The non-traded REIT will rely on limited filings as its subsidiary undergoes a court-supervised debt arrangement in Israel.

March 5, 2026

Pacific Oak Strategic Opportunity REIT announced a series of significant corporate changes on February 24, 2026, signaling deepening financial difficulties for the Newport Beach, California-based real estate investment trust. The company’s board of directors voted to dismiss its independent auditor, dissolve its audit committee, and abandon traditional annual and quarterly SEC reporting in favor of a stripped-down disclosure approach.

Auditor Dismissal

The board approved the immediate termination of Ernst & Young LLP as the company’s independent registered public accounting firm. There were no disagreements between the company and Ernst & Young on accounting principles, financial disclosures, or auditing procedures during the two most recent fiscal years or any subsequent interim period. Ernst & Young’s prior audit reports did not contain adverse opinions, disclaimers, or qualifications. A letter from the firm dated March 2, 2026, was included as an exhibit.

Scaled-Back Reporting

In a more dramatic shift, the board dissolved the company’s audit committee and announced that Pacific Oak Strategic Opportunity REIT would no longer file traditional annual or quarterly reports with the SEC. Instead, the company plans to continue filing current reports and will include quarterly financial statements from its indirect wholly owned subsidiary, Pacific Oak SOR (BVI) Holdings Ltd., prepared under International Financial Reporting Standards. Because shares of the BVI entity represent substantially all of the company’s assets, the board determined those financial statements would be sufficiently informative for stockholders.

The decision was driven by several factors:

• Limited cash: The company has minimal cash on hand and depends on the BVI subsidiary for future funding, which is described as extremely uncertain in both timing and amount.
• Cost concerns: Available funds are not expected to support continued preparation of full-scale SEC filings.
• Minimal trading activity: Trading in the company’s securities is extremely limited, reducing the practical benefit of comprehensive public reporting.

Israeli Debt Arrangement

These developments occur against the backdrop of an ongoing debt restructuring in Israel. The company, the BVI subsidiary, and former external advisor Pacific Oak Capital Advisors LLC entered into a letter of undertaking in August 2025 in favor of the trustee for holders of Series B and Series D bonds issued by the BVI. In late December 2025, the trustee petitioned the Tel Aviv–Jaffa District Court to convene a meeting of bondholders to approve a proposed debt arrangement under Israeli insolvency law. The court granted that request in early February 2026, though a meeting date has not yet been scheduled.

The board indicated it expects all company assets held through the BVI to be disposed of in an orderly fashion as part of the debt arrangement. Given these circumstances, the directors concluded that pursuing stockholder approval of a formal liquidation plan would provide limited benefit relative to its costs.

Additional Cost-Cutting Measures

The board also decided against providing an updated estimated net asset value per share, citing financial constraints and ongoing uncertainty about share value. To further reduce expenses, all current independent directors have waived both accrued and future director fees.

The report was signed by Brian Ragsdale, who serves as President, Chief Executive Officer, and Chief Financial Officer. The company cautioned that forward-looking statements are subject to risks including future economic and market conditions, occupancy and rental rate performance, and other factors detailed in prior SEC filings.