What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-05-12 compared with 2022-11-14 · 425 added, 661 removed, 863 unchanged (56% of the section changed)

3 unchanged sentences

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

September 30, 2022 December 31, 2021

March 31, 2023 December 31, 2022

Real estate assets:

7 unchanged sentences

Investment in unconsolidated entities 97,384 100,604

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

Real estate-related securities ($ 520,639 and $ 576,391 held at fair value as of March 31, 2023 and December 31, 2022, respectively)

520,639 576,391

5 unchanged sentences

Rents and tenant receivables, net 20,977 33,968

Prepaid expenses, derivative assets and other assets 52,410 16,279

Derivative assets, prepaid expenses and other assets 10,711 26,243

Deferred costs, net 17,152 16,429

Accrued interest receivable 23,412 22,343

Assets held for sale 65,011 —

6 unchanged sentences

Distributions payable 15,310 14,828

Deferred rental income, derivative liabilities and other liabilities 8,436 21,282

Deferred rental income and other liabilities 5,960 7,274

Total liabilities 4,036,925 4,505,741

5 unchanged sentences

Common stock, $ 0.01 par value per share;

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

490,000,000 shares authorized, 437,429,808 and 437,397,414 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

Capital in excess of par value 3,529,644 3,529,523

Accumulated distributions in excess of earnings ( 1,021,032 ) ( 1,029,287 )

Accumulated other comprehensive (loss) income ( 21,737 ) 2,949

Accumulated other comprehensive loss ( 74,836 ) ( 48,526 )

Total stockholders’ equity 2,438,150 2,456,083

6 unchanged sentences

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

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

2022 2021 2022 2021

Three Months Ended March 31,

Rental and other property income $ 38,781 $ 73,736

1 unchanged sentence

Total revenues 146,864 105,199

Operating expenses:

General and administrative 3,298 3,475

Interest expense, net 66,234 29,996

Property operating 2,576 7,727

5 unchanged sentences

Real estate impairment 4,814 3,291

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

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

Increase in provision for credit losses 1,453 4,709

Total expenses 110,462 92,100

Other income (expense):

Gain on disposition of real estate and condominium developments, net 19,623 32,574

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

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

Other expense:

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

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

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

(Loss) gain on investment in unconsolidated entities ( 770 ) 5,340

Unrealized gain (loss) on equity security 2,258 ( 2,346 )

Other income, net 324 1,305

Loss on extinguishment of debt ( 3,645 ) ( 10,871 )

Total other expense ( 49,545 ) ( 23,632 ) ( 124,619 ) ( 61,592 )

Total other income (expense) 17,790 26,002

Net income $ 54,192 $ 39,101

9 unchanged sentences

(in thousands) (Unaudited)

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

2022 2021 2022 2021

Three Months Ended March 31,

Net income $ 54,192 $ 39,101

Other comprehensive (loss) income

Unrealized (loss) gain on real estate-related securities ( 8,709 ) ( 813 ) ( 24,496 ) 1,239

Reclassification adjustment for realized gain included in income as other income — — — ( 648 )

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

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

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

Other comprehensive loss

Unrealized loss on real estate-related securities ( 26,310 ) ( 4,878 )

Unrealized gain on interest rate swaps — 1,488

Amount of gain reclassified from other comprehensive loss into income as interest expense, net — ( 7 )

Total other comprehensive loss ( 26,310 ) ( 3,397 )

Comprehensive income 27,882 35,704

7 unchanged sentences

of Par Value Accumulated

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

Distributions in Excess of Earnings Accumulated Other Comprehensive Loss Total

Stockholders’

8 unchanged sentences

Changes in redeemable common stock — — ( 213 ) — — ( 213 ) — ( 213 )

Distributions to non-controlling interests — — — — — — ( 14 ) ( 14 )

Comprehensive income (loss) — — — 54,184 ( 26,310 ) 27,874 8 27,882

Balance as of March 31, 2023 437,429,808 $ 4,374 $ 3,529,644 $ ( 1,021,032 ) $ ( 74,836 ) $ 2,438,150 $ — $ 2,438,150

Issuance of common stock 1,325,282 13 9,529 — — 9,542 — 9,542

Equity-based compensation 22,892 — 120 — — 120 — 120

Distributions declared on common stock — $ 0.09 per common share

— — — ( 40,018 ) — ( 40,018 ) — ( 40,018 )

Redemptions of common stock ( 1,395,095 ) ( 14 ) ( 10,030 ) — — ( 10,044 ) — ( 10,044 )

Changes in redeemable common stock — — 503 — — 503 — 503

Distributions to non-controlling interests — — — — — — ( 16 ) ( 16 )

Comprehensive income (loss) — — — 73,685 ( 10,045 ) 63,640 ( 72 ) 63,568

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

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

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

Distributions declared on common stock — $ 0.09 per common share

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

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

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

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

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

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

CIM REAL ESTATE FINANCE TRUST, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

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

Common Stock Capital in Excess

1 unchanged sentence

Distributions in Excess of Earnings Accumulated

Other Comprehensive (Loss) Income Total

Other Comprehensive Income (Loss) Total

Stockholders’

2 unchanged sentences

Balance as of January 1, 2022 437,373,981 $ 4,374 $ 3,529,126 $ ( 1,008,561 ) $ 2,949 $ 2,527,888 $ 1,073 $ 2,528,961

Equity-based compensation — — 40 — — 40 — 40

Distributions declared on common stock — $ 0.09 per common share

— — — ( 32,906 ) — ( 32,906 ) — ( 32,906 )

Comprehensive (loss) income — — — ( 2,753 ) 3,377 624 — 624

Balance as of March 31, 2021 362,001,968 $ 3,620 $ 3,157,899 $ ( 996,665 ) $ 1,330 $ 2,166,184 $ — $ 2,166,184

Issuance of common stock 1,329,825 13 9,561 — — 9,574 — 9,574

2 unchanged sentences

— — — ( 40,018 ) — ( 40,018 ) — ( 40,018 )

Changes in redeemable common stock — — ( 173,628 ) — — ( 173,628 ) — ( 173,628 )

Comprehensive income — — — 57,787 1,301 59,088 — 59,088

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

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

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

Distributions declared on common stock — $ 0.09 per common share

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

Redemptions of common stock ( 1,345,814 ) ( 13 ) ( 9,676 ) — — ( 9,689 ) — ( 9,689 )

Changes in redeemable common stock — — 115 — — 115 — 115

Distributions to non-controlling interests — — — — — — ( 14 ) ( 14 )

Comprehensive income (loss) — — — 39,092 ( 3,397 ) 35,695 9 35,704

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

Balance as of March 31, 2022 437,357,992 $ 4,374 $ 3,529,163 $ ( 1,009,487 ) $ ( 448 ) $ 2,523,602 $ 1,068 $ 2,524,670

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

2 unchanged sentences

(in thousands) (Unaudited)

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from operating activities:

3 unchanged sentences

Amortization of deferred financing costs 3,190 3,381

Amortization of fair value adjustment of mortgage notes payable assumed — ( 149 )

Amortization and accretion on deferred loan fees ( 3,324 ) ( 2,441 )

Amortization of premiums and discounts on credit investments ( 8,481 ) ( 591 )

Capitalized interest income on real estate-related securities and loans held-for-investment ( 888 ) ( 703 )

Capitalized interest income on real estate-related securities ( 284 ) ( 272 )

Equity-based compensation 120 37

3 unchanged sentences

Loss (gain) on sale of credit investments, net 64 ( 65 )

Gain on investment in unconsolidated entities ( 8,858 ) —

Loss (gain) on investment in unconsolidated entities 770 ( 5,340 )

Gain on sale of marketable security — ( 22 )

Unrealized loss on equity security 15,462 —

Unrealized (gain) loss on equity security ( 2,258 ) 2,368

Amortization of fair value adjustment and gain on interest rate swaps — 92

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

Loss (gain) on interest rate caps 1,960 ( 1,176 )

Impairment of real estate assets 4,814 3,291

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

Increase in provision for credit losses 1,453 4,709

Write-off of deferred financing costs 2,354 7,068

3 unchanged sentences

Prepaid expenses and other assets 13,572 ( 20,530 )

Accrued interest receivable ( 1,069 ) ( 2,792 )

Accrued expenses and accounts payable 2,008 ( 7,648 )

6 unchanged sentences

Investment in real estate-related securities ( 9,401 ) ( 155,618 )

Investment in liquid senior loans ( 160,928 ) ( 266,978 )

Investment in liquid corporate senior loans ( 26,804 ) ( 61,030 )

Investment in real estate assets and capital expenditures ( 2,495 ) ( 9,533 )

Investment in corporate senior loans ( 16,763 ) ( 10,000 )

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

Investment in first mortgage loans ( 17,007 ) ( 784,129 )

Origination and exit fees received on loans held-for-investment — 9,540

3 unchanged sentences

Net proceeds from disposition of real estate assets and condominium developments 775,144 923,400

Net proceeds from sale of liquid senior loans 52,868 55,224

Net proceeds from sale of liquid corporate senior loans 8,311 23,834

Redemption of investment in unconsolidated entities — 48,500

Proceeds from the settlement of insurance claims 619 58

Net cash used in investing activities $ ( 494,783 ) $ ( 347,316 )

Net cash provided by investing activities $ 886,406 $ 62,821

CIM REAL ESTATE FINANCE TRUST, INC.

1 unchanged sentence

(in thousands) (Unaudited) — Continued

Nine Months Ended September 30,

Three Months Ended March 31,

Cash flows from financing activities:

4 unchanged sentences

Termination of interest rate swaps — ( 101 )

Payment of loan deposits — ( 650 )

Refund of loan deposits — 565

Distributions to non-controlling interests — ( 14 )

Deferred financing costs paid ( 3,457 ) ( 4,550 )

Net cash provided by financing activities 413,016 447,992

Net cash (used in) provided by financing activities ( 514,483 ) 534

Net increase in cash and cash equivalents and restricted cash 437,041 93,424

8 unchanged sentences

Accrued capital expenditures $ 468 $ 1,315

Construction reserve allocation $ ( 190 ) $ —

Accrued deferred financing costs $ 174 $ 157

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 notes payable assumed by buyer in connection with disposition of real estate assets $ — $ ( 19,250 )

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 )

Common stock issued through distribution reinvestment plan $ 10,763 $ 9,574

1 unchanged sentence

Change in fair value of real estate-related securities $ ( 26,309 ) $ ( 7,246 )

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

Supplemental Cash Flow Disclosures:

4 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited)

March 31, 2023 (Unaudited)

NOTE 1 — ORGANIZATION AND BUSINESS

2 unchanged sentences

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

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

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

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

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

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

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, creditworthy long-term net-leased property investments and other senior loan and liquid credit investments.

As of March 31, 2023, the Company owned 228 properties, comprising approximately 6.9 million rentable square feet of commercial space located in 37 states.

As of March 31, 2023, the rentable square feet at these properties was 98.9 % leased, including month-to-month agreements, if any.

As of March 31, 2023, the Company’s loan portfolio consisted of 349 loans with a net book value of $ 3.9 billion, and investments in real estate-related securities of $ 520.6 million.

As of March 31, 2023, the Company owned condominium developments with a net book value of $ 131.6 million.

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

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

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

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 also maintains additional offices across the Unites States, as well as in Korea, Hong Kong and the United Kingdom to support its platform.

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

CCO Group, LLC and its subsidiaries (collectively, “CCO Group”) serve as the Company’s sponsor.

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 Group is headquartered in Los Angeles, CA, with offices in Atlanta, GA, Chicago, IL, Dallas, TX, New York, NY, Orlando, FL, Phoenix, AZ and Tokyo, Japan.

CIM Group also maintains additional offices across the United 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”).

14 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

March 31, 2023 (Unaudited) – (Continued)

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

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

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

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

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, and June 30, 2020.

As of March 31, 2023, 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 Company’s estimated per share NAVs are not audited or reviewed by its independent registered public accounting firm.

10 unchanged sentences

All intercompany balances and transactions have been eliminated in consolidation.

In determining whether the Company has controlling interests in an entity and the requirement 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 they are variable interest entities (“VIEs”), and if so, whether the Company is the primary beneficiary.

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 condensed consolidated financial statements.

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

See Note 4 — Real Estate Assets for additional information.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

Reclassifications

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

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

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

As of December 31, 2021

As previously reported Reclassifications As Revised

Condensed Consolidated Balance Sheets

Rents and tenant receivables, net $ 61,468 $ ( 2,520 ) $ 58,948

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

Nine Months Ended September 30, 2021

As previously reported Reclassifications As Revised

Condensed Consolidated Statements of Cash Flows

Rents and tenant receivables, net $ 15,889 $ 2,339 $ 18,228

Prepaid expenses and other assets $ ( 7,908 ) $ ( 2,339 ) $ ( 10,247 )

The Company has chosen to break out the details of $ 30.0 million of interest expense, net from other income, net into expenses in the Company’s condensed consolidated statement of operations for the three months ended March 31, 2022, driven by the Company’s current investment portfolio composition being predominantly comprised of credit investments.

This reclassification of interest expense, net did not have an impact on net income or cash flow from operating activities.

I n addition, the Company has chosen to break out the details of $ 2.3 million of unrealized loss on equity security from other income, net in the Company’s condensed consolidated statement of operations for the three months ended March 31, 2022.

The Company has also chosen to break out the details of $ 7.2 million of accrued interest receivable from derivative assets, prepaid expenses and other assets in the Company’s condensed consolidated balance sheet for the three months ended March 31, 2022, which resulted in a corresponding breakout of $ 2.8 million from derivative assets, prepaid expenses and other assets to accrued interest receivable in the Company’s condensed consolidated statement of cash flows from the three months ended March 31, 2022.

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

Use of Estimates

17 unchanged sentences

changes in anticipated holding periods;

and significant increases to budgeted costs for units under development.

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.

1 unchanged sentence

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

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

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

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

During the three months ended March 31, 2023, as part of the Company’s quarterly impairment review procedures, the Company recorded impairment charges of $ 4.8 million related to one property, due to the sales price being less than its respective carrying value.

The Company’s impairment assessment as of March 31, 2023 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 nine months ended September 30, 2021, the Company recorded impairment charges of $ 5.3 million related to 11 properties, of which impairment at seven properties was due to sales prices that were less than their respective carrying values and impairment at four properties was due to vacancy.

During the three months ended March 31, 2022, the Company recorded impairment charges of $ 3.3 million related to seven properties, all of which was due to sales prices that were less than their respective carrying values.

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

3 unchanged sentences

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

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

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

As of March 31, 2023, in connection with the Realty Income Purchase and Sale Agreement (as defined in Note 4 — Real Estate Assets), the Company identified 27 properties with a fair value of $ 65.0 million as held for sale.

The Company disposed of these properties subsequent to March 31, 2023, as further discussed in Note 17 — Subsequent Events.

Dispositions of Real Estate Assets

1 unchanged sentence

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

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

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

Given the Company’s current asset portfolio and strategy, the Company’s dispositions during the three months ended March 31, 2023 and

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

2022 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 three months ended March 31, 2023.

Allocation of Purchase Price of Real Estate Assets

10 unchanged sentences

Investment in Unconsolidated Entities

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

(“CIM UII Onshore”).

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

investment under the equity method.

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

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

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

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

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

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

3 unchanged sentences

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

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

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

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

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

Noncontrolling Interest in Consolidated Joint Venture

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

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

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

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

The Company recorded a loss totaling $ 770,000 , which represented its share of NP JV Holdings’ loss, during the three months ended March 31, 2023 in the condensed consolidated statements of operations.

As of March 31, 2023, the Company’s aggregate investment in NP JV Holdings of $ 97.4 million is included in investment in unconsolidated entities on the condensed 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.

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.

During the three months ended March 31, 2022, the Company recorded its share of CIM UII Onshore’s gain totaling $ 5.2 million.

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.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

Restricted Cash

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

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

The Company had $ 58.4 million and $ 57.6 million in restricted cash as of March 31, 2023 and December 31, 2022, respectively.

Included in restricted cash was $ 16.8 million and $ 15.4 million held by lenders in lockbox accounts, as of March 31, 2023 and December 31, 2022, 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 $ 56.2 million and $ 29.0 million of construction reserves, amounts held by lenders in escrow accounts for real estate taxes and other lender reserves for certain properties, in accordance with the associated lender’s loan agreement as of September 30, 2022 and December 31, 2021, respectively.

Also included in restricted cash was $ 22.0 million and $ 22.6 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 March 31, 2023 and December 31, 2022, respectively.

In addition, the Company had a $ 19.6 million deposit held as cash collateral included in restricted cash as of March 31, 2023 and December 31, 2022 to be applied by Barclays Bank PLC (“Barclays”) as repayment of certain eligible assets transferred under the master repurchase agreement with Barclays.

Real Estate-Related Securities

1 unchanged sentence

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

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

As of March 31, 2023, 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 nine

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

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

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

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

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

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

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

During the three months ended March 31, 2023, the Company invested $ 9.4 million in CMBS.

As of March 31, 2023, the Company had investments in 18 CMBS with an estimated aggregate fair value of $ 480.1 million.

In addition, the Company had an investment in an equity security with an estimated aggregate fair value of $ 40.5 million as of March 31, 2023, which is comprised of RTL Common Stock received as consideration in connection with the RTL Purchase and Sale Agreement (both of which are defined in Note 4 — Real Estate Assets).

This investment is carried at its estimated fair value with unrealized gains and losses reported on the condensed consolidated statements of operations.

During the three months ended March 31, 2023, the Company recorded $ 1.4 million of dividend income on RTL Common Stock, which is included in other income, net on the condensed consolidated statements of operations.

The Company also recorded $ 2.3 million of unrealized gain and $ 2.4 million of unrealized loss on RTL Common Stock during the three months ended March 31, 2023 and 2022, respectively, which is included in unrealized gain (loss) on equity security in the condensed consolidated statements of operations.

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

2 unchanged sentences

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

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

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

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

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

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 condensed consolidated statements of operations in interest income.

2 unchanged sentences

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

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

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

During the three months ended March 31, 2023 and 2022, the Company capitalized $ 284,000 and $ 272,000 , respectively, of interest income to real estate-related securities.

Loans Held-for-Investment

2 unchanged sentences

Loans held-for-investment are carried on the Company’s condensed 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.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

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.

1 unchanged sentence

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

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

Accrual of interest income is suspended on nonaccrual loans.

2 unchanged sentences

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

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

As of March 31, 2023, one of the Company’s liquid corporate senior loan investments was on a 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

10 unchanged sentences

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 senior loans and corporate senior loans, the Company uses a probability of default and loss given default method using a comparable data set.

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.

9 unchanged sentences

Collateral, if appropriate, exceeds performance metrics;

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

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

10 unchanged sentences

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

normal course of business but may weaken the asset or inadequately protect the Company’s credit position if not checked or corrected.

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;

9 unchanged sentences

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.

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

9 unchanged sentences

Upon successful lease execution, leasing commissions are capitalized.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

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

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

During the three months ended March 31, 2023 and 2022, the Company capitalized $ 2.7 million and $ 3.1 million, respectively, of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets.

Included in the amounts capitalized during the three months ended March 31, 2023 and 2022 was $ 458,000 and $ 387,000 , respectively, of capitalized interest expense.

Revenue Recognition

4 unchanged sentences

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

7 unchanged sentences

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 senior loans is accrued as earned beginning on the settlement date.

Interest income on the Company’s liquid corporate senior loans is accrued as earned beginning on the settlement date.

Reportable Segments

1 unchanged sentence

The Company has two reportable segments:

Credit — engages primarily in acquiring and originating loans, either directly or through co-investments in joint ventures, related to real estate assets.

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

This segment also includes investments in real estate-related securities, liquid senior loans and corporate senior loans.

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

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

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.

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 16 — Segment Reporting for a further discussion regarding these segments.

1 unchanged sentence

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 condensed 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 SOFR as its benchmark interest rate for its derivative instruments.

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

Except as otherwise stated below, the Company is currently evaluating the effect

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

that certain new accounting requirements may have on the Company’s accounting and related reporting and disclosures in the Company’s condensed consolidated financial statements.

On March 31, 2022, the FASB issued ASU No.

2022-02, Troubled Debt Restructurings and Vintage Disclosures (Topic 326) (“ASU 2022-02”).

ASU 2022-02 eliminates the recognition and measurement guidance for troubled debt restructurings (“TDRs”) and, instead, requires that an entity evaluate (consistent with the accounting for other loan modifications) whether the modification represents a new loan or a continuation of an existing loan.

The ASU also enhances existing disclosure requirements and introduces new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty.

The ASU became effective for the Company beginning January 1, 2023 and is generally to be applied prospectively.

ASU 2022-02 did not have an impact on the Company’s condensed consolidated financial statements for the three months ended March 31, 2023.

In June 2022, the FASB issued ASU No.

4 unchanged sentences

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

NOTE 3 — FAIR VALUE MEASUREMENTS

12 unchanged sentences

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

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

As of March 31, 2023, the Company concluded that $ 307.5 million of its CMBS fell under Level 2 and $ 172.6 million of its CMBS fell under Level 3.

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

1 unchanged sentence

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.

Current and prior period liabilities’ carrying

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

and fair values exclude net deferred financing costs.

These financial instruments are valued using Level 2 inputs.

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

As of March 31, 2023, the estimated fair value of the Company’s debt was $ 3.86 billion, compared to a carrying value of $ 3.98 billion.

The estimated fair value of the Company’s debt as of December 31, 2022 was $ 4.32 billion, compared to a carrying value of $ 4.44 billion.

4 unchanged sentences

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

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

However, as of March 31, 2023 and December 31, 2022, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives.

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

1 unchanged sentence

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

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

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

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

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

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

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 March 31, 2023, $ 542.2 million and $ 129.5 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, $ 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 March 31, 2023, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $ 3.91 billion, compared to its carrying value of $ 3.93 billion.

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.

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.

4 unchanged sentences

The Company does not expect that changes in classifications between levels will be frequent.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (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 September 30, 2022 and December 31, 2021 (in thousands):

In accordance with the fair value hierarchy described above, the following tables show the fair value of the Company’s financial assets that are required to be measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022 (in thousands):

Balance as of

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

March 31, 2023 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3)

Financial assets:

7 unchanged sentences

CMBS $ 538,142 $ — $ 348,241 $ 189,901

Preferred units 63,490 — — 63,490

Marketable security 110 110 — —

Equity security 38,249 38,249 — —

Interest rate caps 5,040 — 5,040 —

1 unchanged sentence

$ 581,431 $ 38,249 $ 353,281 $ 189,901

Financial liabilities:

Interest rate swaps $ ( 2,466 ) $ — $ ( 2,466 ) $ —

Total financial liabilities $ ( 2,466 ) $ — $ ( 2,466 ) $ —

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

The following are reconciliations of the changes in financial assets with Level 3 inputs in the fair value hierarchy for the three months ended March 31, 2023 (in thousands):

Beginning Balance, January 1, 2023

Total gains and losses:

Unrealized loss included in other comprehensive (loss) income, net ( 12,487 )

Unrealized loss included in other comprehensive loss, net ( 21,911 )

Purchases and payments received:

Conversion of preferred units (1)

Discounts, net 4,352

Capitalized interest income 284

Ending Balance, September 30, 2022

____________________________________

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

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

Ending Balance, March 31, 2023

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

1 unchanged sentence

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 nine months ended September 30, 2022, real estate assets related to 19 properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 114.1 million, resulting in impairment charges of $ 11.9 million.

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

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

As discussed in Note 4 — Real Estate Assets, during the three months ended March 31, 2023, real estate assets related to one property was deemed to be impaired and its carrying value was reduced to an estimated fair value of $ 4.8 million, resulting in impairment charges of $ 4.8 million.

During the three months ended March 31, 2022, real estate assets related to seven properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 29.1 million, resulting in impairment charges of $ 3.3 million.

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

7 unchanged sentences

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

The following summarizes the ranges of discount rates and terminal capitalization rates used for the Company’s impairment test for the real estate assets during the nine months ended September 30, 2022 and 2021:

Nine Months Ended September 30,

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

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 three months ended March 31, 2023 and 2022:

Three Months Ended March 31,

Discount Rate Terminal Capitalization Rate Discount Rate Terminal Capitalization Rate

2 unchanged sentences

7.5 % – 9.2 %

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

Nine Months Ended September 30,

The following table presents the impairment charges by asset class recorded during the three months ended March 31, 2023 and 2022 (in thousands):

Three Months Ended March 31,

Asset class impaired:

3 unchanged sentences

Intangible lease liabilities — ( 1 )

Condominium developments 7,945 —

Total impairment loss $ 4,814 $ 3,291

1 unchanged sentence

Property Acquisitions

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

During the three months ended March 31, 2023 and 2022, the Company did no t acquire any properties.

Condominium Development Project

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

Condominium Dispositions

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

During the three months ended March 31, 2023, the Company disposed of one condominium unit for a sales price of $ 1.6 million, resulting in proceeds of $ 1.5 million after closing costs and a gain of $ 60,000 .

During the three months ended March 31, 2022, the Company disposed of condominium units for an aggregate sales price of $ 21.1 million, resulting in proceeds of $ 19.4 million after closing costs and a gain of $ 3.3 million.

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

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

2022 Property Dispositions

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

2023 Property Dispositions and Real Estate Assets Held for Sale

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 the three months ended March 31, 2023, the Company disposed of 152 properties, including 150 retail properties and two industrial properties, for an aggregate gross sales price of $ 781.2 million, resulting in proceeds of $ 773.7 million after closing costs and a gain of $ 19.6 million.

The sale of 151 of these properties closed pursuant to the Realty Income Purchase and Sale Agreement for total consideration of $ 779.0 million, resulting in proceeds of $ 771.5 million after closing costs and a gain of $ 19.5 million.

The Company has no continuing involvement that would preclude sale treatment 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 condensed consolidated statements of operations.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

As of March 31, 2023, the Company identified 27 properties with a fair value of $ 65.0 million as held for sale, all of which are in connection with the Realty Income Purchase and Sale Agreement.

The Company disposed of these properties subsequent to March 31, 2023, as further discussed in Note 17 — Subsequent Events.

2022 Property Dispositions and Real Estate Assets Held for Sale

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:

1 unchanged sentence

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

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

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

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

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

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

The Company has no continuing involvement that would preclude sale

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

treatment with these properties.

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

During the three months ended March 31, 2022, the Company disposed of 69 properties, including 32 retail properties and 37 anchored shopping centers, for an aggregate gross sales price of $ 925.3 million, resulting in proceeds of $ 923.2 million after closing costs and a gain of $ 29.2 million.

The sale of 56 of these properties closed pursuant to the RTL Purchase and Sale Agreement for total consideration of $ 811.8 million, which consisted of $ 758.4 million 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.

During the three months ended March 31, 2022, the Company recognized earnout income of $ 31.5 million related to the disposition of these properties pursuant to the RTL Purchase and Sale Agreement, and recorded a related receivable of $ 21.3 million in prepaid expenses and other assets in the condensed consolidated balance sheets.

The Company has no continuing involvement with these properties.

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

2022 Impairment

As of March 31, 2022, the Company identified 26 properties with a carrying value of $ 487.5 million as held for sale, 25 of which are in connection with the RTL Purchase and Sale Agreement.

The Company disposed of these properties in phases subsequent to March 31, 2022.

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

During the three months ended March 31, 2023, one property totaling approximately 45,000 square feet with a carrying value of $ 9.6 million was deemed to be impaired and its carrying value was reduced to an estimated fair value of $ 4.8 million, resulting in impairment charges of $ 4.8 million, which were recorded in the condensed consolidated statements of operations.

During the three months ended March 31, 2022, seven properties totaling approximately 215,000 square feet with a carrying value of $ 32.4 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $ 29.1 million, resulting in impairment charges of $ 3.3 million, which were recorded in the condensed consolidated statements of operations.

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

2021 Property Acquisitions

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

2021 Assets Acquired Via Foreclosure

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

No land was acquired in connection with the foreclosure.

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

As of September 30, 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, as further discussed in Note 10 — Repurchase Facilities, Credit Facilities and Notes Payable.

2021 Condominium Development Project

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

2021 Condominium Dispositions

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

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

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

2021 Property Dispositions and Real Estate Assets Held for Sale

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

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

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

2021 Impairment

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

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

March 31, 2023 (Unaudited) – (Continued)

NOTE 5 — INTANGIBLE LEASE ASSETS AND LIABILITIES

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

September 30, 2022 December 31, 2021

Intangible lease assets and liabilities consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands, except weighted average life remaining):

March 31, 2023 December 31, 2022

Intangible lease assets:

2 unchanged sentences

Acquired above-market leases, net of accumulated amortization of $ 2,773 and $ 4,210 , respectively (with a weighted average life remaining of 11.7 years and 12.9 years, respectively)

11,015 12,774

Total intangible lease assets, net $ 115,149 $ 185,593

4 unchanged sentences

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

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

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

2022 2021 2022 2021

The following table summarizes the amortization related to the intangible lease assets and liabilities for the three months ended March 31, 2023 and 2022 (in thousands):

Three Months Ended March 31,

In-place lease and other intangible amortization $ 5,082 $ 6,786

1 unchanged sentence

Below-market lease amortization $ 433 $ 579

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

As of March 31, 2023, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands):

In-Place Leases and

8 unchanged sentences

NOTE 6 — INVESTMENT IN UNCONSOLIDATED ENTITIES

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

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

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

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

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

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.

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

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

As of March 31, 2023, the carrying value of the Company’s investment in NP JV Holdings was $ 97.4 million, which approximates fair value and is included in investment in unconsolidated entities on the condensed consolidated balance

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

The Company received $ 2.4 million in distributions related to its investment in NP JV Holdings during the three months ended March 31, 2023, all of which was recognized as a return of investment and reduced the invested capital and the carrying amount.

As of March 31, 2023, the Company had $ 112.6 million of unfunded commitments related to NewPoint JV.

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

The Company provided a limited guaranty to 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 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.

During the three months ended March 31, 2022, the Company recognized an equity method net gain of $ 5.2 million related to its investment in CIM UII Onshore.

The Company recognized distributions of $ 531,000 related to its investment in CIM UII Onshore during the three months ended March 31, 2022, all of which was recognized as a return on investment.

NOTE 7 — REAL ESTATE-RELATED SECURITIES

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

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

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

As of March 31, 2023, the Company had real estate-related securities with an aggregate estimated fair value of $ 520.6 million, which included 18 CMBS investments and an investment in a publicly-traded equity security.

The CMBS mature on various dates from July 2023 through June 2058 and have interest rates ranging from 6.2 % to 12.2 % as of March 31, 2023, with one CMBS earning a zero coupon rate.

The following is a summary of the Company’s real estate-related securities as of March 31, 2023 (in thousands):

Real Estate-Related Securities

3 unchanged sentences

Total real estate-related securities $ 608,338 $ ( 87,699 ) $ 520,639

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

Amortized Cost Basis Unrealized Gain (Loss) Fair Value

The following table provides the activity for the real estate-related securities during the three months ended March 31, 2023 (in thousands):

Amortized Cost Basis Unrealized Loss Fair Value

Real estate-related securities as of January 1, 2023

1 unchanged sentence

Face value of real estate-related securities acquired 9,738 — 9,738

Investment in preferred units, net (1)

( 63,490 ) — ( 63,490 )

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

1 unchanged sentence

Amortization of discount on real estate-related securities 7,590 — 7,590

Realized gain on sale of real estate-related securities ( 110 ) ( 22 ) ( 132 )

Capitalized interest income on real estate-related securities 284 — 284

Principal payments received on real estate-related securities (1)

( 48,975 ) — ( 48,975 )

Unrealized loss on real estate-related securities

— ( 24,053 ) ( 24,053 )

Real estate-related securities as of September 30, 2022

Real estate-related securities as of March 31, 2023

$ 608,338 $ ( 87,699 ) $ 520,639

____________________________________

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

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

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

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

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

(1) Includes the repayment of the Company’s position in two different tranches of a CMBS instrument prior to their stated maturity dates.

During the three months ended March 31, 2023, the Company invested $ 9.4 million in CMBS.

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

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

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

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

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

During the three months ended March 31, 2023, the Company recorded $ 26.3 million of unrealized loss on its CMBS, which is included in other comprehensive loss in the accompanying condensed consolidated statements of comprehensive income, and recorded $ 2.3 million of unrealized gain on the Company’s equity security, which is included in unrealized gain (loss) on equity security in the accompanying condensed consolidated statements of operations.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

The scheduled maturities of the Company’s CMBS as of March 31, 2023 are as follows (in thousands):

Amortized Cost Estimated Fair Value

7 unchanged sentences

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

As of March 31, 2023, the Company had no credit losses related to real estate-related securities.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

March 31, 2023 (Unaudited) – (Continued)

NOTE 8 — LOANS HELD-FOR-INVESTMENT

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

As of September 30, As of December 31,

The Company’s loans held-for-investment consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands):

As of March 31, As of December 31,

First mortgage loans (1)

1 unchanged sentence

Total CRE loans held-for-investment and related receivables, net 3,198,651 3,285,193

Liquid senior loans 705,750 655,516

Liquid corporate senior loans 703,866 701,540

Corporate senior loans 73,799 57,165

3 unchanged sentences

____________________________________

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

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

(1) As of March 31, 2023, first mortgage loans included $ 20.1 million of contiguous mezzanine loan components that, as a whole, have expected credit quality similar to that of a first mortgage loan.

The following table details overall statistics for the Company’s loans held-for-investment as of March 31, 2023 and December 31, 2022 (dollar amounts in thousands):

CRE Loans (1) (2)

Liquid Senior Loans Corporate Senior Loans

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

Liquid Corporate Senior Loans Corporate Senior Loans

March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022

Number of loans 28 29 315 317 6 4

7 unchanged sentences

____________________________________

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

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

(1) As of March 31, 2023, 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;

1 unchanged sentence

(3) Unfunded loan commitments are subject to the satisfaction of borrower milestones and are not reflected in the accompanying condensed consolidated balance sheets.

This balance does not include unsettled liquid senior loan purchases of $ 6.3 million that are included in cash and cash equivalents in the accompanying condensed consolidated balance sheets.

This balance does not include unsettled liquid corporate senior loan purchases of $ 18.0 million that are included in cash and cash equivalents in the accompanying condensed consolidated balance sheets.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

March 31, 2023 (Unaudited) – (Continued)

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

CRE Loans Liquid Senior Loans Corporate Senior Loans Total Loan Portfolio

CRE Loans Liquid Corporate Senior Loans Corporate Senior Loans Total Loan Portfolio

Balance, January 1, 2023

Loan originations and acquisitions (1)

$ 3,264,841 $ 680,345 $ 56,368 $ 4,001,554

Loan originations and acquisitions 17,007 27,521 17,182 61,710

Sale of loans — ( 8,311 ) — ( 8,311 )

Principal repayments received (1)

Capitalized interest 62 — — 62

( 106,873 ) ( 16,940 ) ( 183 ) ( 123,996 )

Deferred fees and other items (2)

2 unchanged sentences

Current expected credit losses (3)

Balance, September 30, 2022

( 1,949 ) 914 ( 400 ) ( 1,435 )

Balance, March 31, 2023

$ 3,176,350 $ 683,585 $ 72,602 $ 3,932,537

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

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

____________________________________

(1) Includes the repayment of a $ 105.0 million first mortgage loan prior to the maturity date.

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

(3) 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 condensed consolidated balance sheets.

Current Expected Credit Losses

Current expected credit losses reflect the Company’s current estimate of potential credit losses related to the loans held-for-investment included in the Company’s condensed consolidated balance sheets.

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 condensed 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 by loan type for the nine months ended September 30, 2022 (in thousands):

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 three months ended March 31, 2023 (in thousands):

First Mortgage Loans Unfunded First Mortgage Loans (1)

Liquid Senior Loans Unfunded or Unsettled Liquid Senior Loans (1)

Liquid Corporate Senior Loans Unfunded or Unsettled Liquid Corporate Senior Loans (1)

Corporate Senior Loans Unfunded Corporate Senior Loans (1)

Current expected credit losses as of January 1, 2023

Provision for credit losses 1,312 360 2,581 400 56 — 4,709

Current expected credit losses as of March 31, 2022

$ 20,352 $ 1,890 $ 21,195 $ 377 $ 797 $ 66 $ 44,677

Provision for (reversal of) credit losses 1,949 138 ( 914 ) ( 121 ) 400 1 1,453

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

Current expected credit losses as of March 31, 2023

$ 22,301 $ 2,028 $ 20,281 $ 256 $ 1,197 $ 67 $ 46,130

____________________________________

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

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

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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.

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.

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

4 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

March 31, 2023 (Unaudited) – (Continued)

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

The following table presents the net book value of the Company’s loans held-for-investment portfolio as of September 30, 2022 by year of origination, loan type, and risk rating (dollar amounts in thousands):

The following table presents the net book value of the Company’s loans held-for-investment portfolio as of March 31, 2023 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 September 30, 2022

As of March 31, 2023

Number of Loans 2023 2022 2021 2020 2019 Total

6 unchanged sentences

Total first mortgage loans 28 — 1,247,879 1,740,757 160,506 49,509 3,198,651

Liquid senior loans by internal risk rating:

Liquid corporate senior loans by internal risk rating:

1 — — — — — — —

3 unchanged sentences

— 2,919 — — — 2,919

Total liquid senior loans 313 135,768 338,755 228,210 3,017 705,750

Total liquid corporate senior loans 315 17,033 133,397 377,890 173,229 2,317 703,866

Corporate senior loans by internal risk rating:

11 unchanged sentences

Origination dates are subsequently updated to reflect material loan modifications.

(2) As of March 31, 2023, 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.

1 unchanged sentence

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

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

As of March 31, 2023, the Company had two non-designated interest rate cap agreements.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

Outstanding Notional Fair Value of Assets (Liabilities) as of

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

Location September 30, 2022 Rates (1)

Dates Dates 2022 2021

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

March 31, 2023 (Unaudited) – (Continued)

The following table summarizes the terms of the Company’s interest rate cap agreements as of March 31, 2023 and December 31, 2022 (dollar amounts in thousands):

Outstanding Notional Fair Value of Assets as of

Balance Sheet Amount as of Strike Effective Maturity March 31, December 31,

Location March 31, 2023 Rates Dates Dates 2023 2022

Interest Rate Caps Derivative assets, prepaid expenses and other assets $ 712,000 3.50 % (1) to

7/15/2021 to 9/13/2022

1 unchanged sentence

$ 3,080 $ 5,040

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

____________________________________

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

(1) The index used for this derivative instrument is 1-Month LIBOR.

(2) The index used for this derivative instrument is 1-Month Term SOFR.

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

2 unchanged sentences

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 condensed consolidated statements of operations.

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

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

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

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

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

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

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

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

Interest rate swaps are designated as cash flow hedges in order to hedge the variability of the anticipated cash flows on the Company’s variable rate debt.

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

During the year ended December 31, 2022, two of the Company’s interest rate swap agreements matured and three interest rate swap agreements were terminated prior to the maturity dates.

For the three months ended March 31, 2023, no amounts were reclassified from other comprehensive loss as a change to interest expense.

For the three months ended March 31, 2022, the amount of gain reclassified from other comprehensive loss as a decrease to interest expense was $ 7,000 .

The total unrealized gain on interest rate swaps of $ 1.6 million as of March 31, 2022 is included in accumulated other comprehensive loss in the accompanying condensed consolidated statements of stockholders’ equity.

No such unrealized amounts on interest rate swaps were remaining in other comprehensive loss as of March 31, 2023.

The Company includes cash flows from interest rate swap agreements in net cash flows provided by operating activities on its condensed 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 condensed consolidated statements of cash flows as the category for cash flows from the hedged items.

4 unchanged sentences

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 September 30, 2022.

NOTE 10 — REPURCHASE FACILITIES, CREDIT FACILITIES AND NOTES PAYABLE

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

There were no events of default related to the derivative instruments as of March 31, 2023.

NOTE 10 — REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES

As of March 31, 2023, the Company had $ 4.0 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 5.9 %.

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

2 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

During the Nine Months Ended September 30, 2022

March 31, 2023 (Unaudited) – (Continued)

The following table summarizes the debt balances as of March 31, 2023 and December 31, 2022, and the debt activity for the three months ended March 31, 2023 (in thousands):

During the Three Months Ended March 31, 2023

Balance as of December 31, 2022 Debt Issuances & Assumptions (1)

Repayments & Modifications (2)

Accretion & (Amortization) Balance as of

September 30, 2022

Amortization Balance as of

March 31, 2023

Notes payable – fixed rate debt $ 36,538 $ — $ ( 36,538 )

9 unchanged sentences

Deferred costs – variable rate debt ( 5,261 ) ( 40 ) 602 (4)

488 ( 4,211 )

Deferred costs – ABS mortgage notes ( 13,968 ) ( 493 ) — 477 ( 13,984 )

2 unchanged sentences

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

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

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

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

(2) In connection with the repayment of certain mortgage notes and the termination of the CMFT Credit Facility, the Company recognized a loss on extinguishment of debt of $ 3.6 million during the three months ended March 31, 2023, which included $ 1.3 million in prepayment penalties.

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

(4) In connection with the repayment of certain mortgage notes and the termination of the CMFT Credit Facility, the Company wrote off approximately $ 2.0 million of unamortized deferred loan costs.

Notes Payable

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

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

The fixed rate debt outstanding matures on various dates from 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 $ 59.4 million as of September 30, 2022.

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

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

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

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

During the three months ended March 31, 2023, the Company legally defeased a mortgage loan with an outstanding balance of $ 23.7 million, resulting in a $ 205,000 loss on extinguishment of debt in the Company’s condensed consolidated statement of operations during the three months ended March 31, 2023, and repaid the remaining $ 12.8 million of fixed rate debt outstanding, both in connection with the disposition of the underlying properties securing the fixed rate debt.

As of March 31, 2023, the Company had $ 461.1 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”).

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

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

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

As of March 31, 2023, the amount outstanding on the refinanced Assumed Variable Rate Debt totaled $ 37.6 million.

The Company’s outstanding variable rate debt had a weighted average interest rate of 7.2 % as of March 31, 2023, and matures on various dates from October 2024 to January 2028.

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

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

During the three months ended March 31, 2023, the Company paid down the $ 121.9 million outstanding balance on the Mortgage Loan, $ 105.8 million of which was in connection with the sale of properties pursuant to the Realty Income Purchase and Sale Agreement.

Refer to Note 4 — Real Estate Assets for additional information regarding the sale.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

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

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

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

March 31, 2023 (Unaudited) – (Continued)

ABS Mortgage Notes

11 unchanged sentences

The aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the Class A Notes was $ 963.8 million.

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

As of March 31, 2023, amounts outstanding on the Class A Notes totaled $ 761.1 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 1.375 % at an adjusted leverage ratio greater than 3.50 :1.00.

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

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

The Company and certain subsidiaries of the Company

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

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

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

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

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

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

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

During the three months ended March 31, 2023, CMFT CL Lending Sub AB, LLC (the “Borrower”), an indirect wholly owned subsidiary of the Company, entered into a revolving loan and security agreement (the “Loan and Security Agreement”) with each of the lenders from time to time party thereto (the “Lenders”), Ally Bank as administrative agent and arranger (“Ally Bank”), U.S.

Bank Trust Company, National Association, as the collateral custodian, and U.S.

Bank National Association as the document custodian, which provides for borrowings in an aggregate principal amount up to $ 300.0 million (the “Loan Facility”), which may be increased during the revolving period (as defined below) to an aggregate principal amount up to $ 500.0 million as agreed to by the Borrower, any applicable Lender and Ally Bank.

Borrowings under the Loan and Security Agreement will bear interest equal to SOFR for the relevant interest period, plus an applicable rate.

The applicable rate is 2.875 % per annum (and an additional 2.00 % per annum following an event of default under the Loan and Security Agreement).

The revolving period begins on February 10, 2023 and concludes on the day preceding the earlier to occur of (i) the scheduled revolving period end date of February 10, 2026, (ii) the date of the declaration of the revolving period end date upon the occurrence and continuation of an event of default, and (iii) the termination date.

The termination date is the earlier to occur of (i) February 10, 2028 (two years after the revolving period end date) and (ii) the date of the declaration of the termination date or the date of the automatic occurrence of the termination date upon the occurrence and continuation of an event of default.

As of March 31, 2023, no amounts were borrowed and outstanding under the Loan Facility.

The Company had a 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, that provided for borrowings in the initial amount of $ 300.0 million (the “CMFT Credit Facility”).

The CMFT Credit Facility was set to mature on July 15, 2025.

During the three months ended March 31, 2023, the Company paid down the $ 240.0 million outstanding balance under the CMFT Credit Facility and terminated the CMFT 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 Third Amended Credit and Security Agreement provides for available borrowings under the revolving credit

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

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

As of March 31, 2023, the amounts borrowed and outstanding under the Credit Securities Revolver totaled $ 533.5 million at a weighted average interest rate of 7.0 %.

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 reinvestment period began on December 31, 2019 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 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 September 30, 2022.

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 March 31, 2023.

Repurchase Facilities

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

As of March 31, 2023, 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.

1 unchanged sentence

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

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

The following table is a summary of the Repurchase Facilities as of March 31, 2023 (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

Maximum Facility Size Weighted Average Interest Rate Loans Financed under Repurchase Facility (2)

Amount Financed

Citibank 6/4/2020 8/17/2024 $ 400,000 6.5 % (3)

10 unchanged sentences

__________________________________

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

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

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

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

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

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

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

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

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

(1) As of March 31, 2023, the repurchase facility with Citibank and Wells Fargo each have two one-year extension options remaining, the repurchase facility with Barclays has one one-year extension option remaining and the repurchase facility with Deutsche Bank has four one-year extension options remaining.

All repurchase facilities are subject to certain conditions set forth in their respective Repurchase Agreements.

(2) CRE mortgage loan balances financed under the Repurchase Facilities with Citibank, Barclays, Wells Fargo and Deutsche Bank reflect the aggregate outstanding principal balance while the CMBS balance financed under the J.P.

Morgan Repurchase Facility reflects fair value.

(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) 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,Wells Fargo or Deutsche Bank and the CMFT Lending Subs.

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

2 unchanged sentences

Such facilities carry no maximum facility size.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

(5) 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 September 30, 2022, ranges from 1.10 % to 1.35 %.

Morgan, which as of March 31, 2023, ranges from 0.95 % to 1.35 %.

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

7 unchanged sentences

and (iv) minimum interest coverage ratio of EBITDA (as defined in the Guaranties) to interest expense equal to or greater than 1.40 .

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

The Company believes it was in compliance with the financial covenants under the Repurchase Agreements as of March 31, 2023.

The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to March 31, 2023 (in thousands):

Principal Repayments

7 unchanged sentences

Unfunded Commitments

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

As of March 31, 2023, the Company had $ 292.7 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 condensed consolidated balance sheet.

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

As of March 31, 2023, the Company had $ 18.0 million of unsettled liquid corporate senior loan acquisitions, $ 13.0 million of which settled subsequent to March 31, 2023.

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

Environmental Matters

7 unchanged sentences

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.

On March 24, 2023, the Company and CMFT Management entered into the second amended and restated management agreement (the “Management Agreement”), which amended and restated the amended and restated management agreement between the parties dated August 20, 2019.

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).

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

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, is registered as an investment advisor under the Investment Advisers Act of 1940, as amended (the “Advisers Act”).

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.

4 unchanged sentences

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.

The Sub-Advisor may allocate a portion of these corporate credit-related securities to its other clients, including affiliates of CIM Group.

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 the 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 incentive compensation paid to CMFT Management with respect to the first three calendar quarters of such previous 12-month period (or such lesser number of completed calendar quarters preceding the applicable period, if applicable).

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

During the three months ended March 31, 2023 and 2022, no incentive compensation fees were incurred.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

In addition, the Investment Advisor is eligible to receive a portion of the incentive compensation payable to CMFT Management pursuant to the Management Agreement.

4 unchanged sentences

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

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

2022 2021 2022 2021

Three Months Ended March 31,

Management fees $ 12,579 $ 13,347

Expense reimbursements to related parties $ 3,568 $ 3,694

$ 3,428 $ 2,516 $ 10,899

____________________________________

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

Due to Affiliates

Of the amounts shown above, $ 14.6 million and $ 15.1 million had been incurred, but not yet paid, for services provided by CMFT Management or its affiliates in connection with the management and operating activities during the nine months ended September 30, 2022 and 2021, respectively, and such amounts were recorded as liabilities of the Company as of such dates.

Of the amounts shown above, $ 13.8 million and $ 16.1 million had been incurred, but not yet paid, for services provided by CMFT Management or its affiliates in connection with the management and operating activities during the three months ended March 31, 2023 and 2022, respectively, and such amounts were recorded as liabilities of the Company as of such dates.

Development Management Agreements

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

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

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 Development Management Agreement, subject to the conditions in each respective Development Management Agreement.

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

During the three months ended March 31, 2023 and 2022, the Company recorded $ 76,000 and $ 130,000 , 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.

1 unchanged sentence

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 fund that is advised by affiliates of CMFT Management (“CIM RACR”).

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

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

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

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

The Company 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 of March 31, 2023, $ 203.6 million of the first mortgage loan was outstanding.

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

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

In November 2021, the Company entered into the Unconsolidated Joint Venture (the “MT-FT JV”) with CMMT Holdings, LLC, a fund that is advised by an affiliate of CMFT Management, 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 $ 133.0 million has been funded.

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

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

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

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 nine months ended September 30, 2022.

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

As of March 31, 2023, $ 123.0 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 that 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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

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

March 31, 2023 (Unaudited) – (Continued)

$ 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.

As of March 31, 2023, $ 154.0 million of the first mortgage loan was outstanding.

In April 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 March 31, 2023, $ 145.5 million of the first mortgage loan was outstanding.

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.

During the three months ended March 31, 2023, 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, during the three months ended March 31, 2023.

As of March 31, 2023, $ 74.9 million of the corporate senior loans was outstanding.

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

Subsequent to March 31, 2023, the Company and CIM RACR co-invested $ 34.1 million and $ 6.0 million, respectively, in two corporate senior loans to a third-party.

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

NOTE 13 — ECONOMIC DEPENDENCY

9 unchanged sentences

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

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

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 March 31, 2023.

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

1 unchanged sentence

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

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

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

As of March 31, 2023, 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 March 31, 2023, 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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

March 31, 2023.

The fair value of the Company’s share awards is determined using the Company’s per share NAV on the date of grant.

Compensation expense related to the restricted shares is recognized over the vesting period.

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

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

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

The restricted shares will vest on October 1, 2023.

The Company recorded compensation expense of $ 120,000 and $ 37,000 for the three months ended March 31, 2023 and 2022, respectively, related to the restricted shares, which is included in general and administrative expenses in the accompanying condensed consolidated statements of operations.

As of March 31, 2023, there was $ 240,000 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 15 — LEASES

5 unchanged sentences

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

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

As of March 31, 2023, the Company’s leases had a weighted-average remaining term of 11.3 years.

Certain leases include provisions to extend the lease agreements, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other negotiated terms and conditions.

1 unchanged sentence

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

As of September 30, 2022, the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, was as follows (in thousands):

As of March 31, 2023, the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, was as follows (in thousands):

Future Minimum Rental Income

4 unchanged sentences

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

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

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

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

2022 2021 2022 2021

For the three months ended March 31, 2023 and 2022, the amount of the contingent rent earned by the Company was not significant .

Rental and other property income during the three months ended March 31, 2023 and 2022 consisted of the following (in thousands):

Three Months Ended March 31,

Fixed rental and other property income (1)

1 unchanged sentence

Variable rental and other property income (2)

2,684 10,763 17,281 32,394

Total rental and other property income $ 38,781 $ 73,736

2 unchanged sentences

(2) Consists primarily of tenant reimbursements for recoverable real estate taxes and property operating expenses, and percentage rent.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2023 (Unaudited) – (Continued)

The Company has one property subject to a non-cancelable operating ground lease with a remaining term of 10.4 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 condensed consolidated balance sheets.

1 unchanged sentence

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

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

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

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

The Company recognized $ 63,000 of ground lease expense during the three months ended March 31, 2023, of which $ 61,000 was paid in cash during the period it was recognized.

As of March 31, 2023, the Company’s scheduled future minimum rental payments related to its operating ground lease is approximately $ 187,000 for the remainder of 2023, $ 250,000 annually for 2024 through 2028, and $ 1.2 million thereafter through the maturity date of the lease in August 2033.

NOTE 16 — SEGMENT REPORTING

The Company 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.

Credit and Real Estate.

Corporate/other represents all corporate level and unallocated items and includes the Company’s other asset management activities and 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 three and nine months ended September 30, 2022 and 2021 (in thousands):

The following tables present segment reporting for the three months ended March 31, 2023 and 2022 (in thousands):

Real Estate Credit Corporate/Other (1)

Company Total

Three Months Ended September 30, 2022

Three Months Ended March 31, 2023

Rental and other property income $ 38,715 $ — $ 66 $ 38,781

2 unchanged sentences

General and administrative 74 372 2,852 3,298

Interest expense, net 8,151 54,016 4,067 66,234

Property operating 1,684 — 892 2,576

6 unchanged sentences

Increase in provision for credit losses — 1,453 — 1,453

Total operating expenses 26,035 13,807 9,309 49,151

Gain (loss) on disposition of real estate and condominium developments, net 4,604 — ( 150 ) 4,454

Operating income (loss) 22,034 52,415 ( 9,365 ) 65,084

Other expense:

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

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

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

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

Total expenses 33,521 65,170 11,771 110,462

Other income (expense):

Gain on disposition of real estate and condominium developments, net 19,563 — 60 19,623

Loss on investment in unconsolidated entities — ( 770 ) — ( 770 )

Unrealized gain on equity security — 2,258 — 2,258

Other (expense) income, net ( 1,842 ) 1,843 323 324

Loss on extinguishment of debt ( 1,172 ) — ( 2,473 ) ( 3,645 )

Segment net income (loss) $ 21,743 $ 46,244 $ ( 13,795 ) $ 54,192

1 unchanged sentence

Segment net income (loss) attributable to the Company $ 21,735 $ 46,244 $ ( 13,795 ) $ 54,184

Total assets as of September 30, 2022

Total assets as of March 31, 2023

$ 1,315,426 $ 4,725,168 $ 604,932 $ 6,645,526

3 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

March 31, 2023 (Unaudited) – (Continued)

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

Company Total

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2022

Rental and other property income

6 unchanged sentences

149 230 3,096 3,475

Interest expense, net 15,078 11,612 3,306 29,996

Property operating

9 unchanged sentences

Increase in provision for credit losses — 4,709 — 4,709

Total operating expenses

106,736 37,998 34,001 178,735

Total expenses 58,283 22,767 11,050 92,100

Other income (expense):

Gain on disposition of real estate and condominium developments, net 29,265 — 3,309 32,574

Operating income (loss)

178,823 104,671 ( 30,622 ) 252,872

Other expense:

Gain on investment in unconsolidated entities — 168 5,172 5,340

Unrealized (loss) gain on equity security — ( 2,368 ) 22 ( 2,346 )

Interest expense and other, net

( 27,527 ) ( 61,332 ) ( 9,594 ) ( 98,453 )

Other income, net 1,239 66 — 1,305

Loss on extinguishment of debt ( 10,737 ) — ( 134 ) ( 10,871 )

( 18,609 ) — ( 975 ) ( 19,584 )

Segment net income (loss)

2 unchanged sentences

Segment net income (loss) attributable to the Company $ 35,114 $ 6,562 $ ( 2,584 ) $ 39,092

Total assets as of September 30, 2022

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

__________________________________

(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.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

Real Estate Credit Corporate/Other (1)

Company Total

Three Months Ended September 30, 2021

Rental and other property income

$ 70,694 $ — $ 100 $ 70,794

Interest income

— 19,755 — 19,755

Total revenues

70,694 19,755 100 90,549

General and administrative

86 265 2,725 3,076

Property operating

7,555 — 3,602 11,157

Real estate tax

7,325 — 266 7,591

Expense reimbursements to related parties — — 2,516 2,516

Management fees 8,713 2,990 — 11,703

Transaction-related

Depreciation and amortization

22,801 — — 22,801

Real estate impairment 891 — — 891

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

Total operating expenses

47,377 1,463 9,109 57,949

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

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

Operating income (loss)

53,974 18,292 ( 6,031 ) 66,235

Other expense:

Interest expense and other, net

( 12,820 ) ( 5,117 ) ( 2,444 ) ( 20,381 )

Loss on extinguishment of debt ( 249 ) — ( 3,002 ) ( 3,251 )

Segment net income (loss)

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

Total assets as of September 30, 2021

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

__________________________________

(1) Includes condominium and rental units acquired via foreclosure during the year ended December 31, 2021.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

Real Estate Credit Corporate/Other (1)

Company Total

Nine Months Ended September 30, 2021

Rental and other property income

$ 222,691 $ — $ 335 $ 223,026

Interest income

— 48,168 — 48,168

Total revenues

222,691 48,168 335 271,194

General and administrative

204 978 9,927 11,109

Property operating

22,297 — 10,335 32,632

Real estate tax

22,390 — 5,126 27,516

Expense reimbursements to related parties — — 8,387 8,387

Management fees 26,577 8,458 — 35,035

Transaction-related

Depreciation and amortization

73,186 — — 73,186

Real estate impairment 5,268 — — 5,268

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

Total operating expenses

149,959 8,335 33,775 192,069

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

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

Operating income (loss)

148,365 39,833 ( 28,969 ) 159,229

Other expense:

Interest expense and other, net

( 20,649 ) ( 12,005 ) ( 24,209 ) ( 56,863 )

Loss on extinguishment of debt ( 1,621 ) — ( 3,108 ) ( 4,729 )

Segment net income (loss)

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

Total assets as of September 30, 2021

Total assets as of March 31, 2022

$ 2,919,412 $ 3,767,306 $ 281,702 $ 6,968,420

1 unchanged sentence

(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, L.P.

(“CIM UII Onshore”).

NOTE 17 — SUBSEQUENT EVENTS

Redemptions of Shares of Common Stock

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

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

Subsequent to March 31, 2023, the Company redeemed approximately 1.6 million shares for $ 10.8 million (at a redemption price of $ 6.57 per share).

The remaining redemption requests received during the three months ended March 31, 2023 totaling approximately 23.9 million shares went unfulfilled.

Investment and Disposition Activity

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

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

• Purchased $ 55.0 million in CMBS.

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

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

Subsequent to March 31, 2023, the Company’s investment and disposition activity included the following:

• Sold 27 of the properties under contract for sale pursuant to the Realty Income Purchase and Sale Agreement for total consideration of $ 82.1 million and a gain of approximately $ 12.8 million.

CIM REAL ESTATE FINANCE TRUST, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2022 (Unaudited) – (Continued)

March 31, 2023 (Unaudited) – (Continued)

• In addition to the properties disposed of pursuant to the Realty Income Purchase and Sale Agreement, the Company disposed of two properties and condominium units for an aggregate gross sales price of $ 25.4 million, resulting in net proceeds of $ 23.9 million after closing costs and a net gain of approximately $ 7.6 million.

• Purchased $ 63.5 million in CMBS.

• Settled $ 13.0 million of liquid senior loan purchases, all of which were traded as of March 31, 2023, and sold $ 5.8 million of liquid senior loans.

• Invested $ 44.1 million in three corporate senior loans to a third-party.

• Funded an aggregate amount of $ 4.9 million to six of the Company’s first mortgage loans.

Financing Activity

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

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

• Borrowed $ 35.0 million under the CMFT Credit Facility.

Subsequent to March 31, 2023, the Company’s financing activity included the following:

• Financed CMBS under the J.P.

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

Morgan Repurchase Facility for $ 36.2 million and repaid $ 551,000 of borrowings under the J.P.

Morgan Repurchase Facility.

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

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

• Repaid $ 88.0 million of borrowings under the Credit Securities Revolver.

• Repaid $ 5.0 million of borrowings under the Deutsche Bank Repurchase Facility.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements