HGR Liquidating Trust 10-K 2021 FY Annual report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

(Mark One)
☑	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 000-53964

HGR Liquidating Trust

(Exact Name of Registrant as Specified in its Charter)

Maryland	85-6328984
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
2800 Post Oak Boulevard Suite 5000	77056-6118
Houston, Texas	(Zip code)
(Address of principal executive offices)

Registrant’s telephone number, including area code: (888) 220-6121

Securities registered pursuant to Section 12(b) of the Act: None.

Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $.001

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes ☐     No ☑

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.  Yes ☐     No ☑

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☑     No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑   No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.: 

Large accelerated filer ☐	Accelerated filer ☐	Non-accelerated filer ☑
Smaller reporting company ☐	Emerging growth company ☐	If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐     No ☑

Aggregate market value of the units held by non-affiliates of the registrant: No established market exists for the registrant’s units.

The registrant had 262.4 million units outstanding as of March 4, 2022.

TABLE OF CONTENTS PART I
Item 1.	Business	2
Item 1A.	Risk Factors	5
Item 1B.	Unresolved Staff Comments	7
Item 2.	Properties	8
Item 3.	Legal Proceedings	9
Item 4.	Mine Safety Disclosures	9
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	10
Item 6.	[Reserved]	11
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	19
Item 8.	Financial Statements and Supplementary Data	20
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	45
Item 9A.	Controls and Procedures	45
Item 9B.	Other Information	46
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.	46
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	47
Item 11.	Executive Compensation	55
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	57
Item 13.	Certain Relationships and Related Transactions, and Director Independence	58
Item 14.	Principal Accounting Fees and Services	59
PART IV
Item 15.	Exhibits, Financial Statement Schedules	60
Item 16.	Form 10-K Summary	63
SIGNATURES		65
EX- 21.1	List of Subsidiaries
EX- 31.1	Certification
EX- 31.2	Certification
EX- 32.1	Certification of CEO & CFO pursuant to Section 906
EX- 101	Instance Document
EX- 101	Schema Document
EX- 101	Calculation Linkbase Document
EX- 101	Labels Linkbase Document
EX- 101	Presentation Linkbase Document
EX- 101	Definition Linkbase Document

PART I

Special Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K includes certain statements that may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Such forward-looking statements relate to, without limitation, economic conditions that may impact our operations, our ability to effectively liquidate our assets and pay liquidating distributions to our investors in the expected time frame or at all, our future leverage and financial position, our future capital expenditures, future distributions, other developments and trends in the commercial real estate industry and our business strategy. Forward-looking statements are generally identifiable by the use of the words “may,” “will,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “predict,” “potential” or the negative of these words or other comparable terminology. These statements are not guarantees of future performance, and involve certain risks, uncertainties and assumptions that are difficult to predict.

The forward-looking statements in this Form 10-K are based on our current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Any of the assumptions underlying forward-looking statements could prove to be inaccurate. To the extent that our assumptions differ from actual results, our ability to meet such forward-looking statements, including our ability to generate positive cash flow from operations, provide distributions to our investors and maintain the value of the real estate properties in which we hold an interest, may be significantly hindered.

The following are some of the risks and uncertainties which could cause actual results to differ materially from those presented in certain forward-looking statements:

— Unanticipated difficulties, expenditures or delays relating to our implementation of our plan of liquidation and dissolution, which may reduce or delay our payment of additional liquidating distributions to our investors;

— Risks associated with legal proceedings that may be instituted against us and others related to the plan of liquidation;

— The amount and timing of additional liquidating distributions we may pay is uncertain and cannot be assured;

— The failure of any bank in which we deposit our funds could reduce the amount of cash we have available to fund our operating expenses and other capital expenditures; and

— Changes in governmental and tax laws and regulations and the related costs of compliance and increases in our administrative operating expenses, including expenses associated with operating as a public company.

These risks are more fully discussed in, and all forward-looking statements should be read in light of, all of the factors discussed in “Item 1A. Risk Factors” of this Annual Report.

Our investors are cautioned not to place undue reliance on any forward-looking statement in this Form 10-K. All forward-looking statements are made as of the date of this Form 10-K, and the risk that actual results will differ materially from the expectations expressed in this Form 10-K may increase with the passage of time. In light of the significant uncertainties inherent in the forward-looking statements in this Form 10-K, the inclusion of such forward-looking statements should not be regarded as a representation by us or any other person that the objectives and plans set forth in this Form 10-K will be achieved.

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Item 1.  Business

General Description of Business and Operations

Hines Global REIT, Inc. (“Hines Global” or the “Company”) was incorporated under the Maryland General Corporation Laws on December 10, 2008, primarily for the purpose of investing in a diversified portfolio of quality commercial real estate properties and other real estate investments located throughout the United States and internationally. Hines Global raised the equity capital for its real estate investments through two public offerings from August 2009 through April 2014, and through its distribution reinvestment plan (the “DRP Offering”) from April 2014 through August 2018. Collectively, through its public offerings, Hines Global raised gross offering proceeds of approximately $3.1 billion, including the DRP Offering, all of which was invested in the Company’s real estate portfolio.

We invested the proceeds from our public offerings into a diverse portfolio of real estate investments. At the peak of our acquisition phase, we owned interests in 45 properties. In recent years, we have concentrated our efforts on actively managing our assets and exploring a variety of strategic opportunities focused on enhancing the composition of our portfolio and its total return potential for its investors. On April 23, 2018, in connection with its review of potential strategic alternatives available to the Company, our board of directors determined that it is in the best interests of the Company and its investors to sell all or substantially all of our properties and assets and for the Company to liquidate and dissolve pursuant to our Plan of Liquidation and Dissolution (the “Plan of Liquidation”). The principal purpose of the liquidation is to provide liquidity to our investors by selling the Company’s assets, making payments on property and corporate level debt, and distributing the net proceeds from liquidation to our investors. As required by Maryland law and our charter, the Plan of Liquidation was approved by the affirmative vote of the holders of at least a majority of the shares of our common stock outstanding and entitled to vote thereon at the Company’s annual meeting of stockholders held on July 17, 2018.

While we anticipated the completion of the sale of all the Company’s assets by July 17, 2020, which is the 24-month period imposed by the Internal Revenue Service (“IRS”) for execution of the Plan, the economic disruption and uncertainty resulting from the Coronavirus pandemic have had a significant impact on the process and timing of the Plan’s completion. On June 30, 2020, Hines Global and the Trustees identified below entered into an Agreement and Declaration of Trust (the “Liquidating Trust Agreement”) in connection with the formation of HGR Liquidating Trust, a Maryland statutory trust (the “Liquidating Trust” or the “Trust”). The purpose of the Trust is to complete the liquidation of Hines Global’s assets in accordance with the plan of liquidation and dissolution (the “Plan”) that was previously approved by Hines Global’s stockholders in July 2018. The trustees of the Trust consist of certain members of Hines Global’s board of directors: Jeffrey C. Hines, Charles M. Baughn, Jack L. Farley, Thomas L. Mitchell, John S. Moody and Peter Shaper; and David L. Steinbach, the Company’s Chief Investment Officer (collectively, the “Trustees”). Pursuant to the Liquidating Trust Agreement, the Company transferred all of its assets and liabilities to the Trust and received units of beneficial interest in the Trust (the “Units”) equal to the number of shares of the Company’s common stock outstanding on June 30, 2020. Immediately thereafter, the Company distributed the Units pro rata to its stockholders such that one Unit was distributed for each share of the Company’s common stock and all stockholders of the Company are now unitholders and beneficiaries of the Trust.

The Liquidating Trust Agreement provides that the Trust will terminate upon the earliest of (a) such time as termination is required by the applicable laws of the State of Maryland, (b) the determination of the Board to terminate the Trust following the distribution of all its assets in accordance with the Liquidating Trust Agreement, or (c) the expiration of a period of three years from June 30, 2020. Notwithstanding the foregoing, the Board may continue the existence of the Trust beyond the three-year term if the Board in its reasonable discretion determines that an extension is necessary to fulfill the purposes of the Trust, provided that the Board has requested and obtained no-action assurance from the SEC regarding relief from registration and reporting requirements under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) prior to any such extension.

The Liquidating Trust Agreement further provides that the Board has the discretion to make distributions of available cash to the investors as and when they deem such distributions to be in the best interests of the investors, taking into account the administrative costs of making such distributions, anticipated costs and expenses of the Trust and such other factors as they may consider appropriate.

All references to “the Company,” “we,” “our,” “us” or similar pronouns herein mean Hines Global REIT, Inc. for periods prior to June 30, 2020, when Hines Global REIT, Inc. transferred all of its assets and liabilities to HGR Liquidating Trust, and mean HGR Liquidating Trust for periods subsequent thereto. All references to “the Trust” mean HGR Liquidating Trust. In addition, all references to "investors" mean the stockholders of Hines Global for periods prior to June 30, 2020 and mean the

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unitholders of the Trust for periods subsequent thereto. Similarly, all references to the "Board" mean the board of directors of Hines Global for periods prior to June 30, 2020 and mean the board of trustees of the Trust for periods subsequent thereto.

We sold interests in 39 properties with an aggregate sale price of $5.4 billion from 2017 through 2021. We owned one property, Minneapolis Retail Center, as of December 31, 2021. In March 2022, we sold Minneapolis Retail Center for $150.0 million, excluding closing costs and prorations.

On March 11, 2022, the Board determined a per Unit net asset value (“NAV”) of $0.66 as of March 11, 2022. This per Unit NAV is $1.43 lower than the previously determined per Unit NAV of $2.09 as of December 31, 2020, primarily as a result of the $1.40 per Unit special distributions paid by the Company since that time. These distributions followed the sales of four of the five remaining properties in our real estate portfolio.

Additionally, we sold our final remaining property on March 10, 2022, and declared and paid a special distribution of $0.62 per Unit in March 2022. The per Unit NAV was reduced to $0.04 as of March 17, 2022, following this distribution. See Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities for additional information related to our NAV.

General Business Information

We conduct most of our activities through, and most of our real estate investments were held directly or indirectly by, Hines Global REIT Properties, LP (the “Operating Partnership”), which was formed on January 7, 2009. Hines Global contributed the proceeds it received from the issuance of common shares to the Operating Partnership and the Operating Partnership in turn issued general partner interests to Hines Global. The Trust became the sole general partner of the Operating Partnership on June 30, 2020 in connection with the transfer of all of Hines Global’s assets and liabilities to the Trust. The general partner interests entitle HGR Liquidating Trust to receive its share of the Operating Partnership’s earnings or losses and distributions of cash flow.

We have no employees. Our business is managed by our Advisor, an affiliate of our sponsor, Hines, under the terms and conditions of an advisory agreement between us, the Operating Partnership and the Advisor , effective as of June 30, 2020 (the “Advisory Agreement”). From January 1, 2020 until June 30, 2020, Hines Global, the Operating Partnership and the Advisor were parties to an advisory agreement (the "Prior Advisory Agreement"), pursuant to which the Advisor managed Hines Global's day-to-day operations in substantially the same manner that the Advisor now manages the Trust's day-to-day operations. As compensation for these services, we pay or have paid the Advisor fees and we reimburse certain of the Advisor’s expenses incurred on our behalf in accordance with the Advisory Agreement. Hines or affiliates of Hines managed the leasing and operations of most of the properties in which we invested and, accordingly, we paid property management and leasing fees in connection with these services. Hines is owned and controlled by, or for the benefit, of Jeffrey C. Hines, the Chairman of our Board. Hines and its 4,850 employees have over 60 years of experience in the areas of investment selection, underwriting, due diligence, portfolio management, asset management, property management, leasing, disposition, finance, accounting and investor relations.

Our office is located at 2800 Post Oak Boulevard, Suite 5000, Houston, Texas 77056-6118. Our telephone number is 1-888-220-6121. Our web site is www.HinesSecurities.com/HGRLiquidatingTrust. The information on our website is not incorporated by reference into this report.

Distribution Objectives

We declared distributions of $0.70 per share, per year for the period from October 2009 through December 2011 and $0.65 per share, per year from January 2012 through December 2018, totaling $6.09 per share in aggregate. Approximately $0.45 per share of these distributions declared for the year ended December 31, 2018 were designated as a return of a portion of the investors’ invested capital as described further below. Additionally, we have declared special distributions and/or liquidating distributions to date totaling $9.02 per share, each of which is described further below. In aggregate, we have paid total distributions of $15.11 per share to our investors from the inception of our fund to date.

From 2018 through March 2022, we paid aggregate return of capital distributions or liquidating distributions to investors totaling approximately $9.47 per share, which represented a return of a portion of the investors’ invested capital. These distributions reduced the investors’ remaining investment in the Company and were made up of the following:

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•a $1.05 per share special distribution declared to all investors of record as of December 30, 2017 and paid in January 2018. The special distribution was funded with a portion of the net proceeds received from the strategic sale of six assets during 2017.

•$0.12 per share resulting from a portion of the monthly distributions declared for the months of January 2018 through June 2018, (approximately $0.02 per share, per month), which were designated by our Board as a return of a portion of the investors’ invested capital and, as such, reduced the investors’ remaining investment in the Company.

•Approximately $0.33 per share resulting from the monthly liquidating distributions declared for the months of July 2018 through December 2018 (approximately $0.0541667 per share, per month), which reduced the investors’ remaining investment in the Company.

•a $2.50 per share liquidating distribution declared to all investors of record as of February 13, 2019 and paid in February 2019.

•a $1.00 per Unit liquidating distribution declared to all investors of record as of July 15, 2020 and paid in July 2020.

•a $2.45 per Unit special distribution declared to all investors of record as of September 14, 2020 and paid in September 2020.

•a $0.80 per Unit special distribution declared to all investors of record as of September 29, 2021 and paid in September 2021.

•a $0.60 per Unit special distribution declared to all investors of record as of January 12, 2022, and paid in January 2022.

•a $0.62 per Unit special distribution declared to all investors of record as of March 17, 2022, and paid on or around March 22, 2022.

Tax Status

The Liquidating Trust is intended to qualify as a “liquidating trust” for federal income tax purposes that is treated as a “grantor trust” for federal income tax purposes and accordingly, is not subject to federal income tax on any income earned or gain recognized by it. The Liquidating Trust may recognize taxable income or loss, as the case may be, from the operation of the properties prior to their disposition, and taxable gain or loss as and when its assets are disposed of for an amount greater or less than the fair market value of such assets at the time of the initial distribution of the Units in the Liquidating Trust on June 30, 2020. Our beneficiaries will be treated as the owners of a pro rata portion of each remaining asset, including cash, received by and held by us and will be required to report on their federal and state income tax return their pro rata share of taxable income, including gains and losses recognized by the Liquidating Trust.

The Trustees will provide to each holder of Units after each year end a detailed itemized statement that reports on a per unit basis the holder’s allocable share of all the various categories of revenue and expense of the Liquidating Trust for the year. Each holder of Units is urged to consult with their own tax advisors regarding the filing requirements and the appropriate tax reporting of this information on their tax returns.

Available Information

Investors may obtain copies of our filings with the Securities and Exchange Commission (“SEC”), free of charge from the website maintained by the SEC at www.sec.gov or from our website at www.HinesSecurities.com/HGRLiquidatingTrust. Further, a copy of our filings will be available on our website as soon as reasonably practicable after we electronically file such materials with the SEC. However, the information from our website is not incorporated by reference into this report.

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Item 1A.  Risk Factors

You should carefully read and consider the risks described below together with all other information in this report. If certain of the following risks actually occur, our results of operations and ability to pay additional liquidating distributions would likely suffer materially, or could be eliminated entirely.

Risks Related to the Liquidation of the Trust

We cannot determine the timing or amount of additional distributions to our investors because there are many factors, some of which are outside of our control, which could affect our ability to make such distributions.

Although we have paid distributions to our investors in connection with the Plan of Liquidation, we cannot determine the timing or amount of additional distributions to our investors at this time. These distributions will depend on a variety of factors, including, but not limited to, the length of time it takes to fully implement the Plan of Liquidation, the cost of operating the Trust through the date of our final dissolution, general business and economic conditions, and other matters. In addition, before making the final distribution, we will need to pay or arrange for the payment of all of our transaction costs in the liquidation, all other costs and all valid claims of our creditors. Our Board may also decide to acquire one or more insurance policies covering unknown or contingent claims against us, for which we would pay a premium which has not yet been determined. Our Board may also decide to provide for any unknown and outstanding liabilities and expenses, which may include the establishment of a reserve fund to pay contingent liabilities and ongoing expenses in an amount to be determined as information concerning such contingencies and expenses becomes available. The amount of transaction costs in the liquidation is not yet final, so we have used estimates of these costs in calculating the amounts of our originally projected aggregate distributions. To the extent that we have underestimated these costs, additional distributions will likely be lower than our most recently determined NAV. In addition, if the claims of our creditors are greater than what we have anticipated or if we decide to acquire one or more insurance policies covering unknown or contingent claims against us, our final distribution may be delayed or reduced. Further, if a reserve fund is established to pay contingent liabilities, payment of additional distributions to our investors may be delayed or reduced.

If there are any lawsuits in connection with the Plan of Liquidation, it may be costly and may prevent the Plan of Liquidation from being completed or from being completed within the expected timeframe.

Our investors may file lawsuits challenging the Plan of Liquidation, which may name the Trust or our Board as defendants. As of the date of this report, no such lawsuits challenging the Plan of Liquidation are pending, or to our knowledge, threatened. However, if such a lawsuit is filed, we cannot assure you as to the outcome of any such lawsuits, including the amount of costs associated with defending any such claims or any other liabilities that may be incurred in connection with such claims. If any plaintiffs are successful in obtaining an injunction prohibiting us from completing the Plan of Liquidation, such an injunction may delay the completion of the Plan of Liquidation. Whether or not any plaintiff’s claim is successful, this type of litigation often results in significant costs and diverts management’s attention and resources, which could adversely affect the operation of our business and reduce the funds available for additional distributions to our investors.

Investors may be liable to our creditors for the amount received from us if our reserve fund or the assets remaining in the Trust are inadequate.

Pursuant to the Plan of Liquidation, we intend to discharge our liabilities, distribute to our investors any remaining assets and complete our wind-down as soon as practicable. In the event that it should not be feasible, in the opinion of our Board, for the Trust to pay, or adequately provide for, all of our debts and liabilities, or if our Board shall determine it is advisable, our Board may establish a reserve fund or retain certain assets in the Liquidating Trust.

Any reserve fund or assets remaining in the Liquidating Trust may not be adequate to cover any contingent expenses and liabilities. Under Maryland law, if we make distributions and fail to maintain an adequate reserve fund or fail to retain adequate assets in the Liquidating Trust for payment of our contingent expenses and liabilities, each investor could be held liable for payment to our creditors of such amounts owed to creditors which we fail to pay. The liability of any investor would be limited to the amount of distributions previously received by such investor from us in connection with the Plan of Liquidation. Accordingly, in such event, an investor could be required to return all such distributions received from us. On December 31, 2021, the Trust had outstanding liabilities of approximately $31.7 million. Most of these obligations were paid prior to March 11, 2022 and the rest are expected to be paid in full prior to our wind-down. We will continuously monitor expenses and any other foreseeable liabilities we may incur as we complete the Plan of Liquidation in the coming months in order to seek to ensure that an adequate reserve fund is maintained or adequate assets are retained in the Liquidating Trust to discharge these liabilities in full.

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Risks Related to Adverse Changes in General Economic Conditions

Yields on and safety of deposits may be lower if there are to extensive declines in the financial markets.

We may hold funds in investments, including money market funds, bank money market accounts and CDs or other accounts at third-party depository institutions. Unusual declines in the financial markets similar to those experienced during the Great Recession, could result in a loss of some or all of these funds. In particular, money market funds may experience intense redemption pressure at such times and have difficulty satisfying redemption requests. As a result, we may not be able to access the cash in our money market investments. In addition, current yields from these investments are minimal.

The failure of any bank in which we deposit our funds could reduce the amount of cash we have available to pay distributions and make additional investments.

The Federal Deposit Insurance Corporation only insures amounts up to $250,000 per depositor. It is likely that we will have cash and cash equivalents and restricted cash deposited in certain financial institutions in excess of federally insured levels. If any of the banking institutions in which we deposit funds ultimately fails, we may lose any amount of our deposits over federally insured levels. The loss of our deposits could reduce the amount of cash we have available to distribute and could reduce the amount of additional distributions to investors.

Our business could suffer in the event the Advisor, our transfer agent or any other party that provides us with services essential to our operations experiences system failures or cyber incidents or a deficiency in cybersecurity.

The Advisor, our transfer agent and other parties that provide us with services essential to our operations are vulnerable to damages from any number of sources, including computer viruses, unauthorized access, energy blackouts, natural disasters, terrorism, war and telecommunication failures. Any system failure or accident that causes interruptions in our operations could result in a material disruption to our business.  A cyber incident is considered to be any adverse event that threatens the confidentiality, integrity or availability of information resources. More specifically, a cyber incident is an intentional attack or an unintentional event that may include, but is not limited to, gaining unauthorized access to systems to disrupt operations, corrupt data, steal assets or misappropriate confidential information, such as confidential investor records. As reliance on technology in our industry has increased, so have the risks posed to our systems, both internal and those we have outsourced. In addition, the risk of a cyber incident, including by computer hackers, foreign governments and cyber terrorists, has generally increased as the number, intensity and sophistication of attempted attacks and instructions from around the world have increased.  Affiliates of our Advisor have in the past experienced cyber incidents impacting their information technology systems or relating to software that they utilize, and, while none to date have had an impact on us or our operations, we expect such breaches could to occur in the future.

The remediation costs and lost revenues experienced by a victim of a cyber incident may be significant and significant resources may be required to repair system damage, protect against the threat of future security breaches or to alleviate problems, including reputational harm, loss of revenues and litigation, caused by any breaches. There also may be liability for any stolen assets or misappropriated confidential information. Any material adverse effect experienced by the Advisor, our transfer agent and other parties that provide us with services essential to our operations could, in turn, interrupt our operations, damage our reputation and brand, damage our competitive position, make it difficult for us to attract and retain tenants, and subject us to liability claims or regulatory penalties that could adversely affect our ability to pay additional distributions to investors. While we maintain cyber risk insurance to provide some coverage for certain risks arising out of system failures or cyber incidents, there is no assurance that such insurance would cover all or a significant portion of the costs or consequences associated with a cyber incident.

Risks Related to Taxes

Holders of Trust Units may recognize taxable income as a result of their ownership of Trust Units.

The Trust is intended to qualify as a “liquidating trust” for federal income tax purposes that is treated as a “grantor trust” for federal income tax purposes. Accordingly, each Unit represents ownership of an undivided proportionate interest in all of the assets and liabilities of the Liquidating Trust, and each holder of Units will be treated for federal income tax purposes as receiving or paying directly a pro rata portion of all income, gain, loss, deduction and credit of the Liquidating Trust. A holder of Units will be taxed each year on its share of revenues from the Liquidating Trust, net of such holder’s share of expenses of the Liquidating Trust whether or not the holder of Units receives a distribution of cash from the Liquidating Trust that year. The

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long-term or short-term character of any capital gain or loss recognized in connection with the sale of the Liquidating Trust’s assets will be determined based upon a holding period commencing at the time of the acquisition by each holder of Units.

If the Liquidating Trust fails to qualify as a liquidating trust for federal income tax purposes, it would instead be taxable as a partnership rather than as a grantor trust. If the Liquidating Trust is taxable as a partnership, the tax consequences to holders of Units generally will be similar to those that would be experienced if the Liquidating Trust were a grantor trust.

If the Company failed to qualify as a REIT during its short taxable year ended June 30, 2020, our ability to pay distributions to our investors may be adversely impacted.

The Company elected to be taxed as a REIT for federal income tax purposes. We believe the Company was organized and operated in a manner that allowed it to qualify as a REIT until June 30, 2020 when it transferred all of its assets and liabilities to the Liquidating Trust. In order to maintain its REIT status, the Company was required to annually distribute to its shareholders at least 90% of its REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gain, and meet the various other requirements imposed by the Code relating to such matters as operating results, asset holdings, distribution levels and diversity of share ownership. Provided that the Company qualified for taxation as a REIT, it was generally not subject to corporate level federal income tax on the earnings distributed to its shareholders that it derived from its REIT qualifying activities. The Company was still subject to state and local income and franchise taxes and to federal income and excise tax on its undistributed income for years in which it qualified as a REIT. If the Company were to have failed to qualify as a REIT for any taxable year prior to June 30, 2020, and it was unable to avail itself of certain savings provisions set forth in the Code, all of its taxable income would be subject to federal income tax at the regular corporate rates and its cash available for distribution would be reduced.

If the Operating Partnership is classified as a “publicly traded partnership” under the Code, our operations and our ability to pay distributions to our investors could be adversely affected.

We believe that the Operating Partnership will be treated as a partnership, and not as an association or a publicly traded partnership for U.S. federal income tax purposes. In this regard, the Code generally classifies “publicly traded partnerships” (as defined in Section 7704 of the Code) as associations taxable as corporations (rather than as partnerships), unless substantially all of their taxable income consists of specified types of passive income. In order to minimize the risk that the Code would classify the Operating Partnership as a “publicly traded partnership” for tax purposes, we placed certain restrictions on the transfer and/or repurchase of partnership units in the Operating Partnership. However, if the IRS successfully determined that the Operating Partnership should be taxed as a corporation, the Operating Partnership would be required to pay U.S. federal income tax at corporate rates on its net income, its partners would be treated as investors of the Operating Partnership and distributions to partners would constitute non-deductible distributions in computing the Operating Partnership’s taxable income. In addition, it could cause the Company to fail to qualify as a REIT for one or more taxable years prior to June 30, 2020, and result in the imposition of a corporate tax on the Operating Partnership, which would reduce the amount of cash available for distribution to our investors.

Item 1B.  Unresolved Staff Comments

Not applicable.

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Item 2.  Properties

We owned one remaining property, Minneapolis Retail Center, as of December 31, 2021. We sold Minneapolis Retail Center in March 2022 for $150.0 million, excluding closing costs and prorations.

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Item 3.  Legal Proceedings

From time to time in the ordinary course of business, the Company or its subsidiaries may become subject to legal proceedings, claims or disputes. As of March 31, 2022, neither the Company nor any of its subsidiaries was a party to any material pending legal proceedings.

Item 4.  Mine Safety Disclosures

Not applicable.

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PART II

Item 5.  Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

As of December 31, 2021, we had 262.4 million Units outstanding, held by a total of approximately 57,600 investors. The number of investors is based on the records of our registrar and transfer agent. There is no established public trading market for our Units. For purposes of this section and throughout this Annual Report on Form 10-K, the term “Units” means shares of the Company’s common stock for periods prior to June 30, 2020 and Units of beneficial interest in the Trust for the period subsequent to June 30, 2020.

Our Board determined a per Unit NAV of $0.66 as of March 11, 2022. This per Unit NAV is $1.43 lower than the previously determined per Unit NAV of $2.09 as of December 31, 2020, primarily as a result of the $1.40 per Unit special distributions paid by the Company since that time. These distributions followed the sales of four of the five remaining properties in our real estate portfolio. See below for a description of how the per Unit NAV as of March 11, 2022 was determined.

Additionally, we sold our final remaining property on March 10, 2022 and declared a special distribution of $0.62 per unit to all unitholders of record as of March 17, 2022, which was paid on or around March 22, 2022. The per Unit NAV was reduced to $0.04 as of March 17, 2022, following this distribution.

The per Unit NAV of $0.04 as of March 17, 2022 is not a representation, warranty or guarantee that (i) an investor would ultimately realize distributions per Unit equal to the per Unit NAV upon the completion of our wind-down; (ii) the methodologies used to determine the per Unit NAV would be acceptable to FINRA. In addition, we can make no claim as to whether the estimated value will or will not satisfy the applicable annual valuation requirements under ERISA and the Code with respect to employee benefit plans subject to ERISA and other retirement plans or accounts subject to Section 4975 of the Code that are investing in our Units.

Methodology

We sold our final remaining property on March 10, 2022. As a result, the per Unit NAV of $0.66 as of March 11, 2022 was based solely on the values of other assets and liabilities such as cash, tenant receivables, accounts payable and accrued expenses, other assets and liabilities, all of which were valued at cost and an estimate of closing costs that we would expect to incur in relation to the wind-down of the Company. No liquidity discounts or discounts relating to the fact that we are externally managed were applied to the per Unit NAV and no attempt was made to value the Company as an enterprise.

The table below sets forth the calculation of our per Unit NAV as of March 11, 2022 and December 31, 2020:

	March 11, 2022				December 31, 2020
	Gross Amount (in millions)		Per Unit			Gross Amount (in millions)		Per Unit
Real estate property investments	$	—	$	—		$	597	$	2.27
Cash and other assets	183		0.70			46		0.18
Debt obligations and other liabilities	(10)		(0.04)			(80)		(0.31)
Noncontrolling interests	—		—			—		—
Net Asset Value before closing costs	$	173	$	0.66		$	563	$	2.14
Estimated closing costs	—		—			(13)		(0.05)
NAV	$	173	$	0.66		$	550	$	2.09
Units outstanding	262					262

Our Board determined the per Unit NAV by (i) utilizing the value of our other assets comprised of our cash, tenant and other receivables and other assets of $183.0 million, (ii) subtracting the values of our remaining liabilities comprised of our accounts payable and accrued expenses, due to affiliates, other liabilities and an estimate of costs in excess of income expected to be realized prior to the wind-down of the Company of $10.0 million and (iii) dividing the total by our Units outstanding as of March 11, 2022 of 262.0 million, resulting in a per Unit NAV of $0.66.

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Distributions

We declared distributions of $0.70 per share, per year for the period from October 2009 through December 2011 and $0.65 per share, per year from January 2012 through December 2018 totaling $6.09 per share in aggregate. Approximately $0.45 per share of these distributions declared for the year ended December 31, 2018 were designated as a return of a portion of the investors’ invested capital as described further below. Additionally, we have declared special distributions and/or liquidating distributions to date totaling $9.02 per share, each of which is described further below. In aggregate, we have paid total distributions of $15.11 per share to our investors from the inception of our fund to date.

From 2018 through March 2022, we paid aggregate return of capital distributions or liquidating distributions to investors totaling approximately $9.47 per share, which represented a return of a portion of the investors’ invested capital. These distributions reduced the investors’ remaining investment in the Company and were made up of the following:

•the $1.05 per share special distribution declared to all investors of record as of December 30, 2017 and paid in January 2018. The special distribution was funded with a portion of the net proceeds received from the strategic sale of six assets during 2017.

•$0.12 per share resulting from a portion of the monthly distributions declared for the months of January 2018 through June 2018, (approximately $0.02 per share, per month), which were designated by our board of directors as a return of a portion of the investors’ invested capital and, as such, reduced the investors’ remaining investment in the Company.

•Approximately $0.33 per share resulting from the monthly liquidating distributions declared for the months of July 2018 through December 2018 (approximately $0.054 per share, per month), which reduced the investors’ remaining investment in the Company.

•a $2.50 per share liquidating distribution declared to all investors of record as of February 13, 2019 and paid in February 2019.

•a $1.00 per Unit liquidating distribution declared to all investors of record as of July 15, 2020 and paid in July 2020.

•a $2.45 per Unit special distribution declared to all investors of record as of September 14, 2020 and paid in September 2020.

•a $0.80 per Unit special distribution declared to all investors of record as of September 29, 2021 and paid in September 2021.

•a $0.60 per Unit special distribution declared to all investors of record as of January 12, 2022, and paid in January 2022.

•a $0.62 per Unit special distribution declared to all investors of record as of March 17, 2022, and paid in March 2022.

We declared no operating distributions during the years ended December 31, 2021, 2020 or 2019. All distributions paid in these years were funded from proceeds from the sales of our real estate investments in the current and prior periods.

Item 6.  [Reserved]

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Item 7.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis together with our consolidated financial statements and notes thereto included in this Annual Report on Form 10-K. The following information contains forward-looking statements, which are subject to risks and uncertainties. Should one or more of these risks or uncertainties materialize, actual results may differ materially from those expressed or implied by the forward-looking statements. Please see “Special Note Regarding Forward-Looking Statements” above for a description of these risks and uncertainties.

This section of this Form 10-K generally discusses activities during the years ended December 31, 2021 and 2020 and comparisons between those periods. Discussions of activities during the years ended December 31, 2019 items and comparisons between the years ended December 31, 2020 and 2019 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

Executive Summary

As described more completely in “Item 1. Business”, Hines Global REIT, Inc. (“Hines Global”) was formed in 2008, primarily for the purpose of investing in a diversified portfolio of quality commercial real estate properties and other real estate investments located throughout the United States and internationally. Hines Global raised $3.1 billion of equity capital through various public offerings of its common stock from 2009 through 2018, all of which was invested in a diverse portfolio of 45 real estate investments.

In recent years, we had concentrated our efforts on actively managing our assets and exploring a variety of strategic opportunities focused on enhancing the composition of our portfolio and its total return potential for its investors. Our stockholders approved a Plan of Liquidation and Dissolution (the “Plan of Liquidation” or the “Plan”) in July 2018. The principal purpose of the Plan was to provide liquidity to our investors over a two-year period by selling Hines Global’s assets, making payments on property and corporate level debt, and distributing the net proceeds from liquidation to our investors.

While we anticipated a completion of the sale of our assets by July 17, 2020, which is the end of the 24-month period imposed by the Internal Revenue Service (“IRS”) for execution of the Plan of Liquidation, the economic disruption and uncertainty resulting from the Coronavirus pandemic have had a significant impact on the process and timing of the Plan’s completion. In June 2020, Hines Global and the members of the Board formed HGR Liquidating Trust, a Maryland statutory trust (the “Liquidating Trust” or the “Trust”). The purpose of the Trust is to complete the liquidation of Hines Global’s assets in accordance with the Plan of Liquidation. On June 30, 2020, the Company transferred all of its assets and liabilities to the Trust and received units of beneficial interest in the Trust (the “Units”) equal to the number of shares of the Company’s common stock outstanding on June 30, 2020. Immediately thereafter, the Company distributed the Units pro rata to its stockholders such that one Unit was distributed for each share of the Company’s common stock and all stockholders of the Company are now unitholders and beneficiaries of the Trust. For purposes of this Annual Report on Form 10-K, we refer to this transaction that occurred on June 30, 2020 as the Company's "conversion" to the Liquidating Trust.

All references to “the Company,” “we,” “our,” “us” or similar pronouns herein means Hines Global REIT, Inc. for periods prior to June 30, 2020, when Hines Global REIT, Inc. transferred all of its assets and liabilities to HGR Liquidating Trust, and means HGR Liquidating Trust for periods subsequent thereto. All references to “the Trust” mean HGR Liquidating Trust. In addition, all references to "investors" mean the stockholders of Hines Global for periods prior to June 30, 2020 and mean the unitholders of the Trust for periods subsequent thereto. Similarly, all references to the "Board" mean the board of directors of Hines Global for periods prior to June 30, 2020 and mean the board of trustees of the Trust for periods subsequent thereto.

We sold interests in 39 properties with an aggregate sale price of $5.4 billion from 2017 through 2021. As of December 31, 2021, our real estate portfolio consisted of one property, Minneapolis Retail Center. We sold Minneapolis Retail Center on March 10, 2022 for $150 million, excluding closing costs and prorations.

The Trustees determined a per Unit net asset value (“NAV”) of $0.66 as of March 11, 2022. This per Unit NAV is $1.43 lower than the previously determined per Unit NAV of $2.09 as of December 31, 2020, primarily as a result of the $1.40 per Unit of special distributions paid by the Company since that time. These distributions followed the sales of four of the five remaining properties in our real estate portfolio. We sold our final remaining property on March 10, 2022 and declared a special distribution of $0.62 per Unit that was paid in March 2022. The per Unit NAV was reduced to $0.04 as of March 17, 2022 following this distribution. See Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities for additional information.

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Additionally, the Company declared distributions of $0.70 per Unit per year for the period from October 2009 through December 2011 and $0.65 per Unit per year from January 2012 through December 2018 totaling $6.09 per Unit in aggregate. Approximately $0.45 per Unit of these distributions declared for the year ended December 31, 2018 were designated as a return of a portion of the investors’ invested capital. Further, the Company has declared special distributions and/or liquidating distributions to date totaling $9.02 per Unit. In aggregate, the Company has paid total distributions of $15.11 per Unit to investors, that invested at the inception of the Company. See “Note 7 — Distributions” for additional information regarding these distributions.

Comparability of Financial Data From Period to Period

We adopted the liquidation basis of accounting on July 1, 2020, upon our conversion to the Liquidating Trust. As described further below, the liquidation basis of accounting requires assets and liabilities to be recorded at amounts that approximate their ultimate value at liquidation. In prior periods, our financial statements were prepared on the going concern basis including the consolidated balance sheets, statements of operations and comprehensive income (loss), statements of changes in equity and statements of cash flows. As a result of the adoption of the liquidation basis of accounting, the amounts and results presented in these financial statements are not comparable to the amounts and results presented in our consolidated statement of net assets and statement of changes in net assets. Therefore, we will not describe changes between the periods before and after our adoption of the liquidation basis of accounting. Changes in the liquidation value of our assets are discussed below under Changes in Net Assets in Liquidation.

Further, we sold 40 of our 45 real estate investments prior to December 31, 2020 and distributed available proceeds. We sold four of the five remaining properties throughout 2021 and the final property in March 2022. As a result, we are no longer reporting funds from operations or modified funds from operations or other operating metrics as we no longer consider these to be key performance measures.

Critical Accounting Policies

Basis of Accounting - Liquidation Basis

As a result of our conversion to the Liquidating Trust, we adopted the liquidation basis of accounting in accordance with GAAP as of July 1, 2020 and for the periods subsequent to July 1, 2020. Accordingly, on July 1, 2020, assets were adjusted to their estimated net realizable value, or liquidation value, which represents the estimated amount of cash that we expect to collect. Estimated costs to dispose of assets have been presented separately from the real estate assets, net in the consolidated statement of net assets. Liabilities are carried at their contractual amounts due or estimated settlement amounts. The liquidation value of our net assets is presented on an undiscounted basis.

We accrue expenses and income that we expect to incur and earn through the end of liquidation to the extent we have a reasonable basis for their estimation. These amounts are classified as a liability for estimated expenses in excess of estimated income during liquidation in the consolidated statement of net assets. Actual expenses and income may differ from amounts reflected in the financial statements because of inherent uncertainty in estimating future events. These differences may be material.

Net assets in liquidation represents the estimated liquidation value available to investors upon liquidation. Due to the uncertainty in the timing of the anticipated sale dates and the estimated cash flows, actual operating results and sale proceeds may differ materially from the amounts estimated.

Use of Estimates

The preparation of the consolidated financial statements in accordance with GAAP requires us to make estimates and judgments that affect the reported amounts of assets, liabilities and contingencies as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We evaluate our assumptions and estimates on an ongoing basis. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Additionally, application of our accounting policies involves exercising judgments regarding assumptions as to future uncertainties. Actual results may differ from these estimates under different assumptions or conditions. The following is a discussion of our critical accounting policies. For a discussion of all of our significant accounting policies, see Note 2 — Summary of Significant Accounting Policies, to the accompanying consolidated financial statements.

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Investment Property and Lease Intangibles - Going Concern Basis

Real estate assets are reviewed for impairment each reporting period if events or changes in circumstances indicate that the carrying amount of the individual property may not be recoverable. In such an event, a comparison will be made of the current and projected operating cash flows and expected proceeds from the eventual disposition of each property on an undiscounted basis to the carrying amount of such property. If the carrying amount exceeds the undiscounted cash flows, it would be written down to the estimated fair value to reflect impairment in the value of the asset. The determination of whether investment property is impaired requires a significant amount of judgment by management and is based on the best information available to management at the time of the evaluation.

In July 2019, we determined that all of our real estate properties and their related assets and associated liabilities should be classified as held for sale. As a result of the held for sale classification, amounts related to assets held for sale are recorded at the lower of their current carrying value or fair value less costs to sell. Also, as a result of the held for sale classification, we have stopped recording depreciation and amortization to the assets held for sale and their related liabilities as of July 2019.

During the six months ended June 30, 2020, and year ended December 31, 2019, we recorded total impairment charges of $18.6 million and $122.6 million, respectively.

Deferred Leasing Costs - Going Concern Basis

Direct leasing costs, primarily consisting of third-party leasing commissions and tenant inducements are capitalized and amortized over the life of the related lease. Tenant inducement amortization is recorded as an offset to rental revenue and the amortization of other direct leasing costs is recorded in amortization expense. We consider a number of different factors to evaluate whether we or the lessee is the owner of the tenant improvements for accounting purposes. These factors include: (i) whether the lease stipulates how and on what a tenant improvement allowance may be spent; (ii) whether the tenant or landlord retains legal title to the improvements; (iii) the uniqueness of the improvements; (iv) the expected economic life of the tenant improvements relative to the term of the lease; and (v) who constructs or directs the construction of the improvements. The determination of who owns the tenant improvements for accounting purposes is subject to significant judgment. In making that determination, we consider all of the above factors. No one factor, however, necessarily establishes any determination. Further, as a result of the held for sale designation, no amortization was recorded after July 2019.

Revenue Recognition and Valuation of Receivables - Going Concern Basis

We are required to recognize minimum rent revenues on a straight-line basis over the terms of tenant leases, including rent holidays and bargain renewal options, if any. Revenues associated with tenant reimbursements are recognized in the period in which the expenses are incurred based upon the tenant’s lease provision. Leases are not uniform in dealing with such cost reimbursements and there are many variations to the computation. We make quarterly accrual adjustments, positive or negative, to tenant reimbursement revenue to adjust the recorded amounts to our best estimate of the final amounts to be billed and collected with respect to the cost reimbursements. Revenues relating to lease termination fees are recognized on a straight-line basis amortized from the time that a tenant’s right to occupy the leased space is modified through the end of the revised lease term and are included in other revenue in the accompanying consolidated statements of operations. To the extent our leases provide for rental increases at specified intervals, we will record a receivable for rent not yet due under the lease terms. Accordingly, our management must determine, in its judgment, to what extent the unbilled rent receivable applicable to each specific tenant is collectible. Revenue from leases where collection is deemed to be less than probable is recorded on a cash basis until collectability is determined to be probable. Further, we assess whether operating lease receivables, at a portfolio level, are appropriately valued based upon an analysis of balances outstanding, historical bad debt levels and current economic trends. The uncollectible portion of the portfolio is recorded as an adjustment to rental revenues. Prior to the adoption of ASU 2016-02, an allowance for the uncollectible portion of tenant and other receivables was determined and recognized based upon an analysis of the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located.

Recent Accounting Pronouncements

See Note 2 — Summary of Significant Accounting Policies to the accompanying consolidated financial statements for a discussion regarding recent accounting pronouncements and the potential impact, if any, on our financial statements.

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Financial Condition, Liquidity and Capital Resources

Historically our most significant demands for funds were related to the purchase of real estate properties and other real estate-related investments. Specifically, we funded $5.1 billion of real estate investments using $3.1 billion of proceeds from our public offerings, including the DRP offerings, and debt proceeds. We invested all of the proceeds raised through our public offerings by the end of 2015. As a result, any real estate investments we made since that time were funded using proceeds from the dispositions of other real estate investments, debt proceeds, or our distribution reinvestment plan.

In recent years, our primary demands for funds include debt repayment and liquidating distributions to our investors and, to a lesser extent, the payment of operating expenses and capital expenditures of our remaining properties. Generally, we expect to meet these cash needs using the proceeds from the sales of our remaining investment properties, cash flows from operating activities and cash on hand.

As of December 31, 2021, we had cash and cash equivalents of $187.7 million. Our net assets in liquidation as of December 31, 2021 was $330.6 million.

Principal Sources and Uses of Funds

Our primary non-operating sources of cash flows for the year ended December 31, 2021 include the following:

•$218.9 million of net proceeds from the sale of The Rim in May 2021.

•$35.6 million of net proceeds from the sale of Gogolevsky 11 in November 2021.

•$86.0 million of net proceeds from the sale of Markets at Town Center in November 2021.

•$24.7 million of net proceeds from the sale of New City in December 2021.

Our primary non-operating uses of cash flows for the year ended December 31, 2021 include the following:

•$209.9 million of liquidating distributions to our unitholders, which consisted of the $0.80 per Unit distribution declared in September 2021.

•$3.2 million of amortization payments on the principal balance of our secured mortgage loan. The loan was assumed by the buyer of New City in November 2021.

•$4.4 million of disposition fees paid in 2021 related to the sales described above.

•$8.9 million in payments for capital expenditures at our real estate investment properties in 2021.

As of December 31, 2020, we had cash and cash equivalents of $27.3 million. Our net assets in liquidation as of December 31, 2020, was $549.7 million.

Principal Sources and Uses of Funds

Our primary non-operating sources of cash flows for the year ended December 31, 2020 include the following:

•$222.2 million of net proceeds from the sale of Riverside Center in January 2020.

•$58.2 million of net proceeds from the sale of Perspective Defense in February 2020.

•$64.7 million of net proceeds from the sale of Campus at Marlborough in June 2020.

•$477.7 million of net proceeds from the sale of 25 Cabot in July 2020.

•$132.3 million of net proceeds from the sale of the Avenue at Murfreesboro in August 2020.

•$32.1 million of net proceeds from the sale of several outparcels at the Rim from January 2020 through September 2020.

•$8.0 million of net proceeds from the sale of an outparcel at the Markets at Town Center in October 2020.

•$6.0 million of proceeds from our borrowing from an affiliate of our sponsor in September 2020, which was subsequently paid off in October 31, 2020.

Our primary non-operating uses of cash flows for the year ended December 31, 2020 include the following:

•$905.5 million of liquidating distributions to our unitholders, which consisted of the $1.00 per Unit distribution declared in July 2020, and the $2.45 per Unit distribution declared in September 2020.

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•$399.3 million of payments on our notes payable, including $225.0 million of total payments to pay off the balance of our JP Morgan credit facility. The remaining payments were related to payoffs of the secured mortgage loans upon the sales of the related properties and amortization payments on the principal balances of our secured mortgage loans.

•$19.2 million of disposition fees paid in 2020 related to the sales described above, as well as sales in late 2019.

•$6.0 million in payments to pay off the balance of our notes payable from an affiliate of our sponsor described above.

•$12.3 million in payments for capital expenditures at our real estate investment properties in 2020.

•$6.0 million in payments related to death and disability redemptions of our common shares prior to the suspension of our Share Redemption Program in May 2020.

Results of Operations

Changes in Net Assets for the period from January 1, 2021 through December 31, 2021

The table below includes information regarding changes in our net assets for the period from January 1, 2021 through December 31, 2021, including explanations for significant changes.

	(In thousands)
Net assets in liquidation, beginning of period	$	549,706
Change in liquidation value of investments in real estate	(8,073)
Remeasurement of assets and liabilities, including costs in excess of estimated income	(1,096)
Net decrease in liquidation value	$	(9,169)
Liquidating distributions to unitholders	(209,917)
Changes in net assets in liquidation	(219,086)
Net assets in liquidation, end of period	$	330,620

Net assets in liquidation decreased by $219.1 million for the year ended December 31, 2021. The reduction during the period is primarily due to liquidating distributions paid to investors totaling $209.9 million or $0.80 per Unit. These distributions were funded from proceeds from the sale of four properties with an aggregate sale price of $433.0 million.

Additionally, the estimated value of our real estate investments decreased by $8.1 million for the year ended December 31, 2021, primarily due to market conditions resulting from the Coronavirus pandemic and its effect on our one remaining retail

property, Minneapolis Retail Center. The estimated liquidation value of this property was based on the contract sale price as of

December 31, 2021.

Lastly, during the year ended December 31, 2021, there was a $1.1 million decrease related to remeasuring assets and liabilities, including the liability for estimated costs in excess of estimated income during liquidation.

The remaining undistributed net assets in liquidation is $330.6 million as of December 31, 2021 or approximately $1.26 per Unit. This estimate included projections as of December 31, 2021 regarding the timing of the completion of the sale of our remaining property and the amount of sales proceeds that would be generated, as well as costs and expenses to be incurred during liquidation. Since December 31, 2021, the Company sold its final remaining property and paid distributions totaling

$1.22 per Unit to investors. Our remaining per Unit NAV was $0.04 as of March 17, 2022, which

we expect to pay to investors after our wind-down is completed, later this year. There can be no certainty

regarding the timing or the amount of any future distributions.

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Changes in Net Assets for the period from July 1, 2020 through December 31, 2020

The table below includes information regarding changes in our net assets for the period from July 1, 2020 through December 31, 2020, including explanations for significant changes.

	(In thousands)
Net assets in liquidation, beginning of period	$	1,463,820
Change in liquidation value of investments in real estate	(31,699)
Remeasurement of assets and liabilities, including costs in excess of estimated income	22,851
Net decrease in liquidation value	$	(8,848)
Liquidating distributions to unitholders	(905,266)
Changes in net assets in liquidation	(914,114)
Net assets in liquidation, end of period	$	549,706

Net assets in liquidation decreased by $914.1 million during the period from July 1, 2020 to December 31, 2020. The reduction during the period is primarily due to liquidating distributions paid to investors totaling $905.3 million or $3.45 per Unit. These distributions were funded from proceeds from the sale of five properties with an aggregate sale price of $1.1 billion.

Additionally, the estimated value of our real estate investments decreased by $31.7 million between July 1, 2020 and December 31, 2020, including the effect of properties sold during that period. The decrease was primarily due to adverse effects of the Coronavirus pandemic on market conditions. The estimated liquidation values of the Company’s remaining properties are based on negotiated sale prices or other market conditions and assumptions as of December 31, 2020. The net assets in liquidation at December 31, 2020 includes five properties valued at $597.2 million.

Lastly, during the period from July 1, 2020 through December 31, 2020, there was a $22.9 million increase related to remeasuring assets and liabilities, including the liability for estimated costs in excess of estimated income during liquidation.

The remaining undistributed net assets in liquidation is $549.7 million as of December 31, 2020 or approximately $2.09 per Unit. This estimate included projections as of December 31, 2020 of timing and amounts of future sales, as well as costs and expenses to be incurred during liquidation.

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Related-Party Transactions and Agreements

We have entered into agreements with the Advisor, and Hines or its affiliates, whereby we pay certain fees and reimbursements to these entities during the various phases of our operation. During the disposition and liquidation stages, these include payments for certain services related to management of our investments and operations provided to us by the Advisor and Hines and its affiliates pursuant to various agreements we have entered into or anticipate entering into with these entities. See Note 8 — Related Party Transactions to the Consolidated Financial Statements contained elsewhere in this Annual Report on Form 10-K for additional information concerning our Related-Party Transactions and Agreements.

Off-Balance Sheet Arrangements

As of December 31, 2021 and December 31, 2020, we had no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

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Recent Developments and Subsequent Events

Minneapolis Retail Center

In March 2022, we sold Minneapolis Retail Center for a contract sales price of $150.0 million. The purchaser is not affiliated with us or our affiliates.

Liquidating Distribution

In March 2022, our Trustees declared and paid a liquidating distribution of $0.62 per Unit, following the sale of Minneapolis Retail Center. As a result of the $0.62 per Unit liquidating distribution, the per Unit NAV was reduced to $0.04 as of March 17, 2022.

Item 7A.  Quantitative and Qualitative Disclosures About Market Risk

Market risk includes risks that arise from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices and other market changes that affect market-sensitive instruments. In pursuing our business plan, we believe that interest rate risk, currency risk and real estate valuation risk were the primary market risks to which we were exposed. Due to the sale of all of our international real estate investments and repayment of all of our outstanding debt, we no longer have exposure to these risks.

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Item 8.  Financial Statements and Supplementary Data

HGR LIQUIDATING TRUST

CONSOLIDATED STATEMENT OF NET ASSETS

(Liquidation Basis, Unaudited)

As of December 31, 2021 and 2020

	2021		2020
	(In thousands)
ASSETS
Investment property	$	150,000	$	597,200
Cash and cash equivalents	187,661		27,316
Restricted cash	19,281		3,581
Derivative instruments	—		70
Tenant and other receivables	3,962		12,219
Other assets	1,414		2,802
Total assets	$	362,318	$	643,188
LIABILITIES
Liabilities:
Accounts payable and accrued expenses	$	23,484	$	8,825
Due to affiliates	1,613		2,348
Other liabilities	690		8,587
Liability for estimated costs in excess of estimated income	5,885		8,010
Note payable	—		65,668
Total liabilities	31,672		93,438
Minority Interest	26		44
Net assets in liquidation	$	330,620	$	549,706

See notes to the consolidated financial statements.

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HGR LIQUIDATING TRUST

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS

(Liquidation Basis, Unaudited)

For the Year Ended December 31, 2021 and For the Period from July 1, 2020 through December 31, 2020

	Year Ended December 31, 2021		Period from July 1, 2020 through December 31, 2020
	(In thousands)
Net assets in liquidation, beginning of period	$	549,706	$	1,463,820
Change in liquidation value of investments in real estate	(8,073)		(31,699)
Remeasurement of assets and liabilities, including costs in excess of estimated income	(1,096)		22,851
Net decrease in liquidation value	(9,169)		(8,848)
Liquidating distributions to unitholders	(209,917)		(905,266)
Changes in net assets in liquidation	(219,086)		(914,114)
Net assets in liquidation, end of period	$	330,620	$	549,706

See notes to the consolidated financial statements.

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HGR LIQUIDATING TRUST

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Going Concern Basis - Unaudited)

For the Six Months Ended June 30, 2020 and For the Year Ended December 31, 2019

	Six Months Ended June 30, 2020		Year Ended December 31, 2019
	(In thousands, except per share amounts)
Revenues:
Rental revenue	$	61,632	$	184,601
Other revenue	1,047		8,967
Total revenues	62,679		193,568
Expenses:
Property operating expenses	19,560		49,958
Real property taxes	8,661		24,805
Property management fees	1,466		4,718
Depreciation and amortization	—		30,566
Asset management fees	10,762		26,365
General and administrative expenses	3,904		8,287
Impairment losses	18,591		122,603
Total expenses	62,944		267,302
Other income (expenses):
Gain (loss) on derivative instruments	20,416		(3,838)
Gain (loss) on sale of real estate investments	68,206		406,277
Foreign currency gains (losses)	(4,984)		1,611
Interest expense	(4,319)		(28,809)
Other income (expenses)	1,191		1,595
Income (loss) before benefit (provision) for income taxes	80,245		303,102
Benefit (provision) for income taxes	(2,922)		(2,686)
Provision for income taxes related to sale of real estate	—		—
Net income (loss)	77,323		300,416
Net (income) loss attributable to noncontrolling interests	23		(35)
Net income (loss) attributable to common stockholders	$	77,346	$	300,381
Basic and diluted income (loss) per common share:	$	0.29	$	1.14
Weighted average number of common shares outstanding	264,131		264,131
Net comprehensive income (loss):
Net income (loss)	$	77,323	$	300,416
Other comprehensive income (loss):
Foreign currency translation adjustment	(5,372)		46,367
Net comprehensive income (loss):	71,951		346,783
Net comprehensive (income) loss attributable to noncontrolling interests	39		(46)
Net comprehensive income (loss) attributable to common stockholders	$	71,990	$	346,737

See notes to the consolidated financial statements.

22

HGR LIQUIDATING TRUST

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Going Concern Basis - Unaudited)

For the Six Months Ended June 30, 2020 and For the Year Ended December 31, 2019

(In thousands)

	HGR Liquidating Trust
	Common Shares	Amount		Additional Paid-in Capital		Accumulated Distributions in Excess of Earnings		Accumulated Other Comprehensive Income (Loss)		Total Stockholders’ Equity		Noncontrolling Interests
Balance as of January 1, 2019	267,073	$	267	$	2,409,529	$	(688,475)	$	(128,927)	$	1,592,394	$	468
Issuance of common shares	19	—		90		—		—		90		—
Contributions from noncontrolling interest	—	—		—		—		—		—		97
Distributions declared	—	—		—		(661,238)		—		(661,238)		(81)
Redemption of common shares	(3,719)	(4)		(22,903)		—		—		(22,907)		—
Issuer costs	—	—		(43)		—		—		(43)		—
Net income (loss)	—	—		—		300,381		—		300,381		35
Foreign currency translation adjustment	—	—		—		—		9,572		9,572		11
Foreign currency translation adjustment reclassified into earnings	—	—		—		—		36,784		36,784		—
Balance as of December 31, 2019	263,373	$	263	$	2,386,673	$	(1,049,332)	$	(82,571)	$	1,255,033	$	530
Issuance of common shares	—	—		60		—		—		60		—
Distributions declared	—	—		—		—		—		—		(32)
Redemption of common shares	(977)	(1)		(5,332)		—		—		(5,333)		—
Issuer costs	—	—		(13)		—		—		(13)		—
Net income (loss)	—	—		—		77,346		—		77,346		(23)
Foreign currency translation adjustment	—	—		—		—		(15,257)		(15,257)		(16)
Foreign currency translation adjustment reclassified into earnings	—	—		—		—		9,901		9,901		—
Balance as of June 30, 2020	262,396	$	262	$	2,381,388	$	(971,986)	$	(87,927)	$	1,321,737	$	459

See notes to the consolidated financial statements.

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HGR LIQUIDATING TRUST

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Going Concern Basis - Unaudited)

For the Six Months Ended June 30, 2020 and For the Year Ended December 31, 2019

	Six Months Ended June 30, 2020		Year Ended December 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:	(In thousands)
Net income (loss)	$	77,323	$	300,416
Adjustments to reconcile net income (loss) to net cash from operating activities:
Depreciation and amortization	481		38,540
Foreign currency (gains) losses	4,984		(1,611)
(Gain) on sale of real estate investments	(68,206)		(406,277)
Impairment losses	18,591		122,603
(Gain) loss on derivative instruments	(20,416)		3,838
Changes in assets and liabilities:
Change in other assets	2,512		2,976
Change in tenant and other receivables	(4,974)		1,234
Change in deferred leasing costs	(2,246)		(46,282)
Change in accounts payable and accrued expenses	(6,574)		(7,793)
Change in other liabilities	(2,944)		(7,823)
Change in due to affiliates	(4,508)		(1,998)
Net cash from (used in) operating activities	(5,977)		(2,177)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of real estate investments, net	379,346		1,071,153
Capital expenditures at operating properties	(10,260)		(93,225)
Net cash from investing activities	369,086		977,928
CASH FLOWS FROM FINANCING ACTIVITIES:
Contribution from noncontrolling interest	—		97
Redemption of common shares	(6,031)		(30,348)
Payment of issuer costs	(13)		(46)
Distributions paid to stockholders and noncontrolling interests	(32)		(675,787)
Proceeds from notes payable	—		324,000
Payments on notes payable	(226,046)		(466,683)
Change in security deposit liability	259		70
Deferred financing costs paid	(814)		(1,964)
Payments related to interest rate contracts	—		(29)
Net cash used in financing activities	(232,677)		(850,690)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	1,685		(119)
Net change in cash, cash equivalents, and restricted cash	132,117		124,942
Cash, cash equivalents and restricted cash, beginning of period	385,959		261,017
Cash, cash equivalents and restricted cash, end of period	$	518,076	$	385,959

See notes to the consolidated financial statements.

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HGR LIQUIDATING TRUST

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1.  ORGANIZATION

Hines Global REIT, Inc. (the “Company”), was formed as a Maryland corporation on December 10, 2008 under the General Corporation Law of the state of Maryland for the purpose of engaging in the business of investing in and owning commercial real estate properties and other real estate investments. The Company raised the equity capital for its real estate investments through 2 public offerings from August 2009 through April 2014, and through its distribution reinvestment plan (the “DRP Offering”) from April 2014 through August 2018. Collectively, through its public offerings, the Company raised gross offering proceeds of approximately $3.1 billion, including the DRP Offering, all of which was invested in the Company’s real estate portfolio. The Company invested the proceeds from its public offerings into a diverse portfolio of real estate investments. At the peak of its acquisition phase, the Company owned interests in 45 properties. In recent years, the Company has concentrated its efforts on actively managing its assets and exploring a variety of strategic opportunities focused on enhancing the composition of its portfolio and its total return potential for its investors. On April 23, 2018, in connection with its review of potential strategic alternatives available to the Company, the Board determined that it is in the best interests of the Company and its investors to sell all or substantially all of its properties and assets and for the Company to liquidate and dissolve pursuant to the Company's Plan of Liquidation and Dissolution (the “Plan of Liquidation”). The principal purpose of the liquidation is to provide liquidity to investors by selling the Company’s assets, making payments on property and corporate level debt, and distributing the net proceeds from liquidation to the Company's investors. As required by Maryland law and the Company's charter, the Plan of Liquidation was approved by the affirmative vote of the holders of at least a majority of the shares of the Company's common stock outstanding and entitled to vote thereon at the Company’s annual meeting held on July 17, 2018.

As required by Maryland law and the Company’s charter, the Plan of Liquidation was approved by the affirmative vote of the holders of at least a majority of the shares of the Company’s common stock outstanding and entitled to vote thereon at the Company’s annual meeting of investors held on July 17, 2018. While the Company anticipated a completion of the sale of all of its assets by July 17, 2020, which is the 24-month period imposed by the Internal Revenue Service (“IRS”) for execution of the Plan, the economic disruption and uncertainty resulting from the Coronavirus pandemic have had a significant impact on the process and timing of the Plan of Liquidation’s completion. On June 30, 2020, Hines Global and the Trustees identified below entered into an Agreement and Declaration of Trust (the “Liquidating Trust Agreement”) in connection with the formation of HGR Liquidating Trust, a Maryland statutory trust (the “Liquidating Trust” or the “Trust”). The purpose of the Trust is to complete the liquidation of Hines Global’s assets in accordance with the Plan of Liquidation. The trustees of the Trust consist of certain members of Hines Global’s board of directors: Jeffrey C. Hines, Charles M. Baughn, Jack L. Farley, Thomas L. Mitchell, John S. Moody and Peter Shaper; and David L. Steinbach, the Company’s Chief Investment Officer (collectively, the “Trustees”). Pursuant to the Liquidating Trust Agreement, the Company transferred all of its assets and liabilities to the Trust and received units of beneficial interest in the Trust (the “Units”) equal to the number of shares of the Company’s common stock outstanding on June 30, 2020. Immediately thereafter, the Company distributed the Units pro rata to its stockholders such that one Unit was distributed for each share of the Company’s common stock and all stockholders of the Company are now unitholders and beneficiaries of the Trust.

The Liquidating Trust Agreement provides that the Trust will terminate upon the earliest of (a) such time as termination is required by the applicable laws of the State of Maryland, (b) the determination of the Board to terminate the Trust following the distribution of all its assets in accordance with the Liquidating Trust Agreement, or (c) the expiration of a period of three years from June 30, 2020. Notwithstanding the foregoing, the Board may continue the existence of the Trust beyond the three-year term if the Board in its reasonable discretion determines that an extension is necessary to fulfill the purposes of the Trust, provided that the Board has requested and obtained no-action assurance from the SEC regarding relief from registration and reporting requirements under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) prior to any such extension.

The Liquidating Trust Agreement further provides that the Board has the discretion to make distributions of available cash to the investors as and when they deem such distributions to be in the best interests of the investors, taking into account the administrative costs of making such distributions, anticipated costs and expenses of the Trust and such other factors as they may consider appropriate.

The Liquidating Trust Agreement provides for an orderly sale of the Company's remaining assets, payment of the Company's liabilities and other obligations, and the winding up of operations and dissolution of the Company. The Company may sell any and all of its assets without further approval of the investors and provides that liquidating distributions be made to

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the investors as determined by the Board. The Liquidating Trust expects to pay or provide for all of the Company’s liabilities and distribute any remaining net proceeds from the sale of its remaining assets to the holders of interests in the Liquidating Trust.

The dissolution process and the amount and timing of distributions to investors involves significant risks and uncertainties. Accordingly, it is not possible to predict the timing or aggregate amount which will ultimately be distributed to investors, and no assurance can be given that the distributions will equal or exceed the estimate of net assets presented in the consolidated statement of net assets.

All references to the “Company,” means Hines Global REIT, Inc. for periods prior to June 30, 2020, when Hines Global REIT, Inc. transferred all of its assets and liabilities to HGR Liquidating Trust, and means HGR Liquidating Trust for periods subsequent thereto. In addition, all references to "investors" mean the stockholders of Hines Global REIT, Inc. for periods prior to June 30, 2020 and mean the unitholders of the Trust for the period subsequent thereto. Similarly, all references to the "Board" mean the board of directors of Hines Global for periods prior to June 30, 2020 and mean the board of trustees of the Trust for the period subsequent thereto. Further, all references to "Units" means the units of beneficial interest in the Trust for the period subsequent to June 30, 2020 and means, to the extent applicable, the shares of Hines Global REIT, Inc. for periods through June 30, 2020.

The Company sold interests in 39 properties with an aggregate sale price of $5.4 billion from 2017 through 2021. The Company owned 1 remaining property, Minneapolis Retail Center, as of December 31, 2021. This property was sold on March 10, 2022, as described below.

The Trustees determined a per Unit net asset value (“NAV”) of $0.66 as of March 11, 2022. This per Unit NAV is $1.43 lower than the previously determined per Unit NAV of $2.09 as of December 31, 2020 primarily as a result of the $1.40 per Unit special distributions paid by the Company since that time. These distributions followed the sales of 4 of the 5 remaining properties in our real estate portfolio. We sold our final remaining property on March 10, 2022 and declared a special distribution of $0.62 per Unit that was paid in March 2022. The per Unit NAV was reduced to $0.04 as of March 17, 2022 following this distribution.

The Company declared distributions of $0.70 per Unit, per year for the period from October 2009 through December 2011 and $0.65 per Unit, per year from January 2012 through December 2018 totaling $6.09 per Unit in aggregate. Approximately $0.45 per Unit of these distributions declared for the year ended December 31, 2018 were designated as a return of a portion of the investors’ invested capital. Further, the Company has declared special distributions and/or liquidating distributions to date totaling $9.02 per Unit. In aggregate, the Company has paid total distributions of $15.11 per Unit to the investors from the inception of our fund to date. See “Note 7 — Distributions” for additional information regarding these distributions.

The Company sold interests in 4 properties for an aggregate sales price of $1.3 billion during 2019, and 3 properties through June 30, 2020 for an aggregate sales price of $445.9 million. Subsequent to the conversion to the Liquidation Trust on June 30, 2020, the Company sold 2 additional properties in the period from July 1, 2020 through December 31, 2020 for an aggregate sales price of $619.0 million for a total of 5 properties sold in 2020. Additionally, the Company sold interests in 4 real estate investments for aggregate sales price of $433.0 million during 2021. The Company owned 1 remaining property, Minneapolis Retail Center, as of December 31, 2021. This property was sold on March 10, 2022 for an aggregate sales price of $150.0 million.

Noncontrolling Interests

On January 7, 2009, the Company and Hines Global REIT Associates Limited Partnership (“HALP”), an affiliate of the Advisor, formed Hines Global REIT Properties, LP (the “Operating Partnership”). The Company conducts most of its operations through the Operating Partnership. On January 14, 2009, the Company and HALP made initial capital contributions to the Operating Partnership of $10,000 and $190,000, respectively and accordingly, HALP owned a 95.0% noncontrolling interest in the Operating Partnership. As of December 31, 2021 and 2020, HALP owned a 0.01% and 0.01% interest in the Operating Partnership, respectively.

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2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting - Liquidation Basis

The Company adopted the liquidation basis of accounting as of July 1, 2020 and for the period subsequent to July 1, 2020 as a result of the entering in to the Liquidating Trust Agreement on June 30, 2020. Accordingly, on July 1, 2020 the carrying value of the Company’s assets were adjusted to their estimated net realizable value, or liquidation value, which represents the estimated amount of cash that the Company reasonably expects to collect from their sale. Liabilities are carried at their contractual amounts due or estimated settlement amounts. The liquidation value of the Company’s net assets is presented on an undiscounted basis. Due to the uncertainty in the timing of the anticipated sale amounts and dates and the estimated cash flows, actual operating results and sale proceeds may differ materially from the amounts estimated.

Additionally, the Company accrues costs and income that it expects to incur and earn through the end of the liquidation period, to the extent it has a reasonable basis for estimation. This also includes estimated costs to dispose of assets. These amounts are classified as a liability for estimated costs in excess of estimated income during liquidation in the consolidated statement of net assets. Actual costs and income may differ from amounts reflected in the financial statements because of inherent uncertainty in estimating future events. These differences may be material.

As a result of the change to the liquidation basis of accounting, the Company’s financial statements as of and for the year ended December 31, 2021 are presented using the liquidation basis of accounting. Additionally, the Company’s financial statements as of and for the year ended December 31, 2020 are presented using two different presentations. For the liquidation basis of accounting, a consolidated statement of net assets is presented, which represents the estimated liquidation value available to trustees upon liquidation. In addition, a consolidated statement of changes in net assets reflects changes in net assets for the year ended December 31, 2021 and from the original estimated values as of July 1, 2020 through December 31, 2020.

The consolidated statements of operations and comprehensive income (loss), consolidated statement of changes in equity and statements of cash flow for the periods ended June 30, 2020 and December 31, 2019 included in this Annual Report on Form 10-K are presented based on a going concern basis, which contemplated the realization of assets and liabilities in the normal course of business. The Company no longer presents a Consolidated Balance Sheet, a Consolidated Statement of Operations and Comprehensive Income (Loss), a Consolidated Statement of Changes in Equity or a Consolidated Statement of Cash Flows.

Use of Estimates

The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of the consolidated financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities and contingencies as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. The Company evaluates its assumptions and estimates on an ongoing basis. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. Additionally, application of the Company’s accounting policies involves exercising judgments regarding assumptions as to future uncertainties. Actual results may differ from these estimates under different assumptions or conditions.

Basis of Presentation

The consolidated financial statements of the Company include the accounts of Hines Global REIT, Inc. or HGR Liquidating Trust, the Operating Partnership and its wholly-owned subsidiaries and the joint ventures as well as amounts related to noncontrolling interests. All intercompany balances and transactions have been eliminated in consolidation.

International Operations

The British pound (“GBP”) is the functional currency for the Company’s subsidiaries in the United Kingdom, the Russian ruble (“RUB”) is the functional currency for the Company’s subsidiaries in Russia, the Polish zloty (“PLN”) is the functional currency for the Company’s subsidiaries in Poland, the Australian dollar (“AUD”) is the functional currency for the Company’s subsidiaries in Australia and the Euro (“EUR”) is the functional currency for the Company’s subsidiaries in Germany and France.

These subsidiaries have translated their financial statements into U.S. dollars for reporting purposes. Assets and liabilities are translated at the exchange rate in effect as of the balance sheet date while income statement accounts are translated using the

27

average exchange rate for the period and significant nonrecurring transactions using the rate on the transaction date. Gains or losses resulting from translation are included in accumulated other comprehensive income (loss) within stockholders’ equity. Foreign currency transaction gains and losses are recorded in foreign currency gains (losses) on the Consolidated Statement of Operations and result from the effect of changes in exchange rates on transactions denominated in currencies other than a subsidiary’s functional currency, including transactions between consolidated subsidiaries. An exception is made where an intercompany loan or advance is deemed to be of a long-term investment nature, in which instance foreign currency transaction gains or losses are included as currency translation adjustments and are reported in the Consolidated Statement of Equity as accumulated other comprehensive gains or losses. During the year ended December 31, 2019, the Company sold FM Logistic. Upon the disposal of this property, the Company realized a loss of $36.8 million related to the currency translation adjustment, which was included in the gain (loss) on the sale of real estate investments in its consolidated statement of operations. During the year ended December 31, 2020, the Company sold Perspective Defense. Upon the disposal of this property, the Company realized a loss of $7.8 million related to the currency translation adjustment, which was included in the gain (loss) on the sale of real estate investments in its consolidated statement of operations. As of December 31, 2021, the Company did not own any international real estate investments.

Investment Property and Lease Intangibles - Going Concern Basis

Real estate assets acquired by the Company are stated at fair value at the date of acquisition less accumulated depreciation. Depreciation is computed using the straight-line method. The estimated useful lives for computing depreciation are generally 10 years for furniture and fixtures, 15-20 years for electrical and mechanical installations and 40 years for buildings. Major replacements that extend the useful life of the assets are capitalized and maintenance and repair costs are expensed as incurred.

The estimated fair value of acquired in-place leases are the costs the Company would have incurred to lease the properties to the occupancy level of the properties at the date of acquisition. Such estimates include the fair value of leasing commissions, legal costs and other direct costs that would be incurred to lease the properties to such occupancy levels. Additionally, the Company evaluates the time period over which such occupancy levels would be achieved. Such evaluation will include an estimate of the net market-based rental revenues and net operating costs (primarily consisting of real estate taxes, insurance and utilities) that would be incurred during the lease-up period. Acquired in-place leases as of the date of acquisition are amortized over the remaining lease terms. Should a tenant terminate its lease, the unamortized portion of the in-place lease value is charged to amortization expense.

Acquired out-of-market lease values (including ground leases) are recorded based on the present value (using a discount rate that reflects the risks associated with the lease acquired) of the difference between the contractual amounts paid pursuant to the in-place leases and management’s estimate of fair market value lease rates for the corresponding in-place leases. The capitalized out-of-market lease values are amortized as adjustments to rental revenue (or ground lease expense, as applicable) over the remaining terms of the respective leases, which include periods covered by bargain renewal options. Should a tenant terminate its lease, the unamortized portion of the out-of-market lease value is charged to rental revenue.

Management estimates the fair value of assumed mortgage notes payable based upon indications of then-current market pricing for similar types of debt with similar maturities. Assumed mortgage notes payable are initially recorded at their estimated fair value as of the assumption date, and the difference between such estimated fair value and the outstanding principal balance of the note will be amortized over the life of the mortgage note payable.

Real estate assets are reviewed for impairment each reporting period if events or changes in circumstances indicate that the carrying amount of the individual property may not be recoverable. In such an event, a comparison will be made of the current and projected operating cash flows and expected proceeds from the eventual disposition of each property on an undiscounted basis to the carrying amount of such property. If the carrying amount exceeds the undiscounted cash flows, it would be written down to the estimated fair value to reflect impairment in the value of the asset. The determination of whether investment property is impaired requires a significant amount of judgment by management and is based on the best information available to management at the time of the evaluation.

For the six months ended June 30, 2020, the Company determined that 3 of its remaining properties were impaired by $18.6 million based on such assets having carrying values that exceeded their estimate sales price less costs to sell based on the offers received (level 2 inputs). See Note 9 — Fair Value Measurement for more information.

Cash and Cash Equivalents

The Company considers all short-term, highly liquid investments that are readily convertible to cash with an original maturity of three months or less at the time of purchase to be cash equivalents.

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Restricted Cash

Restricted cash was $19.3 million at December 31, 2021, which related to amounts escrowed for the payment of Value-Added Taxes (“VAT”) related to the sale of New City in November 2021. The Company paid the VAT liability in January 2022.

Concentration of Credit Risk

As of December 31, 2021, the Company had cash and cash equivalents and restricted cash deposited in certain financial institutions in excess of federally insured levels. Management regularly monitors the financial stability of these financial institutions in an effort to manage the Company’s exposure to any significant credit risk in cash and cash equivalents or restricted cash.

In addition, as of December 31, 2021, the Company had $6.8 million of cash and cash equivalents deposited in certain financial institutions located in the United Kingdom, Poland, Australia, and France. Management regularly monitors the financial stability of these financial institutions in an effort to manage its exposure to any significant credit risk in cash and cash equivalents.

Tenant and Other Receivables

Receivable balances consist primarily of base rents, tenant reimbursements and receivables attributable to straight-line rent, and are carried at cost.  Upon the adoption of Accounting Standards Update (“ASU”) 2016-02, individual leases are assessed for collectability and upon the determination that the collection of rents is not probable, accrued rent and accounts receivables are reduced as an adjustment to rental revenues. Revenue from leases where collection is deemed to be less than probable is recorded on a cash basis until collectability is determined to be probable. Further, the Company assesses whether operating lease receivables, at a portfolio level, are appropriately valued based upon an analysis of balances outstanding, historical bad debt levels and current economic trends. The uncollectible portion of the portfolio is recorded as an adjustment to rental revenues.

Deferred Leasing Costs - Going Concern Basis

Direct leasing costs, primarily consisting of third-party leasing commissions and tenant inducements are capitalized and amortized over the life of the related lease. Tenant inducement amortization is recorded as an offset to rental revenue and the amortization of other direct leasing costs is recorded in amortization expense.  

The Company had no tenant inducement amortization for the six months ended June 30, 2020. Tenant inducement amortization was $8.9 million for the year ended December 31, 2019, and was recorded as an offset to rental revenue. The Company recorded no amortization expense related to other direct leasing costs for the six months ended June 30, 2020. Amortization expense related to other direct leasing costs were $2.4 million for the year ended December 31, 2019. In addition, no amortization was recorded after July 2019 due to the Company’s properties being classified as held for sale. 

Deferred Financing Costs - Going Concern Basis

Deferred financing costs consist of direct costs incurred in obtaining debt financing (see Note 6 — Debt Financing).  These fees are presented as a reduction to the related debt liability for permanent mortgages and presented as an asset for revolving credit arrangements.  In total, deferred financing costs (net of amortization) were $2.0 million as of June 30, 2020.  These costs are amortized into interest expense on a straight-line basis, which approximates the effective interest method, over the terms of the obligations.  The Company had no amortized interest expense.

Revenue Recognition

ASU 2014-09 requires the use of a five-step model to recognize revenue from contracts with customers. The five-step model requires that the Company identify the contract with the customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract and recognize revenue when it satisfies the performance obligations. Management has concluded that the majority of the Company’s total revenue, with the exception of gains and losses from the sale of real estate, consist of rental income from leasing arrangements, which is specifically excluded from the standard. Excluding gains and losses on the sale of real estate (as discussed further

29

below), the Company concluded that its remaining revenue streams were immaterial and, as such, the adoption of ASU 2014-09 did not have a material impact on the Company’s consolidated financial statements.

As of January 1, 2018, the Company began accounting for the sale of real estate properties under ASU 2017-05 and provides for revenue recognition based on completed performance obligations, which typically occurs upon the transfer of ownership of a real estate asset.

Revenues associated with operating expense recoveries are recognized in the period in which the expenses are incurred based upon the tenant lease provisions. Revenues relating to lease termination fees are recognized on a straight-line basis amortized from the time that a tenant’s right to occupy the leased space is modified through the end of the revised lease term.

Other revenues consist primarily of parking revenue, tenant reimbursements and interest on loans receivable. Parking revenue represents amounts generated from contractual and transient parking and is recognized in accordance with contractual terms or as services are rendered. Other revenues relating to tenant reimbursements are recognized in the period that the expense is incurred.

Income Taxes

The Company elected to be treated as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”) through June 30, 2020, when it transferred all of its assets and liabilities to the Liquidating Trust.  The Company’s management believes that the Company operated in such a manner as to qualify for treatment as a REIT until June 30, 2020. Accordingly, no provision has been made for U.S. federal income taxes for the six months ended June 30, 2020, and year ended December 31, 2019 in the accompanying consolidated financial statements. In 2021, 2020 and 2019 income tax expense recorded by the Company was primarily comprised of foreign income taxes related to the operation of its international properties. All periods from December 31, 2018 through December 31, 2021 are open for examination by the IRS. The Company does not believe it has any uncertain tax positions or unrecognized tax benefits requiring disclosure.

Per Share Data

Net income (loss) per common share is calculated by dividing the net income (loss) attributable to common investors for each period by the weighted average number of common shares outstanding during such period. Net income (loss) per common share on a basic and diluted basis is the same because the Company has no potentially dilutive common shares outstanding.

Recently Adopted Accounting Pronouncements - Going Concern Basis

In February 2016, the FASB issued ASU 2016-02 which requires companies that lease assets to recognize on the balance sheet the right-of-use assets and related lease liabilities (“ASC 842”). The accounting by companies that own the assets leased by the lessee (the lessor) remains largely unchanged from earlier guidance under ASC 840. The Company adopted ASC 842 as of January 1, 2019, and is using the modified retrospective approach. No adjustment to opening retained earnings was required.

In July 2018, the FASB issued ASU 2018-11, which allows lessors to account for lease and non-lease components by class of underlying assets, as a single lease component if certain criteria are met. Also, the new standard indicates that companies are permitted to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption in lieu of restating prior periods in accordance with ASC 842 and provides other optional practical expedients.

Upon adoption, the Company elected the following practical expedients:

•The transition method in which the application date of January 1, 2019 is the beginning of the reporting period that the Company first applied the new guidance.

•The practical expedient package which allows an entity not to reassess (1) whether any expired or existing contracts are or contain leases; (2) the lease classification for any expired or existing leases; (3) initial direct costs for any existing leases.

•As an accounting policy election, a lessor may choose not to separate the non-lease components, by class of underlying assets, from the lease components and instead account for both types of components as a single component under certain conditions.

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Based on the Company’s analysis, the Company identified the following changes resulted from the adoption of ASC 842:

Lessor Accounting

•The Company is entitled to receive tenant reimbursements for operating expenses for common area maintenance (“CAM”). Based on guidance in these ASUs, CAM reimbursement revenue is defined as a non-lease component, which would be accounted for in accordance with ASC 606. However, the Company elected to apply the practical expedient for all of its leases to account for the lease and non-lease components as a single, combined operating lease component.

•Capitalization of leasing costs is limited to initial direct costs. Initial direct costs have been defined as incremental costs of a lease that would not have been incurred if the lease had not been obtained. Legal costs are no longer capitalized, but expensed as incurred. There is no change in the Company’s accounting for lease inducements and commissions.

•The Company’s existing leases continue to be classified as operating leases, however, leases entered into or modified after January 1, 2019 may be classified as either operating or sales-type leases, based on specific classification criteria. The Company believes all of its leases will continue to be classified as operating leases, and all operating leases will continue to have a similar pattern of recognition as under current GAAP.

•The Company believes there is low risk of inadequate residual values of its leased assets upon the termination of these leases due to the Company’s ability to re-lease the spaces for the assets, the long-lived nature of its real estate assets and the nature of real estate assets to hold their value over a long periods of time.

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3. LIABILITY FOR ESTIMATED COSTS IN EXCESS OF ESTIMATED INCOME DURING LIQUIDATION

The liquidation basis of accounting requires the Company to accrue estimated income and costs associated with the completion of its liquidation. As a basis for its assumptions, the Company has used September 1, 2022 as the date by which it currently expects to liquidate, although there can be no assurance that it will meet such timing. Additionally, these estimates can vary significantly due to, among other things, 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 up of operations. The table below summarizes changes in the liability for estimated costs in excess of estimated income between January 1, 2021 and December 31, 2021 (in thousands):

	January 1, 2021		Amounts Incurred		Remeasurement of Amounts			December 31, 2021
Assets:
Net rental income	$	22,000	$	(23,406)	$	3,406	(1)	$	2,000
Liabilities:
General and administrative expenses	(10,000)		5,563		137			(4,300)
Asset management fees	(7,000)		6,391		9			(600)
Closing costs and credits	(13,010)		9,330		695			(2,985)
Total liability for estimated costs in excess of estimated income during liquidation	$	(8,010)	$	(2,122)	$	4,247		$	(5,885)

(1)The increase in the net rental income is primarily due to changes in the projected sale timing of certain of the Company's properties.

The table below summarizes changes in the liability for estimated costs in excess of estimated income between July 1, 2020 and December 31, 2020 (in thousands):

	July 1, 2020		Amounts Incurred		Remeasurement of Amounts			December 31, 2020
Assets:
Net rental income	$	52,000	$	(16,200)	$	(13,800)	(1)	$	22,000
Liabilities:
General and administrative expenses	(15,300)		2,960		2,340			(10,000)
Asset management fees	(16,700)		5,097		4,603			(7,000)
Closing costs and credits	(43,238)		25,747		4,481			(13,010)
Total liability for estimated costs in excess of estimated income during liquidation	$	(23,238)	$	17,604	$	(2,376)		$	(8,010)

(1)The decrease in the net rental income is primarily due to changes in the projected sale timing of certain of the Company's properties.

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4. NET ASSETS IN LIQUIDATION

The following is a reconciliation of investors’ equity under the going concern basis of accounting as of June 30, 2020 to net assets in liquidation under the liquidation basis of accounting as of July 1, 2020 (in thousands):

Total Equity as of June 30, 2020	$	1,321,734
Increase due to adjustment of net realizable value of real estate investments	426,859
Decrease due to adjustment of assets and liabilities to net realizable value	(261,535)
Liability for estimated costs in excess of estimated income during liquidation	(23,238)
Adjustment to reflect the change to the liquidation basis of accounting	142,086
Estimated value of net assets in liquidation as of July 1, 2020	$	1,463,820

The values of the Company’s assets and liabilities were adjusted from the going concern basis as June 30, 2020, to the liquidation basis as of July 1, 2020. The net increase of $142.1 million was mostly attributed to remeasuring the Company’s remaining 7 properties as well as other assets and liabilities at their the net realizable value. The net realizable value of the Companies properties was based on third party appraisals and other assets and liabilities were based on their estimated net realizable value.

Changes in Net Assets

Net assets in liquidation decreased by $219.1 million during the year ended December 31, 2021. The reduction is primarily due to liquidating distributions paid to investors totaling $209.9 million or $0.80 per share. These distributions were funded from proceeds from the sale of 4 properties with an aggregate sale price of $433.0 million.

Additionally, the estimated value of our real estate investments decreased by $8.1 million for the year ended December 31, 2021, primarily due to market conditions resulting from the Coronavirus pandemic and its effect on our 1 remaining retail property, Minneapolis Retail Center. The estimated liquidation value of this property was based on the contract sale price as of December 31, 2021.

Lastly, during the year ended December 31, 2021, there was a $1.1 million decrease related to the remeasurement of assets and liabilities, including the estimate of costs in excess of income during liquidation.

The remaining undistributed net assets in liquidation was $330.6 million as of December 31, 2021 or approximately $1.26 per Unit. This estimate included projections as of December 31, 2021 regarding the timing of the completion of the sale of the Company’s remaining property and the amount of sales proceeds that would be generated, as well as costs and expenses to be incurred during liquidation. Since December 31, 2021, the Company sold its final remaining property and paid distributions totaling $1.22 per Unit to the unitholders. The Company’s remaining per Unit NAV was $0.04 as of March 17, 2022, which the Company expects to pay to unitholders after the Company’s wind-down is completed, later this year. There can be no certainty regarding the timing or the amount of any future distributions.

Net assets in liquidation decreased by $914.1 million during the period from July 1, 2020 to December 31, 2020. The reduction is primarily due to liquidating distributions paid to investors totaling $905.3 million or $3.45 per share. These distributions were funded from proceeds from the sale of 5 properties with an aggregate sale price of $1.1 billion.

Additionally, the estimated value of our real estate investments decreased by $31.7 million between July 1, 2020 and December 31, 2020, primarily due to market conditions resulting from the Coronavirus pandemic. The estimated liquidation values of the Company’s remaining properties as of December 31, 2020 was based on negotiated sale prices or other market conditions and assumptions as of December 31, 2020. The net assets in liquidation at December 31, 2020, presented on an undiscounted basis, includes 5 real estate investments valued at $597.2 million.

Lastly, during the period from July 1, 2020 through December 31, 2020, there was a $22.9 million increase related to the remeasurement of assets and liabilities, including the estimate of costs in excess of income during liquidation.

The remaining undistributed net assets in liquidation was $549.7 million as of December 31, 2020 or approximately $2.09 per Unit. This estimate of liquidating distributions included projections of timing and amounts of the future sales, as well as costs and expenses to be incurred during liquidation.

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5. INVESTMENT PROPERTY - Going Concern Basis

Recent Dispositions of Real Estate Investments

The Company sold 3 properties for an aggregate gain of $68.2 million during the six months ended June 30, 2020, and 4 properties for an aggregate gain of $406.3 million during the year ended December 31, 2019. The table below provides information regarding each of the properties sold during the six months ended June 30, 2020, and year ended December 31, 2019, including the acquisition/completed construction price, and contract sales price (in millions).

Property		Date Acquired/Completed	Acquisition Price/ Construction Cost	Date Sold	Contract Sales Price
Campus at Marlborough		10/2011	$103.0	6/2020	$66.0
Perspective Defense	(1)	6/2013	$165.8	2/2020	$144.9
Riverside Center		3/2013	$197.1	1/2020	$235.0
FM Logistic		4/2011	$70.8	12/2019	$31.6
The Summit		3/2015	$316.5	12/2019	$756.0
550 Terry Francois		8/2012	$180.0	2/2019	$342.5
55M		12/2013	$140.9	1/2019	$135.3

(1)The acquisition price for Perspective Defense of approximately €126.5 million was converted to USD based on an exchange rate of $1.31 per EUR as of the transaction date. The sales price of approximately €129.8 million was converted to USD based on an exchange rate of $1.12 per EUR as of the transaction date.

Subsequent to the formation of the Liquidation Trust on June 30, 2020, the Company sold 2 properties in the period from July 1, 2020 to December 31, 2020 for a total of 5 properties in 2020. The Company sold 4 properties during the year ended December 31, 2021.

Leases

The Company’s leases are generally for terms of 15 years or less and may include multiple options to extend the lease term upon tenant election. The Company’s leases typically do not include an option to purchase. Generally, the Company does not expect the value of its real estate assets to be impacted materially at the end of any individual lease term, as the Company is typically able to release the space and real estate assets tend to hold their value over a long period of time. Tenant terminations prior to the lease end date occasionally result in a one-time termination fee based on the remaining unpaid lease payments including variable payments and could be material to the tenant. Many of the Company’s leases have increasing minimum rental rates during the terms of the leases through escalation provisions. In addition, the majority of the Company’s leases provide for separate billings for variable rent, such as, reimbursements of real estate taxes, maintenance and insurance and may include an amount based on a percentage of the tenants’ sales. Total billings related to expense reimbursements from tenants for the six months ended June 30, 2020 was $20.5 million, which is included in rental revenue on the Consolidated Statements of Operations and Comprehensive Income (Loss).

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The Company has entered into non-cancelable lease agreements with tenants for space.  As of December 31, 2021, the approximate fixed future minimum rentals for each of the years ending December 31, 2022 through 2026 and thereafter were as follows (in thousands):

	Fixed Future Minimum Rentals
2022	$	11,829
2023	11,809
2024	9,501
2025	8,289
2026	6,697
Thereafter	14,201
Total	$	62,326

During the years ended December 31, 2021, 2020, and 2019, the Company did not earn more than 10% of its total rental revenue from any individual tenant, respectively.

For the six months ended June 30, 2020, there was no amortization expense of in-place leases. Amortization expense of in-place leases was $9.9 million for the year ended December 31, 2019. For the six months ended June 30, 2020, there was no amortization of out-of-market leases. Amortization of out-of-market leases resulted in an increase to rental revenue of approximately $2.7 million for the year ended December 31, 2019.

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6. DEBT FINANCING

As of December 31, 2020, the Company had 1 outstanding mortgage loan in the amount of $65.7 million related to New City. This mortgage loan was assumed by the buyer of the property in November 2021 in conjunction with the sale of the property and subsequently paid off. The Company had no loans outstanding as of December 31, 2021.

7.  DISTRIBUTIONS

As described previously, the Company declared distributions of $0.70 per Unit, per year for the period from October 2009 through December 2011 and $0.65 per Unit, per year from January 2012 through December 2018 totaling $6.09 per Unit in aggregate. Approximately $0.45 per Unit of these distributions declared for the year ended December 31, 2018 were designated as a return of a portion of the investors’ invested capital as described further below. Further, on July 17, 2018, in connection with the investor approval of the Plan of Liquidation, the board of directors determined to suspend indefinitely the distribution reinvestment plan effective as of August 31, 2018. As a result of the suspension of the distribution reinvestment plan, all distributions paid after August 31, 2018 have been paid to investors in cash. Additionally, the Company declared special distributions and/or liquidating distributions to date totaling $9.02 per Unit, each of which is described further below. In aggregate, the Company has paid total distributions of $15.11 per Unit to our investors from the inception of our fund to date.

From 2018 through March 2022, the Company paid aggregate Return of Capital Distributions or Liquidating Distributions to investors totaling approximately $9.47 per Unit, which represented a return of a portion of the investors’ invested capital. These Return of Capital Distributions reduced the investors’ remaining investment in the Company and were made up of the following:

•a $1.05 per Unit special distribution (the “Special Distribution”) declared to all investors of record as of December 30, 2017 and paid in January 2018. The Special Distribution was funded with a portion of the net proceeds received from the strategic sale of 6 assets during 2017.

•$0.12 per Unit resulting from a portion of the monthly distributions declared for the months of January 2018 through June 2018, (approximately $0.02 per Unit, per month), which were designated by the Company’s board of directors as a return of a portion of the investors’ invested capital and, as such, reduced the investors’ remaining investment in the Company.

•Approximately $0.33 per Unit resulting from the monthly liquidating distributions declared for the months of July 2018 through December 2018 ($0.0541667 per share, per month), which were designated as liquidating distributions and, as such, reduced the investors’ remaining investment in the Company.

•a $2.50 per Unit designated liquidating distribution declared to all investors of record as of February 13, 2019 and paid in February 2019.

•a $1.00 per Unit liquidating distribution declared to all investors of record as of July 15, 2020 and paid in July 2020.

•a $2.45 per Unit special distribution declared to all investors of record as of September 14, 2020 and paid in September 2020.

•a $0.80 per Unit special distribution declared to all investors of record as of September 29, 2021 and paid in September 2021.

•a $0.60 per Unit special distribution declared to all investors of record as of January 12, 2022, and paid in January 2022.

•a $0.62 per Unit special distribution declared to all investors of record as of March 17, 2022, and paid on or around March 22, 2022.

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The table below outlines the Company’s total distributions declared to investors and noncontrolling interests for the years ended December 31, 2021, 2020 and 2019 (in thousands).

	Unitholders								Noncontrolling Interests
Distributions for Year Ended	Cash Distributions		Distributions Reinvested		Total Declared (1)		Distributions Declared per Unit		Total Declared
December 31, 2021	$	209,917	$	—	$	209,917	$	0.80	$	17
December 31, 2020	$	905,266	$	—	$	905,266	$	3.45	$	254
December 31, 2019	$	661,238	$	—	$	661,238	$	2.50	$	53

(1)Includes Return of Capital Distributions as described above.

8.  RELATED PARTY TRANSACTIONS

The table below outlines fees and expense reimbursements incurred that are payable by the Company to Hines and its affiliates for the years ended December 31, 2021, 2020, and 2019 (in thousands):

	Incurred During the Years Ended December 31,
Type and Recipient	2021		2020		2019
Asset Management Fee- the Advisor and affiliates of Hines	$	6,391	$	15,859	$	26,365
Disposition Fee- the Advisor	$	4,410	$	11,137	$	12,753
Other (1)	$	4,859	$	7,192	$	5,393
Property Management Fee- Hines	$	1,169	$	1,910	$	4,011
Development/ Construction Management Fee- Hines	$	—	$	13	$	2,230
Leasing Fee- Hines	$	511	$	339	$	1,479
Expense Reimbursement- Hines (with respect to management and operations of the Company’s properties)	$	1,829	$	3,771	$	7,546

(1)Includes amounts the Advisor paid on behalf of the Company such as general and administrative expenses and offering costs.  These amounts are generally reimbursed to the Advisor during the month following the period in which they are incurred.

The table below outlines fees and expense reimbursement amounts unpaid by the Company to Hines and its affiliates as of December 31, 2021 and 2020 (in thousands):

	Unpaid as of December 31,
Type and Recipient	2021		2020
Asset Management Fee- the Advisor and affiliates of Hines	$	(34)	$	777
Disposition Fee- the Advisor	—		—
Other (1)	1,194		1,255
Property Management Fee- Hines	—		38
Development/ Construction Management Fee- Hines	—		—
Leasing Fee- Hines	278		90
Expense Reimbursement- Hines (with respect to management and operations of the Company’s properties)	175		276
Due to Affiliates	$	1,613	$	2,436

(1)Includes amounts the Advisor paid on behalf of the Company such as general and administrative expenses and offering costs.  These amounts are generally reimbursed to the Advisor during the month following the period in which they are incurred.

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Advisory Agreement

Pursuant to the Advisory Agreement, the Company is required to pay the following fees and expense reimbursements:

Asset Management Fee – For the periods through June 30, 2020, the Advisor received an asset management fee equal to 0.125% per month of the net equity capital invested by the Company in real estate investments as of the end of each month. In connection with the closing of the transactions contemplated by the Liquidating Trust Agreement, the Trust assumed the Company’s interest in the Advisory Agreement, dated August 3, 2009 (as amended, the “Advisory Agreement”), by and among the Company, Hines Global REIT Advisors LP (the “Advisor”) and Hines Global REIT Properties LP (the “Operating Partnership”). On June 30, 2020, immediately following the completion of the transactions contemplated by the Liquidating Trust Agreement, the Trust, the Advisor and the Operating Partnership entered into an Amended and Restated Advisory Agreement (the “A&R Advisory Agreement”). Pursuant to the A&R Advisory Agreement, the Advisor agreed to reduce the annual asset management fee payable under the Advisory agreement by 25% from 1.50% to 1.125% of net equity invested in real estate investments, reflecting the Advisor’s continued commitment to the investors as the Trust works toward completion of the liquidation of the Company’s former assets.

Disposition Fee – The Advisor or its affiliates were paid a disposition fee of 1.0% of the sales price of any real estate investments sold or 1.0% of the Company’s pro rata share of the sales price with respect to the Company’s indirect investments. The Company’s disposition fees related to the sales of wholly-owned properties are included in the Gain (loss) on sale of real estate investments in the Consolidated Statement of Operations and Comprehensive Income (loss).

Special OP Units – Hines Global REIT Associates Limited Partnership, an affiliate of Hines, owns the special units of the Operating Partnership (“Special OP Units”), which entitle them to receive distributions in an amount equal to 15% of distributions, including from sales of real estate investments, refinancings and other sources, but only after the Company’s investors have received, or are deemed to have received, in the aggregate, cumulative distributions equal to their invested capital plus an 8.0% cumulative, non-compounded annual pre-tax return on such invested capital. It is not expected that this hurdle will be achieved and therefore no distributions will be paid to the holder of the Special OP Units.

The Company reimburses the Advisor for all expenses paid or incurred by the Advisor in connection with the services provided to the Company.

Property Management and Leasing Agreements

The Company paid Hines fees for the management and leasing of some of its properties. Property management fees were equal to a market-based percentage of the gross revenues of the properties managed by Hines or the amount of property management fees recoverable from tenants of the properties managed by Hines under their leases. In addition, if Hines provided leasing services with respect to a property, the Company paid Hines leasing fees which are usual and customary for that type of property in that geographic area. The Company generally was required to reimburse Hines for certain operating costs incurred in providing property management and leasing services pursuant to the property management and leasing agreements. Included in this reimbursement of operating costs was the cost of personnel and overhead expenses related to such personnel located at the property as well as off-site personnel located in Hines’ headquarters and regional offices, to the extent the same related to or supported the performance of Hines’ duties under the agreement.

From time to time, Hines performed construction management services for the Company for both re-development activities and tenant construction. These fees are considered incremental to the construction effort and were capitalized to the associated real estate project as incurred. Costs related to tenant construction were depreciated over the estimated useful life. Costs related to redevelopment activities were depreciated over the estimated useful life of the associated project. Leasing activities were generally performed by Hines on the Company’s behalf. Leasing fees were capitalized and amortized over the life of the related lease. Generally, as compensation for providing development management services, Hines was paid a fee equal to 3% of the development project costs and as compensation for providing construction management services, an affiliate of Hines was paid a contractor’s fee of 5% of the total construction costs of the project.

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Fees for Other Services

The Company retains certain of the Advisor’s affiliates, from time to time, for services relating to the Company’s investments or operations, which may include corporate services, statutory services, transaction support services (including but not limited to coordinating with brokers, lawyers, accountants and other advisors, assembling relevant information, conducting financial and market analyses, and coordinating closing procedures) and loan management and servicing, and within one or more such categories, providing services in respect of asset and/or investment administration, accounting, technology, tax preparation, finance (including but not limited to budget preparation and preparation and maintenance of corporate models), treasury, operational coordination, risk management, insurance placement, human resources, legal and compliance, valuation and reporting-related services, as well as services related to mortgage servicing, group purchasing, healthcare, consulting/brokerage, capital markets/credit origination, property, title and/or other types of insurance, management consulting and other similar operational matters. Any fees paid to the Advisor’s affiliates for any such services did not reduce the asset management fee otherwise payable to the Advisor. Any such arrangements will be at market rates.

9.  FAIR VALUE MEASUREMENTS - Going Concern Basis

Fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities the Company has the ability to access. Fair values determined by Level 2 inputs utilize inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets and inputs other than quoted prices observable for the asset or liability, such as interest rates and yield curves observable at commonly quoted intervals. Level 3 inputs are unobservable inputs for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. In instances in which the inputs used to measure fair value may fall into different levels of the fair value hierarchy, the level in the fair value hierarchy within which the fair value measurement in its entirety has been determined is based on the lowest level input significant to the fair value measurement in its entirety. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset or liability.

Financial Instruments Measured on a Recurring Basis

The Company entered into several interest rate contracts as economic hedges against the variability of future interest rates on its variable interest rate borrowings. The valuation of these derivative instruments is determined based on assumptions that management believes market participants would use in pricing, using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values of interest rate contracts have been determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.

Although the Company has determined the majority of the inputs used to value its interest rate contracts fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with its derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by the Company and its counterparties, Bank Zachnodni WBK and ING Capital Markets. In adjusting the fair values of its derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds and guarantees. However, as of June 30, 2020 and December 31, 2019, 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 valuations of its derivatives. As a result, the Company determined its derivative valuations were classified in Level 2 of the fair value hierarchy.

Additionally, the Company has entered into foreign currency forward contracts as economic hedges against the variability of foreign exchange rates. The valuation of these forward contracts is determined based on assumptions that management believes market participants would use in pricing, using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including currency exchange rate curves and implied volatilities. The Company has determined its foreign currency forward contracts valuations are classified in Level 2 of the fair value hierarchy, as they are based on observable inputs but are not traded in active markets.

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Financial Instruments Measured on a Nonrecurring Basis

Certain long-lived assets are measured at fair value on a non-recurring basis. These assets are not measured at fair value on an ongoing basis, but are subject to fair value adjustments (i.e., impairments) in certain circumstances.  The fair value methodologies used to measure long-lived assets are described in Note 2 — Summary of Significant Accounting Policies — Investment Property and Lease Intangibles.  The inputs associated with the valuation of long-lived assets are generally included in Level 3 of the fair value hierarchy as discussed below.  

Impairment of Investment Property

For the six months ended June 30, 2020, the Company determined that 3 of its remaining properties were impaired by $18.6 million based on such assets having carrying values that exceeded their estimated sales price less costs to sell based on the offers received (level 2 inputs).

As a result of the Company’s remaining real estate properties meeting the criteria to be classified as held for sale for the year ended December 31, 2019, the Company determined that 6 of its remaining properties were impaired by $115.4 million based on such assets having carrying values that exceeded their estimated sales price less costs to sell based on the offers received (level 2 inputs) and third party broker consultations (level 3 inputs), which were obtained in conjunction with its marketing process. Of this amount, $46.9 million is attributable to the requirement when real estate properties are classified as held for sale to include cumulative foreign currency translation adjustments (“cumulative CTA”) in the carrying value for 2 of the Company’s foreign denominated assets within the impairment tests in accordance with ASC 830, Foreign Currency Matters.

Prior to designating its properties as held for sale, investment properties were reviewed for impairment at each reporting period if events or changes in circumstances indicated that the carrying amount may not be recoverable. During the year ended December 31, 2019, the Company determined that 1 of its properties was impaired by $7.2 million as a result of deteriorating market conditions and valued it using level 3 inputs.

The changes in assumptions resulted in the net book value of the assets exceeding the projected undiscounted cash flows for the property. As a result, the assets were written down to fair value. The following table summarizes activity for the Company’s assets measured at fair value, on a non-recurring basis, for the six months ended June 30, 2020 and year ended December 31, 2019 (in thousands).  

	Basis of Fair Value Measurements
During the six months ended	Description	Fair Value of Assets		Quoted Prices In Active Markets for Identical Items (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Impairment Loss
June 30, 2020	Investment property	$	243,570	$	—	$	243,570	$	—	$	18,591
During the year ended
December 31, 2019	Investment property	$	544,846	$	—	$	458,828	$	86,018	$	122,603

The Company’s estimated fair value of the investment properties measured using level 3 inputs were based on comparisons of recent market activity and discounted cash flow models, which include estimates of property-specific inflows and outflows over a specific holding period.  Significant unobservable quantitative inputs used in determining the fair value of the investment property for the period ended December 31, 2019 include: a discount rate of 8.80%; a capitalization rate of 6.50%; stabilized occupancy rate of 91.7%; and current market rental rates ranging from $12.00 to $47.00 per square foot.  These inputs are based on the location, type and nature of each property, current and anticipated market conditions, and management’s knowledge and expertise in real estate.

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10. REPORTABLE SEGMENTS - Going Concern Basis

Prior to the conversion to the Liquidating Trust in June 2020, management viewed each of its real estate investments as an operating segment and aggregated them into 4 reportable segments based on the location of the segment and the underlying asset class. Subsequent to the conversion to the Liquidating Trust, the Company’s business has been, and will continue to be, to sell its assets in an orderly fashion and therefore it determined to no longer make operating decisions or assess performance in separate segments. Accordingly, the Company has only 1 reporting and operating segment subsequent to June 30, 2020.

Listed below is information regarding the Company’s reportable segments for periods prior to the conversion to the Liquidating Trust:

•Domestic other investments (4 investments)

•International office investments (3 investments)

The Company has also owned properties in the Domestic Office and International Other segments in prior periods, which were sold prior to June 30, 2020.

The tables below provide additional information related to each of the Company’s segments, geographic location and a reconciliation to the Company’s net income (loss), as applicable. “Corporate-Level Accounts” includes amounts incurred by the corporate-level entities which are not allocated to any of the reportable segments (all amounts are in thousands, except for percentages):

		Six Months Ended June 30,		Year Ended December 31,
		2020		2019
Total Revenue
	Domestic office investments	$	5,408	$	63,537
	Domestic other investments	30,327		75,323
	International office investments	26,944		50,870
	International other investments	—		3,838
Total Revenue		$	62,679	$	193,568

For the six months ended June 30, 2020, and year ended December 31, 2019, the Company’s total revenue was attributable to the following countries:

	Six Months Ended June 30,		Year Ended December 31,
	2020		2019
United States	57	%	72	%
United Kingdom	28	%	15	%
Poland	9	%	5	%
Russia	5	%	5	%
France	1	%	3	%

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For the six months ended June 30, 2020, and the year ended 2019, the Company’s property revenues in excess of expenses by segment was as follows:

		Six Months Ended June 30,		Year Ended December 31,
		2020		2019
Property revenues in excess of expenses (1)
	Domestic office investments	$	2,436	$	39,350
	Domestic other investments	15,648		45,774
	International office investments	15,210		26,249
	International other investments	(302)		2,714
Total property revenues in excess of expenses		$	32,992	$	114,087

(1)Revenues less property operating expenses, real property taxes and property management fees.

For the six months ended June 30, 2020, and the year ended December 31, 2019 the Company’s reconciliation to the Company’s property revenues in excess of expenses is as follows:

	Six Months Ended June 30,		Year Ended December 31,
	2020		2019
Reconciliation to property revenues in excess of expenses
Net income (loss)	$	77,323	$	300,416
Depreciation and amortization	—		30,566
Asset management and acquisition fees	10,762		26,365
General and administrative expenses	3,904		8,287
Impairment Losses	18,591		122,603
(Gain) loss on derivatives	(20,416)		3,838
(Gain) loss on sale of real estate investments	(68,206)		(406,277)
Foreign currency (gains) losses	4,984		(1,611)
Interest expense	4,319		28,809
Other (income) expenses	(1,191)		(1,595)
(Benefit) provision for income taxes	2,922		2,686
Provision for income taxes related to the sale of real estate	—		—
Total property revenues in excess of expenses	$	32,992	$	114,087

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11. SUPPLEMENTAL CASH FLOW DISCLOSURES - Going Concern Basis

Supplemental cash flow disclosures for the six months ended June 30, 2020 and the year ended December 31, 2019 (in thousands):

	Six Months Ended June 30,		Year Ended December 31,
	2020		2019
Supplemental Disclosure of Cash Flow Information
Cash paid for interest	$	4,448	$	27,079
Cash paid for income taxes	$	770	$	2,376
Supplemental Schedule of Non-Cash Activities
Other receivables	$	632	$	551
Shares tendered for redemption	$	—	$	699
Assumption of mortgage upon disposition of property	$	78,519	$	—
Accrued capital additions	$	280	$	4,492
Disposition fee payable to the Advisor	$	—	$	7,976

12. COMMITMENTS AND CONTINGENCIES

The Company may be subject to various legal proceedings and claims that arise in the ordinary course of business. These matters are generally covered by insurance. While the resolution of these matters cannot be predicted with certainty, management believes the final outcome of such matters will not have a material adverse effect on the Company’s consolidated financial statements.

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13. SUBSEQUENT EVENTS

Minneapolis Retail Center

In March 2022, the Company sold Minneapolis Retail Center for a contract sales price of $150.0 million. The purchaser is not affiliated with the Company or its affiliates.

Liquidating Distribution

In March 2022, the Company’s Trustees declared a liquidating distribution of $0.62 per Unit, following the sale of Minneapolis Retail Center. As a result of the $0.62 per Unit liquidating distribution, the per Unit NAV was reduced to $0.04 as of March 17, 2022.

*****

44

Item 9.  Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A.  Controls and Procedures

Disclosure Controls and Procedures

In accordance with Exchange Act Rules 13a-15 and 15d-15, we carried out an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2021, to provide reasonable assurance that information required to be disclosed in our reports filed or submitted under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal controls over financial reporting. Our system of internal controls over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles. Our internal controls over financial reporting includes those policies and procedures that:

(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management’s assessment of the effectiveness of our internal control system as of December 31, 2021 was based on the framework for effective internal control over financial reporting described in the 2013 Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our assessment, as of December 31, 2021, our system of internal control over financial reporting was effective at the reasonable assurance level.

This annual report does not include an attestation report of the Company’s independent registered public accounting firm regarding control over financial reporting. Management’s report was not subject to attestation by the company’s independent registered public accounting firm pursuant to Section 989G of the Dodd-Frank Wall Street and Consumer Protection Act, which exempts non-accelerated filers from the auditor attestation requirement of section 404 (b) of the Sarbanes-Oxley Act.

March 31, 2022

Change in Internal Controls

No changes have occurred in our internal controls over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the quarter ended December 31, 2021 that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

45

Item 9B.  Other Information

None.

Item 9C.  Disclosure Regarding Foreign Jurisdictions That Prevent Inspections

Not applicable.

46

PART III

Item 10.  Trustees, Executive Officers and Corporate Governance

As noted previously, we currently have no directors. We are administered by our trustees. For the period from January 1, 2020 through June 30, 2020, all of our trustees, with the exception of Mr. Steinbach, were directors of Hines Global REIT, Inc. References to our trustees and our Board in this report mean our trustees and our board of trustees for the periods after June 30, 2020 and mean the directors and the board of directors of Hines Global REIT, Inc. for the period prior to June 30, 2020. As of the date of this report, our trustees, their ages, their year first elected, their business experience and principal occupation, their directorships in public corporations and investment companies are as follows:

Name	Age	Year First Elected	Business Experience and Principal Occupation; Directorships in Public Corporations and Investment Companies
Jeffrey C. Hines, Trustee and Chief Executive Officer	66	2008	Mr. Hines joined Hines in 1982. Mr. Hines is the Co-owner, Chairman and Chief Executive Officer of Hines. He has served as the Chairman of our Board and as Chairman of the managers of the general partner of our Advisor since December 2008. Mr. Hines has served as the Chairman of the board of directors of Hines Global Income Trust, Inc. (“Hines Global Income Trust”) and Chairman of the managers of the general partner of HGIT Advisors LP (“HGIT LP”), the advisor to Hines Global Income Trust, since July 2013 and as the Chief Executive Officer of Hines Global Income Trust and HGIT LP since December 31, 2019. Mr. Hines also served as the Chairman of the board of directors of Hines Real Estate Investment Trust, Inc. (“Hines REIT”) and the Chairman of the managers of the general partner of Hines Advisors Limited Partnership (“HALP”), the advisor to Hines REIT, from August 2003 through the liquidation and dissolution of Hines REIT in August 2018. He also served as a member of the management board of the Hines US Core Office Fund LP (the “Core Fund”) since August 2003 through the liquidation and dissolution of the Core Fund in December 2018. He is also the co-owner and President and Chief Executive Officer (“CEO”) of the general partner of Hines and is a member of Hines’ Executive Committee. Mr. Hines is responsible for overseeing all firm policies and procedures as well as day-to-day operations of Hines. He became President of the general partner of Hines in 1990 and CEO of the general partner of Hines in January 2008 and has overseen a major expansion of the firm’s personnel, financial resources, domestic and foreign market penetration, products and services. He has been a major participant in the development of the Hines domestic and international acquisition program and currently oversees a portfolio of $83.6 billion in assets under management. Mr. Hines graduated from Williams College with a B.A. in Economics and received his M.B.A. from Harvard Business School. We believe that Mr. Hines’ career, spanning more than 38 years in the commercial real estate industry, including his leadership of Hines, and the depth of his knowledge of Hines and its affiliates, qualifies him to serve on our Board.

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Name	Age	Year First Elected	Business Experience and Principal Occupation; Directorships in Public Corporations and Investment Companies
David L. Steinbach, Trustee	45	2020	Mr. Steinbach joined Hines in 1999 and is a Senior Managing Director - Investment Management, Co-Head of Investment Management and the Global CIO for Hines. Mr. Steinbach has served as a member of our Board since July 2020. Mr. Steinbach served as the CIO for Hines Global REIT, Inc. from July 2014 until June 30, 2020 and as CIO of the general partner of our Advisor since July 2014.  Mr. Steinbach has served as a director of Hines Global Income Trust since September 2019 and has also served as the CIO for Hines Global Income Trust and the general partner of HGIT LP since July 2014. In these roles, he is responsible for management of the real estate acquisition program in the U.S. and internationally.  He is a member of Hines’ Executive and Investment Committees. He previously served as a Managing Director - Investment Management of the general partner of Hines since February 2011 to February 2017 and was responsible for the acquisition of over $4 billion in assets for various Hines affiliates in the U.S. and internationally.  Prior to this role he served in various roles in which he was responsible for acquisitions, asset management and property dispositions on behalf of the Company, Hines REIT, Hines Global Income Trust and the Core Fund, both in the U.S. and internationally.  He graduated from Texas A&M University with a Bachelors and Masters in Business Administration. We believe that Mr. Steinbach’s significant experience as an executive at our Company and at Hines qualifies him to serve as one of our trustees. Mr. Steinbach’s extensive knowledge of the U.S. and international real estate markets, as well as his considerable institutional knowledge, allow him to provide valuable insight as a trustee.

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Name	Age	Year First Elected	Business Experience and Principal Occupation; Directorships in Public Corporations and Investment Companies
Charles M. Baughn, Trustee	67	2008	Mr. Baughn joined Hines in 1984 and retired from Hines in December 2019. Mr. Baughn has served as a member of our Board and as a manager of the general partner of our Advisor since December 2008. Additionally, from July 2013 through September 2019, Mr. Baughn served as a member of the board of directors of Hines Global Income Trust and as a member of the general partner of HGIT LP. In addition, Mr. Baughn was a member of the board of directors of Hines REIT from April 2008 and was a manager of the general partner of HALP from August 2003 until the liquidation and dissolution of Hines REIT in August 2018. He also served as CEO of Hines REIT and the general partner of HALP from August 2003 through April 1, 2008. He has served as the Senior Managing Director of the general partner of Hines since 2012. Additionally, Mr. Baughn served as the CFO of the general partner of Hines from 2012 to 2018. As CFO, Mr. Baughn was responsible for overseeing Hines’ business operations, such as balance sheet related activities and bank and other debt financing. Previously, he also has served as an Executive Vice President and CEO-Capital Markets Group of the general partner of Hines from April 2001 through 2012 and, as such, was responsible for overseeing Hines’ capital markets group, which raises, places and manages equity and debt for Hines projects in the U.S. and internationally. Mr. Baughn is also a director of Hines Securities, Inc. and was a member of the Hines’ Executive Committee until June 2019. Until May 2015, Mr. Baughn also served as the CEO of Hines Securities, Inc. Mr. Baughn also served as a member of the management board of the Core Fund from 2003 until the liquidation and dissolution of the Core Fund in December 2018. During his tenure at Hines, he has contributed to the development or redevelopment of over 9 million square feet of office and special use facilities in the southwestern United States. He graduated from the New York State College of Ceramics at Alfred University with a B.A. and received his M.B.A. from the University of Colorado. We believe that Mr. Baughn’s experience in the commercial real estate industry during his more than 37 year career with Hines, including his familiarity with Hines’ financial and investment policies, qualifies him to serve on our Board.

49

Name	Age	Year First Elected	Business Experience and Principal Occupation; Directorships in Public Corporations and Investment Companies
Jack L. Farley, Independent Trustee	56	2009	Mr. Farley has served as an independent trustee since June 2009. Mr. Farley has served as the President and CEO of Apex Compressed Air Energy Storage LLC, since January 2011, the year the company was launched in order to develop, build, operate, and commercialize utility-scale compressed air energy storage assets. Additionally, since January 2016, he has served as a board member for Live Power Intelligence Company, LLC, which provides real-time power grid information to electric power markets. Prior to that he co-founded Liberty Green Renewables, LLC in June 2008 to pursue development, construction and operation of biomass-to-electricity generation projects in the Midwest and Southeast US. From 2003 to February 2008, Mr. Farley was Senior Vice President of Cinergy Corp., where he was responsible for the Power Trading and Marketing group. During his tenure, the group had approximately $30 billion of annual physical power sales and ranked in the top 15 in the US. Cinergy Corp. merged with Duke Energy (NYSE: DUK) in 2006. In October 2007, Fortis NV acquired Duke’s trading operations as a strategic enhancement to its nascent US banking activities. Prior to joining Cinergy/Duke, Mr. Farley was President of the West Region at Reliant Resources, Inc., where he managed a $1.1 billion portfolio of power generation assets, and was responsible for the development and construction of two combined-cycle gas turbine projects with a total investment of approximately $750 million. We believe that Mr. Farley’s extensive leadership experience and understanding of the requirements of managing a public company, acquired during his tenure at Cinergy Corp. and Duke Energy qualify him to serve on our board of trustees. This experience along with Mr. Farley’s M.B.A. from The Wharton School and his involvement in the preparation of earnings statements and the compliance process for Sarbanes-Oxley requirements of public companies enable him to provide valuable insight to our Board.

50

Name	Age	Year First Elected	Business Experience and Principal Occupation; Directorships in Public Corporations and Investment Companies
Thomas L. Mitchell, Independent Trustee	60	2009	Mr. Mitchell has served as an independent trustee since June 2009. He is a strategic finance leader with a record of driving growth in energy business models as the CFO of both large and small companies in the Oil and Gas Industry. He has had a career of strong Fortune 500 experience with exploration and production companies, and broad energy exposure with offshore drilling and midstream gathering and marketing companies. In his last position as EVP and Chief Financial Officer of Devon Energy Corporation from 2014 to 2017, Mr. Mitchell lead the finance and business development organizations, and also helped the company successfully strengthen its asset quality through strategic acquisitions. Previously, Mr. Mitchell served as EVP and Chief Financial Officer and a member of the board of directors of Midstates Petroleum Company, a private equity-funded exploration and production company. While there, Mr. Mitchell led the initial public offering listing of the company on the New York Stock Exchange in April 2012. From November 2006 to September 2011, Mr. Mitchell was the Senior Vice President, Chief Financial Officer of Noble Corporation, a publicly-held offshore drilling contractor for the oil and gas industry. Following his formal education, Mr. Mitchell began his career in public accounting with Arthur Andersen & Co. where he practiced as a CPA (currently inactive), then, in 1989 entered the oil and gas industry at Apache Corporation where he spent eighteen years in various finance and commercial roles the last being Vice President and Controller. Mr. Mitchell currently serves on the boards of Ring Energy, Inc., a public exploration and production company, and EPIC Midstream Holdings GP, LLC, a private midstream crude and NGL infrastructure company. He previously served on the board of directors of Sundance Energy, Inc., a public exploration and production company, EnLink Midstream Partners, LP and EnLink Midstream, LLC. Mr. Mitchell graduated from Bob Jones University with a B.S. in Accounting. We believe Mr. Mitchell’s significant leadership experience at four public companies qualifies him to serve on our Board. In addition, through his previous experience in public accounting, Mr. Mitchell is able to provide valuable insight with respect to financial reporting processes and our system of internal controls.

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Name	Age	Year First Elected	Business Experience and Principal Occupation; Directorships in Public Corporations and Investment Companies
John S. Moody, Independent Trustee	73	2009	Mr. Moody has served as an independent trustee since June 2009. Mr. Moody has been President of Parkside Capital, LLC in Houston since January 2006. Parkside Capital, LLC is the general partner and manager of Parkside Capital Land Fund, LTD., a Texas real estate private equity firm which invests in raw land in high growth markets in Texas. From January 2004 to December 2005, Mr. Moody was the President and CEO of HRO Asset Management, LLC, a real estate advisory business headquartered in New York City, where he oversaw the acquisition of $850 million of real estate assets. From September 2001 to December 2003, he was the President of Marsh & McLennan Real Estate Advisors, Inc., where he developed the real estate strategy for the Marsh & McLennan Companies, including directing the execution of all real estate leases, projects and transactions. Mr. Moody was also the President and CEO of Cornerstone Properties, Inc., a publicly-held equity REIT which acquired, developed and operated large scale Class A office buildings in major metropolitan markets throughout the U.S. During his tenure at Cornerstone, assets grew from $500 million to $4.8 billion. From 1991 to 1995, Mr. Moody was the President and CEO of Deutsche Bank Realty Advisors, Inc., where he oversaw a $2 billion equity and debt portfolio. Mr. Moody has been a member of the board of directors of Huron Consulting Group (NASDAQ: HURN), a publicly-held integrated strategic services provider since October 2005. Since September 2006, he has been a member of the board of directors of Potlatch Corporation (NYSE: PCH), a publicly-held REIT with approximately 1.6 million acres of forestland. He became the Vice Chairman of the board of directors of Potlatch in January 2009. Mr. Moody also has served as the Chairman of the board of directors of Four Corners Property Trust Inc. (NYSE: FCPT) since November 2015. Mr. Moody was a member of the board of directors and Chairman of the Compensation Committee of CRIIMI MAE, Inc., a publicly-held REIT, from January 2004 to January 2006. He was also a member of the board of directors and Chairman of the Compensation Committee of Keystone Property Trust, a publicly-held REIT, from 2001 to 2004. Mr. Moody graduated from Stanford University with a B.S. and received his J.D. with honors from the University of Texas. We believe that Mr. Moody’s significant experience in the commercial real estate industry qualifies him to serve as one of our trustees. Drawing on this experience, Mr. Moody is able to provide valuable insight regarding our investment strategies, internal controls and financial risk exposures. In addition, through his experience serving on the boards of several public companies, Mr. Moody is well-versed in the requirements of serving on a public company board.

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Name	Age	Year First Elected	Business Experience and Principal Occupation; Directorships in Public Corporations and Investment Companies
Peter Shaper, Independent Trustee	56	2009	Mr. Shaper has served as an independent trustee since June 2009. He served as a director and member of the audit committee of HMS from May 2012 through October 2020. Since 2012, Mr. Shaper also has served as the Chairman and CEO of Greenwell Energy Solutions, an independent specialty chemical supplier to the upstream oil and gas industry. Additionally, he is a founding partner of Genesis Park LP, a Houston-based private equity firm which was founded in 2000 and primarily focuses on buyouts, partnering strategies with public corporations and growth financing bringing each company capital, commercial execution capabilities and a depth of experience in mergers and acquisitions. Mr. Shaper also was the CEO of Harris CapRock Communications, Inc., a global provider of broadband communications to remote locations via satellite with revenues of over $300 million from 2002 through June 2011, when he resigned. From 1998 to 2000, Mr. Shaper was the president of Donnelley Marketing, a Division of First Data Corporation, where he was directly responsible for the turnaround and eventual sale of the $100 million revenue database marketing company to a strategic buyer. In 1996, Mr. Shaper helped found the Information Management Group, (“IMG”), as its Executive Vice President of Operations and CFO. IMG grew to over $600 million in revenue during Mr. Shaper’s tenure. Prior to joining IMG, Mr. Shaper was with a Dallas-based private equity firm, where he was responsible for investments in numerous technology-oriented companies, as well as assisting those companies with developing long-term strategies and financial structures. Mr. Shaper also has several years’ experience with the international consulting firm McKinsey & Company. Mr. Shaper graduated from Stanford University with a B.S. in industrial engineering and received his M.B.A. from Harvard Business School. We believe Mr. Shaper’s significant experience as a senior executive officer of sophisticated companies such as Greenwell Energy Solutions, Harris CapRock Communications, Genesis Park and Donnelley Marketing/First Data, as well as his experience founding and leading IMG, qualify him to serve on our Board.

53

As of the date of this report, our executive officers (other than Mr. Hines, who serves on our Board and is included in the earlier list of our trustees), their ages and their experiences are as follows:

Name and Title	Age	Experience
J. Shea Morgenroth, Chief Financial Officer	46	Mr. Morgenroth has served as CFO for us and the general partner of our Advisor since June 2019. Mr. Morgenroth joined Hines in October 2003, and is a Senior Vice President - Controller and the CFO of Investment Management at Hines, a position he has held since April 2019. Prior to that, he was a Vice President - Controller for Hines since July 2012. Mr. Morgenroth also has served as the CFO of Hines Global Income Trust and the general partner of HGIT LP since June 2019. Since November 2011, Mr. Morgenroth served as the CAO and Treasurer for Hines Global and the general partner of the Advisor. Mr. Morgenroth has served as CAO and Treasurer for Hines Global Income Trust and the general partner of HGIT LP from July 2013 until June 2019. Mr. Morgenroth also served as CAO and Treasurer of Hines REIT and the general partner of HALP from November 2011 through the liquidation and dissolution of Hines REIT in August 2018. In these roles, Mr. Morgenroth has been responsible for the oversight of the treasury, accounting, financial reporting and SEC reporting functions, as well as the Sarbanes-Oxley compliance program in the U.S. and internationally. Prior to his appointment as CAO and Treasurer for Hines Global, Mr. Morgenroth served as a Senior Controller for Hines Global and the general partner of the Advisor from December 2008 until November 2011 and for Hines REIT and the general partner of HALP from January 2008 until November 2011 and as a Controller for Hines REIT and the general partner of HALP from October 2003 to January 2008. In these roles, he was responsible for the management of the accounting, financial reporting and SEC reporting functions. Prior to joining Hines, Mr. Morgenroth was a manager in the audit practices of Arthur Andersen LLP and Deloitte & Touche LLP, serving clients primarily in the real estate industry. He holds a B.B.A. in Accounting from Texas A&M University and is a Certified Public Accountant.
A. Gordon Findlay, Secretary	46	Mr. Findlay has served as Secretary for us and the general partner of our Advisor since March 2020. Mr. Findlay joined Hines in November 2006. Mr. Findlay has served as a Vice President - Controller for Hines since October 2016 and as a Senior Controller for Hines from 2012 until October 2016. In these roles, he has been involved with managing the accounting, financial reporting and SEC reporting functions related to Hines Global, Hines Global Income Trust, and Hines REIT. Mr. Findlay has served as CAO and Treasurer of Hines Global Income Trust, and the general partner of HGIT LP since June 2019. Prior to joining Hines, Mr. Findlay spent six years in the audit practice of Ernst & Young LLP, serving public and private clients in various industries. He holds a Bachelor of Business Administration degree in Accounting from University of Houston - Downtown and is a Certified Public Accountant.

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Item 11.  Executive Compensation

Trustee Compensation

The following table sets forth information regarding compensation paid to or earned by our trustees during 2021.

2021 Trustee Compensation

Name	Fees Earned or Paid in Cash	Aggregate Stock Awards	Option Awards	Non-Equity Incentive Plan Compensation	Change in Pension Value and Non-Qualified Deferred Compensation Earnings	All Other Compensation	Total Compensation
Jack L. Farley	$52,000	$—	$—	$—	$—	$—	$52,000
Thomas L. Mitchell	$52,000	$—	$—	$—	$—	$—	$52,000
John S. Moody	$52,000	$—	$—	$—	$—	$—	$52,000
Peter Shaper	$52,000	$—	$—	$—	$—	$—	$52,000
Jeffery C. Hines, Charles M. Baughn, and David L. Steinbach (1)	$—	$—	$—	$—	$—	$—	$—

(1)Messrs. Hines and Baughn, and Mr. Steinbach, who are employees of Hines, receive no compensation for serving as members of our Board.

We paid our independent trustees an annual retainer of $50,000, and a fee of $2,000 for each meeting of the Board attended in person for the year ended December 31, 2021 and a fee of $1,000 for each Board meeting attended via teleconference, regardless of its length.

Subsequent to the formation of the Liquidating Trust on June 30, 2020, there were no committees of our Board and, accordingly, no additional committee retainers or fees were paid thereafter.

All trustees are reimbursed by us for reasonable out-of-pocket expenses incurred in connection with attendance at Board or committee meetings.

Audit Committee

We do not have an audit committee or other committee that performs similar functions and, consequently, have not designated an audit committee financial expert. Due to our limited operations and level of activity, which primarily consists of the leasing and sale of the remaining assets and the payment of outstanding obligations, our trustees believe that the services of an audit committee financial expert are not warranted.

Trustee Nominations

We currently do not provide any procedure for our investors to recommend nominees to our Board.

Executive Compensation

We have no employees. Our day-to-day management functions are performed by our Advisor and its affiliates. All of our executive officers are employed by and receive compensation from our Advisor or its affiliates, for all of their services to the Hines organization, including their service as our executive officers. The compensation received by our executive officers is not paid or determined by us, but rather by our Advisor or affiliates of our Advisor based on all the services provided by these individuals to the Hines organization, including us. As a result, we do not have and our compensation committee has not considered, a compensation policy or program for our executive officers and have not included a “Compensation Discussion and Analysis,” or “Compensation Committee Report” in this Annual Report on Form 10-K. Please see “Item 13. Certain Relationships and Related Transactions, and Director Independence” for a discussion of fees and expenses payable to our Advisor and its affiliates.

55

Compensation Committee Interlocks and Insider Participation

Subsequent to the formation of the Liquidating Trust on June 30, 2020, when Hines Global REIT, Inc. transferred all of its assets and liabilities to us, we no longer have a Compensation Committee. The functions of the Compensation Committee are now administered by our independent trustees.

Code of Business Conduct and Ethics

Our board of trustees has adopted a Code of Business Conduct and Ethics, which is applicable to our trustees and officers, including our chief executive officer, chief financial officer, and other persons performing similar functions, whether acting in their capacities as our officers or in their capacities as officers of our Advisor or its general partner. The Code of Business Conduct and Ethics covers topics including conflicts of interest, confidentiality of information, full and fair disclosure, reporting of violations and compliance with laws and regulations. Our Code of Business Conduct and Ethics is available, free of charge, on the Corporate Governance section of our website, www.hinessecurities.com/hgrliquidatingtrust. You may also obtain a copy of this code by writing to: Hines Global REIT Investor Relations, 2800 Post Oak Boulevard, Suite 5000, Houston, Texas 77056-6118. Waivers from our Code of Business Conduct and Ethics are discouraged, but any waivers from the Code of Business Conduct and Ethics that relate to any executive officer or director must be approved by our Nominating and Corporate Governance Committee and will be posted on our website at www.hinessecurities.com/hgrliquidatingtrust within four business days of any such waiver.

56

Item 12.  Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 Ownership

The following table shows, as of March 26, 2022, the amount of our common units beneficially owned (unless otherwise indicated) by (1) any person who is known by us to be the beneficial owner of more than 5% of our outstanding common units, (2) our trustees, (3) our executive officers, and (4) all of our trustees and executive officers as a group. Except as otherwise indicated, all units are owned directly, and the owner of such units has the sole voting and investment power with respect thereto.

		Common Units Beneficially Owned (2)
Name of Beneficial Owner (1)	Position	Number of Common Units	Percentage of Class
Jeffrey C. Hines	Trustee and Chief Executive Officer	1,111	* (3) (4)
Charles M. Baughn	Trustee	9,031	*
David L Steinbach	Trustee	—
Jack L. Farley	Independent Trustee	17,272	*
Thomas L. Mitchell	Independent Trustee	16,262	*
John S. Moody	Independent Trustee	16,262	*
Peter Shaper	Independent Trustee	16,262	*
J. Shea Morgenroth	Chief Financial Officer	1,667	*
A. Gordon Findlay	Secretary	—	*
All trustees and executive officers as a group		77,867	*

*    Amount represents less than 1%

(1)The address of each person listed is c/o HGR Liquidating Trust, 2800 Post Oak Boulevard, Suite 5000, Houston, Texas 77056-6618.

(2)For purposes of this table, “beneficial ownership” is determined in accordance with Rule 13d-3 under the Exchange Act, pursuant to which a person is deemed to have “beneficial ownership” of units of our stock that the person has the right to acquire within 60 days. For purposes of computing the percentage of outstanding units of the Company’s stock held by each person or group of persons named in the table, any units that such person or persons have the right to acquire within 60 days of March 26, 2022 are deemed to be outstanding, but are not deemed to be outstanding for the purpose of computing the percentage ownership of any other persons.

(3)Includes 1,111.111 common units owned directly by Hines Global REIT Investor Limited Partnership. Mr. Hines is deemed to be the beneficial owner of the units owned by Hines Global REIT Investor Limited Partnership.

(4)This amount does not include the (i) 21,111.111 partnership interests (the “OP Units”) in Hines Global REIT Properties LP (the “Operating Partnership”) and (ii) the special partnership interests (the “Special OP Units”) of the Operating Partnership owned by Hines Global REIT Associates Limited Partnership. Limited partners in the Operating Partnership may request repurchase of their OP Units for cash or, at our option, common units on a one-for-one basis, beginning one year after such OP Units were issued. The holder of the Special OP Units is entitled to distributions from the Operating Partnership under certain circumstances. In addition, under the Advisory Agreement, if we are not advised by an entity affiliated with Hines, Hines or its affiliates may cause the Operating Partnership to purchase some or all of the Special OP Units or any other OP Units then held by such entities for cash (or in certain cases, a promissory note) or our units as determined by the seller. Mr. Hines indirectly own and/or control Hines Global REIT Associates Limited Partnership.

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Item 13.  Certain Relationships and Related Transactions, and Director Independence

Our Advisor

We do not have employees. Subject to the supervision of our board of trustees, our day-to-day operations are conducted by our Advisor in accordance with the Advisory Agreement. Our Advisor is an affiliate of Hines and is wholly-owned, indirectly, by, or for the benefit of, Jeffrey C. Hines, one of our trustees. All of our executive officers are employed by, and all of our executive officers actively participate in, the management of our Advisor and its affiliates. Jeffrey C. Hines serves as the Chairman of the Managers of the general partner of our Advisor and Charles M. Baughn and David L. Steinbach serve as Managers of the general partner of our Advisor.

Our executive officers have control and primary responsibility for the management decisions of our Advisor, including the disposition of properties to be recommended to our Board, the negotiations for these dispositions, and the property management and leasing of properties remaining in our portfolio. The Advisory Agreement was entered into as of June 30, 2020, and shall continue in force throughout the duration of our existence and shall terminate as of the date of our termination. The Advisory Agreement may be terminated with cause immediately by us or by our Advisor. For the period from January 1, 2020 through June 30, 2020, the Advisor, the Operating Partnership and Hines Global were parties to the Prior Advisory Agreement, as defined in Part I, Item 1 of this Annual Report on Form 10-K.

The Advisor and its affiliates receive compensation and are reimbursed for certain expenses in connection with services provided to us. These payments are summarized below. In the event the Advisory Agreement is terminated, our Advisor will be paid all earned, accrued and unpaid compensation and expense reimbursements within 30 days. Upon termination, we may also be obligated to purchase certain ownership interests owned by our Advisor or other affiliates of Hines under certain circumstances.

The following summarizes fees our Advisor earned under the Advisory Agreement and the Prior Advisory Agreement during 2021:

•Under the Advisory Agreement, we pay our Advisor a monthly asset management fee equal to 0.09375% of the net equity capital we have invested in real estate investments at the end of each month. The Advisor earned $6.4 million in asset management fees during the year ended December 31, 2021.

•Under the Advisory Agreement, we pay our Advisor a disposition fee equal to 1.0% of (i) the sales price of any real estate investments sold, held directly by us, or (ii) when we hold investments indirectly through another entity, our pro rata share of the sales price of the real estate investment sold by that entity. The Advisor earned $4.4 million in disposition fees during the year ended December 31, 2021 related to the sale of four of our properties.

•Likewise, under the Advisory Agreement, we may reimburse our Advisor and its affiliates for certain expenses they incur in connection with administrative and operating services they provide to us. In 2021, our Advisor incurred $4.9 million in expenses, such as general and administrative expenses, on our behalf, which were reimbursed by us. See “Hines - Property Management Agreements” below for additional information concerning expense reimbursements to Hines.

We also agreed to indemnify our Advisor against losses it incurs in connection with its performance of its obligations under the Advisory Agreement, subject to terms and conditions in the Advisory Agreement.

Hines

Property Management Agreements

Hines or its affiliates managed some of our properties. We paid Hines property management fees, leasing fees, tenant construction fees and other fees customarily paid to a property manager. Hines is wholly-owned by Jeffrey C. Hines.

During the year ended December 31, 2021, Hines earned the following amounts pursuant to property management agreements under which Hines managed some of our properties:

•$1.2 million in property management fees;

•$0.5 million in leasing commissions; and

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•$1.8 million for all costs Hines incurred in providing property management and leasing services pursuant to the property management and leasing agreements. Included in this reimbursement of operating costs are the cost of personnel and overhead expenses related to such personnel located at the property as well as off-site personnel located in Hines’ headquarters and regional offices, to the extent the same related to or supported the performance of Hines’ duties under the agreements.

Ownership Interests

The Operating Partnership

We are the sole general partner of the Operating Partnership and owned a 99.99 % interest in the Operating Partnership at December 31, 2021. Hines Global REIT Associates Limited Partnership, an affiliate of Jeffrey C. Hines, owned a 0.01 % interest in the Operating Partnership at December 31, 2021. An affiliate of Jeffrey C. Hines also owns 1,111.111 shares of our common units.

Policies and Procedures for Review of Related Party Transactions

Potential conflicts of interest exist among us, Hines, our Advisor and other affiliates of Hines in relation to our existing agreements and how we will operate. Currently, four of our seven trustees are independent trustees. The board of trustees reviews and approves all matters it believes may involve conflicts of interest.

The board of trustees also must review and approve any transaction between us and our affiliates, on the one hand, and any trustee (including any independent trustee) or the trustee’s affiliates or related persons on the other hand. All related party transactions must be approved by a majority of the disinterested members of the board of trustees. Any related party agreement or arrangements must be on terms no less favorable to us than those available to us in similar agreements or arrangements with unaffiliated third parties.

Trustee Independence

Our board of trustees has determined that each of our independent trustees is independent within the meaning of the applicable (i) provisions set forth in our Agreement and Declaration of Trust, which defines an independent trustee as: a person who is not on the date of determination, and within the two years prior to the date of determination has not been, directly or indirectly associated with the Advisor by virtue of (i) ownership of an interest in the Advisor or any of its affiliates, (ii) employment by the Advisor or any of its affiliates, (iii) service as an officer or director of the Advisor or any of its affiliates, (iv) performance of services, other than as a director or trustee, for Hines Global or the Trust, (v) service as a director or trustee of more than three real estate investment trusts organized by or advised by any affiliate of the Advisor, or (vi) maintenance of a material business or professional relationship with the Advisor or any of its affiliates.

A business or professional relationship is considered “material” if the aggregate gross revenue derived by the trustee from the Advisor and its affiliates exceeds five percent of either the trustee’s annual gross revenue during either of the last two years or the trustee’s net worth on a fair market value basis. An indirect association with the Advisor shall include circumstances in which a trustee’s spouse, parent, child, sibling, mother- or father-in-law, son- or daughter-in-law or brother- or sister-in-law is or has been associated with the Advisor, any of its affiliates, the Trust or Hines Global.

Item 14.  Principal Accounting Fees and Services

We did not engage independent auditors to perform an audit of the financial statements contained in this Form 10-K for the years ended December 31, 2021 and December 31, 2020.

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 PART IV

Item 15. Exhibits, Financial Statement Schedules

(a)(1) Financial Statements

HGR Liquidating Trust

Consolidated Financial Statements

Consolidated Financial Statements
Consolidated Statement of Net Assets, As of December 31, 2021 and 2020	20
Consolidated Statement of Changes in Net Assets, For the Year Ended December 31, 2021 and For the Period from July 1, 2020 through December 31, 2020	21
Consolidated Statements of Operations and Comprehensive Income (Loss), For the Six Months Ended June 30, 2020 and For the Year Ended December 31, 2019	22
Consolidated Statements of Equity, For the Six Months Ended June 30, 2020 and For the Year Ended December 31, 2019	23
Consolidated Statements of Cash Flows, For the Six Months Ended June 30, 2020 and For the Year Ended December 31, 2019	24
Notes to Consolidated Financial Statements	25

Auditor Name None Auditor Location None Auditor Firm ID 999999

(2) Financial Statement Schedules

Schedule III — Real Estate Assets and Accumulated Depreciation is set forth beginning on page 61 hereof.

All other schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are not applicable and therefore have been omitted.

(b) Exhibits

Reference is made to the Index beginning on page 64 for a list of all exhibits filed as a part of this report.

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Schedule III — Real Estate Assets and Accumulated Depreciation

December 31, 2021

				Initial Cost								Gross Amount at Which Carried at 12/31/2021
Description (a)	Location	Encumbrances		Land		Buildings and Improvements		Total		Costs Capitalized Subsequent to Acquisition		Land		Buildings and Improvements		Total (b)		Final Accumulated Depreciation (c)		Total		Date of Construction	Date Acquired
Minneapolis Retail Center	Minneapolis, Minnesota	—		30,792		78,711		109,503		23,201		30,792		101,912		132,704		(15,533)		117,171		1974	August - 12 & December - 12
Net Liquidation Adjustment (d)																				32,829
		$	—	$	30,792	$	78,711	$	109,503	$	23,201	$	30,792	$	101,912	$	132,704	$	(15,533)	$	150,000

(a)Asset is a quality retail property.

(b)The aggregate cost for federal income tax purposes is $168.3 million as of December 31, 2021.

(c)Prior to the held for sale classification, real estate assets were depreciated or amortized using the straight-line method over the useful lives of the assets by class. The estimated useful lives for computing depreciation were generally 10 years for furniture and fixtures, 15-20 years for electrical and mechanical installations and 40 years for buildings. As a result of the held for sale classification, the Company stopped recording depreciation to the assets held for sale as of July 2019.

(d)Under the Liquidation Basis of Accounting, real estate holdings are carried at their liquidation values. The net liquidation adjustment represents the Company’s remeasurement of the property from the carrying value of the property to reflect the estimated liquidation value.

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The changes in total real estate assets for the years ended December 31, (in thousands):

	2021		2020		2019
Gross real estate assets
Balance, beginning of period	$	478,313	$	1,259,164	$	1,942,614
Additions during the period:
Acquisitions	—		—		—
Other additions	86		10,239		89,138
Disposals of fully-depreciated assets	—		—		—
Costs of real estate sold	(345,695)		(760,740)		(602,822)
Impairment losses	—		(29,418)		(179,194)
Effect of changes in foreign currency exchange rates	—		(932)		9,428
Balance, end of period	$	132,704	$	478,313	$	1,259,164
Accumulated Depreciation
Balance, beginning of period	$	(15,605)	$	(79,394)	$	(172,659)
Depreciation	—		—		(18,191)
Effect of changes in foreign currency exchange rates	—		741		(1,270)
Disposals of fully-depreciated assets	—		—		—
Impairment losses	—		10,827		59,854
Retirement or sales of assets	72		52,221		52,872
Balance, end of period	$	(15,533)	$	(15,605)	$	(79,394)
Net real estate assets	$	117,171	$	462,708	$	1,179,770
Liquidation adjustment	32,829		134,492		—
Net real estate assets after liquidation adjustment	$	150,000	$	597,200	$	1,179,770

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Item 16. Form 10-K Summary

The Company has elected not to include a summary.

* * * * * *

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INDEX TO EXHIBITS

Exhibit No.	Description
2.1	Plan of Liquidation and Dissolution (filed as Appendix A to the Registrant’s Definitive Proxy Statement on Schedule 14A, on May 10, 2018 and incorporated by reference herein)
10.1	Form of Restricted Share Award Agreement (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 10-K on March 30, 2018 and incorporated by reference herein)
10.2*	Agreement of Sale and Purchase by and among Galleria Shopping Center, LLC and Galleria Parking Ramp, LLC, and 70th Street Properties, LLC, effective December 23, 2021
10.3*	First Amendment to Agreement of Sale and Purchase by and among Galleria Shopping Center, LLC, and Galleria Parking Ramp, LLC, and 70th Street Properties, LLC, dated February 28, 2022
10.4	Agreement and Declaration of Trust of HGR Liquidating Trust, dated as of June 30, 2020 (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K on July 7, 2020 and incorporated by reference herein)
10.5	Amended and Restated Advisory Agreement, dated as of June 30, 2020, by and among HGR Liquidating Trust, Hines Global REIT Advisors LP and Hines Global REIT Properties LP (filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K on July 7, 2020 and incorporated by reference herein)
10.6	Second Amended and Restated Agreement of Limited Partnership of Hines Global REIT Properties LP (filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K on July 7, 2020 and incorporated by reference herein)
10.7	Form of Indemnification Agreement entered into between HGR Liquidating Trust and the individuals listed on Schedule A thereto (filed as Exhibit 10.4 to the Registrant’s Current Report on Form 8-K on July 7, 2020 and incorporated by reference herein)
10.8	Amendment to Credit Agreement, dated as of March 3, 2020, by and among Hines Global REIT Properties, L.P. and the Lenders party thereto, JP Morgan Chase Bank, National Association, as Administrative Agent, J.P. Morgan Europe Limited, as Administrative Agent for Foreign Currencies, Bank of America, N.A., as Syndication Agent, and Bank of Montreal, Chicago Branch, Regions Bank and U.S. Bank National Association, as Co- Documentation Agents, J.P. Morgan Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Joint Bookrunners and Joint Lead Arrangers. (filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K on March 9, 2020 and incorporated by reference herein)
21.1*	List of Subsidiaries of HGR Liquidating Trust.
31.1*	Certification
31.2*	Certification
32.1*	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C., Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Pursuant to SEC Release 34-47551 this Exhibit is furnished to the SEC and shall not be deemed to be “filed.”
101*	The following materials from Hines Global REIT, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2020, filed on March 31, 2022, are formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) Statements of Equity, (iv) of Cash Flows, and (v) Notes to the Consolidated Financial Statements.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101)

*    Filed herewith

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized representative.

		HGR Liquidating Trust (registrant)
March 31, 2022	By:	/s/ Jeffrey C. Hines
		Jeffrey C. Hines
		Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on March 31, 2022.

Signature	Title	Date
/s/ Jeffrey C. Hines	Trustee and Chief Executive Officer	March 31, 2022
Jeffrey C. Hines	(Principal Executive Officer)
/s/ J. Shea Morgenroth	Chief Financial Officer	March 31, 2022
J. Shea Morgenroth	(Principal Financial Officer)
/s/ David L Steinbach	Trustee	March 31, 2022
David L. Steinbach
/s/ Charles M. Baughn	Trustee	March 31, 2022
Charles M. Baughn
/s/ Jack L. Farley	Trustee	March 31, 2022
Jack L. Farley
/s/ Thomas L. Mitchell	Trustee	March 31, 2022
Thomas L. Mitchell
/s/ John S. Moody	Trustee	March 31, 2022
John S. Moody
/s/ Peter Shaper	Trustee	March 31, 2022
Peter Shaper

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