Sculptor Diversified Real Estate Income Trust, Inc.

Our principal executive and administrative offices are located in leased space at 9 West 57th Street, 40th Floor, New York, New York 10019. We consider these facilities to be suitable and adequate for the management and operations of our business.

• CapGrow Partners LLC Illinois⁴
• CapGrow SUB XI SPE LLC Delaware⁴
• CapGrow Sub I and Sub V SPE LLC Delaware⁴
• CapGrow Sub III SPE LLC Delaware⁴
• CapGrow Sub IV SPE LLC Delaware⁴
• CapGrow Sub IX SPE LLC Delaware⁴
• CapGrow Sub VI SPE LLC Delaware⁴
• CapGrow Sub VIII SPE LLC Delaware⁴
• CapGrow TRS LLC Delaware⁴
• DTR Parking Holdings 1 Investor LLC Delaware⁴
• DTR Parking Holdings 1 LLC Delaware⁴
• HHP Pref Funding LLC Delaware⁴
• HHP Senior Funding LLC Delaware⁴
• HHP TRS LLC Delaware⁴
• HMP Holdings LLC Florida⁴
• LPRI II Court Street Garage, LLC Connecticut⁴
• LPRI II Washington Square Garage, LLC Connecticut⁴
• MVP Resources LLC Florida⁴
• Marysville Holdings LLC Delaware⁴
• Marysville Owner LLC Delaware⁴
• PHC SD Funding LLC Delaware⁴
• RE Fund I LLC Illinois⁴
• RE Fund II LLC Illinois⁴
• SCVH Denton Investor LLC Delaware⁴
• SCVH Denton JV LLC Delaware⁴
• SCVH Denton Owner LLC Delaware⁴
• SCVH Denton TRS LLC Delaware⁴
• Sculptor Diversified REIT Holdings Sarl Luxembourg⁴
• Sculptor Diversified REIT Operating Partnership LP Delaware⁴
• TVREIT Preferred Investor LLC Delaware⁴

• We may fund distributions from sources other than our cash flow from operations, including, without limitation, borrowings, offering proceeds or the sale of our assets, and we have no limits on the amounts we may pay from such sources.
• Purchases and repurchases of shares of our common stock are not made based on the current NAV per share of our common stock.
• Valuations and appraisals of our real estate and real estate debt are estimates of value and may not necessarily correspond to realizable value.
• It may be difficult to reflect, fully and accurately, material events that may impact our monthly NAV.
• NAV calculations are not governed by governmental or independent securities, financial or accounting rules or standards.
• If we quickly raise a substantial amount of capital, we may have difficulty investing it in a timely manner.
• Our UPREIT structure may result in potential conflicts of interest with limited partners in our Operating Partnership whose interests may not be aligned with those of our stockholders.
• Payments to our Adviser or the Special Limited Partner in the form of common stock or Operating Partnership units they elect to receive in lieu of fees or distributions will dilute future cash available for distribution to our stockholders.
• We may not be able to build and maintain a network of licensed broker-dealers, which failure could have a material adverse effect on our business and our offering.
• Our board of directors may, in the future, adopt certain measures under Maryland law without stockholder approval that may have the effect of making it less likely that a stockholder would receive a “control premium” for his or her shares.
• Our charter permits our board of directors to authorize us to issue preferred stock on terms that may subordinate the rights of the holders of our current common stock or discourage a third party from acquiring us.
• Maryland law and our organizational documents limit our rights and the rights of our stockholders to recover claims against our directors and officers, which could reduce your and our recovery against them if they cause us to incur losses.
• Your interest in us will be diluted if we issue additional shares. Your interest in our assets will also be diluted if the Operating Partnership issues additional units.
• The net tangible book value of your shares will be substantially below the price you pay for them, thus increasing the risk of a loss on your investment.
• Our bylaws designate the Circuit Court for Baltimore City, Maryland or, if that court does not have jurisdiction, the U.S. District Court for the District of Maryland, Baltimore Division, as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
• Your investment return may be reduced if we are required to register as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”).
• We depend on our Adviser to develop appropriate systems and procedures to control operational risk.
• We are dependent on information systems, and systems failures, as well as operating failures, could significantly disrupt our business.
• Compliance with the SEC’s Regulation Best Interest by selected dealers may negatively impact our ability to raise capital in our offering, which could harm our ability to achieve our investment objectives.
• Cybersecurity risks and cyber incidents may adversely affect our business by causing a disruption to our operations, a compromise or corruption of our confidential information and/or damage to our business relationships.
• We are subject to risks associated with artificial intelligence and machine learning technology.
• We will face risks associated with hedging transactions.
• Uncertainty with respect to market disruption and terrorism could have a significant adverse effect on our business, financial condition and results of operations.
• Risks Related to Our Acquisition of CapGrow
• Our acquisition of CapGrow was not on an arms-length basis, increasing the risk that we may have paid more for our interest in CapGrow than we otherwise would have.
• Our inability to increase rents beyond the fixed amounts set forth in the leases for the CapGrow Portfolio may adversely affect our performance, thereby reducing the value of your investment in us.
• Our inability to complete new acquisitions in line with our expectations may result in a lower future value for CapGrow than anticipated.
• Approximately 38% of our revenue is derived from affiliates of Sevita. If Sevita became unable to honor its obligations to us, our results of operation and financial condition would be adversely affected and the value of your investment in us could decline substantially.
• Medicaid reimbursement rates could be cut or could be increased below the amount necessary to meet our expected 1.75% annual lease escalations.
• General Risks Related to Investments in Real Estate
• Our operating results will be affected by economic and regulatory changes that impact the real estate market in general.
• Our success is dependent on general market and economic conditions.
• We will depend on tenants for our revenue, and therefore our revenue is dependent on the success and economic viability of our tenants. Our reliance on single or significant tenants in certain buildings may decrease our ability to lease vacated space and could adversely affect our income, performance, operations and ability to pay distributions.
• We may be subject to additional risks from non-U.S. investments.
• Our portfolio may be concentrated in a limited number of industries, geographies or investments.
• We face risks associated with property acquisitions.
• Competition for investment opportunities may reduce our profitability and the return on your investment.
• Acquiring or attempting to acquire multiple properties in a single transaction may adversely affect our operations.
• We may incur “dead deal costs” in connection with potential acquisitions.
• In our due diligence review of potential investments, we may rely on third-party consultants and advisors and representations made by sellers of potential properties, and we may not identify all relevant facts that may be necessary or helpful in evaluating potential investments.
• There can be no assurance that our Adviser will be able to detect or prevent irregular accounting, employee misconduct or other fraudulent practices or material misstatements or omissions during the due diligence phase or during our efforts to monitor and disclose information about any investment on an ongoing basis or that any risk management procedures implemented by us will be adequate.
• Certain properties may require an expedited transaction, which may result in limited information being available about the property prior to its acquisition.
• We will face risks in effecting operating improvements.
• We may have difficulty selling our properties, which may limit our flexibility and ability to pay distributions.
• Investments in real properties carry certain litigation risks at the property level that may reduce our profitability and the return on your investment.
• We may make a substantial amount of joint venture investments, including with Sculptor affiliates. Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on the financial condition of our joint venture partners and disputes between us and our joint venture partners.
• We may be subject to expenses and liabilities related to employees of certain portfolio entities owned by us.
• We will rely on management companies to operate our properties and leasing agents to lease vacancies in our properties.
• We may be unable to renew leases as leases expire.
• Our properties may be leased at below-market rates under long-term leases.
• Short-term leases expose us to the effects of declining market rent and could adversely impact our ability to make cash distributions to you.
• Certain of our real estate investments may not include title to the underlying land, exposing us to greater risks.
• Our properties may face significant competition.
• We may experience material losses or damage related to our properties and such losses may not be covered by insurance policies.
• We could become subject to liability for environmental violations, regardless of whether we caused such violations.
• Our costs associated with complying with the Americans with Disabilities Act of 1990 (the “ADA”) or the Fair Housing Amendment Act of 1988 (the “FHAA”) may affect cash available for distributions.
• Rent control and other changes in applicable laws, or noncompliance with applicable laws, could adversely affect our multifamily residential properties.
• Legislative and regulatory initiatives aimed at limiting institutional ownership or acquisition of single-family and other residential housing could restrict our investment activity, increase our costs, reduce asset values, or require changes to our strategy.
• Our properties are, and any properties we acquire in the future will be, subject to property taxes that may increase in the future, which could adversely affect our cash flow.
• We may be exposed to third-party liability, which can reduce the performance of any associated investment.
• Certain of our investments may have additional capital requirements.
• Technological or other innovations may disrupt the markets and sectors in which we operate and subject us to increased competition or negatively impact the tenants of our properties and the value of our properties.
• Many factors affect the single-family rental housing market, and we may be negatively affected by our assumptions surrounding and general conditions of the single-family rental housing market.
• Certain of our industrial properties may be special use and/or build-to-suit and may be difficult to sell or relet upon tenant defaults or lease terminations.
• We could be negatively impacted by the condition of the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) and by changes in government support for multifamily housing.
• Potential Federal Actions Limiting Institutional Investment in Single-Family Housing Could Adversely Affect Our Business
• The hospitality market is seasonal, highly competitive and generally subject to greater volatility than our other market segments.
• We may invest in leisure properties, and the profitability of such investments may be affected by seasonality, changes in business and leisure travel and other factors that are beyond our control.