KBS Real Estate Investment Trust II (KBRS) 10-Q 13 Nov 20 2020 Q3 Quarterly report Financial data

Cover Page

Cover Page - shares	9 Months Ended
	Sep. 30, 2020	Nov. 09, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2020
Document Transition Report	false
Entity File Number	000-53649
Entity Registrant Name	KBS REAL ESTATE INVESTMENT TRUST II, INC.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	26-0658752
Entity Address, Address Line One	800 Newport Center Drive, Suite 700
Entity Address, City or Town	Newport Beach,
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92660
City Area Code	949
Local Phone Number	417-6500
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		184,500,265
Entity Central Index Key	0001411059
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Amendment Flag	false

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENT OF NET ASSETS $ in Thousands	Sep. 30, 2020USD ($)
Assets
Real estate	$ 767,850
Cash and cash equivalents	55,017
Rents and other receivables	618
Other assets, net	718
Total assets	824,203
Liabilities
Liabilities for estimated costs in excess of estimated receipts during liquidation	109,955
Notes payable	240,520
Accounts payable and accrued liabilities	8,264
Due to affiliate	35
Liabilities for estimated closing costs and disposition fees	17,798
Other liabilities	2,574
Total liabilities	379,146
Commitments and contingencies (Note 9)
Net assets in liquidation	$ 445,057

CONSOLIDATED BALANCE SHEET

CONSOLIDATED BALANCE SHEET $ in Thousands	Dec. 31, 2019USD ($)
Real estate:
Land	$ 118,955
Buildings and improvements	590,950
Tenant origination and absorption costs	28,025
Total real estate held for investment, cost	737,930
Less accumulated depreciation and amortization	(141,323)
Total real estate held for investment, net	596,607
Real estate held for sale, net	270,124
Total real estate, net	866,731
Cash and cash equivalents	31,674
Restricted cash	15,208
Rents and other receivables, net	82,470
Above-market leases, net	150
Assets related to real estate held for sale	39,975
Prepaid expenses and other assets	22,841
Total assets	1,059,049
Notes payable:
Notes payable, net	300,780
Notes payable related to real estate held for sale, net	115,827
Total notes payable, net	416,607
Accounts payable and accrued liabilities	68,539
Due to affiliate	59
Below-market leases, net	164
Liabilities related to real estate held for sale	10,012
Other liabilities	16,445
Total liabilities	511,826
Commitments and contingencies (Note 9)
Redeemable common stock	10,000
Stockholders’ equity:
Preferred stock, $.01 par value; 10,000,000 shares authorized, no shares issued and outstanding	0
Common stock, $.01 par value; 1,000,000,000 shares authorized, 185,302,037 shares issued and outstanding as of December 31, 2019	1,853
Additional paid-in capital	1,662,555
Cumulative distributions in excess of net income	(1,127,185)
Total stockholders’ equity	537,223
Total liabilities and stockholders’ equity	$ 1,059,049

CONSOLIDATED BALANCE SHEET (Par

CONSOLIDATED BALANCE SHEET (Parenthetical)	Dec. 31, 2019$ / sharesshares
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share) | $ / shares	$ 0.01
Preferred stock, shares authorized (in shares)	10,000,000
Preferred stock, shares issued (in shares)	0
Preferred stock, shares outstanding (in shares)	0
Common stock, par value (in dollars per share) | $ / shares	$ 0.01
Common stock, shares authorized (in shares)	1,000,000,000
Common stock, shares issued (in shares)	185,302,037
Common stock, shares outstanding (in shares)	185,302,037

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS $ in Thousands	8 Months Ended
	Sep. 30, 2020USD ($)
Changes in Net Assets in Liquidation [Roll Forward]
Net assets in liquidation, beginning of period	$ 704,404
Changes in net assets in liquidation
Change in liquidation value of real estate properties after closing costs/disposition fees	(71,210)
Change in estimated cash flow during liquidation	2,110
Change in estimated capital expenditures	(3,123)
Redemptions	(1,899)
Other changes, net	(171)
Net decrease in liquidation value	(74,293)
Liquidating distribution to stockholders	(185,054)
Changes in net assets in liquidation	(259,347)
Net assets in liquidation, end of period	$ 445,057

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	9 Months Ended
	Jan. 31, 2020	Sep. 30, 2019	Sep. 30, 2019
Revenues:
Rental income	$ 8,107	$ 24,943	$ 78,619
Other operating income	483	1,480	5,359
Total revenues	8,590	26,423	83,978
Expenses:
Operating, maintenance, and management	2,233	7,991	25,867
Real estate taxes and insurance	1,336	4,294	13,959
Asset management fees to affiliate	751	2,469	7,707
General and administrative expenses	422	1,342	4,204
Depreciation and amortization	2,586	11,050	33,053
Interest expense	1,159	4,418	13,262
Impairment charges on real estate	0	14,300	14,300
Total expenses	8,487	45,864	112,352
Other income (loss):
Other interest income	93	114	477
Loss from extinguishment of debt	(87)	(165)	(471)
Gain on sale of real estate, net	1,935	0	30,754
Total other income (loss)	1,941	(51)	30,760
Net income (loss)	$ 2,044	$ (19,492)	$ 2,386
Net income (loss) per common share, basic and diluted (in dollars per share)	$ 0.01	$ (0.10)	$ 0.01
Weighted-average number of common shares outstanding, basic and diluted (in shares)	185,299,655	185,770,646	186,064,468

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Cumulative Distributions and Net Income (Loss)
Balance (in shares) at Dec. 31, 2018		186,464,794
Balance at Dec. 31, 2018	$ 661,474	$ 1,865	$ 1,667,897	$ (1,008,288)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	2,386			2,386
Redemptions of common stock (in shares)		(913,358)
Redemptions of common stock	(4,345)	$ (9)	(4,336)
Transfers from redeemable common stock	4,345		4,345
Distributions declared	(117,169)			(117,169)
Balance (in shares) at Sep. 30, 2019		185,551,436
Balance at Sep. 30, 2019	546,691	$ 1,856	1,667,906	(1,123,071)
Balance (in shares) at Jun. 30, 2019		185,871,023
Balance at Jun. 30, 2019	576,633	$ 1,859	1,667,903	(1,093,129)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(19,492)			(19,492)
Redemptions of common stock (in shares)		(319,587)
Redemptions of common stock	(1,438)	$ (3)	(1,435)
Transfers from redeemable common stock	1,438		1,438
Distributions declared	(10,450)			(10,450)
Balance (in shares) at Sep. 30, 2019		185,551,436
Balance at Sep. 30, 2019	$ 546,691	$ 1,856	1,667,906	(1,123,071)
Balance (in shares) at Dec. 31, 2019	185,302,037	185,302,037
Balance at Dec. 31, 2019	$ 537,223	$ 1,853	1,662,555	(1,127,185)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	2,044			2,044
Redemptions of common stock (in shares)		(73,817)
Redemptions of common stock	(280)	$ (1)	(279)
Transfers from redeemable common stock	280		280
Balance (in shares) at Jan. 31, 2020		185,228,220
Balance at Jan. 31, 2020	$ 539,267	$ 1,852	$ 1,662,556	$ (1,125,141)

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	9 Months Ended
	Jan. 31, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Cash Flows from Operating Activities:
Net income (loss)	$ 2,044	$ (19,492)		$ 2,386
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization	2,586	11,050		33,053
Impairment charges on real estate	0	14,300	$ 0	14,300
Deferred rent	(638)			2,761
Amortization of above- and below-market leases, net	(3)			(65)
Amortization of deferred financing costs	115	400		1,169
Loss from extinguishment of debt	87	165		471
Gain on sale of real estate, net	(1,935)	0		(30,754)
Changes in operating assets and liabilities:
Rents and other receivables	(515)			(14,841)
Prepaid expenses and other assets	(1,995)			(13,469)
Accounts payable and accrued liabilities	(894)			18,574
Due to affiliate	32			47
Other liabilities	(6,264)			(2,685)
Net cash (used in) provided by operating activities	(7,380)			10,947
Cash Flows from Investing Activities:
Proceeds from sale of real estate	302,028			130,285
Improvements to real estate	(2,684)			(30,943)
Net cash provided by investing activities	299,344			99,342
Cash Flows from Financing Activities:
Proceeds from note payable	0			134,350
Principal payments on notes payable	(176,687)			(133,681)
Payments of deferred financing costs	0			(924)
Payments to redeem common stock	(280)			(4,345)
Distributions paid to common stockholders	0			(117,562)
Net cash used in financing activities	(176,967)			(122,162)
Net increase (decrease) in cash and cash equivalents and restricted cash	114,997			(11,873)
Cash and cash equivalents and restricted cash, beginning of period	46,882		$ 46,882	75,687
Cash and cash equivalents and restricted cash, end of period	161,879	$ 63,814		63,814
Supplemental Disclosure of Cash Flow Information:
Interest paid	1,246			12,131
Supplemental Disclosure of Noncash Transactions:
Accrued improvements to real estate	6,610			6,748
Distributions payable	$ 0			$ 3,481

ORGANIZATION

ORGANIZATION	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION	ORGANIZATION KBS Real Estate Investment Trust II, Inc. (the “Company”) was formed on July 12, 2007 as a Maryland corporation that elected to be taxed as a real estate investment trust (“REIT”) beginning with the taxable year ended December 31, 2008. The Company conducts its business primarily through KBS Limited Partnership II, a Delaware limited partnership formed on August 23, 2007 (the “Operating Partnership”), and its subsidiaries. The Company is the sole general partner of and directly owns a 0.1% partnership interest in the Operating Partnership. The Company’s wholly-owned subsidiary, KBS REIT Holdings II LLC, a Delaware limited liability company formed on August 23, 2007 (“KBS REIT Holdings II”), owns the remaining 99.9% partnership interest in the Operating Partnership and is its sole limited partner. As of September 30, 2020, the Company owned four office properties and an office campus consisting of two office buildings. Subject to certain restrictions and limitations, the business of the Company is managed by KBS Capital Advisors LLC (the “Advisor”), an affiliate of the Company, pursuant to an advisory agreement the Company entered into with the Advisor (the “Advisory Agreement”). The Advisory Agreement is effective through May 21, 2021 and may be renewed for an unlimited number of one As of September 30, 2020, the Company had 184,545,636 shares of common stock issued and outstanding. On November 13, 2019, in connection with a review of potential strategic alternatives available to the Company, a special committee composed of all of the Company’s independent directors (the “Special Committee”) and the board of directors unanimously approved the sale of all of the Company’s assets and the dissolution of the Company pursuant to the terms of the plan of complete liquidation and dissolution (the “Plan of Liquidation”). The principal purpose of the Plan of Liquidation is to provide liquidity to the Company’s stockholders by selling the Company’s assets, paying its debts and distributing the net proceeds from liquidation to the Company’s stockholders. On March 5, 2020, the Company’s stockholders approved the Plan of Liquidation. The Plan of Liquidation is included as an exhibit to this Quarterly Report on Form 10-Q. COVID-19 Pandemic One of the most significant risks and uncertainties facing the Company and the real estate industry generally continues to be the effect of the ongoing public health crisis of the novel coronavirus disease (“COVID-19”) pandemic. The Company continues to closely monitor the impact of the COVID-19 pandemic on all aspects of its business and its liquidation, including how the pandemic is affecting its tenants and the Company’s ability to sell its remaining real estate properties at the times and prices it expects. During the nine months ended September 30, 2020, the Company did not experience significant disruptions in its operations from the COVID-19 pandemic. The Company did decrease its real estate values by $71.2 million due to changes in leasing projections across its portfolio resulting in lower projected cash flow and projected sales prices caused by the impact of the COVID-19 pandemic. Many of the Company’s tenants have experienced disruptions in their business, some more severely than others. During the second and third quarters, the Company granted rent relief to four tenants as a result of the pandemic, but as the impact of the pandemic continues to be felt, these tenants or additional tenants may request rent relief in future periods or become unable to pay rent and therefore, the Company is unable to predict the ultimate impact the pandemic will have on its business and implementation of the Plan of Liquidation due to numerous uncertainties. The Company is evaluating each tenant rent relief request on an individual basis, considering a number of factors. Not all tenant requests will ultimately result in modified agreements, nor is the Company forgoing its contractual rights under its lease agreements. The extent to which the COVID-19 pandemic impacts the Company’s operations and those of its tenants and the Company’s implementation of the Plan of Liquidation depends on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others.

PLAN OF LIQUIDATION

PLAN OF LIQUIDATION	9 Months Ended
	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
PLAN OF LIQUIDATION	PLAN OF LIQUIDATION The Plan of Liquidation authorizes the Company to undertake an orderly liquidation. In an orderly liquidation, the Company will sell all of its remaining properties, pay all of its known liabilities, provide for the payment of its unknown or contingent liabilities, distribute its remaining cash to its stockholders, wind up its operations and dissolve. The Company is authorized to provide for the payment of any unascertained or contingent liabilities and may do so by purchasing insurance, by establishing a reserve fund or in other ways. The Plan of Liquidation enables the Company to sell any and all of its assets without further approval of its stockholders and provides that the amounts and timing of liquidating distributions will be determined by the Company’s board of directors or, if a liquidating trust is formed, by the trustees of the liquidating trust, in their discretion. Pursuant to applicable REIT rules, liquidating distributions the Company pays pursuant to the Plan of Liquidation will qualify for the dividends paid deduction, provided that they are paid within 24 months of the March 5, 2020 approval of the plan by the Company’s stockholders. However, if the Company cannot sell its properties and pay its debts within such time period, or if the board of directors and the Special Committee determine that it is otherwise advisable to do so, the Company may transfer and assign its remaining assets to a liquidating trust. Upon such transfer and assignment, the Company’s stockholders would receive beneficial interests in the liquidating trust. The liquidating trust would pay or provide for all of the Company’s liabilities and distribute any remaining net proceeds from liquidation to the holders of beneficial interests in the liquidating trust. If the Company is not able to sell its properties and pay its debt within the 24-month period and the remaining assets are not transferred to a liquidating trust, the distributions made during the 24 months may not qualify for the dividends paid deduction and may increase the Company’s tax liability. The Company’s expectations about the implementation of the Plan of Liquidation and the amount of any additional liquidating distributions that the Company pays to its stockholders and when the Company will pay them are subject to risks and uncertainties and are based on certain estimates and assumptions, one or more of which may prove to be incorrect. As a result, the actual amount of any additional liquidating distributions the Company pays to its stockholders may be more or less than the Company estimates and the liquidating distributions may be paid later than the Company predicts. There are many factors that may affect the amount of liquidating distributions the Company will ultimately pay to its stockholders. If the Company underestimates its existing obligations and liabilities or the amount of taxes, transaction fees and expenses relating to the liquidation and dissolution or if unanticipated or contingent liabilities arise, the amount of liquidating distributions ultimately paid to the Company’s stockholders could be less than estimated. Moreover, the liquidation value will fluctuate over time in response to developments related to individual assets in the Company’s portfolio and the management of those assets, in response to the real estate and finance markets, based on the amount of net proceeds received from the disposition of the remaining assets and due to other factors. In particular, the outbreak of COVID-19, together with the resulting measures imposed to help control the spread of the virus, including quarantines, “shelter in place” and “stay at home” orders, travel restrictions, restrictions on businesses and school closures, has had a negative impact on the economy and business activity globally. As of September 30, 2020, tenants in the mining and oil and gas extraction industry represented approximately 18% of the Company’s base rent. Tenants in this sector have been adversely impacted by the reduced demand for oil as a result of the slowdown in economic activity resulting from the pandemic spread of COVID-19 and the collapse in oil prices. Many of the Company’s tenants have suffered reductions in revenue, and during the second and third quarters, the Company granted rent relief to four tenants as a result of the pandemic. Depending upon the duration of the pandemic, the various measures imposed to help control the spread of the virus and the corresponding economic slowdown, these tenants or additional tenants may seek rent deferrals or abatements in future periods or become unable to pay their rent. While the Company has considered the impact from COVID-19 in its net assets in liquidation presented on the Condensed Consolidated Statement of Net Assets as of September 30, 2020, the extent to which the Company’s business may be affected by COVID-19 depends on future developments with respect to the continued spread and treatment of the virus, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures. Any long-term impact of this situation, even after an economic rebound, remains unclear. Given the uncertainty and current business disruptions as a result of the outbreak of COVID-19, the Company’s implementation of the Plan of Liquidation may be materially and adversely impacted and this may have a material effect on the ultimate amount and timing of liquidating distributions received by stockholders. Accordingly, it is not possible to precisely predict the timing of any additional liquidating distributions the Company pays to it stockholders or the aggregate amount of liquidating distributions that the Company will ultimately pay to its stockholders. No assurance can be given that any additional liquidating distributions the Company pays to its stockholders will equal or exceed the estimate of net assets in liquidation presented on the Condensed Consolidated Statement of Net Assets as of September 30, 2020. The Company expects to comply with the requirements necessary to continue to qualify as a REIT through the completion of the liquidation process, or until such time as any remaining assets are transferred into a liquidating trust. The board of directors shall use commercially reasonable efforts to continue to cause the Company to maintain its REIT status; provided, however, that the board of directors may elect to terminate the Company’s status as a REIT if it determines that such termination would be in the best interest of the stockholders.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2020
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation and Basis of Presentation The accompanying unaudited consolidated financial statements and condensed notes thereto have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), including Subtopic 205-30, “Liquidation Basis of Accounting,” as indicated, and the rules and regulations of the Securities and Exchange Commission, including the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. Pursuant to the Company’s stockholders’ approval of the Plan of Liquidation, the Company adopted the liquidation basis of accounting as of and for the periods subsequent to February 1, 2020 (as the approval of the Plan of Liquidation by the Company’s stockholders became imminent within the first week of February 2020 based on the results of the Company’s solicitation of proxies from its stockholders for their approval of the Plan of Liquidation). Accordingly, on February 1, 2020, assets were adjusted to their estimated net realizable value, or liquidation value, which represents the estimated amount of cash that the Company will collect through the disposal of assets as it carries out the Plan of Liquidation. The liquidation values of the Company’s remaining real estate properties are presented on an undiscounted basis. Estimated costs to dispose of assets and estimated capital expenditures through the anticipated disposition date of the properties have been presented separately from the related assets. Liabilities are carried at their contractual amounts due or estimated settlement amounts. The Company accrues costs and income that it expects to incur and earn through the completion of its liquidation, including the estimated amount of cash the Company expects to collect through the disposal of its assets and the estimated costs to dispose of its assets, to the extent it has a reasonable basis for estimation. These amounts are classified as a liability for estimated costs in excess of estimated receipts during liquidation on the Condensed Consolidated Statement of Net Assets. Actual costs and income may differ from amounts reflected in the financial statements because of the inherent uncertainty in estimating future events. These differences may be material. See Note 2, “Plan of Liquidation” and Note 4, “Liabilities for Estimated Costs in Excess of Estimated Receipts During Liquidation” for further discussion. Actual costs incurred but unpaid as of September 30, 2020 are included in accounts payable and accrued liabilities, due to affiliates and other liabilities on the Condensed Consolidated Statement of Net Assets. Net assets in liquidation represents the remaining estimated liquidation value available to stockholders upon liquidation. Due to the uncertainty in the timing of the sale of the Company's remaining real estate properties and the estimated cash flows from operations, actual liquidation costs and sale proceeds may differ materially from the amounts estimated. All financial results and disclosures through January 31, 2020, prior to the adoption of the liquidation basis of accounting, are presented on a going concern basis, which contemplates the realization of assets and liabilities in the normal course of business. As a result, the balance sheet as of December 31, 2019, the statements of operations, the statements of stockholders’ equity and the statements of cash flows for the month ended January 31, 2020 and the comparative three and nine months ended September 30, 2019 are presented using the going concern basis of accounting. Under the going concern basis of accounting, the Company’s consolidated financial statements included its accounts and the accounts of KBS REIT Holdings II, the Operating Partnership and their direct and indirect wholly owned subsidiaries. All significant intercompany balances and transactions were eliminated in consolidation. Use of Estimates The preparation of the unaudited consolidated financial statements and condensed notes thereto in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and condensed notes. Actual results could materially differ from those estimates. Real Estate Liquidation Basis of Accounting As of February 1, 2020, the Company’s investments in real estate were adjusted to their estimated net realizable value, or liquidation value, to reflect the change to the liquidation basis of accounting. The liquidation value represents the estimated amount of cash that the Company will collect through the disposal of its assets, including any residual value attributable to lease intangibles, as it carries out the Plan of Liquidation. The Company estimated the liquidation value of its investments in real estate based on internal valuation methodologies using a combination of the direct capitalization approach and discounted cash flow analyses and an offer received which the Company subsequently accepted in the case of two office buildings. The liquidation values of the Company’s investments in real estate are presented on an undiscounted basis and investments in real estate are no longer depreciated. Estimated costs to dispose of these investments are carried at their contractual amounts due or estimated settlement amounts and are presented separately from the related assets. Subsequent to February 1, 2020, all changes in the estimated liquidation value of the investments in real estate are reflected as a change to the Company’s net assets in liquidation. Rents and Other Receivables In accordance with the liquidation basis of accounting, as of February 1, 2020, rents and other receivables were adjusted to their net realizable value. The Company periodically evaluates the collectibility of amounts due from tenants. Any changes in the collectibility of the receivables are reflected as a change to the Company’s net assets in liquidation. Revenue Recognition Liquidation Basis of Accounting Under the liquidation basis of accounting, the Company has accrued all income that it expects to earn through the completion of its liquidation to the extent it has a reasonable basis for estimation. Revenue from tenants is estimated based on the contractual in-place leases and projected leases through the anticipated disposition date of the property. These amounts are classified in liabilities for estimated costs in excess of estimated receipts during liquidation on the Consolidated Statement of Net Assets. Accrued Liquidation Costs In accordance with the liquidation basis of accounting, the Company accrues for certain estimated liquidation costs to the extent it has a reasonable basis for estimation. These consist of legal fees, dissolution costs, final audit/tax costs, insurance, and distribution processing costs. Per Share Data Basic net income (loss) per share of common stock is calculated by dividing net income (loss) by the weighted-average number of shares of common stock issued and outstanding during such period. Diluted net income (loss) per share of common stock equals basic net income (loss) per share of common stock as there were no potentially dilutive securities outstanding during the month of January 31, 2020 and the nine months ended September 30, 2019.

LIABILITIES FOR ESTIMATED COSTS

LIABILITIES FOR ESTIMATED COSTS IN EXCESS OF ESTIMATED RECEIPTS DURING LIQUIDATION	9 Months Ended
	Sep. 30, 2020
Liability during Liquidation [Abstract]
LIABILITIES FOR ESTIMATED COSTS IN EXCESS OF ESTIMATED RECEIPTS DURING LIQUIDATION	LIABILITIES FOR ESTIMATED COSTS IN EXCESS OF ESTIMATED RECEIPTS DURING LIQUIDATION The liquidation basis of accounting requires the Company to estimate net cash flows from operations and to accrue all costs associated with implementing and completing the Plan of Liquidation. As of September 30, 2020, the Company estimated that it will have costs in excess of estimated receipts during the liquidation process. These amounts can vary significantly due to, among other things, the timing and estimates for executing and renewing leases, estimates of tenant improvement costs and capital expenditures, the timing of property sales, direct costs incurred to complete the sales, the timing and amounts associated with discharging known and contingent liabilities and the costs associated with the winding down of operations. These costs are estimated and are anticipated to be paid out over the liquidation period. Upon transition to the liquidation basis of accounting on February 1, 2020, the Company accrued the following revenues and expenses expected to be incurred during liquidation (in thousands): As of February 1, 2020 Rental income $ 77,940 Other operating income 7,650 Operating, maintenance, and management (31,311) Real estate taxes and insurance (11,254) Asset management fees due to affiliate (7,883) General and administrative expenses (11,810) Interest expense (9,000) Other interest income 3,448 Liquidating transaction costs (3,500) Capital expenditures (146,524) Liabilities for estimated costs in excess of estimated receipts during liquidation $ (132,244) The change in the liabilities for estimated costs in excess of estimated receipts during liquidation as of September 30, 2020 is as follows (in thousands): February 1, 2020 Cash Payments Remeasurement of September 30, 2020 Assets: Estimated net inflows from investments in real estate $ 34,025 $ (21,116) $ 8,043 $ 20,952 34,025 (21,116) 8,043 20,952 Liabilities: Liquidation transaction costs (3,500) 740 — (2,760) Corporate expenditures (16,245) 7,136 (5,933) (15,042) Capital expenditures (146,524) 36,542 (3,123) (113,105) (166,269) 44,418 (9,056) (130,907) Total liabilities for estimated costs in excess of estimated receipts during liquidation $ (132,244) $ 23,302 $ (1,013) $ (109,955)

NET ASSETS IN LIQUIDATION

NET ASSETS IN LIQUIDATION	9 Months Ended
	Sep. 30, 2020
Assets in Liquidation [Abstract]
NET ASSETS IN LIQUIDATION	NET ASSETS IN LIQUIDATION Net assets in liquidation decreased by approximately $259.3 million during the eight months ended September 30, 2020 as follows (in thousands): For the Period from Changes in net assets in liquidation Change in liquidation value of real estate properties after closing costs/disposition fees $ (71,210) Change in estimated cash flow during liquidation 2,110 Change in estimated capital expenditures (3,123) Redemptions (1,899) Other changes, net (171) Net decrease in liquidation value (74,293) Liquidating distribution to stockholders (185,054) Changes in net assets in liquidation $ (259,347) Pursuant to the Plan of Liquidation, on March 5, 2020, the Company’s board of directors authorized the Initial Liquidating Distribution in the amount of $0.75 per share of common stock to the Company’s stockholders of record as of the close of business on March 5, 2020, for an aggregate cash distribution of approximately $138.9 million. The Initial Liquidating Distribution was paid on March 10, 2020 and was funded with proceeds from the sale of the Campus Drive Buildings. On July 31, 2020, the Company’s board of directors authorized the Second Liquidating Distribution in the amount of $0.25 per share of common stock to the Company’s stockholders of record as of the close of business on August 3, 2020, for an aggregate cash distribution of approximately $46.2 million. The Second Liquidating Distribution was paid on August 7, 2020 and was funded with proceeds from the sale of two office buildings in Corporate Technology Centre - 100 Headquarters and 200 Holger. These liquidating distributions were the largest component of the decline in net assets in liquidation. The estimated net realizable value of real estate decreased by $71.2 million during the eight months ended September 30, 2020, which was primarily driven by the Company’s investment in an office building located in Los Angeles, California (the “Union Bank Plaza”) and an office property located in Denver, Colorado (“Granite Tower”), as follows: • Union Bank Plaza –The estimated net proceeds from the sale of the Union Bank Plaza decreased by approximately $38.1 million primarily due to changes in leasing projections to account for a longer lease-up period and lower projected rental rates caused by COVID-19. As of September 30, 2020, the Union Bank Plaza was 71% leased and due to the amount of vacancy, its valuation or projected sales price is more sensitive to the disruption caused by COVID-19 as compared to a fully stabilized property. Additionally, the valuation or projected sales price was adjusted to increase the terminal capitalization rates and discount rate to account for the increased risk and uncertainty in the current environment. • Granite Tower – The estimated net proceeds from the sale of Granite Tower decreased by approximately $24.0 million due to a reduction in the anticipated sales price to account for a longer lease-up period and lower projected rental rates caused by COVID-19. Granite Tower is further impacted by the deteriorating oil and gas industry as its anchor tenant that occupies approximately 50% of the building square footage as of September 30, 2020 is engaged in the exploration and production of oil and gas. The valuation or projected sales price was adjusted to increase the terminal capitalization rates and discount rate to account for the increased risk and uncertainty in the current environment caused by COVID-19 and the deteriorating oil and gas industry. As of September 30, 2020, Granite Tower was 82% leased. • Other Properties – The estimated net proceeds from the sales of the Company’s other real estate properties were adjusted to increase the terminal capitalization rates and discount rates to account for the increased risk and uncertainty caused by COVID-19 resulting in a net reduction in the aggregate estimated net proceeds from sales of $9.1 million. The net assets in liquidation as of September 30, 2020 would result in the payment of additional estimated liquidating distributions of approximately $2.41 per share of common stock to the Company’s stockholders of record as of September 30, 2020. This estimate of additional liquidating distributions includes projections of costs and expenses to be incurred during the estimated period required to complete the Plan of Liquidation. There is inherent uncertainty with these estimates and projections, and they could change materially based on the timing of the sales of the Company’s remaining real estate properties, the performance of the Company’s remaining assets and any changes in the underlying assumptions of the projected cash flows from such properties. See Note 2, “Plan of Liquidation.”

REAL ESTATE

REAL ESTATE	9 Months Ended
	Sep. 30, 2020
Real Estate [Abstract]
REAL ESTATE	REAL ESTATE As of September 30, 2020, the Company’s real estate investments were composed of four office properties and an office campus consisting of two office buildings, encompassing in the aggregate approximately 2.5 million rentable square feet. As of September 30, 2020, the Company’s real estate portfolio was 74% occupied. As of September 30, 2020, the Company’s liquidation value of real estate was $767.9 million. As a result of adopting the liquidation basis of accounting in February 2020, as of September 30, 2020, real estate properties were recorded at their estimated liquidation value, which represents the estimated gross amount of cash that the Company will collect through the sale of its real estate properties owned as of September 30, 2020 as it carries out its Plan of Liquidation. Real Estate Sales 100 & 200 Campus Drive Buildings and 300-600 Campus Drive Buildings On September 9, 2008, the Company, through an indirect wholly owned subsidiary, KBSII 100-200 Campus Drive, LLC, purchased two four-story office buildings located at 100 & 200 Campus Drive in Florham Park, New Jersey containing 590,458 rentable square feet on an approximate 71.1-acre parcel of land (the “100 & 200 Campus Drive Buildings”). On October 10, 2008, the Company, through an indirect wholly owned subsidiary, KBSII 300-600 Campus Drive, LLC, purchased four four-story office buildings containing 578,388 rentable square feet (the “300-600 Campus Drive Buildings”). The 300-600 Campus Drive Buildings are located at 300, 400, 500 and 600 Campus Drive in Florham Park, New Jersey on an approximate 64.80-acre parcel of land. On October 22, 2019, the Company, through indirect wholly owned subsidiaries, entered into a membership interest purchase and sale agreement and escrow instructions for the sale of all of the membership interests of KBSII 300-600 Campus Drive, LLC (the owner of the 300-600 Campus Drive Buildings) and KBSII 100-200 Campus Drive, LLC (the owner of the 100 & 200 Campus Drive Buildings)(together, the “Property Owners”) to a buyer (the “Purchaser”), an affiliate of Opal Holdings. On January 22, 2020, the Company completed the sale of the membership interests in the Property Owners to the Purchaser for $311.0 million, before third-party closing costs of approximately $4.3 million and excluding disposition fees payable to the Advisor of $3.1 million. In connection with the disposition of the properties, the Company repaid $136.1 million of the outstanding principal balance due under its Portfolio Loan Facility and the properties were released as collateral from the Portfolio Loan Facility. Additionally, on January 23, 2020, the Company used a portion of the proceeds generated by the sale of the membership interests in the Property Owners to repay the entire outstanding principal balance of $40.6 million due under the Corporate Centre Technology Mortgage Loan. See Note 7, “Notes Payable.” Corporate Technology Centre - 100 Headquarters, 200 Holger & 250 Holger On March 28, 2013, the Company, through an indirect wholly owned subsidiary, acquired an office campus consisting of eight office buildings totaling 610,083 rentable square feet located on approximately 32.7 acres of land in San Jose, California (“Corporate Technology Centre”). In 2018, the Company completed the sale of three office buildings in Corporate Technology Centre to three separate purchasers unaffiliated with the Company or the Advisor. On June 25, 2020, the Company completed the sale of two office buildings in Corporate Technology Centre containing 46,070 rentable square feet (“100 Headquarters”) and 96,640 rentable square feet (“200 Holger”), respectively, to a purchaser unaffiliated with the Company or its Advisor, for $95.2 million, or $68.5 million net of credits given to the purchaser primarily for outstanding tenant improvements and lease incentives, before third-party closing costs of approximately $0.9 million and excluding disposition fees payable to the Advisor. On September 25, 2020, the Company completed the sale of one office building in Corporate Technology Centre containing 76,410 rentable square feet (“250 Holger”) to a purchaser unaffiliated with the Company or the Advisor, for $38.3 million, or $30.2 million net of credits given to the purchaser primarily for outstanding tenant improvements, before third-party closing costs of approximately $0.7 million and excluding disposition fees payable to the Advisor.

NOTES PAYABLE

NOTES PAYABLE	9 Months Ended
	Sep. 30, 2020
Debt Disclosure [Abstract]
NOTES PAYABLE	NOTES PAYABLE As of September 30, 2020 and December 31, 2019, the Company’s notes payable consisted of the following (dollars in thousands): Book Value as of Book Value as of Contractual Interest Rate as of September 30, 2020 (1) Effective Interest Rate as of September 30, 2020 (1) Payment Type Maturity Date (2) Corporate Technology Centre Mortgage Loan (3) $ — $ 40,564 (3) (3) (3) (3) Portfolio Loan Facility (4) 145,170 281,293 One-month LIBOR + 1.45% 1.6% Interest Only 03/29/2021 Granite Tower Mortgage Loan (5) 95,350 95,350 One-month LIBOR + 1.65% 1.8% (5) 09/01/2023 Total notes payable principal outstanding $ 240,520 $ 417,207 Deferred financing costs, net (6) — (600) Total notes payable, net $ 240,520 $ 416,607 _____________________ (1) Contractual interest rate represents the interest rate in effect under the loan as of September 30, 2020. Effective interest rate is calculated as the actual interest rate in effect as of September 30, 2020, using interest rate indices as of September 30, 2020, where applicable. (2) Represents the initial maturity date or the maturity date as extended as of September 30, 2020; subject to certain conditions, the maturity dates of certain loans may be extended beyond the maturity date shown. (3) On January 23, 2020, the Company repaid the outstanding principal and accrued interest due under the Corporate Technology Centre Mortgage Loan. (4) As of September 30, 2020, the Portfolio Loan Facility was secured by Willow Oaks Corporate Center, Union Bank Plaza and Fountainhead Plaza. As of September 30, 2020, $145.2 million of term debt of the Portfolio Loan Facility was outstanding and $48.4 million of revolving debt remained available for future disbursements, subject to certain terms and conditions set forth in the loan documents. As of September 30, 2020, there is a one (5) As of September 30, 2020, $95.4 million had been disbursed to the Company with the remaining loan balance of $49.6 million available for future disbursements, subject to certain conditions set forth in the loan agreement. Monthly payments are initially interest-only. Beginning on January 1, 2022, monthly payments for the Granite Tower Mortgage Loan will begin to include principal and interest with principal payments calculated using an amortization schedule of 30 years for the balance of the loan term, with the remaining principal balance, all accrued and unpaid interest and any other amounts due at maturity. (6) As described in Note 3, “Summary of Significant Accounting Policies - Principles of Consolidation and Basis of Presentation,” on February 1, 2020, the Company adopted the liquidation basis of accounting which requires the Company to record notes payable at their contractual amounts.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	9 Months Ended
	Sep. 30, 2020
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS The Company has entered into the Advisory Agreement with the Advisor. This agreement entitles the Advisor to specified fees upon the provision of certain services with regard to the management of the Company’s investments, among other services, and the disposition of investments, as well as reimbursement of certain costs incurred by the Advisor in providing services to the Company. In addition, the Advisor is entitled to certain other fees, including an incentive fee upon achieving certain performance goals, as detailed in the Advisory Agreement. The Company has also entered into a fee reimbursement agreement with KBS Capital Markets Group LLC (the “Dealer Manager”) pursuant to which the Company agreed to reimburse the Dealer Manager for certain fees and expenses it incurs for administering the Company’s participation in the Depository Trust & Clearing Corporation Alternative Investment Product Platform with respect to certain accounts of the Company’s investors serviced through the platform. The Advisor and Dealer Manager also serve or served as the advisor and dealer manager, respectively, for KBS Real Estate Investment Trust III, Inc. (“KBS REIT III”), Pacific Oak Strategic Opportunity REIT, Inc., formerly KBS Strategic Opportunity REIT, Inc., (“Pacific Oak Strategic Opportunity REIT”) (advisory agreement terminated as of October 31, 2019 and the dealer manager agreement terminated as of December 31, 2019), Pacific Oak Strategic Opportunity REIT II, Inc., formerly KBS Strategic Opportunity REIT II, Inc., (“Pacific Oak Strategic Opportunity REIT II”) (advisory agreement terminated as of October 31, 2019 and the dealer manager agreement terminated as of December 31, 2019) and KBS Growth & Income REIT, Inc. (“KBS Growth & Income REIT”). On November 1, 2019, Pacific Oak Strategic Opportunity REIT and Pacific Oak Strategic Opportunity REIT II each entered into advisory agreements with a new external advisor, Pacific Oak Capital Advisors, LLC. Pacific Oak Capital Advisors, LLC is part of a group of companies formed, owned and managed by Keith D. Hall and Peter McMillan III. Together, through GKP Holding LLC, Messrs. Hall and McMillan continue to indirectly own a 33 1/3% interest in the Advisor and the Dealer Manager. As of January 1, 2019, the Company, together with KBS REIT III and KBS Growth & Income REIT, the Dealer Manager, the Advisor and other KBS-affiliated entities, had entered into an errors and omissions and directors and officers liability insurance program where the lower tiers of such insurance coverage were shared. The cost of these lower tiers is allocated by the Advisor and its insurance broker among each of the various entities covered by the program, and is billed directly to each entity. In June 2020, the Company renewed its participation in the program. The program is effective through June 30, 2021. During the nine months ended September 30, 2020 and 2019, no other business transactions occurred between the Company and KBS REIT III, Pacific Oak Strategic Opportunity REIT, Pacific Oak Strategic Opportunity REIT II, KBS Growth & Income REIT, the Advisor, the Dealer Manager or other KBS-affiliated entities. Pursuant to the terms of these agreements, summarized below are the related-party costs incurred by the Company for the three and nine months ended September 30, 2020 and 2019, respectively, and any related amounts payable as of September 30, 2020 and December 31, 2019 (in thousands): Incurred Payable as of Three Months Ended September 30, Nine Months Ended September 30, September 30, December 31, 2020 2019 2020 2019 2020 2019 Expensed Asset management fees (1) $ 1,577 $ 2,469 $ 5,076 $ 7,707 $ — $ — Reimbursement of operating expenses (2) 89 69 311 222 35 59 Disposition fees (3) 381 — 4,148 1,334 — — $ 2,047 $ 2,538 $ 9,535 $ 9,263 $ 35 $ 59 _____________________ (1) During the month ended January 31, 2020, asset management fees were $0.8 million and were presented on a going concern basis. Asset management fees incurred for the eight months ended September 30, 2020 were $4.3 million. (2) Reimbursable operating expenses primarily consists of internal audit personnel costs, accounting software and cybersecurity related expenses incurred by the Advisor under the Advisory Agreement. The Company has reimbursed the Advisor for the Company’s allocable portion of the salaries, benefits and overhead of internal audit department personnel providing services to the Company. These amounts totaled $70,000 and $55,000 for the three months ended September 30, 2020 and 2019, respectively, and $235,000 and $170,000 for the nine months ended September 30, 2020 and 2019, respectively, and were the only type of employee costs reimbursed under the Advisory Agreement for the nine months ended September 30, 2020 and 2019. The Company will not reimburse for employee costs in connection with services for which the Advisor earns acquisition, origination or disposition fees (other than reimbursement of travel and communication expenses) or for the salaries or benefits the Advisor or its affiliates may pay to the Company’s executive officers. In addition to the amounts above, the Company reimburses the Advisor for certain of the Company’s direct costs incurred from third parties that were initially paid by the Advisor on behalf of the Company. During the month ended January 31, 2020, reimbursable operating expenses were $31,000 as presented on a going concern basis. Reimbursable operating expenses incurred for the eight months ended September 30, 2020 were $280,000.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Sep. 30, 2020
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Economic Dependency The Company is dependent on the Advisor for certain services that are essential to the Company, including the execution of the Plan of Liquidation; the disposition of real estate investments; management of the daily operations of the Company’s real estate investment portfolio; and other general and administrative responsibilities. In the event the Advisor is unable to provide any of these services, the Company will be required to obtain such services from other sources. Environmental As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. Compliance with existing environmental laws is not expected to have a material adverse effect on the Company’s financial condition and results of operations as of September 30, 2020. Legal Matters

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2020
Accounting Policies [Abstract]
Basis of Presentation	The accompanying unaudited consolidated financial statements and condensed notes thereto have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), including Subtopic 205-30, “Liquidation Basis of Accounting,” as indicated, and the rules and regulations of the Securities and Exchange Commission, including the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods.
Use of Estimates	The preparation of the unaudited consolidated financial statements and condensed notes thereto in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and condensed notes. Actual results could materially differ from those estimates.
Real Estate	Liquidation Basis of Accounting As of February 1, 2020, the Company’s investments in real estate were adjusted to their estimated net realizable value, or liquidation value, to reflect the change to the liquidation basis of accounting. The liquidation value represents the estimated amount of cash that the Company will collect through the disposal of its assets, including any residual value attributable to lease intangibles, as it carries out the Plan of Liquidation. The Company estimated the liquidation value of its investments in real estate based on internal valuation methodologies using a combination of the direct capitalization approach and discounted cash flow analyses and an offer received which the Company subsequently accepted in the case of two office buildings. The liquidation values of the Company’s investments in real estate are presented on an undiscounted basis and investments in real estate are no longer depreciated. Estimated costs to dispose of these investments are carried at their contractual amounts due or estimated settlement amounts and are presented separately from the related assets. Subsequent to February 1, 2020, all changes in the estimated liquidation value of the investments in real estate are reflected as a change to the Company’s net assets in liquidation.
Rents and Other Receivables	In accordance with the liquidation basis of accounting, as of February 1, 2020, rents and other receivables were adjusted to their net realizable value. The Company periodically evaluates the collectibility of amounts due from tenants. Any changes in the collectibility of the receivables are reflected as a change to the Company’s net assets in liquidation.
Revenue Recognition	Liquidation Basis of Accounting Under the liquidation basis of accounting, the Company has accrued all income that it expects to earn through the completion of its liquidation to the extent it has a reasonable basis for estimation. Revenue from tenants is estimated based on the contractual in-place leases and projected leases through the anticipated disposition date of the property. These amounts are classified in liabilities for estimated costs in excess of estimated receipts during liquidation on the Consolidated Statement of Net Assets.
Accrued Liquidation Costs	In accordance with the liquidation basis of accounting, the Company accrues for certain estimated liquidation costs to the extent it has a reasonable basis for estimation. These consist of legal fees, dissolution costs, final audit/tax costs, insurance, and distribution processing costs.
Per Share Data	Basic net income (loss) per share of common stock is calculated by dividing net income (loss) by the weighted-average number of shares of common stock issued and outstanding during such period. Diluted net income (loss) per share of common stock equals basic net income (loss) per share of common stock as there were no potentially dilutive securities outstanding during the month of January 31, 2020 and the nine months ended September 30, 2019.

LIABILITIES FOR ESTIMATED COS_2

LIABILITIES FOR ESTIMATED COSTS IN EXCESS OF ESTIMATED RECEIPTS DURING LIQUIDATION (Tables)	9 Months Ended
	Sep. 30, 2020
Liability during Liquidation [Abstract]
Schedule of Revenues and Expenses Expected to be Incurred during Liquidation	Upon transition to the liquidation basis of accounting on February 1, 2020, the Company accrued the following revenues and expenses expected to be incurred during liquidation (in thousands): As of February 1, 2020 Rental income $ 77,940 Other operating income 7,650 Operating, maintenance, and management (31,311) Real estate taxes and insurance (11,254) Asset management fees due to affiliate (7,883) General and administrative expenses (11,810) Interest expense (9,000) Other interest income 3,448 Liquidating transaction costs (3,500) Capital expenditures (146,524) Liabilities for estimated costs in excess of estimated receipts during liquidation $ (132,244)
Summary of Changes in Liquidation Accrual of Company	The change in the liabilities for estimated costs in excess of estimated receipts during liquidation as of September 30, 2020 is as follows (in thousands): February 1, 2020 Cash Payments Remeasurement of September 30, 2020 Assets: Estimated net inflows from investments in real estate $ 34,025 $ (21,116) $ 8,043 $ 20,952 34,025 (21,116) 8,043 20,952 Liabilities: Liquidation transaction costs (3,500) 740 — (2,760) Corporate expenditures (16,245) 7,136 (5,933) (15,042) Capital expenditures (146,524) 36,542 (3,123) (113,105) (166,269) 44,418 (9,056) (130,907) Total liabilities for estimated costs in excess of estimated receipts during liquidation $ (132,244) $ 23,302 $ (1,013) $ (109,955)

NET ASSETS IN LIQUIDATION (Tabl

NET ASSETS IN LIQUIDATION (Tables)	9 Months Ended
	Sep. 30, 2020
Assets in Liquidation [Abstract]
Schedule of Change in Net Assets in Liquidation	Net assets in liquidation decreased by approximately $259.3 million during the eight months ended September 30, 2020 as follows (in thousands): For the Period from Changes in net assets in liquidation Change in liquidation value of real estate properties after closing costs/disposition fees $ (71,210) Change in estimated cash flow during liquidation 2,110 Change in estimated capital expenditures (3,123) Redemptions (1,899) Other changes, net (171) Net decrease in liquidation value (74,293) Liquidating distribution to stockholders (185,054) Changes in net assets in liquidation $ (259,347)

NOTES PAYABLE (Tables)

NOTES PAYABLE (Tables)	9 Months Ended
	Sep. 30, 2020
Debt Disclosure [Abstract]
Schedule of Long-term Debt Instruments	As of September 30, 2020 and December 31, 2019, the Company’s notes payable consisted of the following (dollars in thousands): Book Value as of Book Value as of Contractual Interest Rate as of September 30, 2020 (1) Effective Interest Rate as of September 30, 2020 (1) Payment Type Maturity Date (2) Corporate Technology Centre Mortgage Loan (3) $ — $ 40,564 (3) (3) (3) (3) Portfolio Loan Facility (4) 145,170 281,293 One-month LIBOR + 1.45% 1.6% Interest Only 03/29/2021 Granite Tower Mortgage Loan (5) 95,350 95,350 One-month LIBOR + 1.65% 1.8% (5) 09/01/2023 Total notes payable principal outstanding $ 240,520 $ 417,207 Deferred financing costs, net (6) — (600) Total notes payable, net $ 240,520 $ 416,607 _____________________ (1) Contractual interest rate represents the interest rate in effect under the loan as of September 30, 2020. Effective interest rate is calculated as the actual interest rate in effect as of September 30, 2020, using interest rate indices as of September 30, 2020, where applicable. (2) Represents the initial maturity date or the maturity date as extended as of September 30, 2020; subject to certain conditions, the maturity dates of certain loans may be extended beyond the maturity date shown. (3) On January 23, 2020, the Company repaid the outstanding principal and accrued interest due under the Corporate Technology Centre Mortgage Loan. (4) As of September 30, 2020, the Portfolio Loan Facility was secured by Willow Oaks Corporate Center, Union Bank Plaza and Fountainhead Plaza. As of September 30, 2020, $145.2 million of term debt of the Portfolio Loan Facility was outstanding and $48.4 million of revolving debt remained available for future disbursements, subject to certain terms and conditions set forth in the loan documents. As of September 30, 2020, there is a one (5) As of September 30, 2020, $95.4 million had been disbursed to the Company with the remaining loan balance of $49.6 million available for future disbursements, subject to certain conditions set forth in the loan agreement. Monthly payments are initially interest-only. Beginning on January 1, 2022, monthly payments for the Granite Tower Mortgage Loan will begin to include principal and interest with principal payments calculated using an amortization schedule of 30 years for the balance of the loan term, with the remaining principal balance, all accrued and unpaid interest and any other amounts due at maturity. (6) As described in Note 3, “Summary of Significant Accounting Policies - Principles of Consolidation and Basis of Presentation,” on February 1, 2020, the Company adopted the liquidation basis of accounting which requires the Company to record notes payable at their contractual amounts.

RELATED PARTY TRANSACTIONS (Tab

RELATED PARTY TRANSACTIONS (Tables)	9 Months Ended
	Sep. 30, 2020
Related Party Transactions [Abstract]
Schedule of Related Party Costs	Pursuant to the terms of these agreements, summarized below are the related-party costs incurred by the Company for the three and nine months ended September 30, 2020 and 2019, respectively, and any related amounts payable as of September 30, 2020 and December 31, 2019 (in thousands): Incurred Payable as of Three Months Ended September 30, Nine Months Ended September 30, September 30, December 31, 2020 2019 2020 2019 2020 2019 Expensed Asset management fees (1) $ 1,577 $ 2,469 $ 5,076 $ 7,707 $ — $ — Reimbursement of operating expenses (2) 89 69 311 222 35 59 Disposition fees (3) 381 — 4,148 1,334 — — $ 2,047 $ 2,538 $ 9,535 $ 9,263 $ 35 $ 59 _____________________ (1) During the month ended January 31, 2020, asset management fees were $0.8 million and were presented on a going concern basis. Asset management fees incurred for the eight months ended September 30, 2020 were $4.3 million. (2) Reimbursable operating expenses primarily consists of internal audit personnel costs, accounting software and cybersecurity related expenses incurred by the Advisor under the Advisory Agreement. The Company has reimbursed the Advisor for the Company’s allocable portion of the salaries, benefits and overhead of internal audit department personnel providing services to the Company. These amounts totaled $70,000 and $55,000 for the three months ended September 30, 2020 and 2019, respectively, and $235,000 and $170,000 for the nine months ended September 30, 2020 and 2019, respectively, and were the only type of employee costs reimbursed under the Advisory Agreement for the nine months ended September 30, 2020 and 2019. The Company will not reimburse for employee costs in connection with services for which the Advisor earns acquisition, origination or disposition fees (other than reimbursement of travel and communication expenses) or for the salaries or benefits the Advisor or its affiliates may pay to the Company’s executive officers. In addition to the amounts above, the Company reimburses the Advisor for certain of the Company’s direct costs incurred from third parties that were initially paid by the Advisor on behalf of the Company. During the month ended January 31, 2020, reimbursable operating expenses were $31,000 as presented on a going concern basis. Reimbursable operating expenses incurred for the eight months ended September 30, 2020 were $280,000.

ORGANIZATION (Details)

ORGANIZATION (Details) $ in Millions	8 Months Ended	9 Months Ended
	Sep. 30, 2020USD ($)propertyshares	Sep. 30, 2020propertyshares	Jan. 31, 2020propertyshares	Dec. 31, 2019shares	Sep. 30, 2019shares	Jun. 30, 2019shares	Dec. 31, 2018shares
Organizational Structure [Line Items]
Common stock, shares issued (in shares) | shares	184,545,636	184,545,636		185,302,037
Common stock, shares outstanding (in shares) | shares	184,545,636	184,545,636		185,302,037
Number of tenants with rent relief, COVID-19 | property	4	4
Common Stock
Organizational Structure [Line Items]
Common stock, shares outstanding (in shares) | shares			185,228,220	185,302,037	185,551,436	185,871,023	186,464,794
KBS Capital Advisors LLC
Organizational Structure [Line Items]
Period of Advisory Agreement renewal		1 year
Period of termination notice		60 days
KBS Capital Advisors LLC |  Common Stock
Organizational Structure [Line Items]
Shares held by affiliate | shares	20,000	20,000
Office Properties
Organizational Structure [Line Items]
Number of real estate properties | property	4	4
Decrease in real estate property values, COVID-19 | $	$ 71.2
Office Campus
Organizational Structure [Line Items]
Number of real estate properties | property	1	1	1
Office Buildings, Campus
Organizational Structure [Line Items]
Number of real estate properties | property	2	2
KBS Limited Partnership II
Organizational Structure [Line Items]
Partnership interest in Operating Partnership		0.10%
Partnership interest in the Operating Partnership and is its sole limited partner		99.90%

PLAN OF LIQUIDATION (Details)

PLAN OF LIQUIDATION (Details)	Mar. 05, 2020	Sep. 30, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Period of payment activities upon plan of liquidation	24 months
Percent of base rent from tenants in mining and oil and gas extraction industry		18.00%

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	Jun. 12, 2019$ / shares	Jan. 31, 2020shares	Sep. 30, 2019$ / shares	Sep. 30, 2019$ / sharesshares	Sep. 30, 2020property	Jul. 31, 2020$ / shares	Mar. 05, 2020$ / shares
Accounting Policies [Abstract]
Potentially dilutive securities | shares		0		0
Distributions declared per common share (in dollars per share)			$ 0.056	$ 0.630
Special distributions declared per common share (in dollars per share)	$ 0.45
Initial liquidating distribution (in dollars per share)							$ 0.75
Second liquidation distribution (in dollars per share)						$ 0.25
Office Properties
Real Estate [Line Items]
Properties with accepted offer | property					2

LIABILITIES FOR ESTIMATED COS_3

LIABILITIES FOR ESTIMATED COSTS IN EXCESS OF ESTIMATED RECEIPTS DURING LIQUIDATION - Revenues and Expenses (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Feb. 01, 2020	Jan. 31, 2020
Item Effected [Line Items]
Liabilities for estimated costs in excess of estimated receipts during liquidation	$ (109,955)	$ (132,244)	$ (132,244)
Rental income
Item Effected [Line Items]
Revenues		77,940
Other operating income
Item Effected [Line Items]
Revenues		7,650
Operating, maintenance, and management
Item Effected [Line Items]
Expenses		(31,311)
Real estate taxes and insurance
Item Effected [Line Items]
Expenses		(11,254)
Asset management fees due to affiliate
Item Effected [Line Items]
Expenses		(7,883)
General and administrative expenses
Item Effected [Line Items]
Expenses		(11,810)
Interest expense
Item Effected [Line Items]
Expenses		(9,000)
Other interest income
Item Effected [Line Items]
Revenues		3,448
Liquidating transaction costs
Item Effected [Line Items]
Expenses		(3,500)
Capital expenditures
Item Effected [Line Items]
Expenses		$ (146,524)

LIABILITIES FOR ESTIMATED COS_4

LIABILITIES FOR ESTIMATED COSTS IN EXCESS OF ESTIMATED RECEIPTS DURING LIQUIDATION - Change in Liability (Details) $ in Thousands	8 Months Ended
	Sep. 30, 2020USD ($)
Movement in Liquidation Accrual [Roll Forward]
Beginning balance	$ (132,244)
Cash Payments (Receipts)	23,302
Remeasurement of Assets and Liabilities	(1,013)
Ending balance	(109,955)
Assets:
Movement in Liquidation Accrual [Roll Forward]
Beginning balance	34,025
Cash Payments (Receipts)	(21,116)
Remeasurement of Assets and Liabilities	8,043
Ending balance	20,952
Estimated net inflows from investments in real estate
Movement in Liquidation Accrual [Roll Forward]
Beginning balance	34,025
Cash Payments (Receipts)	(21,116)
Remeasurement of Assets and Liabilities	8,043
Ending balance	20,952
Liabilities:
Movement in Liquidation Accrual [Roll Forward]
Beginning balance	(166,269)
Cash Payments (Receipts)	44,418
Remeasurement of Assets and Liabilities	(9,056)
Ending balance	(130,907)
Liquidation transaction costs
Movement in Liquidation Accrual [Roll Forward]
Beginning balance	(3,500)
Cash Payments (Receipts)	740
Remeasurement of Assets and Liabilities	0
Ending balance	(2,760)
Corporate expenditures
Movement in Liquidation Accrual [Roll Forward]
Beginning balance	(16,245)
Cash Payments (Receipts)	7,136
Remeasurement of Assets and Liabilities	(5,933)
Ending balance	(15,042)
Capital expenditures
Movement in Liquidation Accrual [Roll Forward]
Beginning balance	(146,524)
Cash Payments (Receipts)	36,542
Remeasurement of Assets and Liabilities	(3,123)
Ending balance	$ (113,105)

NET ASSETS IN LIQUIDATION - Add

NET ASSETS IN LIQUIDATION - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	Aug. 03, 2020	Mar. 05, 2020	Sep. 30, 2020	Jul. 31, 2020
Assets in Liquidation [Abstract]
Decrease in assets, net			$ 259,300
Initial liquidating distribution (in dollars per share)		$ 0.75
Aggregate cash distributions		$ 138,900
Second liquidation distribution (in dollars per share)				$ 0.25
Aggregate cash distributions	$ 46,200
Additional estimated liquidation distribution (in dollars per share)			$ 2.41
Real Estate Properties [Line Items]
Percentage of real estate occupied			74.00%
Aggregate cash distributions		$ 138,900
Office Properties
Assets in Liquidation [Abstract]
Decrease in real estate property values, COVID-19			$ 71,200
Office Properties | Union Bank Plaza
Real Estate Properties [Line Items]
Decrease in estimated net proceeds from sale			$ 38,100
Percentage of real estate occupied			71.00%
Office Properties | Granite Tower
Real Estate Properties [Line Items]
Decrease in estimated net proceeds from sale			$ 24,000
Percentage of real estate occupied			82.00%
Percent of real estate property occupied by oil and gas industry tenants			50.00%
Other Properties
Real Estate Properties [Line Items]
Decrease in estimated net proceeds from sale			$ 9,100

NET ASSETS IN LIQUIDATION - Cha

NET ASSETS IN LIQUIDATION - Change in Liquidation Value (Details) $ in Thousands	8 Months Ended
	Sep. 30, 2020USD ($)
Assets in Liquidation [Abstract]
Change in liquidation value of real estate properties after closing costs/disposition fees	$ (71,210)
Change in estimated cash flow during liquidation	2,110
Change in estimated capital expenditures	(3,123)
Redemptions	(1,899)
Other changes, net	(171)
Net decrease in liquidation value	(74,293)
Liquidating distribution to stockholders	(185,054)
Changes in net assets in liquidation	$ (259,347)

REAL ESTATE - Investments (Deta

REAL ESTATE - Investments (Details) $ in Thousands, ft² in Millions	Sep. 30, 2020USD ($)ft²property	Jan. 31, 2020property
Real Estate Properties [Line Items]
Rentable square feet | ft²	2.5
Percentage of real estate occupied	74.00%
Real estate | $	$ 767,850
Office Properties
Real Estate Properties [Line Items]
Number of real estate properties	4
Office Campus
Real Estate Properties [Line Items]
Number of real estate properties	1	1
Office Buildings, Campus
Real Estate Properties [Line Items]
Number of real estate properties	2

REAL ESTATE - Sale of 100 & 200

REAL ESTATE - Sale of 100 & 200 Campus Drive Buildings and 300-600 Campus Drive Buildings (Details) $ in Millions	Jan. 23, 2020USD ($)	Jan. 22, 2020USD ($)	Oct. 10, 2008aft²property	Sep. 09, 2008aft²property
Portfolio Loan Facility
Real Estate Properties [Line Items]
Extinguishment of debt, amount		$ 136.1
Corporate Centre Technology Mortgage Loan
Real Estate Properties [Line Items]
Extinguishment of debt, amount	$ 40.6
Campus Drive Buildings | Disposed of by Sale
Real Estate Properties [Line Items]
Consideration		311
Closing cost		4.3
Campus Drive Buildings | Disposed of by Sale | KBS Capital Advisors LLC
Real Estate Properties [Line Items]
Disposition fees payable		$ 3.1
100 & 200 Campus Drive | Office Properties
Real Estate Properties [Line Items]
Number of real estate buildings acquired | property				2
Net rentable area | ft²				590,458
Area of land | a				71.1
300-600 Campus Drive Buildings | Office Properties
Real Estate Properties [Line Items]
Number of real estate buildings acquired | property			4
Net rentable area | ft²			578,388
Area of land | a			64.80

REAL ESTATE - Corporate Technol

REAL ESTATE - Corporate Technology Centre - 100 Headquarters and 200 Holger & 250 Holger (Details) $ in Millions	Sep. 25, 2020USD ($)ft²property	Jun. 25, 2020USD ($)ft²property	Dec. 31, 2018property	Sep. 30, 2020property	Jan. 31, 2020property	Mar. 28, 2013aft²property
Office Campus
Real Estate Properties [Line Items]
Number of real estate properties				1	1
Office Properties
Real Estate Properties [Line Items]
Number of real estate properties				4
Office Properties | Corporate Technology Centre | Disposed of by Sale
Real Estate Properties [Line Items]
Number of real estate properties sold	1	2	3
Consideration | $	$ 38.3	$ 95.2
Consideration, net of credits | $	30.2	68.5
Closing cost | $	$ 0.7	$ 0.9
Office Properties | 100 Headquarters | Disposed of by Sale
Real Estate Properties [Line Items]
Net rentable area | ft²		46,070
Office Properties | 200 Holger | Disposed of by Sale
Real Estate Properties [Line Items]
Net rentable area | ft²		96,640
Office Properties | 250 Holger | Disposed of by Sale
Real Estate Properties [Line Items]
Net rentable area | ft²	76,410
Corporate Technology Centre | Office Campus
Real Estate Properties [Line Items]
Number of real estate properties						1
Corporate Technology Centre | Office Properties
Real Estate Properties [Line Items]
Number of real estate properties						8
Net rentable area | ft²						610,083
Area of land | a						32.7

NOTES PAYABLE - Schedule of Lon

NOTES PAYABLE - Schedule of Long-term Debt Instruments (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Total notes payable principal outstanding	$ 240,520	$ 417,207
Deferred financing costs, net	0	(600)
Total notes payable, net	240,520	416,607
Portfolio Loan Facility | Secured Debt
Debt Instrument [Line Items]
Total notes payable principal outstanding	145,200
Remaining borrowing capacity	$ 48,400
Extension period	1 year
Granite Tower Mortgage Loan
Debt Instrument [Line Items]
Total notes payable principal outstanding	$ 95,400
Remaining borrowing capacity	$ 49,600
Amortization schedule of mortgage loans	30 years
Mortgage | Corporate Technology Centre Mortgage Loan
Debt Instrument [Line Items]
Total notes payable principal outstanding	$ 0	40,564
Mortgage | Portfolio Loan Facility
Debt Instrument [Line Items]
Total notes payable principal outstanding	$ 145,170	281,293
Effective Interest Rate	1.60%
Mortgage | Portfolio Loan Facility | One-month LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate	1.45%
Mortgage | Granite Tower Mortgage Loan
Debt Instrument [Line Items]
Total notes payable principal outstanding	$ 95,350	$ 95,350
Effective Interest Rate	1.80%
Mortgage | Granite Tower Mortgage Loan | One-month LIBOR
Debt Instrument [Line Items]
Basis spread on variable rate	1.65%

NOTES PAYABLE - Additional Info

NOTES PAYABLE - Additional Information (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	9 Months Ended
	Jan. 31, 2020	Sep. 30, 2019	Sep. 30, 2019	Dec. 31, 2019
Debt Disclosure [Abstract]
Interest expense	$ 1,159	$ 4,418	$ 13,262
Amortization of deferred financing costs	$ 115	$ 400	$ 1,169
Interest payable, current				$ 1,200

RELATED PARTY TRANSACTIONS - Ad

RELATED PARTY TRANSACTIONS - Additional Information (Details)	Nov. 01, 2019
GKP Holding LLC | KBS Capital Advisors LLC
Related Party Transaction [Line Items]
Ownership percentage	33.33%

RELATED PARTY TRANSACTIONS - Co

RELATED PARTY TRANSACTIONS - Costs (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		8 Months Ended	9 Months Ended
	Jan. 31, 2020	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Related Party Transaction [Line Items]
Payable as of		$ 35		$ 35	$ 35		$ 59
Administrative fees		70	$ 55		235	$ 170
Advisor and Dealer Manager
Related Party Transaction [Line Items]
Expenses		2,047	2,538		9,535	9,263
Payable as of		35		35	35		59
Advisor and Dealer Manager | Asset management fees
Related Party Transaction [Line Items]
Expenses	$ 800	1,577	2,469	4,300	5,076	7,707
Payable as of		0		0	0		0
Advisor and Dealer Manager | Reimbursement of operating expenses
Related Party Transaction [Line Items]
Expenses	$ 31	89	69	280	311	222
Payable as of		35		35	35		59
Advisor and Dealer Manager | Disposition fees
Related Party Transaction [Line Items]
Expenses		381	$ 0		4,148	$ 1,334
Payable as of		$ 0		$ 0	$ 0		$ 0