Pacific Oak Strategic Opportunity REIT, Inc.

Pacific Oak Strategic Opportunity REIT, Inc. announced a significant overhaul of its leadership. Bradley E. Scher was appointed as Chairman of the Board, director, President, and Chief Executive Officer, effective June 18, 2026. This follows the immediate resignations of four directors on June 15, 2026, and Kenneth Yee's resignation on June 18, 2026. Additionally, CFO Brian Ragsdale's contract will not be renewed, with his termination effective August 11, 2026.

Pacific Oak Strategic Opportunity REIT, Inc. announced that an Israeli court approved a debt arrangement for its indirect wholly-owned subsidiary, Pacific Oak SOR (BVI) Holdings, Ltd., on June 5, 2026. This arrangement restructures the maturity, interest rate, security, and enforcement terms for the BVI's Series B and Series D bonds, with a final maturity date of June 30, 2028. The bonds will bear interest at 11.5% annually from the Completion Date, and the BVI will be subject to significant covenants, operational limitations, and a minimum liquidity reserve requirement.

Pacific Oak Strategic Opportunity REIT, Inc.'s subsidiary, Pacific Oak SOR (BVI) Holdings, Ltd., disclosed significant financial challenges in its interim financial statements. The company reported a substantial working capital shortfall of $590.9 million as of March 31, 2026, driven by maturing debt obligations including Series B and D bonds, and various mortgage loans. Negotiations with bondholders have resulted in payment deferrals, and a proposed debt arrangement is underway to extend maturities to June 2028. The company's ability to continue as a going concern is in doubt, and it faces a class action lawsuit in Israel.

Pacific Oak Strategic Opportunity REIT, Inc. announced that its indirect subsidiaries received demand letters from Whitehawk Capital Partners, LP, alleging events of default under a Credit Agreement and demanding immediate payment of all obligations, totaling an aggregate principal amount of $80,000,000 plus accrued default interest and an exit fee. Whitehawk claims two events of default occurred in August and December 2025, leading to the acceleration of obligations by February 8, 2026. Whitehawk also filed a lawsuit on May 19, 2026, seeking to enjoin subsidiaries from impairing collateral property in North Las Vegas, Nevada. The Company's legal counsel is reviewing Whitehawk's assertions and claims, reserving all rights and defenses.

Pacific Oak Strategic Opportunity REIT, Inc. subsidiaries secured a new loan agreement for up to $216 million, fully funded on May 8, 2026. The loan, bearing interest at one-month SOFR plus 4.75% (7.75% floor), replaces existing financing and provides working capital, including a $10 million interest reserve. The company also amended agreements with Brian Ragsdale and R2 Advisors, LLC to reduce costs and enhance flexibility, with R2 Advisors' monthly fee set at $10,000.

Pacific Oak Strategic Opportunity REIT, Inc. has filed an exhibit containing the table of contents for the 2025 Annual Report of its subsidiary, Pacific Oak SOR (BVI) Holdings, Ltd. The report provides a comprehensive overview of the company's business development, financial information, and operational details across its income-producing property and hotel sectors. It includes asset valuations for key properties such as Oakland City Center, The Marq, and 110 William St.