company’s liquid corporate senior loans portfolio. Current Expected Credit Losses The Company adopted Accounting Standards Update (“ASU”) No. 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 consolidated balance sheets. Changes to current expected credit losses are recognized through net income on the Company’s consolidated statements of operations. While ASU 2016-13 does not require any particular method for determining current expected credit losses, it does specify current expected credit losses should be based on relevant information about past events, including historical loss experience, current portfolio and market conditions, and reasonable and supportable forecasts for the duration of each respective loan. In addition, other than a few narrow exceptions, ASU 2016-13 requires that all financial instruments subject to the credit loss model have some amount of loss reserve to reflect the GAAP principal underlying the credit loss model that all loans, debt securities, and similar assets have some inherent risk of loss, regardless of credit quality, subordinate capital, or other mitigating factors. The Company estimates the current expected credit loss for its first mortgage loans primarily using the Weighted Average Remaining Maturity method, which has been identified as an acceptable method for estimating CECL reserves in the Financial Accounting Standards Board (“FASB”) Staff Q&A Topic 326, No. 1. This method requires the Company to reference historic loan loss data across a comparable data set and apply such loss rate to each loan investment over its expected remaining term, taking into consideration expected economic conditions over the relevant timeframe. The Company considers loan investments that are both (i) expected to be substantially repaid through the operation or sale of the underlying collateral, and (ii) for which the borrower is experiencing financial difficulty, to be “collateral-dependent” loans. For such loans that the Company determines that foreclosure of the collateral is probable, the Company measures the expected losses based on the difference between the fair value of the collateral less costs to sell and the amortized cost basis of the loan as of the measurement date. For collateral-dependent loans that the Company determines foreclosure is not probable, the Company applies a practical expedient to estimate expected losses using the difference between the collateral’s fair value (less costs to sell the asset if repayment is expected through the sale of the collateral) and the amortized cost basis of the loan. For the Company’s liquid corporate senior loans and corporate senior loans, the Company uses a probability of default and loss given default method using a comparable data set. The Company may use other acceptable alternative approaches in the future depending on, among other factors, the type of loan, underlying collateral, and availability of relevant historical market loan loss data. The Company adopted ASU 2016-13 using the modified retrospective method for all financial assets measured at amortized cost. Prior to adoption, the Company had no current expected credit losses on its consolidated balance sheets. The F-16 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Company recorded a cumulative-effective adjustment to the opening retained earnings in its consolidated statement of stockholders’ equity as of January 1, 2020 of $ 2.0 million. Quarterly, the Company evaluates the risk of all loans and assigns a risk rating based on a variety of factors, grouped as follows: (i) loan and credit structure, including the as-is loan-to-value (“LTV”) ratio and structural features; (ii) quality and stability of real estate value and operating cash flow, including debt yield, dynamics of the geography, property type and local market, physical condition, stability of cash flow, leasing velocity and quality and diversity of tenancy; (iii) performance against underwritten business plan; and (iv) quality, experience and financial condition of sponsor, borrower and guarantor(s). Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from least risk to greatest risk, respectively, which ratings are defined as follows: 1- Outperform — Most satisfactory asset quality and liquidity, good leverage capacity. A “1” rating maintains predictable and strong cash flows from operations. The trends and outlook for the credit's operations, balance sheet, and industry are neutral to favorable. Collateral, if appropriate, exceeds performance metrics; 2- Meets or Exceeds Expectations — Acceptable asset quality, moderate excess liquidity, modest leverage capacity. A “2” rating could have some financial/non-financial weaknesses which are offset by strengths; however, the credit demonstrates an ample current cash flow from operations. The trends and outlook for the credit's operations, balance sheet, and industry are generally positive or neutral. Collateral performance, if appropriate, meets or exceeds substantially all performance metrics included in original or current underwriting / business plan; 3- Satisfactory — Acceptable asset quality, somewhat strained liquidity, minimal leverage capacity. A “3” rating is at times characterized by acceptable cash flows from operations. The trends and conditions of the credit's operations and balance sheet are neutral. Collateral performance, if appropriate, meets or is on track to meet underwriting; business plan can reasonably be achieved; 4- Underperformance — The debt investment possesses credit deficiencies or potential weaknesses which deserve management’s close and continued attention. The portfolio company’s operations and/or balance sheet have demonstrated an adverse trend or deterioration which, while serious, has not reached the point where the liquidation of debt is jeopardized. These weaknesses are generally considered correctable by the borrower in the normal course of business but may weaken the asset or inadequately protect the Company’s credit position if not checked or corrected. Collateral performance, if appropriate, falls short of original underwriting, material differences exist from business plan, or both; technical milestones have been missed; defaults may exist, or may soon occur absent material improvement; and 5- Default/Possibility of Loss — The debt investment is protected inadequately by the current enterprise value or paying capacity of the obligor or of the collateral, if any. The underlying company’s operations have well-defined weaknesses based upon objective evidence, such as recurring or significant decreases in revenues and cash flows. Major variance from business plan; loan covenants or technical milestones have been breached; timely exit from loan via sale or refinancing is questionable; risk of principal loss. Collateral performance, if appropriate, is significantly worse than underwriting. The Company generally assigns a risk rating of “3” to all newly originated or acquired loans held-for-investment during a most recent quarter, except in the case of specific circumstances warranting an exception. 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. Deferred Financing Costs Deferred financing costs represent commitment fees, legal fees and other costs associated with obtaining commitments for financing. These costs are amortized to interest expense over the terms of the respective financing agreements using the straight-line method, which approximates the effective interest method. Unamortized deferred financing costs are written off when the associated debt is extinguished or repaid before maturity. The presentation of all deferred financing costs, other than those associated with the revolving loan portion of the credit facilities, are classified such that the debt issuance costs related to a recognized debt liability are presented on the consolidated balance sheets as a direct deduction from the carrying amount of the related debt liability rather than as an asset. Debt issuance costs related to securing a revolving line of credit are presented as an asset and amortized ratably over the term of the line of credit arrangement. As such, the Company’s current and corresponding prior period total deferred costs, net in the accompanying consolidated balance sheets relate only to the revolving F-17 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) loan portion of the credit facilities and the historical presentation, amortization and treatment of unamortized costs are still applicable. As of December 31, 2022 and 2021, the Company had $ 16.4 million and $ 7.2 million, respectively, of deferred financing costs, net of accumulated amortization, related to the revolving loan portion of the credit facilities. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined the financing will not close. Due to Affiliates CMFT Management, and certain of its affiliates, received and will continue to receive, fees, reimbursements and compensation in connection with services provided relating to the Offerings and the acquisition, management, financing and leasing of the properties of the Company. Derivative Instruments and Hedging Activities The Company accounts for its derivative instruments at fair value. Accounting for changes in the fair value of a derivative instrument depends on the intended use of the derivative instrument and the designation of the derivative instrument. The change in fair value of the derivative instrument that is designated as a cash flow hedge is recorded as other comprehensive income. The changes in fair value for derivative instruments that are not designated as hedges or that do not meet the hedge accounting criteria are recorded as a gain or loss to operations. Redeemable Common Stock Under the Company’s share redemption program, the Company’s obligation to redeem shares of its outstanding common stock is limited, among other things, to the net proceeds received by the Company from the sale of shares under the DRIP, net of shares redeemed to date. The Company records the maximum amount that is redeemable under the share redemption program as redeemable common stock outside of permanent equity in its consolidated balance sheets. Changes in the amount of redeemable common stock from period to period are recorded as an adjustment to capital in excess of par value. Leases The Company has lease agreements with lease and non-lease components. The Company has elected to not separate non-lease components from lease components for all classes of underlying assets (primarily real estate assets) and will account for the combined components as rental and other property income. Non-lease components included in rental and other property income include certain tenant reimbursements for maintenance services (including common-area maintenance services or “CAM”), real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. As a lessor, the Company has further determined that this policy will be effective only on a lease that has been classified as an operating lease and the revenue recognition pattern and timing is the same for both types of components. The Company is not a party to any material leases where it is the lessee. Significant judgments and assumptions are inherent in not only determining if a contract contains a lease, but also the lease classification, terms, payments, and, if needed, discount rates. Judgments include the nature of any options, including if they will be exercised, evaluation of implicit discount rates and the assessment and consideration of “fixed” payments for straight-line rent revenue calculations. Lease costs represent the initial direct costs incurred in the origination, negotiation and processing of a lease agreement. Such costs include outside broker commissions and other independent third-party costs and are amortized over the life of the lease on a straight-line basis. Costs related to salaries and benefits, supervision, administration, unsuccessful origination efforts and other activities not directly related to completed lease agreements are expensed as incurred. Upon successful lease execution, leasing commissions are capitalized. Development Activities 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 years ended December 31, 2022 and 2021, the Company capitalized $ 14.0 million and $ 9.8 million, respectively, of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying consolidated balance sheets. Included in the amounts capitalized during the years ended December 31, 2022 and 2021 was $ 1.7 million and $ 1.8 million, respectively, of capitalized interest expense. F-18 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Revenue Recognition Revenue from leasing activities Rental and other property income is primarily derived from fixed contractual payments from operating leases and, therefore, is generally recognized on a straight-line basis over the term of the lease, which typically begins the date the tenant takes control of the space. When the Company acquires a property, the terms of existing leases are considered to commence as of the acquisition date for the purpose of this calculation. Variable rental and other property income consists primarily of tenant reimbursements for recoverable real estate taxes and operating expenses which are included in rental and other property income in the period when such costs are incurred, with offsetting expenses in real estate taxes and property operating expenses, respectively, within the consolidated statements of operations. 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. 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. Management’s estimate of the collectability of lease-related receivables is based on the best information available at the time of estimate. The Company does not use a general reserve approach and lease-related receivables are adjusted and taken against rental and other property income only when collectability becomes not probable. Revenue from lending activities Interest income from the Company’s loans held-for-investment and real estate-related securities is comprised of interest earned on loans and the accretion and amortization of net loan origination fees and discounts. Interest income on loans is accrued as earned, with the accrual of interest suspended when the related loan becomes a nonaccrual loan. Interest income on the Company’s liquid corporate senior loans is accrued as earned beginning on the settlement date. Income Taxes The Company elected to be taxed, and currently qualifies, as a REIT for federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, commencing with the taxable year ended December 31, 2012. The Company will generally not be subject to federal corporate income tax to the extent it distributes its taxable income to its stockholders, and so long as it, among other things, distributes at least 90% of its annual taxable income (computed without regard to the dividends paid deduction and excluding net capital gains). REITs are subject to a number of other organizational and operational requirements. Even if the Company maintains its qualification for taxation as a REIT, it or its subsidiaries may be subject to certain state and local taxes on its income and property, and federal income and excise taxes on its undistributed income. Earnings (Loss) and Distributions Per Share Earnings (loss) per share are calculated based on the weighted average number of shares of common stock outstanding during each period presented. Diluted income (loss) per share considers the effect of any potentially dilutive share equivalents, of which the Company had no ne for each of the years ended December 31, 2022, 2021 or 2020. Distributions per share are calculated based on the authorized monthly distribution rate. Reportable Segments The Company’s segment information reflects how the chief operating decision makers review information for operational decision-making purposes. The Company has two reportable segments: Credit — engages primarily in acquiring and originating primarily floating rate first and second lien mortgage loans, either directly or through co-investments in joint ventures, related to real estate assets. This segment also includes investments in real estate-related securities, liquid corporate senior loans and corporate senior loans. F-19 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Real estate — engages primarily in acquiring and managing geographically diversified income-producing retail, industrial and office properties that are primarily single-tenant properties, which are leased to creditworthy tenants under long-term net leases. See Note 18 — Segment Reporting for a further discussion regarding these segments. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by various standard setting bodies that may have an impact on the Company’s accounting and reporting. Except as otherwise stated below, the Company is currently evaluating the effect that certain new accounting requirements may have on the Company’s accounting and related reporting and disclosures in the Company’s consolidated financial statements. In January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) (“ASU 2021-01”). The amendments in ASU 2021-01 clarify that certain optional expedients and exceptions for contract modifications and hedge accounting apply to derivative instruments that use an interest rate for margining, discounting, or contract price alignment that is modified as a result of the discontinuation of the use of the London Interbank Offered Rate (“LIBOR”) as a benchmark interest rate due to reference rate reform. ASU 2021-01 is effective immediately for all entities with the option to apply retrospectively as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, and can be applied prospectively to any new contract modifications made on or after January 7, 2021. The Company currently uses LIBOR and the secured overnight financing rate (“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 consolidated financial statements. In December 2022, the FASB issued ASU No. 2022-06, Deferral of the Sunset Date of Topic 848 (“ASU 2022-06”) which was issued to defer the sunset date of Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform to December 31, 2024. ASU 2022-06 is effective immediately for all companies. ASU 2022-06 did not have an impact on the Company’s consolidated financial statements for the year ended December 31, 2022. In June 2022, the FASB issued ASU No. 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions . The amendments in this update clarify the guidance in Topic 820 when measuring the fair value of an equity security subject to contractual sale restrictions and introduce new disclosure requirements related to such equity securities. The amendments are effective for fiscal years beginning after December 15, 2023, with early adoption permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements. NOTE 3 — FAIR VALUE MEASUREMENTS GAAP defines fair value, establishes a framework for measuring fair value, and requires disclosures about fair value measurements. GAAP emphasizes that fair value is intended to be a market-based measurement, as opposed to a transaction-specific measurement. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate the fair value. Assets and liabilities are measured using inputs from three levels of the fair value hierarchy, as follows: Level 1 — Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market is defined as a market in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 — Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active (markets with few transactions), inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data correlation or other means (market corroborated inputs). Level 3 — Unobservable inputs, which are only used to the extent that observable inputs are not available, reflect the Company’s assumptions about the pricing of an asset or liability. The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities: F-20 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Real estate-related securities — The Company generally determines the fair value of its real estate-related securities by utilizing broker-dealer quotations, reported trades or valuation estimates from pricing models to determine the reported price. Pricing models for real estate-related securities are generally discounted cash flow models that usually consider the attributes applicable to a particular class of security (e.g., credit rating, seniority), current market data, and estimated cash flows for each class and incorporate deal collateral performance such as prepayment speeds and default rates, as available. Depending upon the significance of the fair value inputs used in determining these fair values, these securities are valued using Level 1, Level 2 or Level 3 inputs. As of December 31, 2022, the Company concluded that $ 348.2 million of its CMBS fell under Level 2 and $ 189.9 million of its CMBS fell under Level 3. The Company’s equity security investment is valued using Level 1 inputs. The estimated fair value of the Company’s equity security is based on quoted market prices that are readily and regularly available in an active market. Credit facilities and notes payable — The fair value is estimated by discounting the expected cash flows based on estimated borrowing rates available to the Company as of the measurement date. Current and prior period liabilities’ carrying and fair values exclude net deferred financing costs. These financial instruments are valued using Level 2 inputs. As of December 31, 2022, the estimated fair value of the Company’s debt was $ 4.32 billion, compared to a carrying value of $ 4.44 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 caps. All derivative instruments are carried at fair value and are valued using Level 2 inputs. The fair value of these instruments is determined using interest rate market pricing models. In addition, credit valuation adjustments are incorporated into the fair values to account for the Company’s potential nonperformance risk and the performance risk of the respective counterparties. 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 December 31, 2022 and 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. Loans held-for-investment — The Company’s loans held-for-investment are recorded at cost upon origination and adjusted by net loan origination fees and discounts. The Company estimates the fair value of its loans held-for-investment by performing a present value analysis for the anticipated future cash flows using an appropriate market discount rate taking into consideration the credit risk. 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 corporate 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 the measurement date. As of December 31, 2022, $ 494.4 million and $ 168.0 million of the Company’s liquid corporate 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 corporate senior loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively. As of December 31, 2022, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $ 3.98 billion, compared to its carrying value of $ 4.00 billion. As of December 31, 2021, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $ 2.63 billion, compared to its carrying value of $ 2.61 billion. Other financial instruments — The Company considers the carrying values of its cash and cash equivalents, restricted cash, tenant receivables, accounts payable and accrued expenses, other liabilities, due to affiliates and distributions payable to approximate their fair values because of the short period of time between their origination and their expected realization as well as their highly-liquid nature. Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments. Considerable judgment is necessary to develop estimated fair values of financial assets and liabilities. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize, or be liable for, upon disposition of the financial assets and liabilities. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. The Company does not expect that changes in classifications between levels will be frequent. F-21 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) 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 December 31, 2022 and 2021 (in thousands): Balance as of December 31, 2022 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets: CMBS $ 538,142 $ — $ 348,241 $ 189,901 Equity security 38,249 38,249 — — Interest rate caps 5,040 — 5,040 — Total financial assets $ 581,431 $ 38,249 $ 353,281 $ 189,901 Balance as of December 31, 2021 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets: CMBS $ 41,871 $ — $ — $ 41,871 Preferred units 63,490 — — 63,490 Marketable security 110 110 — — Interest rate caps 179 — 179 — Total financial assets $ 105,650 $ 110 $ 179 $ 105,361 Financial liabilities: Interest rate swaps $ ( 2,466 ) $ — $ ( 2,466 ) $ — Total financial liabilities $ ( 2,466 ) $ — $ ( 2,466 ) $ — F-22 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The following are reconciliations of the changes in financial assets with Level 3 inputs in the fair value hierarchy for the years ended December 31, 2022 and 2021 (in thousands): Level 3 Beginning Balance, January 1, 2021 $ 10,733 Total gains and losses: Unrealized gain included in other comprehensive (loss) income, net 2,197 Purchases and payments received: Purchases 97,981 Discounts, net ( 4,701 ) Capitalized interest income 974 Principal payments received ( 42 ) Sales ( 1,781 ) Balance, December 31, 2021 $ 105,361 Total gains and losses: Unrealized loss included in other comprehensive (loss) income, net ( 13,426 ) Purchases and payments received: Conversion of preferred units (1) ( 68,243 ) Purchases 4,752 Discounts, net 1,254 Capitalized interest income 1,110 Net transfers (2) 159,093 Ending Balance, December 31, 2022 $ 189,901 ____________________________________ (1) Reflects the Company’s investment in preferred units which matured during the year ended December 31, 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) One of the Company’s CMBS instruments in two different tranches was transferred into Level 3 during the year ended December 31, 2022 due to a decrease in transparency of inputs and observable prices in the market. Items Measured at Fair Value on a Non-Recurring Basis (Including Impairment Charges) Certain financial and nonfinancial assets and liabilities are measured at fair value on a nonrecurring basis and are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment. 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 year ended December 31, 2022, real estate assets related to 23 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 123.9 million, resulting in impairment charges of $ 16.2 million. Additionally, during the year ended December 31, 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 $ 16.1 million. During the year ended December 31, 2021, real estate assets related to 12 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 48.9 million, resulting in impairment charges of $ 6.0 million. Additionally, during the year ended December 31, 2021, certain condominium units were deemed to be impaired and their carrying values were reduced to their estimated fair value, resulting in impairment charges of $ 12.1 million. During the year ended December 31, 2020, real estate assets related to 12 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 86.4 million, resulting in impairment charges of $ 16.7 million. 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. The evaluation of real estate assets for potential impairment requires the Company’s management to exercise significant judgment and to make certain key assumptions, including, but not limited to, the following: (1) terminal capitalization rates; (2) discount rates; (3) the number of years the property will be held; (4) property operating expenses; and (5) re-leasing assumptions, including the number of months to re-lease, market rental income and required tenant improvements. There are inherent uncertainties in making these estimates such as market conditions F-23 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) and the future performance and sustainability of the Company’s tenants. 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 years ended December 31, 2022 and 2021 : Year Ended December 31, 2022 Year Ended December 31, 2021 Discount Rate Terminal Capitalization Rate Discount Rate Terminal Capitalization Rate 8.0 % - 9.7 % 7.5 % - 9.2 % 8.0 % - 10.5 % 7.5 % - 9.2 % The following table presents the impairment charges by asset class recorded during the years ended December 31, 2022, 2021 and 2020 (in thousands): Year Ended December 31, 2022 2021 2020 Asset class impaired: Land $ 3,553 $ 1,089 $ 3,738 Buildings, fixtures and improvements 11,081 4,755 12,310 Intangible lease assets 1,550 311 737 Intangible lease liabilities — ( 162 ) ( 48 ) Condominium developments 16,137 12,085 — Total impairment loss $ 32,321 $ 18,078 $ 16,737 NOTE 4 — REAL ESTATE ASSETS 2022 Property Acquisitions During the year ended December 31, 2022, the Company did not acquire any properties. 2022 Condominium Development Project During the year ended December 31, 2022, the Company capitalized $ 14.0 million of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying consolidated balance sheets. 2022 Condominium Dispositions During the year ended December 31, 2022, the Company disposed of condominium units for an aggregate sales price of $ 40.7 million, resulting in proceeds of $ 33.0 million after closing costs and a gain of $ 4.1 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 consolidated statements of operations. 2022 Property Dispositions On December 20, 2021, certain subsidiaries of the Company entered into an Agreement of Purchase and Sale, as amended (the “RTL Purchase and Sale Agreement”), with American Finance Trust, Inc. (now known as The Necessity Retail REIT, Inc.) (NASDAQ: RTL) (“RTL”), American Finance Operating Partnership, L.P. (now known as The Necessity Retail REIT Operating Partnership, L.P.) (“RTL OP”), and certain of their subsidiaries (collectively, the “Purchaser”) to sell to the Purchaser 79 shopping centers and two single-tenant properties encompassing approximately 9.5 million gross rentable square feet of commercial space across 27 states for total consideration of $ 1.32 billion (the “Purchase Price”). The Purchase Price included the Purchaser’s option to seek the assumption of certain existing debt, and the 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 RTL Purchase and Sale Agreement. During the year ended December 31, 2022, the Company disposed of 134 properties, including 69 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 $ 1.69 billion, resulting in net proceeds of $ 1.69 billion after closing costs and a gain of $ 117.8 million. Included F-24 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) 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 RTL 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 RTL Purchase and Sale Agreement. Such shares are included in real estate-related securities in the consolidated balance sheets. During the year ended December 31, 2022, the Company recognized earnout income of $ 70.0 million related to the disposition of properties pursuant to the RTL Purchase and Sale Agreement, and recorded a related receivable of $ 12.2 million, which is included in prepaid expenses and other assets in the consolidated balance sheets as of December 31, 2022. Subsequent to December 31, 2022, the Company collected the $ 12.2 million earnout income related receivable in full. 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 consolidated statements of operations. 2022 Impairment The Company performs quarterly impairment review procedures, primarily through continuous monitoring of events and changes in circumstances that could indicate that the carrying value of certain of its real estate assets may not be recoverable. See Note 2 — Summary of Significant Accounting Policies for a discussion of the Company’s accounting policies regarding impairment of real estate assets. During the year ended December 31, 2022, 23 properties totaling approximately 962,000 square feet with a carrying value of $ 140.1 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 123.9 million, resulting in impairment charges of $ 16.2 million, which were recorded in the consolidated statements of operations. Additionally, during the year ended December 31, 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 $ 16.1 million, which were recorded in the consolidated statements of operations. See Note 3 — Fair Value Measurements for a further discussion regarding these impairment charges. 2021 Property Acquisitions During the year ended December 31, 2021, the Company acquired 115 commercial properties in connection with the merger with CIM Income NAV, Inc. (the “CIM Income NAV Merger”) for an aggregate purchase price of $ 911.3 million (the “2021 Property Acquisitions”), which includes $ 5.0 million of external acquisition-related expenses that were capitalized. The Company funded the 2021 Property Acquisitions acquired in connection with the CIM Income NAV Merger with the consideration received in connection with the CIM Income NAV Merger. Five of the 2021 Property Acquisitions with a fair value of $ 66.5 million were classified as held for sale in connection with the RTL Purchase and Sale Agreement as of December 31, 2021. The following table summarizes the purchase price allocation for the 2021 Property Acquisitions (in thousands): 2021 Property Acquisitions Land $ 160,364 Buildings, fixtures and improvements 591,908 Acquired in-place leases and other intangibles (1) 94,118 Acquired above-market leases (2) 6,831 Intangible lease liabilities (3) ( 8,425 ) Assets held for sale 66,466 Total purchase price $ 911,262 ______________________ (1) The amortization period for acquired in-place leases and other intangibles is 10.2 years. (2) The amortization period for acquired above-market leases is 13.5 years. (3) The amortization period for acquired intangible lease liabilities is 14.8 years. 2021 Assets Acquired Via Foreclosure During the year ended December 31, 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. F-25 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The following table summarizes the purchase price allocation for the real estate acquired via foreclosure (in thousands): As of December 31, 2021 Buildings, fixtures and improvements $ 192,182 Acquired in-place leases and other intangibles 134 Intangible lease liabilities ( 326 ) Total purchase price $ 191,990 In connection with the foreclosure, the Company assumed $ 102.6 million of mortgage notes payable related to the assets. 2021 Condominium Development Project During the year ended December 31, 2021, the Company capitalized $ 9.8 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 consolidated balance sheets. 2021 Condominium Dispositions During the year ended December 31, 2021, the Company disposed of condominium units for an aggregate sales price of $ 42.3 million, resulting in proceeds of $ 37.8 million after closing costs and a gain of $ 5.9 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 consolidated statements of operations. 2021 Property Dispositions and Real Estate Assets Held for Sale During the year ended December 31, 2021, the Company disposed of 117 properties, consisting of 113 retail properties, three anchored shopping centers and one industrial property, and an outparcel of land for an aggregate gross sales price of $ 490.3 million, resulting in net proceeds of $ 475.8 million after closing costs and a gain of $ 77.2 million. The Company has no continuing involvement with these properties that would preclude sale treatment. The gain on sale of real estate is included in gain on disposition of real estate and condominium developments, net in the consolidated statements of operations. On December 20, 2021, certain subsidiaries of the Company entered into the RTL Purchase and Sale Agreement to sell 79 shopping centers and two single-tenant properties. As of December 31, 2021, these 81 properties were classified as held for sale with a carrying value of $ 1.3 billion included in assets held for sale in the accompanying consolidated balance sheets. Subsequent to December 31, 2021, the Company disposed of these properties in phases. 2021 Impairment During the year ended December 31, 2021, 12 properties totaling approximately 275,000 square feet with a carrying value of $ 54.9 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 48.9 million, resulting in impairment charges of $ 6.0 million, which were recorded in the consolidated statements of operations. Additionally, during the year ended December 31, 2021, certain condominium units were deemed to be impaired and their carrying values were reduced to their estimated fair value, resulting in impairment charges of $ 12.1 million, which were recorded in the consolidated statements of operations. See Note 3 — Fair Value Measurements for a further discussion regarding these impairment charges. 2020 Property Acquisitions During the year ended December 31, 2020, the Company acquired 150 commercial properties, including 146 properties acquired in connection with the mergers with Cole Office & Industrial REIT (CCIT III), Inc. (“CCIT III”) and Cole Credit Property Trust V, Inc. (“CCPT V”) (the “CCIT III and CCPT V Mergers”), for an aggregate purchase price of $ 798.5 million (the “2020 Property Acquisitions”), which includes $ 7.9 million of external acquisition-related expenses that were capitalized. The Company funded the 2020 Property Acquisitions acquired in connection with the CCIT III and CCPT V Mergers with the consideration paid in the CCIT III and CCPT V Mergers, which consisted of the right to receive 1.098 and 2.892 shares of the Company’s common stock, respectively, for each issued and outstanding share of common stock of CCIT III and CCPT V, and funded the remaining acquisitions with proceeds from real estate dispositions and available borrowings. F-26 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The following table summarizes the purchase price allocation for the 2020 Property Acquisitions (in thousands): 2020 Property Acquisitions Land $ 166,395 Buildings, fixtures and improvements 571,777 Acquired in-place leases and other intangibles (1) 74,888 Acquired above-market leases (2) 2,367 Intangible lease liabilities (3) ( 16,927 ) Total purchase price $ 798,500 ______________________ (1) The amortization period for acquired in-place leases and other intangibles is 8.9 years. (2) The amortization period for acquired above-market leases is 6.5 years. (3) The amortization period for acquired intangible lease liabilities is 9.7 years. 2020 Property Dispositions and Real Estate Assets Held for Sale During the year ended December 31, 2020, the Company disposed of 30 properties, consisting of 20 retail properties and 10 anchored shopping centers for an aggregate gross sales price of $ 270.4 million, resulting in net proceeds of $ 263.8 million after closing costs and disposition fees due to CMFT Management or its affiliates, and a recorded gain of $ 27.5 million. The Company has no continuing involvement with these properties. The gain on sale of real estate is included in gain on disposition of real estate and condominium developments, net in the consolidated statements of operations. As of December 31, 2020, there was one property classified as held for sale with a carrying value of $ 3.5 million included in assets held for sale in the accompanying consolidated balance sheets. Subsequent to December 31, 2020, the Company disposed of the property. 2020 Impairment During the year ended December 31, 2020, 12 properties totaling approximately 824,000 square feet with a carrying value of $ 103.1 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 86.4 million, resulting in impairment charges of $ 16.7 million, which were recorded in the consolidated statements of operations. See Note 3 — Fair Value Measurements for a further discussion regarding these impairment charges. NOTE 5 — INTANGIBLE LEASE ASSETS AND LIABILITIES Intangible lease assets and liabilities consisted of the following as of December 31, 2022 and 2021 (in thousands, except weighted average life remaining): As of December 31, 2022 2021 Intangible lease assets: In-place leases and other intangibles, net of accumulated amortization of $ 86,881 and $ 73,923 , respectively (with a weighted average life remaining of 11.1 years and 11.4 years, respectively) $ 174,954 $ 224,931 Acquired above-market leases, net of accumulated amortization of $ 4,210 and $ 3,204 , respectively (with a weighted average life remaining of 12.9 years and 13.3 years, respectively) 10,639 12,774 Total intangible lease assets, net $ 185,593 $ 237,705 Intangible lease liabilities: Acquired below-market leases, net of accumulated amortization of $ 5,575 and $ 9,043 , respectively (with a weighted average life remaining of 12.4 years and 11.5 years, respectively) $ 19,054 $ 24,896 Amortization of the above-market leases is recorded as a reduction to rental and other property income, and amortization expense for the in-place leases and other intangibles is included in depreciation and amortization in the accompanying F-27 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) consolidated statements of operations. Amortization of below-market leases is recorded as an increase to rental and other property income in the accompanying consolidated statements of operations. The following table summarizes the amortization related to the intangible lease assets and liabilities for the years ended December 31, 2022, 2021, and 2020 (in thousands): Year Ended December 31, 2022 2021 2020 In-place lease and other intangible amortization $ 24,629 $ 28,994 $ 23,262 Above-market lease amortization $ 1,152 $ 2,379 $ 3,095 Below-market lease amortization $ 1,990 $ 5,393 $ 5,309 As of December 31, 2022, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands): Amortization Year Ending December 31, In-Place Leases and Other Intangibles Above-Market Leases Below-Market Leases 2023 $ 21,684 $ 1,022 $ 1,802 2024 20,338 929 1,675 2025 17,508 916 1,603 2026 15,884 871 1,595 2027 14,894 846 1,526 Thereafter 84,646 6,055 10,853 Total $ 174,954 $ 10,639 $ 19,054 NOTE 6 — INVESTMENT IN UNCONSOLIDATED ENTITIES 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 approximately 90 % 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 December 31, 2022, the carrying value of the Company’s investment in NP JV Holdings was $ 100.6 million, which approximates fair value and is included in investment in unconsolidated entities on the consolidated balance sheets. The Company received $ 46.0 million in distributions related to its investment in NP JV Holdings during the year ended December 31, 2022, $ 6.8 million of which was recognized as a return on investment and $ 39.2 million of which was recognized as a return of investment and reduced the invested capital and the carrying amount. As of December 31, 2022, the Company had $ 112.6 million of unfunded commitments related to NewPoint JV. These commitments are not reflected in the accompanying consolidated balance sheets. The Company entered into a guaranty with NewPoint JV, under which the Company agreed to guarantee the Unconsolidated Joint Venture’s cross indemnity and its share of capital contribution obligations under the agreement with NewPoint JV. On December 16, 2021, as a result of the CIM Income NAV Merger, the Company acquired a limited partnership interest in CIM UII Onshore. CIM UII Onshore’s sole purpose is to invest all of its assets in CIM Urban Income Investments, L.P. (“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 year ended December 31, 2022 and 2021, the Company recognized an equity method net gain of $ 5.2 million and $ 606,000 , respectively, 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 year ended December 31, 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. F-28 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) NOTE 7 — REAL ESTATE-RELATED SECURITIES As of December 31, 2022, the Company had real estate-related securities with an aggregate estimated fair value of $ 576.4 million, which included 20 CMBS investments and an investment in a publicly-traded equity security. The CMBS mature on various dates from January 2023 through June 2058 and have interest rates ranging from 5.8 % and 11.7 % as of December 31, 2022, with one CMBS earning a zero coupon rate. The following is a summary of the Company’s real estate-related securities as of December 31, 2022 (in thousands): Real Estate-Related Securities Amortized Cost Basis Unrealized Loss Fair Value CMBS $ 586,649 $ ( 48,507 ) $ 538,142 Equity Security 53,388 ( 15,139 ) 38,249 Total real estate-related securities $ 640,037 $ ( 63,646 ) $ 576,391 The following table provides the activity for the real estate-related securities during the year ended December 31, 2022 and 2021 (in thousands): Amortized Cost Basis Unrealized Gain (Loss) Fair Value Real estate-related securities as of January 1, 2021 $ 37,047 $ 1,147 $ 38,194 Face value of real estate-related securities acquired 264,246 — 264,246 Investment in preferred units 63,490 — 63,490 Premiums and discounts on purchase of real estate-related securities, net of acquisition costs ( 5,982 ) — ( 5,982 ) Amortization of discount on real estate-related securities 1,197 — 1,197 Sale of real estate-related securities ( 258,260 ) 1,419 ( 256,841 ) Capitalized interest income on real estate-related securities 974 — 974 Principal payments received on real estate-related securities ( 38 ) — ( 38 ) Unrealized gain on real estate-related securities — 231 231 Real estate-related securities as of January 1, 2022 102,674 2,797 105,471 Face value of real estate-related securities acquired 640,793 — 640,793 Investment in preferred units, net (1) ( 63,490 ) ( 63,490 ) Premiums and discounts on purchase of real estate-related securities, net of acquisition costs ( 33,939 ) — ( 33,939 ) Amortization of discount on real estate-related securities 10,160 — 10,160 Realized gain on sale of real estate-related securities ( 110 ) ( 22 ) ( 132 ) Capitalized interest income on real estate-related securities 1,110 — 1,110 Principal payments received on real estate-related securities ( 17,161 ) — ( 17,161 ) Unrealized loss on real estate-related securities — ( 66,421 ) ( 66,421 ) Real estate-related securities as of December 31, 2022 $ 640,037 $ ( 63,646 ) $ 576,391 ____________________________________ (1) Included in this balance is $ 68.2 million of the Company’s investment in preferred units which were redeemed during the year ended December 31, 2022 in exchange for an investment in a first mortgage loan, as further discussed in Note 8 — Loans Held-For-Investment. During the year ended December 31, 2022, the Company invested $ 558.2 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 year ended December 31, 2022 as consideration in connection with the RTL 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 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 consolidated statement of operations. During the year ended December 31, 2022, the Company recorded $ 66.4 million of unrealized loss on its real estate-related securities, $ 51.3 million of which is included in other comprehensive (loss) income in the accompanying consolidated statements of comprehensive income (loss). The remaining $ 15.1 million of unrealized loss on the Company’s equity security is included in F-29 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) unrealized loss on equity security in the accompanying consolidated statement of operations. During the year ended December 31, 2021, the Company recorded $ 231,000 of unrealized gain on its real estate-related securities included in other comprehensive (loss) income in the accompanying consolidated statements of comprehensive income (loss). The scheduled maturities of the Company’s CMBS as of December 31, 2022 are as follows (in thousands): CMBS Amortized Cost Estimated Fair Value Due within one year $ 316,771 $ 292,382 Due after one year through five years 228,442 214,952 Due after five years through ten years — — Due after ten years 41,436 30,808 Total $ 586,649 $ 538,142 Actual maturities of real estate-related securities can differ from contractual maturities because borrowers on certain corporate credit securities may have the right to prepay their respective debt obligations at any time. In addition, factors such as prepayments and interest rates may affect the yields on such securities. In estimating credit losses related to real estate-related securities, management considers a variety of factors, including, 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 December 31, 2022, the Company had no credit losses related to real estate-related securities. NOTE 8 — LOANS HELD-FOR-INVESTMENT The Company’s loans held-for-investment consisted of the following as of December 31, 2022 and 2021 (dollar amounts in thousands): As of December 31, 2022 2021 First mortgage loans (1) $ 3,285,193 $ 1,968,585 Total CRE loans held-for-investment and related receivables, net 3,285,193 1,968,585 Liquid corporate senior loans 701,540 655,516 Corporate senior loans 57,165 — Loans held-for-investment and related receivables, net $ 4,043,898 $ 2,624,101 Less: Current expected credit losses ( 42,344 ) ( 15,201 ) Total loans held-for-investment and related receivable, net $ 4,001,554 $ 2,608,900 ____________________________________ (1) As of December 31, 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. F-30 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The following table details overall statistics for the Company’s loans held-for-investment as of December 31, 2022 and 2021 (dollar amounts in thousands): CRE Loans (1) (2) Liquid Corporate Senior Loans Corporate Senior Loans As of December 31, As of December 31, As of December 31, 2022 2021 2022 2021 2022 2021 Number of loans 29 22 317 295 4 — Principal balance $ 3,306,411 $ 1,985,722 $ 708,254 $ 659,007 $ 57,918 $ — Net book value $ 3,264,841 $ 1,958,655 $ 680,345 $ 650,245 $ 56,368 $ — Weighted-average interest rate 7.6 % 3.3 % 8.0 % 3.7 % 10.5 % — % Weighted-average maximum years to maturity 3.6 4.3 4.7 5.1 4.6 0.0 Unfunded loan commitments (3) $ 304,649 $ 209,368 $ 1,425 $ 1,562 $ 4,324 $ — ____________________________________ (1) As of December 31, 2022, 100 % of the Company’s CRE loans by principal balance earned a floating rate of interest, primarily indexed to SOFR and U.S. dollar LIBOR. (2) Maximum maturity date assumes all extension options are exercised by the borrowers; however, the Company’s CRE loans may be repaid prior to such date. (3) Unfunded loan commitments are subject to the satisfaction of borrower milestones and are not reflected in the accompanying consolidated balance sheets. This balance does not include unsettled liquid corporate senior loan purchases of $ 19.8 million that are included in cash and cash equivalents in the accompanying consolidated balance sheets. Activity relating to the Company’s loans held-for-investment portfolio was as follows for the years ended December 31, 2022 and 2021 (dollar amounts in thousands): Mezzanine Loans CRE Loans Liquid Corporate Senior Loans Corporate Senior Loans Total Loan Portfolio Balance, January 1, 2021 $ ( 58,038 ) $ 486,431 $ 463,873 $ — $ 892,266 Loan originations and acquisitions — 1,810,166 408,898 — 2,219,064 Cure payments receivable (1) — ( 7,351 ) — — ( 7,351 ) Sale of loans — — ( 69,918 ) — ( 69,918 ) Principal repayments received — ( 169,094 ) ( 156,968 ) — ( 326,062 ) Capitalized interest (1) — ( 9,469 ) — — ( 9,469 ) Deferred fees and other items — ( 17,031 ) ( 2,204 ) — ( 19,235 ) Accretion and amortization of fees and other items — 2,998 2,105 — 5,103 Foreclosure of assets (1) — ( 130,655 ) — — ( 130,655 ) Current expected credit losses 58,038 (2) ( 7,340 ) 4,459 — 55,157 Balance, January 1, 2022 — 1,958,655 650,245 — 2,608,900 Loan originations and acquisitions (3) — 1,401,539 184,513 75,851 1,661,903 Sale of loans — — ( 60,027 ) — ( 60,027 ) Principal repayments received — ( 80,911 ) ( 73,758 ) ( 17,933 ) ( 172,602 ) Capitalized interest — 62 — — 62 Deferred fees and other items (4) — ( 13,978 ) ( 5,856 ) ( 1,050 ) ( 20,884 ) Accretion and amortization of fees and other items — 9,896 1,152 297 11,345 Current expected credit losses (5) — ( 10,422 ) ( 15,924 ) ( 797 ) ( 27,143 ) Balance, December 31, 2022 $ — $ 3,264,841 $ 680,345 $ 56,368 $ 4,001,554 ____________________________________ F-31 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) (1) During the year ended December 31, 2021, the Company completed foreclosure of the assets which previously secured its eight mezzanine loans. (2) Includes the reversal of current expected credit losses related to the mezzanine loans upon foreclosure of the assets which previously secured the eight mezzanine loans during the year ended December 31, 2021. (3) The Company’s investment in preferred units, which was previously recorded in real estate-related securities on the accompanying consolidated balance sheets, was redeemed during the year ended December 31, 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 11.0 % and an initial maturity date of October 9, 2023. (4) Other items primarily consist of purchase discounts or premiums and deferred origination expenses. (5) Does not include current expected losses for unfunded or unsettled loan commitments. Such amounts are included in accrued expenses and accounts payable on the accompanying consolidated balance sheets. Current Expected Credit Losses Current expected credit losses reflect the Company’s current estimate of potential credit losses related to loans held-for-investment included in the Company’s consolidated balance sheets. Refer to Note 2 — Summary of Significant Accounting Policies for further discussion of the Company’s current expected credit losses. The following table presents the activity in the Company’s current expected credit losses related to loans held-for-investment by loan type for the year ended December 31, 2022 (dollar amounts in thousands): First Mortgage Loans Unfunded First Mortgage Loans (1) Liquid Corporate Senior Loans Unfunded or Unsettled Liquid Corporate Senior Loans (1) Corporate Senior Loans Unfunded Corporate Senior Loans (1) Total Current expected credit losses as of January 1, 2022 $ 9,930 $ — $ 5,271 $ — $ — $ — $ 15,201 Provision for credit losses 1,312 360 2,581 400 56 — 4,709 Current expected credit losses as of March 31, 2022 11,242 360 7,852 400 56 — 19,910 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 Provision for (reversal of) credit losses 5,345 1,239 7,426 158 ( 11 ) 4 14,161 Current expected credit losses as of December 31, 2022 $ 20,352 $ 1,890 $ 21,195 $ 377 $ 797 $ 66 $ 44,677 ____________________________________ (1) Current expected losses for unfunded or unsettled loan commitments are included in accrued expenses and accounts payable on the accompanying consolidated balance sheets. Changes to current expected credit losses are recognized through net income (loss) on the Company’s 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, 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. F-32 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The Company also classifies a financial instrument as a troubled debt restructuring when receivables from third parties, real estate, or other assets are transferred from the debtor to the creditor in order to fully or partially satisfy a debt, such as in the event of a foreclosure or repossession. During the year ended December 31, 2019, the borrower on the Company’s eight mezzanine loans became delinquent on certain required reserve payments. Throughout 2020, the borrower remained delinquent on the required reserve payments and became delinquent on principal and interest. As a result, the Company classified the loans as a troubled debt restructuring and commenced foreclosure proceedings during the year ended December 31, 2020. Upon completing foreclosure in January 2021, the Company took control of the assets which previously secured the loans, including 75 condominium units and 21 rental units across four buildings. As a result of the foreclosure, the Company recorded a $ 58.0 million decrease to its provision for credit losses related to its mezzanine loans during the three months ended March 31, 2021. Risk Ratings As further described in Note 2 — Summary of Significant Accounting Policies, the Company evaluates its loans held-for-investment portfolio on a quarterly basis. Each quarter, the Company assesses the risk factors of each loan, and assigns a risk rating based on several factors. Factors considered in the assessment include, but are not limited to, loan and credit structure, current LTV ratio, debt yield, collateral performance, and the quality and condition of the sponsor, borrower, and guarantor(s). Loans are rated “1” (less risk) through “5” (greater risk), which ratings are defined in Note 2 — Summary of Significant Accounting Policies. F-33 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The Company’s primary credit quality indicator is its risk ratings, which are further discussed above. The following table presents the net book value of the Company’s loans-held-for-investment portfolio as of December 31, 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 December 31, 2022 Number of Loans 2022 2021 2020 2019 Total First mortgage loans by internal risk rating: 1 — $ — $ — $ — $ — $ — 2 1 — — 83,787 — 83,787 3 25 1,163,918 1,604,647 72,745 50,618 2,891,928 4 3 80,369 229,109 — — 309,478 5 — — — — — — Total first mortgage loans 29 1,244,287 1,833,756 156,532 50,618 3,285,193 Liquid corporate senior loans by internal risk rating: 1 — — — — — — 2 2 — — 5,298 — 5,298 3 304 146,331 324,010 202,092 2,322 674,755 4 10 3,268 6,255 9,045 — 18,568 5 1 (2) 2,919 — — — 2,919 Total liquid corporate senior loans 317 152,518 330,265 216,435 2,322 701,540 Corporate senior loans by internal risk rating: 1 — — — — — — 2 — — — — — — 3 4 57,165 — — — 57,165 4 — — — — — — 5 — — — — — — Total corporate senior loans 4 57,165 — — — 57,165 Less: Current expected credit losses ( 42,344 ) Total loans-held-for-investment and related receivables, net 350 $ 4,001,554 Weighted Average Risk Rating (3) 3.1 ____________________________________ (1) Date loan was originated or acquired by the Company. Origination dates are subsequently updated to reflect material loan modifications. (2) As of December 31, 2022, one of the Company’s liquid corporate senior loan investments was on nonaccrual status with a carrying value of $ 2.9 million, which represented less than 1 % of the carrying value of the Company’s liquid corporate senior loans portfolio. (3) Weighted average risk rating calculated based on carrying value at period end. NOTE 9 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES In the normal course of business, the Company uses certain types of derivative instruments for the purpose of managing or hedging its interest rate risk. During the year ended December 31, 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 December 31, 2022, the Company had two non-designated interest rate cap agreements. F-34 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The following table summarizes the terms of the Company’s interest rate cap agreements and interest rate swap agreements as of December 31, 2022 and 2021 (dollar amounts in thousands): Outstanding Notional Fair Value of Assets (Liabilities) as of Balance Sheet Amount as of Interest Effective Maturity December 31, December 31, Location December 31, 2022 Rates (1) Dates Dates 2022 2021 Interest Rate Caps Prepaid expenses, derivative assets and other assets $ 712,000 8.38 % to 9.00 % 7/15/2021 to 9/13/2022 7/15/2023 to 10/9/2023 $ 5,040 $ 179 Interest Rate Swaps Deferred rental income, derivative liabilities and other liabilities $ — — % — — $ — $ ( 2,466 ) ____________________________________ (1) The interest rate consists of the underlying index capped to a fixed rate as of December 31, 2022. Additional disclosures related to the fair value of the Company’s derivative instruments are included in Note 3 — Fair Value Measurements. The notional amount under the derivative instruments is an indication of the extent of the Company’s involvement in each instrument, but does not represent exposure to credit, interest rate or market risks. Accounting for changes in the fair value of a derivative instrument depends on the intended use and designation of the derivative instrument. The Company has interest rate caps that are used to manage exposure to interest rate movements, but do not meet the requirements to be designated as hedging instruments. 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 consolidated statements of operations. During the year ended December 31, 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 year ended December 31, 2022, the amount of gain reclassified from other comprehensive (loss) income as a decrease to interest expense was $ 2.5 million. For the years ended December 31, 2021 and 2020, the amount of losses reclassified from other comprehensive (loss) income as an increase to interest expense was $ 3.3 million and $ 12.3 million, respectively. The total unrealized gain on interest rate swaps of $ 152,000 and the total unrealized loss on interest rate swaps of $ 3.2 million as of December 31, 2021 and 2020, respectively, is included in accumulated other comprehensive (loss) income in the accompanying consolidated statement of stockholders’ equity. No such unrealized amounts on interest rate swaps were remaining in other comprehensive (loss) income as of December 31, 2022. The Company includes cash flows from interest rate swap agreements in net cash flows provided by operating activities on its consolidated statements of cash flows, as the Company’s accounting policy is to present cash flows from hedging instruments in the same category in its consolidated statements of cash flows as the category for cash flows from the hedged items. 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 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. The Company believes it mitigates its credit risk by entering into agreements with creditworthy counterparties. 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 December 31, 2022. NOTE 10 — REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES As of December 31, 2022, the Company had $ 4.4 billion of debt outstanding, including net deferred financing costs, with a weighted average years to maturity of 3.5 years and a weighted average interest rate of 5.6 %. 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. F-35 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The following table summarizes the debt balances as of December 31, 2022 and 2021, and the debt activity for the year ended December 31, 2022 (in thousands): During the Year Ended December 31, 2022 Balance as of December 31, 2021 Debt Issuances & Assumptions (1) Repayments & Modifications (2) Amortization Balance as of December 31, 2022 Notes payable – fixed rate debt $ 471,967 $ — $ ( 435,429 ) (4) $ — $ 36,538 Notes payable – variable rate debt 70,268 474,461 ( 79,212 ) — 465,517 First lien mortgage loan 650,000 — ( 528,060 ) — 121,940 ABS mortgage notes 770,775 — ( 7,740 ) — 763,035 Credit facilities 910,000 872,000 ( 1,043,500 ) — 738,500 Repurchase facilities 1,298,414 1,145,649 ( 125,682 ) — 2,318,381 Total debt 4,171,424 2,492,110 ( 2,219,623 ) — 4,443,911 Deferred costs – credit facility (3) ( 143 ) ( 1,085 ) 89 399 ( 740 ) Deferred costs – fixed rate debt and first lien mortgage loan ( 11,678 ) — 7,655 (5) 2,914 ( 1,109 ) Deferred costs – variable rate debt ( 271 ) ( 6,126 ) — 1,136 ( 5,261 ) Deferred costs – ABS mortgage notes ( 16,127 ) ( 179 ) 353 1,985 ( 13,968 ) Total debt, net $ 4,143,205 $ 2,484,720 $ ( 2,211,526 ) $ 6,434 $ 4,422,833 ____________________________________ (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 $ 19.6 million during the year ended December 31, 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 the buyer in connection with disposition of real estate assets. (5) In connection with the repayment of certain mortgage notes, the Company wrote off $ 7.7 million of unamortized deferred loan costs. Notes Payable As of December 31, 2022, the Company had fixed rate debt outstanding of $ 36.5 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 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 $ 57.2 million as of December 31, 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 December 31, 2022, the Company had $ 465.5 million of variable rate debt outstanding, which included $ 423.5 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 year ended December 31, 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 December 31, 2022, the amount outstanding on the refinanced Assumed Variable Rate Debt totaled $ 42.0 million. The Company’s outstanding variable rate debt had a weighted average interest rate of 6.7 % as of December 31, 2022, and matures on various dates from October 2024 to January 2028. F-36 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) First Lien Mortgage Loan On July 15, 2021, JPMorgan Chase Bank, N.A., as administrative agent (“JPMorgan Chase”), and DBR Investments Co. 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 December 31, 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 48 properties, comprised of 47 single-tenant retail properties and one office property. As of December 31, 2022, the aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the notes was $ 314.2 million. Amounts outstanding on the Mortgage Loan totaled $ 121.9 million with a weighted average interest rate of 8.4 % as of December 31, 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. Subsequent to December 31, 2022, the Company paid down the $ 121.9 million outstanding balance on the Mortgage Loan, as further discussed in Note 19 — Subsequent Events. ABS Mortgage Notes On July 28, 2021, the Company issued $ 774.0 million aggregate principal amount of asset backed securities (“ABS”) mortgage notes, Series 2021-1 (the “Class A Notes”) in six classes, as shown below: Class of Notes Initial Principal Balance Note Rate Anticipated Repayment Date Rated Final Payment Date Credit Rating (1) A-1 (AAA) $ 146,400,000 2.09 % July 2028 July 2051 AAA (sf) A-2 (AAA) $ 219,600,000 2.57 % July 2031 July 2051 AAA (sf) A-3 (AA) $ 39,200,000 2.51 % July 2028 July 2051 AA (sf) A-4 (AA) $ 58,800,000 3.04 % July 2031 July 2051 AA (sf) A-5 (A) $ 124,000,000 2.91 % July 2028 July 2051 A (sf) A-6 (A) $ 186,000,000 3.44 % July 2031 July 2051 A (sf) ____________________________________ (1) Reflects credit rating from Standard & Poor’s Financial Services LLC (“Standard & Poor’s”). The collateral pool for the Class A Notes is comprised of 171 of the Company’s double- and triple-net leased single tenant properties, together with the related leases and certain other rights and interests. The aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the Class A Notes was $ 985.2 million. As of December 31, 2022, amounts outstanding on the Class A Notes totaled $ 763.0 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 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 F-37 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) 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 also entered into a guaranty with the lenders, under which the Company and certain subsidiaries agreed to guarantee the CMFT Borrowing Sub’s obligations under the Credit Agreement. As of December 31, 2022, the CMFT Term Loan and CMFT Revolving Loans outstanding totaled $ 100.0 million and $ 105.0 million, respectively. As of December 31, 2022, the Company had $ 205.0 million outstanding under the CMFT Credit Facility at a weighted average interest rate of 5.9 % and $ 95.0 million in unused capacity, subject to borrowing availability. Subsequent to December 31, 2022, the Company paid down the $ 240.0 million outstanding balance under the CMFT Credit Facility and terminated the CMFT Credit Facility, as further discussed in Note 19 — Subsequent Events. 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 year ended December 31, 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. (“Citibank”), as administrative agent, CMFT Securities Investments, LLC, a wholly-owned subsidiary of the Company (“CMFT Securities”), as equityholder and as collateral manager, Citibank (acting through its Agency & Trust division), as both a collateral agent and as a collateral custodian, and Virtus Group, LP, as collateral administrator. The Third Amended Credit and Security Agreement provides for available borrowings under the revolving credit facility to an aggregate principal amount up to $ 550.0 million (the “Credit Securities Revolver”). The Credit Securities Revolver may be increased from time to time pursuant to the Third Amended Credit and Security Agreement. As of December 31, 2022, the amounts borrowed and outstanding under the Credit Securities Revolver totaled $ 533.5 million at a weighted average interest rate of 6.5 %. 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 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: (i) the date that the Credit Securities Revolver is paid down and (ii) the second anniversary after the Reinvestment Period concludes. 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 corporate 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 December 31, 2022. Repurchase Facilities As of December 31, 2022, indirect wholly-owned subsidiaries of the Company (collectively, the “CMFT Lending Subs”), had Master Repurchase Agreements with Citibank, Barclays, Wells Fargo Bank, N.A. (“Wells Fargo”), Deutsche Bank AG (“Deutsche Bank”), and J.P. Morgan Securities LLC (“J.P. 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”). F-38 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The following table is a summary of the Repurchase Facilities as of December 31, 2022 (dollar amounts in thousands): Repurchase Facility Date of Agreement Maturity Date (1) Maximum Facility Size (2) Weighted Average Interest Rate Carrying Value of Loans Financed under Repurchase Facility Amount Financed Citibank 6/4/2020 8/17/2024 $ 400,000 6.1 % (3) $ 465,690 $ 335,458 Barclays 9/21/2020 9/22/2025 1,250,000 6.1 % (3) 1,183,270 885,067 Wells Fargo 5/20/2021 8/30/2025 750,000 5.9 % (3) 891,234 693,616 Deutsche Bank 10/8/2021 10/8/2023 300,000 6.5 % (4) 192,376 146,211 J.P. Morgan 6/1/2022 1/5/2023 (5) — (5) 5.5 % (6) 469,103 258,029 Total $ 2,700,000 $ 3,201,673 $ 2,318,381 __________________________________ (1) The repurchase facility with Citibank is set to mature in August 2024, with up to two one-year extension options. The repurchase facility with Barclays was set to mature in September 2024, with up to two one-year extension options. During the year ended December 31, 2022, the Company extended the current facility termination date to September 22, 2025 under the Third Amendment to the Master Repurchase Agreement with Barclays. The repurchase facility with Wells Fargo was set to mature on May 19, 2024, with up to two one-year extension options. During the year ended December 31, 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 Agreement with Deutsche Bank. During the year ended December 31, 2022, the Company exercised the Deutsche Bank Repurchase Facility’s first extension option, extending the date of maturity to October 8, 2023, and added an additional extension option, providing for a total of four one-year extension options remaining as of December 31, 2022. (2) During the year ended December 31, 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 1.30 % to 2.85 % 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 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. (6) Under the Master Repurchase Agreement with J.P. Morgan, advances under the repurchase agreement may be made based on one-month Term SOFR plus a spread designated by J.P. Morgan, which as of December 31, 2022, ranges from 0.95 % to 1.40 %. The Repurchase Agreements provide for simultaneous agreements by Citibank, Barclays, Wells Fargo, Deutsche Bank and J.P. Morgan to re-sell such purchased CRE mortgage loans and CMBS back to CMFT Lending Subs at a certain future date or upon demand. In connection with certain of the Repurchase Agreements, the Company (as the guarantor) entered into guaranties with Citibank, Barclays, Wells Fargo, and Deutsche Bank (the “Guaranties”), under which the Company agreed to guarantee up to 25 % of the CMFT Lending Subs’ obligations under certain Repurchase Agreements. The Repurchase Agreements and the Guaranties contain representations, warranties, covenants, conditions precedent to funding, events of default and indemnities that are customary for agreements of these types. In addition, the Guaranties contain financial covenants that require the Company to maintain: (i) minimum liquidity of not less than the lower of (a) $ 50.0 million and (b) the greater of (A) $ 10.0 million and (B) 5 % of the Company’s recourse indebtedness, as defined in the Guaranties; (ii) minimum consolidated net worth greater than or equal to $ 1.0 billion plus (a) 75 % of the equity issued by the Company following the respective closing dates of the Repurchase Agreements (the “Repurchase Closing Dates”) minus (b) the aggregate F-39 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) amount of any redemptions or similar transaction by the Company from the Repurchase Closing Dates; (iii) maximum leverage ratio of total indebtedness to total equity less than or equal to 80 %; and (iv) minimum interest coverage ratio of EBITDA (as defined in the Guaranties) to interest expense equal to or greater than 1.40 . The Company believes it was in compliance with the financial covenants under the Repurchase Agreements as of December 31, 2022. Maturities The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to December 31, 2022 (in thousands): Year Ending December 31, Principal Repayments 2023 $ 531,143 2024 400,783 2025 1,796,445 2026 — 2027 911,180 Thereafter 804,360 Total $ 4,443,911 F-40 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) NOTE 11 — SUPPLEMENTAL CASH FLOW DISCLOSURES Supplemental cash flow disclosures for the years ended December 31, 2022, 2021 and 2020 are as follows (in thousands): Year Ended December 31, 2022 2021 2020 Supplemental Disclosures of Non-Cash Investing and Financing Activities: Distributions declared and unpaid $ 14,828 $ 13,252 $ 10,969 Accrued capital expenditures $ 249 $ 5,902 $ 160 Construction reserve allocation $ ( 4,299 ) $ — $ — Real estate acquired via foreclosure $ — $ 191,990 $ — Foreclosure of assets securing the mezzanine loans $ — $ ( 79,968 ) $ — Mortgage notes payable assumed in connection with foreclosure of assets securing the mezzanine loans $ — $ 102,553 $ — Mortgage note 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 ) $ 539 Accrued deferred financing costs $ 247 $ 12 $ — Common stock issued through distribution reinvestment plan $ 38,912 $ 25,784 $ 34,191 Common stock issued in connection with mergers $ — $ 538,703 $ 384,319 Change in fair value of derivative instruments $ 2,252 $ 5,907 $ 727 Change in fair value of real estate-related securities $ ( 51,304 ) $ 1,650 $ 1,147 Conversion of preferred units to loans held-for-investment $ 68,242 $ — $ — Interest rate swaps assumed in mergers $ — $ ( 2,719 ) $ ( 9,115 ) Debt assumed in mergers $ — $ 437,877 $ 379,737 Real estate assets acquired in mergers $ — $ 906,254 $ 761,326 Assets assumed in mergers $ — $ 69,058 $ 4,424 Liabilities assumed in mergers $ — $ 5,184 $ 6,389 Non-controlling interest assumed in mergers $ — $ 1,073 $ — Supplemental Cash Flow Disclosures: Interest paid $ 146,947 $ 72,533 $ 60,990 Cash paid for taxes $ 1,301 $ 1,093 $ 1,243 NOTE 12 — COMMITMENTS AND CONTINGENCIES Litigation In the ordinary course of business, the Company may become subject to litigation and claims. The Company is not aware of any material pending legal proceedings, other than ordinary routine litigation incidental to the Company’s business, to which the Company is a party or of which the Company’s properties are the subject. Unfunded Commitments As of December 31, 2022, the Company had $ 310.4 million of unfunded loan commitments related to its existing CRE loans held-for-investment, corporate senior loans, and liquid corporate senior loans, and $ 112.6 million of unfunded commitments related to NewPoint JV. These commitments are not reflected in the accompanying consolidated balance sheet. As of December 31, 2022, the Company had $ 19.8 million of unsettled liquid corporate senior loan acquisitions, $ 19.2 million of which settled subsequent to December 31, 2022. Unsettled acquisitions are included in cash and cash equivalents in the accompanying consolidated balance sheet. F-41 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Environmental Matters In connection with the ownership and operation of real estate, the Company may potentially be liable for costs and damages related to environmental matters. In addition, the Company may own or acquire certain properties that are subject to environmental remediation. Generally, the seller of the property, the tenant of the property and/or another third party is responsible for environmental remediation costs related to a property. Additionally, in connection with the purchase of certain properties, the respective sellers and/or tenants may agree to indemnify the Company against future remediation costs. The Company also carries environmental liability insurance on its properties that provides limited coverage for any remediation liability and/or pollution liability for third-party bodily injury and/or property damage claims for which the Company may be liable. The Company is not aware of any environmental matters which it believes are reasonably likely to have a material effect on its results of operations, financial condition or liquidity. NOTE 13 — RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS The Company has incurred fees and expenses payable to CMFT Management and certain of its affiliates in connection with the acquisition, management and disposition of its assets. On August 20, 2019, the Company and CMFT Management entered into an Amended and Restated Management Agreement (the “Management Agreement”), which amended and restated that certain Advisory Agreement between the parties dated January 24, 2012, as amended (the “Prior Advisory Agreement”). Following the effective date of the Management Agreement, CMFT Management is no longer entitled to receive the disposition fees pursuant to the Prior Advisory Agreement, as described below; provided, however, that for the Company’s properties under contract to be sold or specifically identified in a broker agreement as being marketed for sale as of the effective date of the Management Agreement, CMFT Management was entitled to receive a disposition fee in accordance with the terms of the Prior Advisory Agreement. Management and investment advisory fees 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). CMFT Securities has an investment advisory and management agreement dated December 6, 2019 (the “Investment Advisory and Management Agreement”) with the Investment Advisor. CMFT Securities was formed for the purpose of holding any securities investments and certain other investments made by the Company. The Investment Advisor, a wholly-owned subsidiary of CIM Group, is registered as an investment advisor under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). Pursuant to the Investment Advisory and Management Agreement, the Investment Advisor manages the day-to-day business affairs of CMFT Securities and its investments in corporate credit and real estate-related securities (collectively, the “Managed Assets”), subject to the supervision of the Board. In connection with the services provided by the Investment Advisor, CMFT Securities pays the Investment Advisor an investment advisory fee (the “Investment Advisory Fee”), payable quarterly in arrears, equal to 1.50 % per annum ( 0.375 % per quarter) of CMFT Securities’ Equity (as defined in the Investment Advisory and Management Agreement). Because the Managed Assets are excluded from the calculation of management fees payable by the Company to CMFT Management pursuant to the Management Agreement, the total management and advisory fees payable by the Company to its external advisors are not increased as a result of the Investment Advisory and Management Agreement. In addition, 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. The Sub-Advisor is registered as an investment adviser under the Advisers Act and is an affiliate of the Investment Advisor. The Sub-Advisor principally provides investment management services with respect to the corporate credit-related securities held by CMFT Securities and its subsidiaries. The Sub-Advisor may allocate a portion of these corporate credit-related securities to its other clients, including affiliates of CIM. On a quarterly basis, the Investment Advisor designates 50 % of the sum of the Investment Advisory Fee and incentive compensation attributable to the assets for which Sub-Advisor has provided investment management services payable to the Investment Advisor as sub-advisory fees. Incentive compensation 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 F-42 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) 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 years ended December 31, 2022, 2021 and 2020, no incentive compensation fees were incurred. In addition, the Investment Advisor is eligible to receive a portion of the incentive compensation payable to CMFT Management pursuant to the Management Agreement. In the event that the incentive compensation is earned and payable with respect to any quarter, CMFT Management calculates the portion of the incentive compensation that was attributable to the Managed Assets and payable to the Investment Advisor. Expense reimbursements to related parties The Company reimburses CMFT Management, the Investment Advisor or their affiliates for certain expenses paid or incurred in connection with the services provided to the Company. The Company will reimburse CMFT Management, the Investment Advisor, or their affiliates for salaries and benefits paid to personnel who provide services to the Company, excluding the Company’s executive officers and any portfolio management, acquisitions or investment professionals. Disposition fees Pursuant to the Prior Advisory Agreement, through August 20, 2019, if CMFT Management or its affiliates provided a substantial amount of services (as determined by a majority of the Company’s independent directors) in connection with the sale of one or more properties (or the Company’s entire portfolio), the Company paid CMFT Management or its affiliates a disposition fee in an amount equal to up to one-half of the real estate or brokerage commission paid by the Company to third parties on the sale of such property, not to exceed 1.0 % of the contract price of the property sold; provided, however, in no event would the total disposition fees paid to CMFT Management, its affiliates and unaffiliated third parties exceed the lesser of the customary competitive real estate commission or an amount equal to 6.0 % of the contract sales price. For the Company’s properties under contract to be sold or specifically identified in a broker agreement as being marketed for sale as of August 20, 2019, CMFT Management was entitled to receive a disposition fee, which was paid in 2020 (as shown in the table below), in accordance with the terms of the Prior Advisory Agreement. 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): Year Ended December 31, 2022 2021 2020 Management fees $ 52,564 $ 47,020 $ 40,025 Disposition fees $ — $ — $ 434 Expense reimbursements to related parties (1) $ 16,567 $ 11,624 $ 8,920 ____________________________________ (1) Excludes $ 1.1 million of expense reimbursements recorded during the year ended December 31, 2022 attributable to earnout leasing costs under the RTL 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. Due to Affiliates Of the amounts shown above, $ 16.1 million and $ 14.6 million had been incurred, but not yet paid, for services provided by CMFT Management or its affiliates in connection with the management and operating activities during the years ended December 31, 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 Board’s former valuation, compensation and affiliate transactions committee, 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 Services”). 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 F-43 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Development Management Agreement, subject to the conditions in each respective Development Management Agreement. During the years ended December 31, 2022 and 2021, the Company recorded $ 486,000 and $ 162,000 , 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. The Development Management Agreement shall remain in effect until the project completion date, and is terminable by either party with fifteen days prior notice to the other party, with or without cause. Affiliated Investments 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 f und that is advised by affiliates of CMFT Management (“CIM RACR”). During the year ended December 31, 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 year ended December 31, 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 December 31, 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 December 31, 2022, $ 122.9 million of the first mortgage loan was outstanding. In November 2021, the Company entered into the Unconsolidated Joint Venture (the “MT-FT JV”) with CMMT Holdings, LLC, a fund th at is advised by an affiliate of CMFT Management (“CMMT”), for the purposes of investing in the NewPoint JV. The Company owns 50 % of the equity interests of the MT-FT JV and has committed to fund capital to the MT-FT JV up to $ 212.5 million, of which $ 99.9 million has been funded, net of $ 39.9 million returned as a return of capital that can be called back by NewPoint JV through NP JV Holdings as a capital call on a future date. For more information on the NewPoint JV, see Note 2 — Summary of Significant Accounting Policies. 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 December 31, 2022, $ 154.0 million of the first mortgage loan was outstanding. During the year ended December 31, 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 December 31, 2022, $ 145.5 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 year ended December 31, 2022. See Note 2 — Summary of Significant Accounting Policies for more information on the CIM UII Onshore investment. During the year ended December 31, 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 December 31, 2022, $ 57.9 million of the corporate senior loans was outstanding. The Sub-Advisor provided investment services related to these corporate senior loans pursuant to the Sub-Advisory Agreement. Subsequent to December 31, 2022, the Company and CIM RACR co-invested $ 15.5 million and $ 3.1 million, respectively, in two corporate senior loans to a third-party. In addition, the Company and CIM RACR upsized a co-invested corporate senior loan to a third-party by $ 1.7 million and $ 348,000 , respectively, subsequent to December 31, 2022. The Sub-Advisor provided investment management services related to these corporate senior loans pursuant to the Sub-Advisory Agreement. NOTE 14 — ECONOMIC DEPENDENCY Under various agreements, the Company has engaged and may in the future engage CMFT Management or its affiliates to provide certain services that are essential to the Company, including asset management services, supervision of the management and leasing of properties owned by the Company, asset acquisition and disposition decisions, as well as other administrative responsibilities for the Company including accounting services and stockholder relations. As a result of these relationships, the Company is dependent upon CMFT Management or its affiliates. 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. F-44 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) NOTE 15 — STOCKHOLDERS’ EQUITY As of December 31, 2022, 2021 and 2020, the Company was authorized to issue $ 600.0 million of shares of common stock under the Secondary DRIP Offering. All shares of such stock have a par value of $ 0.01 per share. The par value of stockholder proceeds raised from the DRIP Offerings is classified as common stock, with the remainder allocated to capital in excess of par value. On August 11, 2010, the Company sold 20,000 shares of common stock, at $ 10.00 per share, to Cole Holdings Corporation (“CHC”). On April 5, 2013, the ownership of such shares was transferred to CREInvestments, LLC, an affiliate of CMFT Management. On February 7, 2014, the ownership of such shares was transferred to VEREIT Operating Partnership, L.P. (“VEREIT OP”), a former affiliated entity of the Company’s sponsor. On February 1, 2018, the ownership of such shares was transferred by VEREIT OP to CMFT Management. On December 21, 2020, in connection with the consummation of the CCIT III and CCPT V Mergers, the Company issued 52.6 million shares of common stock for consideration of $ 7.31 per share. In addition, on December 16, 2021, in connection with the consummation of the CIM Income NAV Merger, the Company issued 74.8 million shares of common stock for consideration of $ 7.20 per share. Distribution Reinvestment Plan Pursuant to the DRIP, the Company allows stockholders to elect to have their distributions reinvested in additional shares of the Company’s common stock at the most recent estimated per share NAV as determined by the Board. The Board may terminate or amend the Secondary DRIP Offering at the Company’s discretion at any time upon ten days ’ prior written notice to the stockholders. In connection with the CCIT III and CCPT V Mergers, on August 30, 2020, the Board approved the suspension of the DRIP, and, therefore, distributions paid after that date were paid in cash to all stockholders until the DRIP was reinstated, effective April 1, 2021, by the Board on March 25, 2021. During the years ended December 31, 2022, 2021 and 2020, approximately 5.4 million, 3.6 million and 4.2 million shares were purchased under the DRIP Offerings for approximately $ 38.9 million, $ 25.8 million and $ 34.2 million, respectively, which were recorded as redeemable common stock on the consolidated balance sheets. Share Redemption Program The Company’s share redemption program permits its stockholders to sell their shares back to the Company after they have held them for at least one year , subject to the significant conditions and limitations described below. The share redemption program provides that the Company will redeem shares of its common stock from requesting stockholders, subject to the terms and conditions of the share redemption program. The Company will limit the number of shares redeemed pursuant to the share redemption program as follows: (1) the Company will not redeem in excess of 5 % of the weighted average number of shares outstanding during the trailing 12 months prior to the end of the fiscal quarter for which the redemptions are being paid; and (2) funding for the redemption of shares will be limited, among other things, to the net proceeds the Company receives from the sale of shares under the DRIP Offering, net of shares redeemed to date. In an effort to accommodate redemption requests throughout the calendar year, the Company intends to limit quarterly redemptions to approximately 1.25 % of the weighted average number of shares outstanding during the trailing 12-month period ending on the last day of the fiscal quarter for which the redemptions are being paid, and to the net proceeds the Company receives from the sale of shares in the respective quarter under the Secondary DRIP Offering. Any of the foregoing limits might prevent the Company from accommodating all redemption requests made in any fiscal quarter or in any 12-month period. The Company will determine whether it has sufficient funds and/or shares available as soon as practicable after the end of each fiscal quarter, but in any event prior to the applicable payment date. Upon receipt of a request for redemption, the Company may conduct a Uniform Commercial Code search to ensure that no liens are held against the shares. If the Company cannot purchase all shares presented for redemption in any fiscal quarter, based upon insufficient cash available from the sale of shares under the DRIP and/or the limit on the number of shares the Company may redeem during any quarter or year, the Company will give priority to the redemption of deceased stockholders’ shares and stockholders with exigent circumstances, as determined in the Company’s sole discretion and accompanied by such evidentiary documentation as the Company may request. While the shares of deceased stockholders and stockholders determined to have exigent circumstances will be included in calculating the maximum number of shares that may be redeemed in any annual or quarterly period, they will not be subject to the annual or quarterly percentage caps; therefore, if the volume of requests to redeem deceased stockholders’ shares in a particular quarter were large enough to cause the annual or quarterly percentage caps to be exceeded, even if no other redemption requests were processed, the redemptions of deceased F-45 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) stockholders’ shares would be completed in full, assuming sufficient proceeds from the sale of shares under the DRIP, net of shares redeemed to date, were available. If sufficient proceeds from the sale of shares under the DRIP, net of shares redeemed to date, were not available to pay all such redemptions in full, the requests to redeem deceased stockholders’ shares and, effective as of April 1, 2023, shareholders deemed to have exigent circumstances would be honored on a pro rata basis. The Company next will give priority to requests for full redemption of accounts with a balance of 250 shares or less at the time the Company receives the request, in order to reduce the expense of maintaining small accounts. Thereafter, the Company will honor the remaining quarterly redemption requests on a pro rata basis. Following such quarterly redemption period, if a stockholder would like to resubmit the unsatisfied portion of the prior request for redemption, such stockholder must submit a new request for redemption of such shares prior to the last day of the new quarter. Unfulfilled requests for redemption will not be carried over automatically to subsequent redemption periods. In addition, the Company reserves the right, in its sole discretion at any time, and from time to time, to reject any request for redemption for any reason. The Company redeems shares no later than the end of the month following the end of each fiscal quarter. Requests for redemption must be received on or prior to the end of the fiscal quarter in order for the Company to repurchase the shares in the month following the end of that fiscal quarter. The Board may choose to amend the terms of, suspend or terminate the share redemption program at any time in its sole discretion if it believes that such action is in the best interest of the Company and its stockholders. Any material modifications or suspension of the share redemption program will be disclosed to the Company’s stockholders as promptly as practicable in the Company’s reports filed with the SEC and via the Company’s website. In connection with the CCIT III and CCPT V Mergers, the Board approved the suspension of the Company’s share redemption program on August 30, 2020, and, therefore, no shares were redeemed from the Company’s stockholders after that date until the share redemption program was reinstated, effective April 1, 2021, by the Board on March 25, 2021. During the years ended December 31, 2022, 2021 and 2020, the Company redeemed approximately 5.5 million, 3.1 million and 6.0 million shares, respectively, under the share redemption program for $ 39.4 million, $ 22.0 million and $ 48.1 million, respectively. During the year ended December 31, 2022, redemption requests relating to approximately 93.5 million shares went unfulfilled. Distributions Payable and Distribution Policy Prior to April 1, 2020, on a quarterly basis, the Board authorized a daily distribution for the succeeding quarter. The Board authorized the following daily distribution amounts per share for the periods indicated below: Period Commencing Period Ending Daily Distribution Amount April 14, 2012 December 31, 2012 $ 0.001707848 January 1, 2013 December 31, 2015 $ 0.001712523 January 1, 2016 December 31, 2016 $ 0.001706776 January 1, 2017 December 31, 2019 $ 0.001711452 January 1, 2020 March 31, 2020 $ 0.001706776 From April 20, 2020 through March 24, 2021, the Board determined the amount and timing of distributions on a monthly, instead of a quarterly, basis. On March 25, 2021, the Board resumed declaring distributions on a quarterly basis, which are paid out on a monthly basis. Since April 2020, the Board authorized the following monthly distribution amounts per share, payable to stockholders as of the record date for the applicable month, for the periods indicated below: Period Commencing Period Ending Monthly Distribution Amount April 2020 May 2020 $ 0.0130 June 2020 June 2020 $ 0.0161 July 2020 July 2020 $ 0.0304 August 2020 December 2021 $ 0.0303 January 2022 September 2022 $ 0.0305 October 2022 December 2022 $ 0.0339 January 2023 June 2023 $ 0.0350 As of December 31, 2022, the Company had distributions payable of $ 14.8 million. F-46 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Equity-Based Compensation On August 10, 2018, the Board approved the adoption of the Company’s 2018 Equity Incentive Plan (the “2018 Plan”), under which 400,000 of the Company’s shares of common stock were reserved for issuance. 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 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 183,000 shares of common stock are available for future grant at December 31, 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. The Board or the compensation committee of the Board also has the authority to determine the terms of any award granted pursuant to the 2022 Plan, including vesting schedules, restrictions and acceleration of any restrictions. 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 December 31, 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 and approximately 67,000 restricted shares in the aggregate to the independent members of the Board under the 2022 Plan. As of December 31, 2022, 116,000 of the restricted shares had vested based on one year of continuous service. The remaining 67,000 restricted shares issued had not vested or been forfeited as of December 31, 2022. 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 $ 397,000 and $ 289,000 for the years ended December 31, 2022 and 2021, respectively, related to the restricted shares which is included in general and administrative expenses in the accompanying consolidated statements of operations. As of December 31, 2022, there was $ 360,000 of total unrecognized compensation expense related to these restricted shares, which will be recognized ratably over the remaining period of service prior to October 2023. NOTE 16 — INCOME TAXES For federal income tax purposes, distributions to stockholders are characterized as ordinary dividends, capital gain distributions, or nondividend distributions. Nondividend distributions will reduce U.S stockholders’ basis (but not below zero) in their shares. The following table shows the character of the distributions the Company paid on a percentage basis for the years ended December 31, 2022, 2021 and 2020: Year Ended December 31, Character of Distributions: 2022 2021 2020 Ordinary dividends 90 % 22 % — % Nondividend distributions 10 % 36 % 100 % Capital gain distributions — % 42 % — % Total 100 % 100 % 100 % During the years ended December 31, 2022, 2021 and 2020, the Company incurred state and local income and franchise taxes of $ 1.3 million, $ 1.1 million, and $ 568,000 , respectively, which were recorded in general and administrative expenses in the consolidated statements of operations. The Company had no unrecognized tax benefits as of or during the years ended December 31, 2022 and 2021. Any interest and penalties related to unrecognized tax benefits would be recognized within the provision for income taxes in the accompanying consolidated statements of operations. The Company files income tax returns in the U.S. federal jurisdiction, as well as various state jurisdictions, and is subject to routine examinations by the respective tax authorities. F-47 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) NOTE 17 — LEASES The Company’s real estate assets are leased to tenants under operating leases for which the terms, expirations and extension options vary. The Company’s operating leases do not convey to the lessee the right to purchase the underlying asset upon expiration of the lease period. To determine whether a contract contains a lease, the Company reviews contracts to determine if the agreement conveys the right to control the use of an asset. The Company accounts for lease and non-lease components as a single, combined operating lease component. Non-lease components primarily consist of maintenance services, including CAM, real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. Non-lease components are considered to be variable rental and other property income and are recognized in the period incurred. As of December 31, 2022, the Company’s leases had a weighted-average remaining term of 10.6 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. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of December 31, 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): Year Ending December 31, Future Minimum Rental Income 2023 $ 152,296 2024 150,514 2025 147,016 2026 142,789 2027 140,164 Thereafter 959,489 Total $ 1,692,268 A certain amount of the Company’s rental and other property income is from tenants with leases which are subject to contingent rent provisions. These contingent rents are subject to the tenant achieving periodic revenues in excess of specified levels. For the years ended December 31, 2022, 2021 and 2020, the amount of the contingent rent earned by the Company was not significant. Rental and other property income during the years ended December 31, 2022, 2021 and 2020 consisted of the following (in thousands): Year Ended December 31, 2022 2021 2020 Fixed rental and other property income (1) $ 192,982 $ 252,422 $ 221,445 Variable rental and other property income (2) 20,407 42,742 40,085 Total rental and other property income $ 213,389 $ 295,164 $ 261,530 __________________________________ (1) Consists primarily of fixed contractual payments from operating leases with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above- and below-market leases, and is net of uncollectible lease-related receivables. (2) Consists primarily of tenant reimbursements for recoverable real estate taxes and property operating expenses, and percentage rent. The Company has one property subject to a non-cancelable operating ground lease with a remaining term of 10.7 years, with a lease liability (in deferred rental income, derivative liabilities and other liabilities ) and a related right of use (“ROU”) asset (in prepaid expenses, derivative assets and other assets ) of $ 2.1 million in the consolidated balance sheets. The lease liability and ROU asset were initially measured at the present value of the future minimum lease payments using a discount rate of 4.3 %. 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. F-48 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) The Company recognized $ 250,000 of ground lease expense during the year ended December 31, 2022, of which $ 242,000 was paid in cash during the period it was recognized. As of December 31, 2022, the Company’s scheduled future minimum rental payments related to its operating ground lease is approximately $ 250,000 annually for 2023 through 2027, and $ 1.4 million thereafter through the maturity date of the lease in August 2033. NOTE 18 — SEGMENT REPORTING As of December 31, 2022, the Company determined that it has two reportable segments: real estate and credit. Corporate/other represents all corporate level and unallocated items and includes the Company’s other asset management activities and operating expenses. There were no changes in the structure of the Company’s internal organization that prompted the change in reportable segments. Prior period amounts have been revised to conform to the current year presentation shown below. The following tables present segment reporting for the years ended December 31, 2022, 2021 and 2020 (in thousands): Year Ended December 31, 2022 Real Estate Credit Corporate/Other (1) (2) Company Total Rental and other property income $ 213,001 $ — $ 388 $ 213,389 Interest income — 238,757 — 238,757 Total revenues 213,001 238,757 388 452,146 General and administrative 553 807 14,004 15,364 Property operating 14,609 — 6,181 20,790 Real estate tax 10,923 — 1,689 12,612 Expense reimbursements to related parties — — 16,567 16,567 Management fees 21,526 31,038 — 52,564 Transaction-related 511 — 23 534 Depreciation and amortization 70,606 — — 70,606 Real estate impairment 16,184 — 16,137 32,321 Increase in provision for credit losses — 29,476 — 29,476 Total operating expenses 134,912 61,321 54,601 250,834 Gain on disposition of real estate and condominium developments, net 117,763 — 4,139 121,902 Operating income (loss) 195,852 177,436 ( 50,074 ) 323,214 Other income (expense): Gain on investment in unconsolidated entities — 6,780 5,172 11,952 Unrealized (loss) gain on equity security — ( 15,139 ) 22 ( 15,117 ) Interest expense and other, net ( 36,283 ) ( 106,908 ) ( 13,348 ) ( 156,539 ) Loss on extinguishment of debt ( 18,646 ) — ( 998 ) ( 19,644 ) Segment net income (loss) 140,923 62,169 ( 59,226 ) 143,866 Segment net income attributable to non-controlling interest 66 — — 66 Segment net income (loss) attributable to the Company $ 140,857 $ 62,169 $ ( 59,226 ) $ 143,800 Total assets as of December 31, 2022 $ 2,118,513 $ 4,794,593 $ 218,948 $ 7,132,054 __________________________________ (1) Includes condominium and rental units acquired via foreclosure during the year ended December 31, 2021 . (2) Includes the Company’s investment in CIM UII Onshore. F-49 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Year Ended December 31, 2021 Real Estate Credit Corporate/Other (1) (2) Company Total Rental and other property income $ 294,729 $ — $ 435 $ 295,164 Interest income — 70,561 — 70,561 Total revenues 294,729 70,561 435 365,725 General and administrative 317 1,268 13,493 15,078 Property operating 32,033 — 15,526 47,559 Real estate tax 29,109 — 5,834 34,943 Expense reimbursements to related parties — — 11,624 11,624 Management fees 33,248 13,772 — 47,020 Transaction-related 126 — 189 315 Depreciation and amortization 95,190 — — 95,190 Real estate impairment 5,993 — 12,085 18,078 Increase in provision for credit losses — 2,881 — 2,881 Total operating expenses 196,016 17,921 58,751 272,688 Gain on disposition of real estate and condominium developments, net 77,178 — 5,867 83,045 Merger-related expenses, net — — ( 1,404 ) ( 1,404 ) Operating income (loss) 175,891 52,640 ( 53,853 ) 174,678 Other income (expense): Gain on investment in unconsolidated entities — — 606 606 Interest expense and other, net ( 37,022 ) ( 21,278 ) ( 25,599 ) ( 83,899 ) Loss on extinguishment of debt ( 1,628 ) — ( 3,267 ) ( 4,895 ) Segment net income (loss) 137,241 31,362 ( 82,113 ) 86,490 Segment net income (loss) attributable to the Company $ 137,241 $ 31,362 $ ( 82,113 ) $ 86,490 Total assets as of December 31, 2021 $ 3,821,085 $ 2,859,017 $ 282,674 $ 6,962,776 __________________________________ (1) Includes condominium and rental units acquired via foreclosure during the year ended December 31, 2021 . (2) Includes the Company’s investment in CIM UII Onshore. F-50 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) Year Ended December 31, 2020 Real Estate Credit Corporate/Other Company Total Rental and other property income $ 261,530 $ — $ — $ 261,530 Interest income — 29,393 — 29,393 Total revenues 261,530 29,393 — 290,923 General and administrative 291 2,080 9,671 12,042 Property operating 23,399 — — 23,399 Real estate tax 27,691 — — 27,691 Expense reimbursements to related parties — — 8,920 8,920 Management fees 32,164 7,861 — 40,025 Transaction-related 346 9 — 355 Depreciation and amortization 80,973 — — 80,973 Real estate impairment 16,737 — — 16,737 Increase in provision for credit losses — 68,356 — 68,356 Total operating expenses 181,601 78,306 18,591 278,498 Gain on disposition of real estate and condominium developments, net 27,518 — — 27,518 Merger-related expenses, net — — ( 1,884 ) ( 1,884 ) Merger termination fee — — 7,380 7,380 Operating income (loss) 107,447 ( 48,913 ) ( 13,095 ) 45,439 Other income (expense): Interest expense and other, net ( 21,380 ) ( 5,101 ) ( 37,635 ) ( 64,116 ) Loss on extinguishment of debt ( 4,394 ) — ( 447 ) ( 4,841 ) Segment net income (loss) 81,673 ( 54,014 ) ( 51,177 ) ( 23,518 ) Segment net income (loss) attributable to the Company $ 81,673 $ ( 54,014 ) $ ( 51,177 ) $ ( 23,518 ) Total assets as of December 31, 2020 $ 3,405,590 $ 949,764 $ 104,255 $ 4,459,609 NOTE 19 — SUBSEQUENT EVENTS Redemptions of Shares of Common Stock Subsequent to December 31, 2022, the Company redeemed approximately 1.6 million shares for $ 10.5 million (at an average redemption price of $ 6.57 per share). The remaining redemption requests received during the three months ended December 31, 2022 totaling approximately 22.9 million shares went unfulfilled. Investment and Disposition Activity Subsequent to December 31, 2022, the Company’s investment and disposition activity included the following: • Sold 151 of the properties under contract for sale pursuant to the Realty Income Purchase and Sale Agreement for total consideration of $ 779.0 million and a gain of approximately $ 19.6 million. • In addition to the properties disposed of pursuant to the Realty Income Purchase and Sale Agreement, the Company disposed of one property and condominium units for an aggregate gross sales price of $ 3.8 million, resulting in net proceeds of $ 3.7 million after closing costs and a net gain of approximately $ 176,000 . • Settled $ 19.2 million of liquid corporate senior loan purchases, all of which were traded as of December 31, 2022, and settled $ 873,000 of liquid corporate senior loans sales. • Funded an aggregate amount of $ 16.9 million to 14 of the Company’s first mortgage loans. • Invested $ 15.5 million in two corporate senior loans and upsized a corporate senior loan by $ 1.7 million to a third-party. F-51 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued) • Received $ 49.0 million of proceeds upon the pay down of the Company’s position in two different tranches of a CMBS instrument. • The extension option was exercised on one of the Company’s first mortgage loans for $ 50.7 million that was initially set to mature on February 1, 2023, extending the date of maturity to February 1, 2024. Financing Activity Subsequent to December 31, 2022, the Company’s financing activity included the following: • In connection with the sale of properties pursuant to the Realty Income Purchase and Sale Agreement noted above, the Company repaid $ 105.8 million on the first lien mortgage loan, legally defeased a mortgage loan with an outstanding balance of $ 23.7 million, and paid down $ 240.0 million of the outstanding balance under the CMFT Credit Facility and terminated the CMFT Credit Facility. • Repaid $ 18.5 million of borrowings under the Company’s mortgage loans and repaid $ 16.2 million on the first lien mortgage loan. • Increased aggregate borrowings by $ 15.9 million and repaid $ 33.0 million of borrowings under the Repurchase Facilities. • Entered into a new financing facility with Ally Bank that provides up to $ 300.0 million in financing, which may be increased to an aggregate principal amount up to $ 500.0 million, pursuant to the revolving loan and security agreement. F-52 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Real Estate Held for Investment the Company has Invested in Under Operating Leases: 24 Hour Fitness Orlando, FL (h) $ 2,825 $ 6,157 $ — $ 8,982 $ 195 12/16/2021 2018 AAA Office Park Hamilton, NJ (h) 5,427 22,970 — 28,397 837 12/16/2021 2016 Aaron’s Rents: Arkadelphia, AR $ — 183 491 — 674 55 12/21/2020 2014 Academy Sports: Cartersville, GA 7,008 4,517 4,574 — 9,091 344 12/21/2020 2014 Actuant Campus: Columbus, WI 13,121 2,090 14,633 — 16,723 915 12/21/2020 2014 Advance Auto Parts: Fairmont, NC 516 253 868 — 1,121 64 12/21/2020 2004 Hampton, VA 516 645 655 — 1,300 54 12/21/2020 2015 Ravenswood, WV — 271 657 ( 64 ) 864 15 12/16/2021 1996 AK Steel: West Chester, OH — 1,421 21,044 — 22,465 669 12/16/2021 2007 Apex Technologies: Mason, OH — 1,288 11,127 — 12,415 347 12/16/2021 2013 Aspen Dental: Rogers, AR 874 289 1,611 — 1,900 106 12/21/2020 2015 At Home: Pearland, TX 11,329 3,663 10,305 — 13,968 673 12/21/2020 1994 Bank of America: Fairview Park, OH (h) 714 1,220 — 1,934 40 12/16/2021 2014 Bass Pro Shop: Portage, IN (h) 1,428 8,414 — 9,842 703 12/21/2020 1983 Tallahassee, FL 6,712 945 5,713 — 6,658 1,512 8/20/2013 2013 BJ's Wholesale Club: Fort Myers, FL 20,018 5,331 21,692 — 27,023 1,202 12/21/2020 2018 Roanoke, VA 15,672 4,509 14,545 — 19,054 829 11/25/2020 2018 Bob Evans: Akron, OH (h) 447 1,537 — 1,984 272 4/28/2017 2007 Anderson, IN (h) 912 1,455 — 2,367 262 4/28/2017 1984 Austintown, OH (h) 305 1,426 — 1,731 271 4/28/2017 1995 Birch Run, MI (h) 733 1,192 — 1,925 221 4/28/2017 2008 Blue Ash, OH (h) 628 1,429 — 2,057 293 4/28/2017 1994 Chardon, OH (h) 333 682 — 1,015 137 4/28/2017 2003 Chillicothe, OH (h) 557 1,524 — 2,081 280 4/28/2017 1998 Columbus, OH (h) 523 1,376 — 1,899 261 4/28/2017 2003 Dayton, OH (h) 325 1,438 — 1,763 280 4/28/2017 1998 Defiance, OH — 501 2,781 — 3,282 86 12/16/2021 2011 Dover, OH — 552 1,930 — 2,482 57 12/16/2021 2013 Dundee, MI — 526 1,298 — 1,824 41 12/16/2021 2011 Florence, KY (h) 496 1,876 — 2,372 358 4/28/2017 1991 Gallipolis, OH 2,735 529 2,963 — 3,492 162 12/21/2020 2003 Hagerstown, MD 2,565 490 2,789 — 3,279 159 12/21/2020 1989 Hamilton, OH — 446 2,359 — 2,805 66 12/16/2021 2014 Holland, MI (h) 314 1,367 — 1,681 258 4/28/2017 2004 Hummelstown, PA — 1,029 2,283 — 3,312 66 12/16/2021 2013 Huntersville, NC (h) 751 657 — 1,408 120 4/28/2017 2008 Hurricane, WV (h) 297 1,654 — 1,951 284 4/28/2017 1993 S-1 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Bob Evans (continued): Mansfield, OH $ 2,284 $ 495 $ 2,423 $ — $ 2,918 $ 142 12/21/2020 2004 Mayfield Heights, OH — 847 1,278 — 2,125 39 12/16/2021 2003 Milford, OH (h) 271 1,498 — 1,769 286 4/28/2017 1987 Monroe, MI 2,218 623 2,177 — 2,800 129 12/21/2020 1998 Monroeville, PA (h) 1,340 848 — 2,188 148 4/28/2017 1995 Nicholasville, KY (h) 731 693 — 1,424 123 4/28/2017 1989 North Canton, OH (h) 859 1,393 — 2,252 265 4/28/2017 2006 Northwood, OH 2,558 514 2,760 — 3,274 155 12/21/2020 1998 Peoria, IL 902 620 524 — 1,144 43 12/21/2020 1995 Piqua, OH 2,040 413 2,187 — 2,600 125 12/21/2020 1989 Ripley, WV (h) 269 1,304 — 1,573 240 4/28/2017 1988 Tipp City, OH (h) 554 1,120 — 1,674 219 4/28/2017 1989 Warsaw, IN (h) 684 1,222 — 1,906 223 4/28/2017 1993 Bottom Dollar Grocery: Ambridge, PA — 519 2,985 — 3,504 702 11/5/2013 2012 BrightView Health: Danville, VA — 274 1,514 ( 1,062 ) 726 73 4/29/2014 2014 Burger King: Midwest City, OK 733 736 810 — 1,546 28 12/16/2021 2014 Yukon, OK 1,220 500 1,141 — 1,641 72 12/21/2020 1989 Burlington Coat Factory: Bangor, ME — 1,820 2,549 — 4,369 237 12/21/2020 2014 Cabela's: Acworth, GA 21,888 4,979 18,775 — 23,754 2,723 9/25/2017 2014 Avon, OH 12,486 2,755 10,751 — 13,506 1,584 9/25/2017 2016 La Vista, NE 21,223 3,260 16,923 — 20,183 2,361 9/25/2017 2006 Sun Prairie, WI 16,063 3,373 14,058 — 17,431 2,150 9/25/2017 2015 Caliber Collision Center: Fredericksburg, VA 3,659 1,807 2,292 — 4,099 171 7/22/2020 2019 Houston, TX (h) 581 6,284 — 6,865 179 12/16/2021 2016 Lake Jackson, TX 2,920 800 2,974 — 3,774 200 12/21/2020 2006 Richmond, VA 4,273 1,453 3,323 — 4,776 259 7/30/2020 2020 San Antonio, TX (h) 371 5,284 — 5,655 146 12/16/2021 2015 San Antonio, TX 3,973 691 4,458 — 5,149 275 12/21/2020 2019 San Antonio, TX 1,301 622 832 — 1,454 182 6/4/2014 2014 Venice, FL (h) 878 4,181 — 5,059 118 12/16/2021 2015 Williamsburg, VA 3,740 1,418 2,800 — 4,218 213 6/12/2020 2020 Wylie, TX 3,179 816 2,690 — 3,506 608 2/10/2015 2014 Camping World: Fort Myers, FL 11,288 3,226 11,832 — 15,058 794 12/21/2020 1987 CarMax: Tinley Park, IL — 7,296 22,949 — 30,245 690 12/16/2021 1998 Carrier Rental Systems: Houston, TX — 935 3,199 — 4,134 90 12/16/2021 2006 Cash & Carry: Salt Lake City, UT 3,940 863 4,149 — 5,012 243 12/21/2020 2006 Chase: Hanover Township, NJ 1,054 2,192 — — 2,192 — 12/18/2013 2012 Chick-Fil-A: Dickson City, PA 1,974 1,113 7,946 ( 7,817 ) 1,242 276 6/30/2014 2013 S-2 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Costco: Tallahassee, FL (h) $ 9,497 $ — $ — $ 9,497 $ — 12/11/2012 2006 CVS: Arnold, MO $ 4,007 2,043 2,367 — 4,410 551 12/13/2013 2013 Asheville, NC (h) 1,108 1,084 — 2,192 305 4/26/2012 1998 Austin, TX (h) 1,433 2,251 — 3,684 63 12/16/2021 1997 Austin, TX 4,369 1,076 3,475 — 4,551 803 12/13/2013 2013 Bloomington, IN 4,458 1,620 2,957 — 4,577 688 12/13/2013 2012 Blue Springs, MO 2,957 395 2,722 — 3,117 633 12/13/2013 2013 Bridgeton, MO 4,007 2,056 2,362 — 4,418 549 12/13/2013 2013 Charleston, SC (h) 869 1,009 — 1,878 285 4/26/2012 1998 Chesapeake, VA 3,267 1,044 3,053 — 4,097 725 12/13/2013 2013 Chicago, IL (h) 1,832 4,255 — 6,087 1,041 3/20/2013 2008 Cicero, IN 3,474 487 3,099 — 3,586 720 12/13/2013 2013 Corpus Christi, TX (h) 648 2,557 — 3,205 696 4/19/2012 1998 Danville, IN (h) 424 2,105 99 2,628 489 7/16/2014 1998 Eminence, KY 3,504 872 2,511 — 3,383 577 12/13/2013 2013 Erie, PA (h) 944 1,954 — 2,898 54 12/16/2021 1999 Goose Creek, SC 2,853 1,022 1,980 — 3,002 456 12/13/2013 2013 Greenwood, IN 4,251 912 3,549 61 4,522 853 7/11/2013 1999 Hanover Township, NJ (h) 4,746 — — 4,746 — 12/18/2013 2012 Hazlet, NJ 5,995 3,047 3,610 — 6,657 835 12/13/2013 2013 Hillcrest Heights, MD 3,874 1,817 2,989 71 4,877 707 9/30/2013 2001 Honesdale, PA 4,140 1,206 3,342 — 4,548 796 12/13/2013 2013 Independence, MO 2,447 359 2,242 — 2,601 523 12/13/2013 2013 Indianapolis, IN 3,393 1,110 2,484 — 3,594 577 12/13/2013 2013 Irving, TX 3,615 745 3,034 — 3,779 796 10/5/2012 2000 Janesville, WI 3,075 736 2,545 — 3,281 591 12/13/2013 2013 Katy, TX 3,156 1,149 2,462 — 3,611 560 12/13/2013 2013 Lincoln, NE (h) 2,534 3,014 — 5,548 698 12/13/2013 2013 London, KY 4,177 1,445 2,661 — 4,106 636 9/10/2013 2013 Mansfield, OH (h) 371 2,169 — 2,540 59 12/16/2021 1998 Middletown, NY (h) 665 5,483 — 6,148 1,257 12/13/2013 2013 North Wilkesboro, NC 2,321 332 2,369 73 2,774 558 10/25/2013 1999 Poplar Bluff, MO 3,733 1,861 2,211 — 4,072 517 12/13/2013 2013 Riverton, NJ (h) 1,217 5,553 124 6,894 313 12/21/2020 2007 Salem, NH 5,263 3,456 2,351 — 5,807 540 11/18/2013 2013 San Antonio, TX 3,327 1,893 1,848 — 3,741 435 12/13/2013 2013 Sand Springs, OK 3,593 1,765 2,283 — 4,048 535 12/13/2013 2013 Santa Fe, NM 6,276 2,243 4,619 — 6,862 1,057 12/13/2013 2013 Sedalia, MO 2,609 466 2,318 — 2,784 540 12/13/2013 2013 St. John, MO 3,777 1,546 2,601 — 4,147 604 12/13/2013 2013 Vineland, NJ 3,570 813 2,926 — 3,739 701 12/13/2013 2010 Waynesboro, VA 3,290 986 2,708 — 3,694 630 12/13/2013 2013 West Monroe, LA 3,437 1,738 2,136 — 3,874 500 12/13/2013 2013 Wisconsin Rapids, WI (h) 707 3,262 — 3,969 91 12/16/2021 2013 Davita: Austell, GA — 777 913 — 1,690 29 12/16/2021 2009 Dick’s Sporting Goods: Oklahoma City, OK 3,218 685 10,587 — 11,272 2,961 12/31/2012 2012 S-3 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Dollar General: Erie, IL (h) $ 549 $ 531 $ — $ 1,080 $ 27 12/16/2021 2016 Glouster, OH (h) 220 1,276 — 1,496 84 12/21/2020 2015 New Richland, MN (h) 327 685 — 1,012 31 12/16/2021 2016 Parchment, MI (h) 168 1,162 — 1,330 253 6/25/2014 2014 Pine River, MN (h) 215 963 — 1,178 39 12/16/2021 2016 Russell, KS (h) 54 899 — 953 205 8/5/2014 2014 St. Louis, MO $ — 229 1,102 — 1,331 266 12/31/2013 2013 Starbuck, MN (h) 345 733 — 1,078 33 12/16/2021 2016 Trimble, MO (h) 311 830 — 1,141 35 12/16/2021 2016 Wheaton, MN (h) 205 854 — 1,059 33 12/16/2021 2016 Winthrop, MN (h) 216 767 — 983 31 12/16/2021 2016 Duluth Trading: Arlington, TX — 1,574 3,918 — 5,492 120 12/16/2021 2018 Denton, TX 3,715 1,662 2,918 — 4,580 184 12/21/2020 2017 Madison, AL 3,800 1,174 3,603 — 4,777 223 12/21/2020 2019 Noblesville, IN 3,711 1,212 3,436 — 4,648 233 12/21/2020 2003 Wichita, KS — 1,433 2,757 — 4,190 88 12/16/2021 2019 Family Dollar: Bearden, AR — 52 760 — 812 61 12/21/2020 2014 Centreville, AL — 110 669 — 779 26 12/16/2021 2013 Danville, VA — 468 422 — 890 22 12/16/2021 2013 Darby, MT 845 356 865 26 1,247 34 12/16/2021 2014 Denton, NC — 433 434 — 867 22 12/16/2021 2012 DeRidder, LA — 290 790 — 1,080 31 12/16/2021 2014 Hampton, AR 624 112 689 — 801 29 12/16/2021 2014 Hobbs, NM 602 243 1,084 — 1,327 88 12/21/2020 2006 Londonderry, OH — 154 1,166 — 1,320 41 12/16/2021 2014 Morgan, UT 495 235 1,068 — 1,303 82 12/21/2020 2013 New Roads, LA 430 190 674 — 864 64 12/21/2020 2015 Roswell, NM 545 199 921 — 1,120 82 12/21/2020 2014 Salina, UT 538 211 1,262 — 1,473 93 12/21/2020 2014 Tatum, NM 671 220 675 — 895 28 12/16/2021 2014 West Portsmouth, OH — 290 664 — 954 29 12/16/2021 2004 Food 4 Less: Atwater, CA 3,175 1,383 5,271 345 6,999 1,380 11/27/2013 2002 Fresh Thyme: Lafayette, IN — 1,173 6,316 — 7,489 360 12/21/2020 2006 Ypsilanti, MI — 3,168 5,719 — 8,887 364 12/21/2020 2017 Giant Eagle: Seven Fields, PA 6,615 1,574 13,659 355 15,588 3,062 5/7/2014 2005 H&E Equipment Services: Albuquerque, NM (h) 1,355 4,622 — 5,977 158 12/16/2021 2016 Fort Myers, FL (h) 1,245 4,841 — 6,086 167 12/16/2021 2017 Suwanee, GA (h) 1,818 2,813 — 4,631 120 12/16/2021 2016 Hobby Lobby: Cadillac, MI (h) 628 4,597 — 5,225 162 12/16/2021 2016 Lewisville, TX 4,458 2,184 8,977 — 11,161 2,251 11/26/2013 2013 S-4 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Hobby Lobby (continued): Sedalia, MO (h) $ 781 $ 3,645 $ — $ 4,426 $ 151 12/16/2021 2007 Watertown, SD (h) 1,055 4,226 — 5,281 156 12/16/2021 2017 Willmar, MN (h) 1,079 4,615 — 5,694 170 12/16/2021 2017 Jewel-Osco: Plainfield, IL $ 8,819 — — 11,151 11,151 1,122 11/14/2018 2001 Spring Grove, IL (h) 991 11,361 — 12,352 334 12/16/2021 2007 Wood Dale, IL — 4,069 7,800 — 11,869 240 12/16/2021 2005 Kloeckner: University Park, IL — 862 13,540 — 14,402 407 12/16/2021 2016 Kohl's: Charlottesville, VA 10,889 3,929 12,280 — 16,209 2,694 7/28/2014 2011 Eagan, MN 3,361 3,581 3,751 — 7,332 296 12/21/2020 1996 Easton, MD 3,763 2,962 2,661 — 5,623 468 12/2/2015 1992 Kroger: Bay City, MI 2,272 718 5,057 — 5,775 368 12/21/2020 1994 Shelton, WA 8,989 1,180 11,040 — 12,220 2,791 4/30/2014 1994 Kum & Go: Cedar Rapids, IA — 771 2,493 — 3,264 82 12/16/2021 2011 Conway, AR 3,216 510 2,577 — 3,087 559 6/13/2014 2014 LA Fitness: Bloomfield Township, MI 3,691 2,287 10,075 — 12,362 2,709 6/21/2013 2008 Columbus, OH 4,745 1,013 6,734 — 7,747 1,430 4/29/2015 2014 New Lenox, IL 3,304 1,965 6,257 19 8,241 1,150 12/21/2015 2015 Pawtucket, RI (h) 5,945 8,012 — 13,957 237 12/16/2021 2015 Rock Hill, SC (h) 780 7,590 — 8,370 230 12/16/2021 2015 Levin Furniture: Monroeville, PA (h) 1,385 9,017 — 10,402 274 12/16/2021 2004 Lowe's: Adrian, MI 3,713 2,604 5,036 30 7,670 1,626 9/27/2013 1996 Alpharetta, GA 8,407 7,979 9,630 403 18,012 2,155 5/29/2015 1998 Asheboro, NC 7,023 1,098 6,722 — 7,820 1,549 6/23/2014 1994 Cincinnati, OH 11,768 14,092 — 8 14,100 — 2/10/2014 2001 Columbia, SC 9,869 3,943 6,353 750 11,046 1,876 9/12/2013 1994 Covington, LA 9,137 10,233 — — 10,233 — 8/20/2014 2002 Fremont, OH (h) 3,244 6,071 — 9,315 242 12/16/2021 1996 Hermitage, PA 5,941 2,279 12,579 — 14,858 785 12/21/2020 2016 Lilburn, GA 8,256 8,817 9,380 385 18,582 2,088 5/29/2015 1999 Mansfield, OH 7,880 873 8,256 26 9,155 1,950 6/12/2014 1992 Marietta, GA 14,459 7,471 8,404 392 16,267 1,899 5/29/2015 1997 North Dartmouth, MA (h) 6,774 17,384 — 24,158 546 12/16/2021 2004 Oxford, AL 10,778 1,668 7,622 369 9,659 2,284 6/28/2013 1999 Tuscaloosa, AL 7,865 4,908 4,786 9 9,703 1,260 10/29/2013 1993 Woodstock, GA 14,895 7,316 8,879 392 16,587 2,003 5/29/2015 1997 Zanesville, OH 9,181 2,161 8,375 297 10,833 2,093 12/11/2013 1995 S-5 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed McAlister's Deli: Lawton, OK $ 2,125 $ 805 $ 1,057 $ — $ 1,862 $ 253 5/1/2014 2013 Merchants Tire & Auto: Wake Forest, NC 2,816 782 1,730 — 2,512 332 9/1/2015 2005 Mister Car Wash: Athens, AL 2,536 383 1,150 — 1,533 176 9/12/2017 2008 Decatur, AL 1,242 257 559 — 816 92 9/12/2017 2005 Decatur, AL 2,824 486 1,253 — 1,739 219 9/12/2017 2014 Decatur, AL 1,449 359 1,152 — 1,511 199 9/12/2017 2007 Hartselle, AL 1,042 360 569 — 929 97 9/12/2017 2007 Hudson, FL — 1,229 1,562 — 2,791 46 12/16/2021 2007 Madison, AL 3,866 562 1,139 — 1,701 202 9/12/2017 2012 Spring Hill, FL — 1,123 2,770 — 3,893 76 12/16/2021 2008 National Tire & Battery: Cedar Hill, TX (h) 469 1,951 — 2,420 502 12/18/2012 2006 Cypress, TX 2,824 910 2,224 — 3,134 458 9/1/2015 2005 Flower Mound, TX 3,009 779 2,449 — 3,228 484 9/1/2015 2005 Fort Worth, TX (h) 730 2,309 — 3,039 456 9/1/2015 2005 Montgomery, IL 3,046 516 2,494 — 3,010 647 1/15/2013 2007 North Richland Hills, TX 2,698 513 2,579 — 3,092 524 9/1/2015 2005 Pasadena, TX 2,883 908 2,307 — 3,215 475 9/1/2015 2005 Pearland, TX 3,001 1,016 2,040 — 3,056 411 9/1/2015 2005 Plano, TX 3,171 1,292 2,197 — 3,489 441 9/1/2015 2005 Tomball, TX 2,972 838 2,229 — 3,067 446 9/1/2015 2005 Natural Grocers: Heber City, UT 4,568 1,286 3,727 — 5,013 226 12/21/2020 2017 Idaho Falls, ID 3,585 833 2,316 — 3,149 545 2/14/2014 2013 O'Reilly Automotive: Bennettsville, SC 1,190 361 1,207 — 1,568 82 12/21/2020 2015 Clayton, GA 1,308 501 945 — 1,446 170 1/29/2016 2015 Fayetteville, NC (h) 331 1,620 — 1,951 47 12/16/2021 2012 Flowood, MS 1,353 506 1,288 — 1,794 85 12/21/2020 2014 Iron Mountain, MI 1,220 249 1,400 — 1,649 94 12/21/2020 2014 Patriot Urgent Care: Eldersburg, MD (h) 557 876 288 1,721 176 4/28/2017 2000 PetSmart: McAllen, TX 2,804 2,352 1,309 ( 1,742 ) 1,919 — 12/16/2021 1995 Wilkesboro, NC 1,054 447 1,710 — 2,157 490 4/13/2012 2011 Pick 'N Save: Pewaukee, WI 4,293 1,323 6,761 257 8,341 1,733 8/13/2014 1999 Sheboygan, WI — 2,003 10,695 — 12,698 2,906 9/6/2012 2012 South Milwaukee, WI 3,469 1,126 5,706 362 7,194 1,356 11/6/2013 2005 Pier 7 Juicy Seafood & Bar: Lancaster, TX (h) 1,203 1,620 131 2,954 459 10/23/2012 2011 S-6 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Popeyes: Independence, MO $ 1,168 $ 333 $ 680 $ — $ 1,013 $ 151 6/27/2014 2005 Raising Cane's: Avondale, AZ — 1,774 2,381 — 4,155 70 12/16/2021 2013 Murphy, TX 1,412 495 2,853 — 3,348 172 12/21/2020 1994 Reno, NV 3,312 1,841 2,259 — 4,100 140 12/21/2020 2014 Republic Services: Scottsdale, AZ (h) 11,460 36,231 — 47,691 1,215 12/16/2021 2016 Safeway: Juneau, AK 10,830 6,174 8,791 — 14,965 558 12/21/2020 2017 Schumacher Homes: Troy, OH (h) 992 1,577 ( 1,383 ) 1,186 130 10/23/2012 2011 Siemens: Milford, OH 10,328 4,137 23,153 — 27,290 2,040 12/21/2020 1991 Sleepy's: Roanoke Rapids, NC — 339 1,240 — 1,579 38 12/16/2021 2015 Snider Fleet Solutions: Decatur, AL 1,257 365 1,461 — 1,826 48 12/16/2021 1998 Spinx: Simpsonville, SC 1,804 591 969 — 1,560 243 1/24/2013 2012 Sprouts: Lawrence, KS 6,838 762 8,111 — 8,873 474 12/21/2020 2001 Steinhafels: Greenfield, WI 7,392 1,783 7,643 — 9,426 438 12/21/2020 1991 Madison, WI (h) 3,227 8,531 — 11,758 260 12/16/2021 2017 Stop & Shop: North Kingstown, RI (h) 639 2,057 — 2,696 121 12/21/2020 1979 Sunbelt Rentals: Canton, OH 803 148 1,679 331 2,157 545 10/24/2013 2013 Sunoco: Lake Worth, FL 3,533 580 1,907 — 2,487 465 4/12/2013 2011 Palm Beach Gardens, FL (h) 1,050 2,667 — 3,717 649 4/12/2013 2009 Palm City, FL 3,497 667 1,698 — 2,365 414 4/12/2013 2011 Sebastian, FL (h) 490 2,128 — 2,618 519 4/12/2013 2009 Titusville, FL (h) 626 2,534 — 3,160 617 4/12/2013 2009 SuperValu: Oglesby, IL (h) 2,505 11,777 — 14,282 437 12/16/2021 1996 Take 5: Andrews, TX 887 230 862 — 1,092 49 12/21/2020 1994 Bedford, TX 906 283 837 — 1,120 58 12/21/2020 2009 Burleson, TX 1,127 471 936 — 1,407 62 12/21/2020 1994 Burleson, TX 832 201 837 — 1,038 50 12/21/2020 2010 Burleson, TX 647 394 407 — 801 49 12/21/2020 2003 Cedar Hill, TX 795 250 705 — 955 44 12/21/2020 1985 Hereford, TX 832 50 995 — 1,045 56 12/21/2020 1993 S-7 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Take 5 (continued): Irving, TX $ 462 $ 120 $ 445 $ — $ 565 $ 27 12/21/2020 1989 Irving, TX 832 210 818 — 1,028 49 12/21/2020 1987 Lubbock, TX 1,275 151 1,428 — 1,579 78 12/21/2020 2002 Midland, TX 1,682 192 1,861 — 2,053 101 12/21/2020 1995 Mineral Wells, TX 1,127 131 1,263 — 1,394 70 12/21/2020 2019 Teradata: Miami Township, OH — 1,615 5,250 — 6,865 200 12/16/2021 2010 TGI Friday's: Chesapeake, VA 2,698 1,217 1,388 — 2,605 316 6/27/2014 2003 Wilmington, DE 2,765 1,685 969 — 2,654 224 6/27/2014 1991 The Toro Company: Windom, MN (h) 292 10,651 — 10,943 364 12/16/2021 2016 Time Warner: Streetsboro, OH 3,397 1,009 5,602 — 6,611 174 12/16/2021 2003 Tire Kingdom: Bluffton, SC 2,380 645 1,688 — 2,333 324 9/1/2015 2005 Summerville, SC 2,181 1,208 1,233 — 2,441 245 9/1/2015 2005 Title Resource Group: Mount Laurel, NJ — 3,129 8,491 — 11,620 379 12/16/2021 2004 TJ Maxx: Danville, IL — 463 2,048 — 2,511 90 12/16/2021 2013 Tractor Supply: Ashland, VA 3,060 500 2,696 175 3,371 670 11/22/2013 2013 Augusta, KS 1,405 407 2,315 175 2,897 570 1/10/2014 2013 Blytheville, AR 2,587 780 2,660 175 3,615 205 12/21/2020 2002 Cambridge, MN 1,154 807 1,272 203 2,282 438 5/14/2012 2012 Canon City, CO 1,777 597 2,527 175 3,299 656 11/30/2012 2012 Carlyle, IL 2,366 707 2,386 175 3,268 201 12/21/2020 2015 Fortuna, CA 2,602 568 3,819 175 4,562 898 6/27/2014 2014 Logan, WV 3,012 597 3,232 175 4,004 215 12/21/2020 2006 Lumberton, NC 1,383 611 2,007 175 2,793 569 5/24/2013 2013 Marion, IN 1,319 1,536 1,099 175 2,810 286 2/19/2014 2004 Midland, NC 1,383 865 2,182 175 3,222 175 12/21/2020 2013 Monticello, FL 1,548 448 1,916 175 2,539 542 6/20/2013 2013 Shelbyville, IL 2,351 586 2,576 175 3,337 195 12/21/2020 2017 South Hill, VA 1,448 630 2,179 175 2,984 580 6/24/2013 2011 Weaverville, NC 2,394 867 3,138 294 4,299 816 9/13/2013 2006 Woodward, OK 1,405 446 1,973 175 2,594 532 11/19/2013 2013 Trader Joe's: Asheville, NC 3,197 2,770 3,766 — 6,536 951 10/22/2013 2013 Columbia, SC 2,996 2,308 2,597 — 4,905 746 3/28/2013 2012 Wilmington, NC 2,659 2,016 2,519 — 4,535 797 6/27/2013 2012 S-8 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Ulta Salon: Albany, GA $ 1,097 $ 441 $ 1,757 $ — $ 2,198 $ 407 5/8/2014 2013 Greeley, CO 1,383 596 2,035 — 2,631 423 3/31/2015 2014 United Oil: Bellflower, CA 1,937 1,246 788 — 2,034 165 9/30/2014 2001 Brea, CA 2,905 2,393 658 — 3,051 137 9/30/2014 1984 Carson, CA 5,404 2,354 4,821 — 7,175 291 12/21/2020 1958 El Cajon, CA 1,870 1,533 568 — 2,101 119 9/30/2014 2008 El Cajon, CA 1,663 1,225 368 — 1,593 77 9/30/2014 2000 El Monte, CA — 766 510 — 1,276 106 9/30/2014 1994 Escondido, CA — 3,514 1,062 — 4,576 221 9/30/2014 2002 Fallbrook, CA 3,570 1,266 3,458 — 4,724 189 12/21/2020 1958 Glendale, CA — 4,871 795 — 5,666 166 9/30/2014 1999 Harbor City, CA 3,327 1,359 3,047 — 4,406 170 12/21/2020 2014 Hawthorne, CA 2,011 896 1,764 — 2,660 99 12/21/2020 2001 Inglewood, CA — 1,809 878 — 2,687 183 9/30/2014 1997 La Habra, CA 2,425 1,971 571 — 2,542 119 9/30/2014 2000 Lakewood, CA 3,696 2,499 2,400 — 4,899 147 12/21/2020 1973 Lawndale, CA 2,218 1,462 862 — 2,324 180 9/30/2014 2001 Long Beach, CA 2,772 1,088 2,582 — 3,670 146 12/21/2020 1990 Long Beach, CA — 2,778 883 — 3,661 184 9/30/2014 1972 Los Angeles, CA — 2,334 717 — 3,051 149 9/30/2014 2002 Los Angeles, CA — 3,552 1,242 — 4,794 259 9/30/2014 2002 Los Angeles, CA — 2,745 669 — 3,414 139 9/30/2014 1998 Los Angeles, CA — 3,930 428 — 4,358 89 9/30/2014 2005 Los Angeles, CA 3,253 1,927 1,484 — 3,411 309 9/30/2014 2007 Los Angeles, CA 2,772 2,182 701 — 2,883 146 9/30/2014 1964 Los Angeles, CA 3,807 2,435 2,614 — 5,049 148 12/21/2020 1982 Los Angeles, CA 4,154 2,016 3,486 — 5,502 190 12/21/2020 1965 Madera, CA (h) 1,500 3,804 — 5,304 628 9/27/2019 2018 Norco, CA 3,186 1,852 1,489 — 3,341 310 9/30/2014 1995 Poway, CA — 3,072 705 — 3,777 147 9/30/2014 1960 San Clemente, CA 4,221 2,036 3,561 — 5,597 199 12/21/2020 1973 San Diego, CA 2,284 1,362 1,662 — 3,024 98 12/21/2020 1959 San Diego, CA 3,600 1,547 3,218 — 4,765 178 12/21/2020 2011 San Diego, CA 4,916 2,409 4,105 — 6,514 239 12/21/2020 1976 San Diego, CA — 2,977 1,448 — 4,425 301 9/30/2014 1984 San Diego, CA 2,632 1,877 883 — 2,760 184 9/30/2014 2006 San Diego, CA — 1,824 382 — 2,206 80 9/30/2014 2006 Santa Ana, CA 2,565 1,629 1,766 — 3,395 105 12/21/2020 2000 Santa Clarita, CA — 4,787 733 — 5,520 152 9/30/2014 2001 Sun City, CA — 1,136 1,421 — 2,557 296 9/30/2014 1984 Vista, CA 2,284 2,063 334 — 2,397 69 9/30/2014 1986 S-9 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed United Oil (continued): Vista (Vista), CA $ 2,218 $ 2,028 $ 418 $ — $ 2,446 $ 88 9/30/2014 2010 Whittier, CA 2,491 1,629 985 — 2,614 206 9/30/2014 1997 Urban Air Adventure Park: Waukesha, WI 7,030 3,408 12,918 666 16,992 2,797 9/29/2014 2007 Vacant: Appleton, WI — 895 1,026 ( 1,194 ) 727 34 11/18/2015 2015 Sanford, FL — 1,031 1,807 ( 1,861 ) 977 53 10/23/2012 1999 Walker, LA — 899 3,910 ( 2,849 ) 1,960 — 6/27/2014 1999 Willmar, MN — 200 1,279 — 1,479 252 3/25/2015 2014 Valeo North American HQ: Troy, MI (h) 1,880 9,813 — 11,693 464 12/16/2021 2007 Valeo Production Facility: East Liberty, OH — 357 4,989 46 5,392 173 12/16/2021 2016 Valvoline HQ: Lexington, KY (h) 5,558 41,234 — 46,792 1,686 12/16/2021 2016 Walgreens: Austintown, OH 3,600 637 4,173 — 4,810 990 8/19/2013 2002 Clinton, MI 4,065 1,977 4,232 — 6,209 254 12/21/2020 1997 Connelly Springs, NC (h) 1,349 3,628 — 4,977 882 8/27/2013 2012 Coweta, OK (h) 897 3,303 — 4,200 92 12/16/2021 2009 Danville, VA 4,849 989 4,547 — 5,536 1,222 12/24/2012 2012 Dearborn Heights, MI 6,113 2,236 3,411 — 5,647 833 7/9/2013 2008 East Chicago, IN — 331 5,242 — 5,573 1,102 8/8/2014 2005 Fort Madison, IA 3,511 514 3,723 — 4,237 892 9/20/2013 2008 Harrison, AR 4,589 1,237 5,424 — 6,661 309 12/21/2020 2007 Indianapolis, IN 4,446 1,212 5,484 — 6,696 312 12/21/2020 1996 Las Vegas, NV 3,896 2,325 3,262 70 5,657 787 9/26/2013 1999 Lawton, OK 2,791 860 2,539 106 3,505 631 7/3/2013 1998 Lees Summit, MO 4,042 1,205 4,884 — 6,089 288 12/21/2020 2014 Little Rock, AR 4,435 548 4,676 — 5,224 1,002 6/30/2014 2011 Lubbock, TX 3,567 565 3,257 103 3,925 860 10/11/2012 2000 Lubbock, TX 3,142 531 2,951 102 3,584 774 10/11/2012 1998 Metropolis, IL 4,132 284 4,991 — 5,275 1,049 8/8/2014 2009 Reidsville, NC (h) 722 5,117 — 5,839 141 12/16/2021 2008 Sacramento, CA 3,260 324 2,669 — 2,993 598 6/30/2014 2008 San Antonio, TX 6,967 1,417 7,932 — 9,349 429 12/21/2020 2005 Siloam Springs, AR 3,709 936 4,367 — 5,303 256 12/21/2020 1999 Slidell, LA 2,924 757 3,557 — 4,314 218 12/21/2020 2000 Springfield, IL — 830 3,619 — 4,449 989 5/14/2012 2007 St. Louis, MO 2,430 355 3,149 — 3,504 89 12/16/2021 2007 Suffolk, VA 4,066 1,261 3,461 — 4,722 994 5/14/2012 2007 Walmart: Anderson, SC 9,625 2,424 9,719 — 12,143 1,739 11/5/2015 2015 Florence, SC 8,915 2,013 9,225 — 11,238 1,643 11/5/2015 2015 S-10 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) Initial Costs to Company Gross Amount at Which Carried Buildings, Fixtures and Total Adjustment At December 31, 2022 Accumulated Depreciation Date Date Description (a) Encumbrances Land Improvements to Basis (b) (c) (d) (e) (e) (f) (g) Acquired Constructed Walmart (continued): Randallstown, MD (h) $ 8,382 $ 23,365 $ — $ 31,747 $ 734 12/16/2021 2012 Tallahassee, FL $ 11,196 14,823 — — 14,823 — 12/11/2012 2008 Weasler Engineering: West Bend, WI (h) 1,019 13,390 — 14,409 484 12/16/2021 2016 Wendy's: Grafton, VA 1,597 539 894 — 1,433 200 6/27/2014 1985 Westminster, CO 724 596 1,108 — 1,704 246 6/27/2014 1986 West Marine: Chicago, IL — 4,442 8,698 — 13,140 486 12/21/2020 2005 Panama City, FL 1,383 676 2,220 — 2,896 539 4/24/2015 2014 Pensacola, FL 1,405 1,107 3,397 — 4,504 798 2/27/2015 2015 Winn-Dixie: Amite, LA 1,197 1,479 1,691 — 3,170 192 12/21/2020 2000 $ 921,520 $ 581,304 $ 1,457,571 $ 2,822 $ 2,041,696 $ 179,855 ____________________________________ (a) Initial costs exclude subsequent impairment charges. (b) Consists of capital expenditures and real estate development costs, and impairment charges. (c) The aggregate cost for federal income tax purposes was $ 2.0 billion. (d) The following is a reconciliation of total real estate carrying value for the years ended December 31 (in thousands): 2022 2021 2020 Balance, beginning of period $ 2,362,175 $ 3,371,926 $ 2,530,311 Additions Acquisitions — 752,272 738,172 Improvements 1,245 3,785 192,591 Assets placed back into service — — 200,758 Total additions $ 1,245 $ 756,057 $ 1,131,521 Less: Deductions Cost of real estate sold 305,071 426,436 83,144 Other (including provisions for impairment of real estate assets) 16,653 1,339,372 206,762 Total deductions 321,724 1,765,808 289,906 Balance, end of period $ 2,041,696 $ 2,362,175 $ 3,371,926 (e) Gross intangible lease assets of $ 276.7 million and the associated accumulated amortization of $ 91.1 million are not reflected in the table above. S-11 CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE III – REAL ESTATE ASSETS AND ACCUMULATED DEPRECIATION — (Continued) (in thousands) (f) The following is a reconciliation of accumulated depreciation for the years ended December 31 (in thousands): 2022 2021 2020 Balance, beginning of period $ 158,354 $ 298,364 $ 243,122 Additions Acquisitions - Depreciation expense for building, acquisitions costs and tenant improvements acquired 41,627 61,868 56,218 Improvements - Depreciation expense for tenant improvements and building equipment 5,270 5,140 2,280 Total additions $ 46,897 $ 67,008 $ 58,498 Deductions Cost of real estate sold 22,508 43,600 10,108 Other (including provisions for impairment of real estate assets) 2,888 163,418 ( 6,852 ) Total deductions 25,396 207,018 3,256 Balance, end of period $ 179,855 $ 158,354 $ 298,364 (g) The Company’s assets are depreciated or amortized using the straight-line method over the useful lives of the assets by class. Generally, buildings are depreciated over 40 years, site improvements are amortized over 15 years and tenant improvements are amortized over the remaining life of the lease or the useful life, whichever is shorter. (h) Property is included in the CMFT Credit Facility’s borrowing base. As of December 31, 2022, the Company had $ 205.0 million outstanding under the CMFT Credit Facility. S-12 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE IV – MORTGAGE LOANS ON REAL ESTATE (in thousands) Principal Carrying Amount of Amount of Loans Subject Final Periodic Face Mortgages at to Delinquent Interest Maturity Payment Prior Amount of December 31, Principal or Loan Type Description / Location Rate (a) Date (b) Terms (c) Liens Mortgages 2022 (d) "Interest" First mortgage loan Office / Duluth, Georgia + 3.15 % 2/1/2025 P/I N/A $ 50,734 $ 50,618 $ — First mortgage loan Office / Dallas, Texas + 3.75 % 9/8/2025 P/I N/A 84,377 83,787 — First mortgage loan Office / Orlando, Florida + 4.00 % 10/9/2025 P/I N/A 72,930 72,745 — First mortgage loan Office / San Diego, California + 4.55 % 2/7/2027 P/I N/A 105,252 104,519 — First mortgage loan Office / Houston, Texas + 2.00 % 11/7/2024 P/I N/A 86,739 86,739 — First mortgage loan Office / Houston, Texas + 2.55 % 11/7/2024 P/I N/A 15,236 15,236 — First mortgage loan Office / San Diego, California + 3.80 % 6/5/2026 P/I N/A 105,000 104,461 — First mortgage loan Office / Irvine, California + 3.45 % 7/7/2026 P/I N/A 170,230 169,176 — First mortgage loan Office / Bethesda, Maryland + 3.75 % 9/16/2026 P/I N/A 57,390 56,896 — First mortgage loan Multifamily / Fort Lauderdale, Florida + 1.47 % - 6.82 % 10/7/2025 P/I N/A 203,591 202,779 — First mortgage loan Multifamily / Los Angeles, California + 2.60 % 10/7/2025 P/I N/A 122,857 122,436 — First mortgage loan Retail / Queens, New York + 4.15 % 11/7/2026 P/I N/A 65,000 64,603 — First mortgage loan Multifamily / San Jose, California + 2.90 % 11/7/2024 P/I N/A 149,205 148,756 — First mortgage loan Multifamily / Arlington, Virginia + 2.75 % 12/15/2026 P/I N/A 84,558 84,098 — First mortgage loan Multifamily / Brooklyn, New York + 3.50 % 12/17/2026 P/I N/A 60,750 60,328 — First mortgage loan (e) Multifamily / Brooklyn, New York + 3.50 % 12/17/2026 P/I N/A 20,250 20,109 — First mortgage loan Office / McLean, Virginia + 3.30 % 2/5/2027 P/I N/A 125,664 124,589 — First mortgage loan Multifamily / Gainesville, Florida + 3.20 % 1/7/2027 P/I N/A 68,588 68,220 — First mortgage loan Office / Medford, Massachusetts + 2.90 % 1/7/2026 P/I N/A 130,510 129,441 — First mortgage loan Multifamily / Miami, Florida + 2.60 % 1/7/2027 P/I N/A 154,000 153,220 — First mortgage loan Multifamily / Nashville, Tennessee + 3.00 % 1/7/2027 P/I N/A 118,750 118,149 — First mortgage loan Office / Tampa, Florida + 3.28 % 2/7/2027 P/I N/A 167,500 166,268 — First mortgage loan Office / Atlanta, Georgia + 3.40 % 3/7/2027 P/I N/A 247,778 245,369 — First mortgage loan Office / Phoenix, Arizona + 3.34 % 4/7/2027 P/I N/A 295,950 293,204 — First mortgage loan Mixed-Use / Alpharetta, Georgia + 4.70 % 4/7/2027 P/I N/A 67,833 67,260 — First mortgage loan Multifamily / Phoenix, Arizona + 3.05 % 5/7/2027 P/I N/A 145,519 144,659 — First mortgage loan Office / Washington D.C. + 4.00 % 6/6/2027 P/I N/A 188,100 186,582 — First mortgage loan Industrial / Spanish Fork, Utah + 3.50 % 7/7/2025 P/I N/A 81,000 80,369 — First mortgage loan Self Storage / Various + 3.95 % 9/7/2027 P/I N/A 61,120 60,577 — Total loans $ 3,306,411 $ 3,285,193 $ — Current expected credit losses (f) — ( 20,352 ) — Total loans, net $ 3,306,411 $ 3,264,841 $ — S-13 Table of Contents CIM REAL ESTATE FINANCE TRUST, INC. SCHEDULE IV – MORTGAGE LOANS ON REAL ESTATE (in thousands) ____________________________________ (a) Expressed as a spread over the relevant floating benchmark rates, which include one-month LIBOR, Term SOFR, and the 30-day SOFR average, as applicable to each loan. (b) Final maturity date assumes all extension options are exercised. (c) P/I = principal and interest. (d) The tax basis of the loans included above is $ 3.3 billion as of December 31, 2022. (e) As of December 31, 2022, the first mortgage loan is comprised of contiguous mezzanine loan components that, as a whole, have expected credit quality similar to that of a first mortgage loan. (f) As of December 31, 2022, the Company’s current expected credit losses related to its loans held-for-investment totaled $ 42.3 million, $ 20.4 million of which was related to the CRE loans. The following table reconciles mortgage loans on real estate for the years ended December 31 (in thousands): Year Ended December 31, 2022 2021 2020 Balance, beginning of period $ 1,958,655 $ 428,393 $ 298,880 Additions during period: New loans 1,401,539 1,810,166 231,212 Capitalized interest 62 — 539 Accretion of fees and other items 9,896 2,998 1,909 Total additions $ 1,411,497 $ 1,813,164 $ 233,660 Less: Deductions during period: Collections of principal ( 80,911 ) ( 169,094 ) ( 47,670 ) Capitalized interest — ( 9,469 ) — Foreclosures — ( 138,006 ) — Deferred fees and other items ( 13,978 ) ( 17,031 ) ( 3,200 ) Total deductions $ ( 94,889 ) $ ( 333,600 ) $ ( 50,870 ) Cure payments receivable $ — — 7,351 (Provision for) reversal of credit losses ( 10,422 ) 50,698 ( 60,628 ) Net balance, end of period $ 3,264,841 $ 1,958,655 $ 428,393 S-14