CNSREIT-AR-2024 Final - Flipbook - Page 41
Some additional risks and conflicts related to our joint venture investments (including any future joint venture
investments with Cohen & Steers affiliates) include:
"
the joint venture partner may have economic or other interests that are inconsistent with or different from our
interests, including interests relating to the financing, management, operation, leasing or sale of the assets
purchased by such joint venture;
"
our joint venture partners may receive ongoing fees from our joint ventures, including promote payments and
potential buyouts of their equity investments, all of which may reduce amounts otherwise payable to us;
"
tax, Investment Company Act and other regulatory requirements applicable to the joint venture partner could
cause it to want to take actions contrary to our interests;
"
the joint venture partner could have joint control or joint governance of the joint venture even in cases where
its economic stake in the joint venture is significantly less than ours;
"
under the joint venture arrangement, there will be cases where neither we nor the joint venture partner will be
in a position to unilaterally control the joint venture, and deadlocks may occur. Such deadlocks could
adversely impact the operations and profitability of the joint venture, including as a result of the inability of
the joint venture to act quickly in connection with a potential acquisition or disposition or expected costs and
expenses. In addition, depending on the governance structure of such joint venture partner, decisions of such
vehicle may be subject to approval by individuals who are independent of Cohen & Steers;
"
under the joint venture arrangement, if we have a right of first refusal to buy out a joint venture partner, we
may be unable to finance such a buyout if it becomes exercisable or we are required to purchase such interest
at a time when it would not otherwise be in our best interest to do so;
"
under the joint venture arrangement, we and the joint venture partner may have a buy/sell right and, as a result
of an impasse that triggers the exercise of such right, we could be forced to sell our investment in the joint
venture, or buy the joint venture partner9s share of the joint venture at a time when it would not otherwise be
in our best interest to do so;
"
our participation in investments in which a joint venture partner participates will be less than what our
participation would have been had such joint venture partner not participated, and because there may be no
limit on the amount of capital that such joint venture partner can raise, the degree of our participation in such
investments may decrease over time;
"
under the joint venture arrangement, we and the joint venture partner could each have preemptive rights in
respect of future issuances by the joint venture, which could limit a joint venture9s ability to attract new thirdparty capital;
"
under the joint venture arrangement, a removal of the Advisor may require the consent of the joint venture
partner. If such consent is not obtained, it could trigger change of control restrictions that may include buy/
sell rights like those described above, a loss of governance rights in the joint venture or other adverse
consequences;
"
under the joint venture arrangement, we will rely on the operating partner to provide financial and asset level
information on which we will rely for valuation and calculating NAV;
"
under the joint venture arrangement, we and the joint venture partner could be subject to lock-ups, which
could prevent us from disposing of our interests in the joint venture when desired; and
"
the joint venture partner could have a right of first offer, tag-along rights, drag-along rights, consent rights or
other similar rights in respect of any transfers of the ownership interests in the joint venture to third parties,
which could have the effect of making such transfers more complicated or limiting or delaying us from selling
our interest in the applicable investment.
Furthermore, we may have conflicting fiduciary obligations if we acquire properties with our affiliates or other related
entities; as a result, in any such transaction we may not have the benefit of arm9s-length negotiations of the type normally
conducted between unrelated parties.
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