Pacific Oak previously expressed “substantial doubt” about its ability to continue as a going concern, according to its latest quarterly report on Form 10-Q filed with the U.S. Securities and Exchange Commission (“SEC”) for the quarter ended June 30, 2025.  Also earlier this year, Pacific Oak’s longtime Chief Financial Officer, Michael A. Bender, resigned.

In a more recent SEC filing in November 2025, Pacific Oak described a “difficult financial situation” and reported operating losses of $117.2 million on sales of only $26.56 million.  Pacific Oak also announced that it has initiated a formal review of strategic alternatives. The REIT has significant major debt maturities in the next year, meaning that a large portion of its loans have come due and will have to either be refinanced or paid off.  According to recent reports, Pacific Oak faces more than $512.8 million in debt obligations coming due within the next year, including debts related to bond that it issued that were denominated in Israel shekels.

Pacific Oak has also publicly stated that in October 2025, its Board of Directors formed a special committee of independent directors to evaluate all available strategic options- which could include a merger, recapitalization, listing on a stock exchange, or liquidation.  Pacific Oak has retained investment banking firm Robert A. Stanger & Company Inc. to advise on the process.  

Non-traded REITs like Pacific Oak are generally illiquid investments.  Unlike traditional stocks and mutual funds, non-traded REITs do not trade on a national securities exchange.  Many uninitiated investors in non-traded REITs have come to learn too late that their ability to exit their investment position is limited.  Typically, investors in non-traded REITs can only exit their investment through redemption directly with the sponsor on a limited basis, and often at a disadvantageous price, or through sales in a limited secondary market.   As of April 2025, Pacific Oak’s net asset value or “NAV” per share was reported at $5.72, down from $8.03 in September 2023 and $10.50 in September 2022. This NAV reflects a 23.5% decline from 2022 to 2023 and a further slide into 2025. In online secondary market platform trading, shares have reportedly been traded as low as between $0.48 and $0.75 per share.

Investors who wish to discuss a possible claim concerning Pacific Oak or another alternative investment may contact a securities arbitration lawyer at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or via email at newcases@investorlawyers.net for a no-cost, confidential consultation.  Attorneys at the firm are admitted in New York, Wisconsin and various federal courts around the country, and handle cases nationwide (in cooperation with attorneys located in those states if required by applicable rules). 

This article is intended as ATTORNEY ADVERTISING and is not an official announcement.

In March, KBS REIT I investors were notified that the investment’s value would drop from $7.32 to $5.16 per share, representing a 29 percent decline in value. The investment’s offering price was $10 per share. Furthermore, KBS also stated it would cease distributions to investors. An investor presentation filed with the SEC in March stated that KBS REIT I raised $1.7 billion in equity during its initial offering. The investment holds loans and other debt of $2.3 billion and property assets of $3.4 billion.

Financial Industry Regulatory Authority rules have established that brokers and firms have an obligation to fully disclose all the risks of a given investment when making recommendations, and those recommendations must be suitable for the individual investor receiving the recommendation given their age, investment objectives and risk tolerance. Non-traded REITs are illiquid and inherently risky and, therefore, not suitable for many investors. According to securities fraud attorneys, because of the high-commissions these investments generally offer, many brokers make unsuitable recommendations of REITs to investors. Based on information now known about KBS REIT, many of the firms that sold this investment will be unable to prove the adequate due diligence was performed before recommending this product to investors.

According to securities arbitration lawyers, investors should not be discouraged by the fact that the class action lawsuit against KBS has been withdrawn. Investors can still recover losses through Financial Industry Regulatory Authority arbitration.

If you have suffered significant losses as a result of your investment in the KBS REIT, you may have a valid securities arbitration claim. To find out more about your legal rights and options, contact a securities fraud attorney at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.