10-Q

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One):
ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2015
OR
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                    to

Commission File Number 1-13610

CIM COMMERCIAL TRUST CORPORATION
(Exact name of registrant as specified in its charter)

Maryland (State or other jurisdiction of incorporation or organization)	75-6446078 (I.R.S. Employer Identification No.)
17950 Preston Road, Suite 600, Dallas, TX 75252 (Address of principal executive offices)	(972) 349-3200 (Registrant's telephone number)

        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 ý    NO o

        Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). YES ý    NO o

        Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o Accelerated filer o Non-accelerated filer o
(Do not check if a
smaller reporting company) Smaller reporting company ý

        Indicate by check mark whether the Registrant is a shell company (as defined in Exchange Act Rule 12b-2). YES o    NO ý

        As of August 5, 2015, the Registrant had outstanding 97,589,598 shares of common stock, par value $0.001 per share.

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES
INDEX

			PAGE NO.
PART I.	Financial Information
	Item 1.	Financial Statements
		Consolidated Balance Sheets—June 30, 2015 and December 31, 2014 (Unaudited)		2
		Consolidated Statements of Operations and Comprehensive Income—Three and Six Months Ended June 30, 2015 and 2014 (Unaudited)		3
		Consolidated Statements of Equity—Six Months Ended June 30, 2015 and 2014 (Unaudited)		4
		Consolidated Statements of Cash Flows—Six Months Ended June 30, 2015 and 2014 (Unaudited)		5
		Notes to Consolidated Financial Statements (Unaudited)		6
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations		37
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk		52
	Item 4.	Controls and Procedures		52
PART II.	Other Information
	Item 1.	Legal Proceedings		53
	Item 1A.	Risk Factors		53
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		53
	Item 3.	Defaults Upon Senior Securities		53
	Item 4.	Mine Safety Disclosures		53
	Item 5.	Other Information		53
	Item 6.	Exhibits		53

PART I
Financial Information

Item 1.
Financial Statements

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(In thousands, except share data)

	June 30, 2015			December 31, 2014
	(Unaudited)
ASSETS
Investments in real estate, net	$	1,700,414		$	1,715,937
Cash and cash equivalents		22,552			17,615
Restricted cash		7,612			8,861
Accounts receivable, net		12,450			10,754
Deferred rent receivable and charges, net		100,052			97,630
Other intangible assets, net		18,683			20,433
Other assets		11,607			14,653
Assets held for sale, net		217,418			208,799
TOTAL ASSETS	$	2,090,788		$	2,094,682
LIABILITIES AND EQUITY
LIABILITIES:
Debt	$	647,644		$	608,714
Accounts payable and accrued expenses		29,840			35,512
Intangible liabilities, net		7,347			8,657
Due to related parties		9,807			9,186
Other liabilities		25,142			23,006
Liabilities associated with assets held for sale		45,382			49,791
Total liabilities		765,162			734,866
COMMITMENTS AND CONTINGENCIES (Note 13)
EQUITY:
Common stock, $0.001 par value; 200,000,000 shares authorized; 97,696,863 and 97,688,863 shares issued; and 97,589,598 and 97,581,598 shares outstanding at June 30, 2015 and December 31, 2014, respectively		98			98
Additional paid-in capital		1,825,098			1,824,381
Distributions in excess of earnings		(495,608	)		(460,623	)
Stockholders' equity before treasury stock		1,329,588			1,363,856
Less: Treasury stock, at cost, 107,265 shares outstanding		(4,901	)		(4,901	)
Total stockholders' equity		1,324,687			1,358,955
Noncontrolling interests		939			861
Total equity		1,325,626			1,359,816
TOTAL LIABILITIES AND EQUITY	$	2,090,788		$	2,094,682

The accompanying notes are an integral part of these consolidated financial statements.

2

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

Consolidated Statements of Operations and Comprehensive Income

(In thousands, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
	(Unaudited)
REVENUES:
Rental and other property income	$	63,171		$	60,804		$	126,569		$	120,626
Expense reimbursements		3,263			2,646			6,444			4,997
Interest and other income		485			1,737			1,145			2,161
		66,919			65,187			134,158			127,784
EXPENSES:
Rental and other property operating		32,985			30,439			65,694			60,025
Asset management and other fees to related parties		7,456			6,338			14,665			12,075
Interest		5,586			4,565			10,989			8,602
General and administrative		1,955			2,357			4,547			3,131
Transaction costs		373			32			801			500
Depreciation and amortization		17,566			17,286			36,694			33,915
		65,921			61,017			133,390			118,248
Bargain purchase gain (Note 2)		—			—			—			4,918
INCOME FROM CONTINUING OPERATIONS		998			4,170			768			14,454
DISCONTINUED OPERATIONS:
Income from operations of assets held for sale		3,984			4,344			6,946			5,277
INCOME FROM DISCONTINUED OPERATIONS		3,984			4,344			6,946			5,277
NET INCOME		4,982			8,514			7,714			19,731
Net income attributable to noncontrolling interests		(6	)		(115	)		(6	)		(113	)
NET INCOME ATTRIBUTABLE TO STOCKHOLDERS	$	4,976		$	8,399		$	7,708		$	19,618
COMPREHENSIVE INCOME	$	4,976		$	8,399		$	7,708		$	19,618
BASIC AND DILUTED INCOME PER SHARE:
Continuing operations	$	0.01		$	0.04		$	0.01		$	0.15
Discontinued operations	$	0.04		$	0.05		$	0.07		$	0.05
Net income	$	0.05		$	0.09		$	0.08		$	0.20
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic		97,589			97,571			97,586			96,758
Diluted		97,589			97,576			97,586			96,764

The accompanying notes are an integral part of these consolidated financial statements.

3

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

Consolidated Statements of Equity

(In thousands, except per share data)

	Six Months Ended June 30, 2015
	Common Stock Outstanding		Common Stock Par Value		Additional Paid-in Capital		Distributions In Excess Of Earnings			Treasury Stock			Noncontrolling Interests			Total Equity
	(Unaudited)
Balances, January 1, 2015		97,581,598	$	98	$	1,824,381	$	(460,623	)	$	(4,901	)	$	861		$	1,359,816
Contributions from noncontrolling interests		—		—		—		—			—			110			110
Distributions to noncontrolling interests		—		—		—		—			—			(38	)		(38	)
Stock based compensation expense		8,000		—		717		—			—			—			717
Common dividends ($0.4375 per share)		—		—		—		(42,693	)		—			—			(42,693	)
Net income		—		—		—		7,708			—			6			7,714
Balances, June 30, 2015		97,589,598	$	98	$	1,825,098	$	(495,608	)	$	(4,901	)	$	939		$	1,325,626

	Six Months Ended June 30, 2014
	Common Stock Outstanding			Common Stock Par Value			Preferred Stock Outstanding			Preferred Stock Par Value			Additional Paid-in Capital			Distributions In Excess Of Earnings			Treasury Stock			Noncontrolling Interests			Total Equity
	(Unaudited)
Balances, January 1, 2014		4,400,000		$	220			65,028,571		$	650		$	1,772,821		$	(399,953	)	$	—		$	2,745		$	1,376,483
Distributions pre-merger		—			—			—			—			—			(16,100	)		—			—			(16,100	)
Contributions from noncontrolling interests		—			—			—			—			—			—			—			10			10
Distributions to noncontrolling interests		—			—			—			—			—			—			—			(148	)		(148	)
Reverse acquisition capital transaction		2,119,244			111			—			—			49,400			—			(4,901	)		—			44,610
Conversion of preferred stock to common stock		91,039,999			910			(65,028,571	)		(650	)		(260	)		—			—			—			—
Change in par value		—			(1,143	)		—			—			1,143			—			—			—			—
Exercise of stock options		14,500			—			—			—			201			—			—			—			201
Stock based compensation expense		8,000			—			—			—			373			—			—			—			373
Retirement of fractional shares		(145	)		—			—			—			(3	)		—			—			—			(3	)
Common dividends ($0.26875 per share)		—			—			—			—			—			(21,671	)		—			—			(21,671	)
Preferred dividends ($0.0705 per share)		—			—			—			—			—			(4,585	)		—			—			(4,585	)
Net income		—			—			—			—			—			19,618			—			113			19,731
Balances, June 30, 2014		97,581,598		$	98			—		$	—		$	1,823,675		$	(422,691	)	$	(4,901	)	$	2,720		$	1,398,901

The accompanying notes are an integral part of these consolidated financial statements.

4

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(In thousands)

	Six Months Ended June 30,
	2015			2014
	(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	7,714		$	19,731
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred rent and amortization of intangible assets, liabilities and lease inducements		(2,893	)		(1,874	)
Depreciation and amortization		36,694			33,915
Bargain purchase gain		—			(4,918	)
Straight line rent, below-market ground lease and amortization of intangible assets		1,000			933
Amortization of deferred loan costs		1,538			652
Amortization of premiums and discounts on debt		(634	)		(562	)
Unrealized premium adjustment		727			782
Amortization and accretion on loans receivable, net		(2,234	)		(1,837	)
Bad debt expense		982			126
Deferred income taxes		(26	)		55
Stock-based compensation		717			373
Loans funded, held for sale to secondary market		(16,438	)		(16,753	)
Proceeds from sale of guaranteed loans		17,365			12,999
Principal collected on loans		2,365			2,071
Other operating activity		(192	)		(300	)
Changes in operating assets and liabilities:
Accounts receivable and interest receivable		(2,045	)		(58	)
Other assets		(1,681	)		(2,151	)
Accounts payable and accrued expenses		(3,956	)		(6,287	)
Deferred leasing costs		(2,926	)		(4,542	)
Other liabilities		352			2,232
Due to related parties		621			2,083
Net cash provided by operating activities		37,050			36,670
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to investments in real estate		(14,074	)		(12,903	)
Acquisition of real estate properties		—			(44,936	)
Loans funded		(24,683	)		(8,438	)
Cash and cash equivalents acquired in connection with the merger		—			3,185
Principal collected on loans		13,058			25,348
Restricted cash		1,200			(536	)
Other investing activity		184			160
Net cash used in investing activities		(24,315	)		(38,120	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of mortgages payable		(15,692	)		(3,194	)
Proceeds from unsecured revolving lines of credit, revolving credit facility and term note, net		55,000			110,000
Payment of principal on secured borrowings—government guaranteed loans		(2,365	)		(2,071	)
Proceeds from secured borrowings—government guaranteed loans		—			1,978
Payment of deferred loan costs		(3,415	)		(447	)
Payment of dividends		(42,693	)		(26,256	)
Payment of special dividend and dividend assumed in acquisition		—			(59,286	)
Distributions pre-merger		—			(16,100	)
Contributions from noncontrolling interests		110			10
Proceeds from issuance of stock		—			201
Retirement of fractional shares of common stock		—			(3	)
Noncontrolling interests' distributions		(38	)		(148	)
Net cash (used in) provided by financing activities		(9,093	)		4,684
Change in cash balances included in assets held for sale		1,295			(2,593	)
NET INCREASE IN CASH AND CASH EQUIVALENTS		4,937			641
CASH AND CASH EQUIVALENTS:
Beginning of period		17,615			16,796
End of period	$	22,552		$	17,437
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for interest	$	10,520		$	9,055
Federal income taxes paid	$	505		$	334
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES:
Additions to investments in real estate included in accounts payable and accrued expenses	$	5,115		$	3,168
Additions to investments in real estate included in other assets	$	4,244		$	—
Additions to deferred loan costs included in accounts payable and accrued expenses	$	67		$	120

The accompanying notes are an integral part of these consolidated financial statements.

5

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

1. ORGANIZATION AND OPERATIONS

        CIM Commercial Trust Corporation ("CIM Commercial") together with its wholly-owned subsidiaries (which, together with CIM Commercial may be referred to as "we," "us" or "our") primarily acquires, owns, and operates Class A and creative office properties in vibrant and improving urban communities throughout the United States. These communities are located in areas that include traditional downtown areas and suburban main streets, which have high barriers to entry, high population density, improving demographic trends and a propensity for growth. We also obtain income from the yield and other related fee income earned on our investments from our lending activities, which have principally been to borrowers in the hospitality industry. As discussed in Note 6, the lending segment is held for sale at June 30, 2015 and December 31, 2014. We were originally organized in 1993 as PMC Commercial Trust ("PMC Commercial"), a Texas real estate investment trust.

        On July 8, 2013, PMC Commercial entered into a merger agreement (the "Merger Agreement") with CIM Urban REIT, LLC ("CIM REIT") and subsidiaries of the respective parties. CIM REIT was a private commercial REIT and was the owner of CIM Urban Partners, LP ("CIM Urban"). The transaction (the "Merger") was completed on March 11, 2014 (the "Acquisition Date"). The Merger was accounted for as a reverse acquisition under the acquisition method of accounting with CIM Urban considered to be the accounting acquirer based upon the terms of the Merger Agreement. Based on the determination that CIM Urban was the accounting acquirer in the transaction, CIM Urban allocated the purchase price to the fair value of PMC Commercial's assets and liabilities as of the Acquisition Date.

        On April 28, 2014, PMC Commercial's charter was amended to increase the authorized shares of common stock of PMC Commercial from 100,000,000 to 1,000,000,000 shares (20,000,000 and 200,000,000 after giving effect to the reverse stock split described below) and PMC Commercial changed its state of incorporation (the "Reincorporation") from Texas to Maryland by means of a merger of PMC Commercial with and into a newly formed, wholly-owned Maryland corporation subsidiary. Also on April 28, 2014, we changed our name from "PMC Commercial Trust" to "CIM Commercial Trust Corporation." Our common stock ("Common Stock") is currently traded on the NASDAQ Global Market (symbol "CMCT").

        On April 28, 2014, we filed Articles of Amendment (the "Reverse Split Amendment") to effectuate a one-for-five reverse stock split of the Common Stock, effective April 29, 2014. Pursuant to the reverse stock split, each five shares of Common Stock issued and outstanding immediately prior to the effective time of the reverse stock split were converted into one share of Common Stock. Fractional shares of Common Stock were not issued as a result of the reverse stock split; instead, holders of pre-split shares of Common Stock who otherwise would have been entitled to receive a fractional share of Common Stock received an amount in cash equal to the product of the fraction of a share multiplied by the closing price of the Common Stock (as adjusted for the one-for-five reverse stock split). In connection with and immediately following the filing of the Reverse Split Amendment, we filed Articles of Amendment (the "Par Value Amendment") to decrease the par value of the Common Stock issued and outstanding to $0.001 per share, effective April 29, 2014, subsequent to the effective time of the Reverse Split Amendment. All per share and outstanding share information has been presented to reflect the reverse stock split.

6

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

1. ORGANIZATION AND OPERATIONS (Continued)

        CIM Commercial has qualified and intends to continue to qualify as a real estate investment trust ("REIT"), as defined in the Internal Revenue Code of 1986, as amended.

2. MERGER

        The Merger Agreement provided for the business combination of CIM REIT's wholly owned subsidiary, CIM Urban, and PMC Commercial. Pursuant to the Merger Agreement, an affiliate of CIM REIT received 4,400,000 shares of newly-issued PMC Commercial Common Stock and approximately 65,000,000 shares of newly-issued PMC Commercial preferred stock. Following the Merger and subsequent increase in our authorized number of shares, each share of preferred stock was converted into 1.4 shares of PMC Commercial Common Stock, resulting in the issuance of 95,440,000 shares of common stock in the aggregate in connection with the Merger, representing approximately 97.8% of PMC Commercial's outstanding shares of common stock.

        All shares of PMC Commercial Common Stock that were outstanding immediately prior to the closing of the Merger continued to remain outstanding following the Acquisition Date. In addition, stockholders of record of PMC Commercial at the close of the business day prior to the Acquisition Date received a special cash dividend of $27.50 per share of common stock plus that pro-rata portion of PMC Commercial's regular quarterly cash dividend accrued through the Acquisition Date, each of which was paid on March 25, 2014.

        The Merger was accounted for as a reverse acquisition under the acquisition method of accounting with CIM Urban considered to be the accounting acquirer based upon the terms of the Merger Agreement. Based on the determination that CIM Urban was the accounting acquirer in the transaction, CIM Urban allocated the purchase price to the fair value of PMC Commercial's assets and liabilities as of the Acquisition Date.

        Accordingly, the accompanying financial statements include (1) the historical financial information for CIM Urban for all periods presented, (2) the assets and liabilities of PMC Commercial acquired on March 11, 2014 and still owned or held by us in the consolidated balance sheet as of December 31, 2014 and June 30, 2015, respectively, and (3) the results of PMC Commercial's operations and cash flows in the consolidated statements of operations and comprehensive income and cash flows from the Acquisition Date. The equity of CIM Commercial is the historical equity of CIM Urban retroactively restated to reflect the number of shares of stock issued by PMC Commercial pursuant to the Merger Agreement. In connection with the reverse acquisition, for purposes of presenting equity for CIM Commercial, the historical stockholders of PMC Commercial were deemed to have been issued 2,119,244 shares of Common Stock (2,226,509 shares of Common Stock, less 107,265 shares of treasury stock) on the Acquisition Date.

        Consideration Transferred—The fair value of the consideration transferred in the reverse acquisition is determined based on the number of shares of stock the accounting acquirer would have to issue to the stockholders of the accounting acquiree in order to provide the same ratio of ownership in the combined entity following the completion of the Merger, and was determined to be the outstanding stock of PMC Commercial as of the Acquisition Date. The fair value of the consideration

7

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

2. MERGER (Continued)

transferred was based on the most reliable measure, which was determined to be the market price of PMC Commercial stock as of the Acquisition Date. The computation of the fair value of the consideration transferred, based on the market price of PMC Commercial stock on the Acquisition Date, is as follows:

	(in thousands, except per share data)
PMC Commercial common stock outstanding		2,119
Equity consideration price per share of common stock	$	21.05
Fair value of the equity consideration		44,610
Payment in cash—special dividend		58,279
Total purchase price	$	102,889

        Purchase Price Allocation—As CIM Urban was the accounting acquirer in the business combination, it has allocated the purchase price to PMC Commercial's individually identifiable assets acquired and liabilities assumed based on their estimated fair values on the Acquisition Date. A bargain purchase gain was recorded as of the Acquisition Date in the amount equal to the excess of the fair value of the identifiable net assets acquired over the total purchase price.

        The following table summarizes the allocation of the purchase price:

	(in thousands)
Assets
Cash and cash equivalents	$	3,185
Loans receivable		207,140
Accounts receivable and interest receivable		755
Other assets		5,396
Intangible assets		2,957
Total assets acquired		219,433
Liabilities
Debt		99,849
Accounts payable and accrued expenses		7,396
Special dividend liability and dividend payable		59,286
Other liabilities		3,374
Total liabilities assumed		169,905
Net identifiable assets acquired		49,528
Bargain purchase gain		(4,918	)
Net purchase price	$	44,610

8

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

2. MERGER (Continued)

        In order to allow CIM Commercial to increase its focus on Class A and creative office properties, our board of directors (the "Board of Directors") approved a plan for the lending business that, when completed, will result in the deconsolidation of the lending segment. As a result, the lending segment was held for sale at June 30, 2015 and December 31, 2014 (see Note 6).

        For the three and six months ended June 30, 2014, Merger related costs of $0 and $468,000, respectively, were included in transaction costs.

3. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        For more information regarding our significant accounting policies and estimates, please refer to "Basis of Presentation and Summary of Significant Accounting Policies" contained in Note 3 to our consolidated financial statements for the year ended December 31, 2014, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 16, 2015.

        Interim Financial Information—The accompanying interim consolidated financial statements of CIM Commercial have been prepared by our management in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim consolidated financial statements do not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods. Operating results for the three and six months ended June 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. Our accompanying interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K filed with the SEC on March 16, 2015.

        Principles of Consolidation—The consolidated financial statements include the accounts of CIM Commercial and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

        Investments in Real Estate—Real estate acquisitions are recorded at cost as of the acquisition date. Costs related to the acquisition of properties are expensed as incurred. Investments in real estate are stated at depreciated cost. Depreciation and amortization are recorded on a straight line basis over the estimated useful lives as follows:

Buildings and improvements	15 - 40 years
Furniture, fixtures, and equipment	3 - 5 years
Tenant improvements	Shorter of the useful lives or the terms of the related leases

9

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

3. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        Improvements and replacements are capitalized when they extend the useful life, increase capacity, or improve the efficiency of the asset. Ordinary repairs and maintenance are expensed as incurred.

        Investments in real estate are evaluated for impairment on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. The estimated fair value of the asset group identified for step two of the impairment testing under U.S. GAAP is based on either the income approach with market discount rate, terminal capitalization rate and rental rate assumptions being most critical, or on the sales comparison approach to similar properties. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell. No impairment of long-lived assets was recognized during the three and six months ended June 30, 2015 and 2014.

        Loans Receivable—Our loans receivable included in assets held for sale are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, retained loan discounts and loan loss reserves. For loans originated under the Small Business Administration's ("SBA") 7(a) Guaranteed Loan Program ("SBA 7(a) Program"), we sell the portion of the loan that is guaranteed by the SBA. Upon sale of the SBA guaranteed portion of the loan, the unguaranteed portion of the loan retained by us is valued on a fair value basis and a discount (the "Retained Loan Discount") is recorded as a reduction in basis of the retained portion of the loan.

        At the Acquisition Date, the carrying value of our loans was adjusted to the estimated fair market value and acquisition discounts of $33,907,000 were recorded, which are being accreted to interest income, included in income from operations of assets held for sale, using the effective interest method. The amount of acquisition discounts that have not yet been accreted to income at June 30, 2015 was $23,828,000.

        A loan receivable is generally classified as non-accrual (a "Non- Accrual Loan") if (i) it is past due as to payment of principal or interest for a period of 60 days or more, (ii) any portion of the loan is classified as doubtful or is charged-off or (iii) the repayment in full of the principal and/or interest is in doubt. Generally, loans are charged-off when management determines that we will be unable to collect any remaining amounts due under the loan agreement, either through liquidation of collateral or other means. Interest income, included in income from operations of assets held for sale, on a Non-Accrual Loan is recognized on either the cash basis or the cost recovery basis.

        On a quarterly basis, and more frequently if indicators exist, we evaluate the collectability of our loans receivable. Our evaluation of collectability involves judgment, estimates, and a review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers' business models and future operations in accordance with Accounting Standards Codification ("ASC") 450-20, Contingencies—Loss Contingencies, and ASC 310-10, Receivables. The

10

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

3. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

allowance for losses on our impaired loans receivable decreased by $36,000 and increased by $65,000 during the three and six months ended June 30, 2015, respectively. No impairment on loans receivable was recorded for the three and six months ended June 30, 2014. We establish a general loan loss reserve when available information indicates that it is probable a loss has occurred based on the carrying value of the portfolio and the amount of the loss can be reasonably estimated. Significant judgment is required in determining the general loan loss reserve, including estimates of the likelihood of default and the estimated fair value of the collateral. The general loan loss reserve includes those loans, which may have negative characteristics which have not yet become known to us. In addition to the reserves established on loans not considered impaired that have been evaluated under a specific evaluation, we establish the general loan loss reserve using a consistent methodology to determine a loss percentage to be applied to loan balances. These loss percentages are based on many factors, primarily cumulative and recent loss history and general economic conditions.

        Deferred Rent Receivable and Charges—Deferred rent receivable and charges consist of deferred rent, deferred loan costs and deferred leasing costs. Deferred rent receivable was $55,313,000 and $53,622,000 at June 30, 2015 and December 31, 2014, respectively. Deferred loan costs, which represent legal and third-party fees incurred in connection with our borrowing activities, are capitalized and amortized to interest expense on a straight line basis over the life of the related loan, approximating the effective interest method. Deferred loan costs of $10,941,000 and $7,521,000 are presented net of accumulated amortization of $3,251,000 and $1,741,000 at June 30, 2015 and December 31, 2014, respectively. Deferred leasing costs, which represent lease commissions and other direct costs associated with the acquisition of tenants, are capitalized and amortized on a straight line basis over the terms of the related leases. Deferred leasing costs of $56,511,000 and $55,145,000 are presented net of accumulated amortization of $19,462,000 and $16,917,000 at June 30, 2015 and December 31, 2014, respectively.

        Noncontrolling Interests—Noncontrolling interests represent the interests in various properties owned by third parties.

        Discontinued Operations—We classify assets as held for sale when they meet the necessary criteria, which include: a) management commits to and actively embarks upon a plan to sell the assets, b) the assets to be sold are available for immediate sale in their present condition, c) the sale is expected to be completed within one year under terms usual and customary for such sales and d) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. We believe that we meet these criteria because the plan for sale has been approved by the Board of Directors, there are no known significant contingencies related to the sale and management believes it is probable that the sale will be completed within one year.

        Assets held for sale are recorded at the lower of cost or estimated fair value less cost to sell. Revenues and expenses related to assets held for sale are presented as discontinued operations for all periods presented in the consolidated statements of operations and comprehensive income.

11

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

3. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

        Consolidation Considerations for Our Investments in Real Estate—ASC 810-10, Consolidation, addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights that would require the entity to be consolidated. We analyze our investments in real estate in accordance with this accounting standard to determine whether they are variable interest entities, and if so, whether we are the primary beneficiary. Our judgment with respect to our level of influence or control over an entity and whether we are the primary beneficiary of a variable interest entity involves consideration of various factors, including the form of our ownership interest, our voting interest, the size of our investment (including loans), and our ability to participate in major policy-making decisions. Our ability to correctly assess our influence or control over an entity affects the presentation of these investments in our consolidated financial statements.

        Use of Estimates—The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

        Reclassifications—Certain prior period amounts have been reclassified to conform with the current period presentation. These reclassifications had no effect on previously reported net income or cash flows.

        Recently Issued Accounting Pronouncements—In April 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360). Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, which amends the definition of a discontinued operation and requires entities to provide additional disclosures about disposal transactions that do not meet the discontinued-operations criteria. The revised guidance is effective prospectively to all disposals (or classifications as held for sale) that occur in annual periods (and interim periods therein) beginning on or after December 15, 2014, with early adoption permitted. Entities are prohibited from applying the new ASU to any component, equity method investment, or acquired business that is classified as held for sale before the adoption date. We early adopted this guidance during the second quarter of 2014, and the adoption did not have a material impact on our consolidated financial statements.

        In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including the guidance on real estate de-recognition for most transactions. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted for annual periods beginning after December 15, 2016. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance in the ASU. The modified approach provides entities relief from having to

12

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

3. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

restate and present comparable prior-year financial statement information; however, entities will still need to evaluate existing contracts as of the date of initial adoption under the ASU to determine whether a cumulative adjustment is necessary. We are currently in the process of evaluating the impact of adoption of the new accounting guidance on our consolidated financial statements.

        In August 2014, the FASB issued ASU No. 2014-15 Presentation of Financial Statements—Going Concern (Subtopic 205-40) which requires an entity's management to evaluate whether there are conditions or events, when considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date the financial statements are issued. The ASU is effective for the annual reporting period ending after December 15, 2016, and for annual and interim periods thereafter. Early application is permitted. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

        In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis, which is intended to improve targeted areas of consolidation guidance for legal entities such as limited partnerships, limited liability corporations, and securitization structures (collateralized debt obligations, collateralized loan obligations, and mortgage-backed security transactions). In addition to reducing the number of consolidation models from four to two, the new standard simplifies the FASB Accounting Standards Codification and improves current U.S. GAAP by: placing more emphasis on risk of loss when determining a controlling financial interest; reducing the frequency of the application of related-party guidance when determining a controlling financial interest in a variable interest entity (VIE); and changing consolidation conclusions for public and private companies in several industries that typically make use of limited partnerships or VIEs. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. ASU 2015-02 may be applied retrospectively in previously issued financial statements for one or more years with a cumulative-effect adjustment to retained earnings as of the beginning of the first year restated. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

        In March 2015, the FASB issued ASU No. 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, which is intended to simplify the presentation of debt issuance costs. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2015. Early adoption is permitted for financial statements that have not been previously issued. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

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CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

4. INVESTMENTS IN REAL ESTATE

        Investments in real estate consist of the following:

	June 30, 2015			December 31, 2014
	(in thousands)
Land	$	354,035		$	354,035
Land improvements		28,071			28,071
Buildings and improvements		1,504,902			1,501,603
Furniture, fixtures, and equipment		8,914			10,875
Tenant improvements		142,306			131,446
Work in progress		5,862			10,764
Investments in real estate		2,044,090			2,036,794
Accumulated depreciation		(343,676	)		(320,857	)
Net investments in real estate	$	1,700,414		$	1,715,937

        We recorded depreciation expense of $15,063,000 and $14,705,000 for the three months ended June 30, 2015 and 2014, respectively, and $31,343,000 and $28,852,000 for the six months ended June 30, 2015 and 2014, respectively.

5. OTHER INTANGIBLE ASSETS

        A schedule of our intangible assets and liabilities and related accumulated amortization and accretion as of June 30, 2015 and December 31, 2014 is as follows:

	Assets															Liabilities
June 30, 2015	Acquired Above-Market Leases			Acquired In-Place Leases			Tax Abatement			Franchise Affiliation Fee			Acquired Below-Market Ground Lease			Acquired Below-Market Leases
	(in thousands)
Gross balance	$	1,072		$	21,431		$	4,273		$	3,936		$	11,685		$	(19,750	)
Accumulated amortization		(867	)		(16,269	)		(2,047	)		(3,179	)		(1,352	)		12,403
	$	205		$	5,162		$	2,226		$	757		$	10,333		$	(7,347	)
Average useful life (in years)		6			8			8			10			84			8

14

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

5. OTHER INTANGIBLE ASSETS (Continued)

	Assets															Liabilities
December 31, 2014	Acquired Above-Market Leases			Acquired In-Place Leases			Tax Abatement			Franchise Affiliation Fee			Acquired Below-Market Ground Lease			Acquired Below-Market Leases
	(in thousands)
Gross balance	$	2,402		$	22,680		$	4,273		$	3,936		$	11,685		$	(20,333	)
Accumulated amortization		(2,039	)		(16,470	)		(1,771	)		(2,981	)		(1,282	)		11,676
	$	363		$	6,210		$	2,502		$	955		$	10,403		$	(8,657	)
Average useful life (in years)		7			8			8			10			84			8

        The amortization of the above-market leases which decreased rental and other property income was $79,000 and $98,000 for the three months ended June 30, 2015 and 2014, respectively, and $158,000 and $435,000 for the six months ended June 30, 2015 and 2014, respectively. The amortization of the below-market leases included in rental and other property income was $655,000 and $697,000 for the three months ended June 30, 2015 and 2014, respectively, and $1,310,000 and $1,345,000 for the six months ended June 30, 2015 and 2014, respectively. The amortization of in-place leases included in depreciation and amortization expense was $519,000 and $587,000 for the three months ended June 30, 2015 and 2014, respectively, and $1,048,000 and $1,199,000 for the six months ended June 30, 2015 and 2014, respectively. Included in depreciation and amortization expense is franchise affiliation fee amortization of $99,000 for each of the three months ended June 30, 2015 and 2014, and $198,000 for each of the six months ended June 30, 2015 and 2014. The amortization of advance bookings included in depreciation and amortization expense was $0 and $67,000 for the three months ended June 30, 2015 and 2014, respectively, and $0 and $134,000 for the six months ended June 30, 2015 and 2014, respectively. Tax abatement amortization of $138,000 for each of the three months ended June 30, 2015 and 2014, and $276,000 for each of the six months ended June 30, 2015 and 2014 is included in rental and other property operating expenses. Amortization of below-market ground lease obligation of $35,000 for each of the three months ended June 30, 2015 and 2014, and $70,000 for each of the six months ended June 30, 2015 and 2014 is included in rental and other property operating expenses.

15

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

5. OTHER INTANGIBLE ASSETS (Continued)

        A schedule of future amortization and accretion of acquisition related intangible assets and liabilities as of June 30, 2015 is as follows:

	Assets										Liabilities
Years Ending December 31,	Acquired Above-Market Leases		Acquired In-Place Leases		Tax Abatement		Franchise Affiliation Fee		Acquired Below-Market Ground Lease		Acquired Below-Market Leases
	(in thousands)
2015 (Six months ending December 31, 2015)	$	83	$	793	$	275	$	196	$	70	$	(1,259	)
2016		88		1,346		551		394		140		(2,502	)
2017		26		915		551		167		140		(2,399	)
2018		8		666		551		—		140		(963	)
2019		—		488		298		—		140		(224	)
Thereafter		—		954		—		—		9,703		—
	$	205	$	5,162	$	2,226	$	757	$	10,333	$	(7,347	)

6. DISCONTINUED OPERATIONS

        We have reflected the lending segment, which was acquired on the Acquisition Date as disclosed in Note 2, as held for sale at June 30, 2015 and December 31, 2014, based on a plan approved by the Board of Directors to sell the lending business that, when completed, will result in the deconsolidation of the lending segment. In connection with our plan, we have expensed transaction costs of $61,000 and $224,000 during the three and six months ended June 30, 2015, respectively.

16

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

6. DISCONTINUED OPERATIONS (Continued)

        The following is a reconciliation of the carrying amounts of assets and liabilities that are classified as held for sale on the consolidated balance sheets as of June 30, 2015 and December 31, 2014:

	June 30, 2015		December 31, 2014
	(in thousands)
Assets held for sale
Loans receivable, net	$	198,851	$	189,052
Cash and cash equivalents		8,642		9,937
Restricted cash		965		916
Accounts receivable and interest receivable, net		733		738
Other intangible assets		2,957		2,957
Other assets		5,270		5,199
Total assets held for sale	$	217,418	$	208,799
Liabilities associated with assets held for sale
Debt	$	39,280	$	41,901
Accounts payable and accrued expenses		2,101		2,709
Other liabilities		4,001		5,181
Total liabilities associated with assets held for sale	$	45,382	$	49,791

        Loans receivable, net consist of the following:

	June 30, 2015			December 31, 2014
	(in thousands)
Commercial mortgage loans	$	99,955		$	108,864
SBA 7(a) loans, subject to secured borrowings		38,719			41,328
SBA 7(a) loans		40,447			38,707
Commercial real estate loans		19,639			—
Loans receivable		198,760			188,899
Deferred capitalized costs, net		347			292
Loan loss reserves		(256	)		(139	)
Net loans receivable	$	198,851		$	189,052

        Commercial Mortgage Loans—Represents loans to small businesses collateralized by first liens on the real estate of the related business.

        SBA 7(a) Loans, Subject to Secured Borrowings—Represents the government guaranteed portion of loans which were sold with the proceeds received from the sale reflected as "secured borrowings—government guaranteed loans." There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal.

17

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

6. DISCONTINUED OPERATIONS (Continued)

        SBA 7(a) Loans—Represents the non-government guaranteed retained portion of loans originated under the SBA 7(a) Program and the government guaranteed portion of loans that have not yet been fully funded or sold.

        Commercial Real Estate Loans—Represents a mezzanine loan secured by an indirect ownership interest in an entity that either directly or indirectly owns parcels of commercial real estate. It is short term and has a variable interest rate.

        Debt consists of the following:

	June 30, 2015		December 31, 2014
	(in thousands)
Secured borrowing principal on loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 4.03% and 3.92% at June 30, 2015 and December 31, 2014, respectively	$	31,358	$	33,654
Secured borrowing principal on loans sold for excess spread, variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 1.58%		5,016		5,085
		36,374		38,739
Unamortized premiums on loans sold for a premium and excess spread		2,906		3,162
Total secured borrowings—government guaranteed loans	$	39,280	$	41,901

        Secured Borrowings—Government Guaranteed Loans—Represents sold SBA 7(a) Program loans which are treated as secured borrowings since the loan sales did not meet the derecognition criteria provided for in ASC 860-30, Transfers and Servicing. To the extent secured borrowings include cash premiums, these premiums are included in secured borrowings and amortized as a reduction to interest expense over the life of the loan using the effective interest method and fully amortized when the loan is repaid in full.

18

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

6. DISCONTINUED OPERATIONS (Continued)

        Future principal payments on the debt (face value) at June 30, 2015 are as follows:

Years Ending December 31,	Secured Borrowings Principal(1)
	(in thousands)
2015 (Six months ending December 31, 2015)	$	895
2016		1,229
2017		1,269
2018		1,314
2019		1,361
Thereafter		30,306
	$	36,374

(1)

Principal payments are generally dependent upon cash flows received from the underlying loans. Our estimate of their repayment is based on scheduled principal payments on the underlying loans. Our estimate will differ from actual amounts to the extent we experience prepayments and/or loan liquidations or charge-offs. No payment is due unless payments are received from the borrowers on the underlying loans.

        The following is the detail of income from operations of assets held for sale classified as discontinued operations on the consolidated statement of operations and comprehensive income:

	Three Months Ended June 30, 2015		Three Months Ended June 30, 2014
	(in thousands)
Revenue—Interest and other income	$	5,768	$	6,271
Expenses:
Interest expense		120		374
Fees to related party(1)		1,093		—
General and administrative(1)		294		1,253
Provision for income taxes		277		300
Total expenses		1,784		1,927
Income from operations of assets held for sale	$	3,984	$	4,344

(1)

Salaries and related benefits of $1,018,000 were included in general and administrative expense for the three months ended June 30, 2014 while, as a result of the transfer of our employees to an affiliate (see Note 12), such expenses were included in fees to related party for the three months ended June 30, 2015.

19

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

6. DISCONTINUED OPERATIONS (Continued)

	Six Months Ended June 30, 2015		From the Acquisition Date through June 30, 2014
	(in thousands)
Revenue—Interest and other income	$	10,946	$	7,797
Expenses:
Interest expense		421		554
Fees to related party(1)		2,236		—
General and administrative(1)		868		1,658
Provision for income taxes		475		308
Total expenses		4,000		2,520
Income from operations of assets held for sale	$	6,946	$	5,277

(1)

Salaries and related benefits of $1,325,000 were included in general and administrative expense for the period from the Acquisition Date through June 30, 2014 while, as a result of the transfer of our employees to an affiliate (see Note 12), such expenses were included in fees to related party for the six months ended June 30, 2015.

20

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

7. DEBT

        Information on our debt is as follows:

	June 30, 2015			December 31, 2014
	(in thousands)
Mortgage loan with a fixed interest rate of 7.66% per annum, with monthly payments of principal and interest. The loan has a 20-year amortization schedule with a $25,324,000 balance due on December 1, 2015. The loan is nonrecourse.	$	26,000		$	26,783
Mortgage loan with a fixed interest rate of 4.50% per annum, with monthly payments of interest only for 10 years, and payments of interest and principal starting in February 2022. The loan has a $42,008,000 balance due on January 5, 2027. The loan is nonrecourse.		46,000			46,000
Mortgage loan with a fixed interest rate of 5.56% per annum, with monthly payments of principal and interest. The loan had a 10-year amortization schedule with a $12,288,000 balance due on July 1, 2015. The loan was nonrecourse. The loan was paid in full in April 2015.		—			12,442
Mortgage loan with a fixed interest rate of 6.65% per annum, with monthly payments of principal and interest. The loan has a 25-year amortization schedule with a $21,136,000 balance due on July 15, 2018. The loan is nonrecourse.		30,656			32,070
Mortgage loan with a fixed interest rate of 5.06% per annum, with monthly payments of principal and interest, and a balance of $33,068,000 due on September 1, 2015. The loan is nonrecourse.		33,290			33,734
Mortgage loans with a fixed interest rate of 5.39% per annum, with monthly payments of principal and interest, and a balance of $35,695,000 due on March 1, 2021. The loans are nonrecourse.		40,188			40,526
Mortgage loan with a fixed interest rate of 5.18% per annum, with monthly payments of principal and interest, and a balance of $26,232,000 due on June 5, 2021. The loan is nonrecourse.		30,021			30,292
		206,155			221,847
Premiums and discounts on assumed mortgages		1,547			1,961
Total Mortgages Payable		207,702			223,808
Junior subordinated notes with a variable interest rate which resets quarterly based on the 90-day LIBOR plus 3.25%, with quarterly interest only payments. Balance due at maturity on March 30, 2035.		27,070			27,070
Unsecured credit facilities		415,000			360,000
		442,070			387,070
Discount on junior subordinated notes		(2,128	)		(2,164	)
Total Other		439,942			384,906
Total Debt	$	647,644		$	608,714

21

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

7. DEBT (Continued)

        The mortgages payable are secured by deeds of trust on certain of the properties and assignments of rents.

        The junior subordinated notes may be redeemed at par at our option.

        In February 2012, CIM Urban entered into an unsecured revolving line of credit with a bank syndicate, which allowed for maximum borrowings of $100,000,000. Outstanding advances under the line of credit bore interest at LIBOR plus 1.75% to 2.50% until August 2013. In August 2013, the unsecured revolving line was amended, and outstanding advances under the line of credit bore interest at LIBOR plus 1.25% to 1.85%. The line of credit was also subject to an unused commitment fee of 0.25% or 0.35% depending on the amount of aggregate unused commitments. This line of credit was terminated and repaid in full in September 2014.

        In August 2013, CIM Urban entered into another unsecured revolving line of credit with a bank syndicate, as amended in April 2014, which allowed for maximum borrowings of $200,000,000. Outstanding advances under the line of credit bore interest at LIBOR plus 1.25% to 1.85%. The line of credit was also subject to an unused commitment fee of 0.25% or 0.35% depending on the amount of aggregate unused commitments. This line of credit was terminated and repaid in full in September 2014.

        In September 2014, CIM Commercial entered into an $850,000,000 unsecured credit facility with a bank syndicate consisting of a $450,000,000 revolver, a $325,000,000 term loan and a $75,000,000 delayed-draw term loan. The credit facility can be increased to $1,150,000,000 under certain conditions. CIM Commercial is subject to certain financial maintenance covenants and a minimum property ownership condition. Outstanding advances under the revolver bear interest at (i) the base rate, plus 0.20% to 1.00% or (ii) LIBOR plus 1.20% to 2.00%, depending on the maximum consolidated leverage ratio. Outstanding advances under the term loans bear interest at (i) the base rate, plus 0.15% to 0.95% or (ii) LIBOR plus 1.15% to 1.95%, depending on the maximum consolidated leverage ratio. The revolver is also subject to an unused commitment fee of 0.15% or 0.25% depending on the amount of aggregate unused commitments. The delayed draw term loan was also subject to an unused line fee of 0.25%. The credit facility matures in September 2016 and provides for two one-year extension options under certain conditions. As of June 30, 2015 and December 31, 2014, $415,000,000 ($15,000,000 under the revolver and $400,000,000 under the term loans) and $360,000,000 ($35,000,000 under the revolver and $325,000,000 under the term loans), respectively, was outstanding under the credit facility and $435,000,000 and $490,000,000, respectively, was available for future borrowings. Proceeds from the unsecured credit facility were used for acquisitions and general corporate purposes and to repay $323,000,000 outstanding under our prior unsecured credit facilities. At June 30, 2015 and December 31, 2014, the interest rate on this unsecured credit facility ranged from 1.34% to 1.39% and 1.31% to 1.37%, respectively.

        In May 2015, CIM Commercial entered into an unsecured term loan facility with a bank syndicate pursuant to which CIM Commercial can borrow up to a maximum of $385,000,000. The term loan facility ranks pari passu with CIM Commercial's $850,000,000 credit facility described above; covenants under the term loan facility are substantially the same as those in the $850,000,000 credit facility.

22

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

7. DEBT (Continued)

Outstanding advances under the term loan facility bear interest at (i) the base rate plus 0.60% to 1.25% or (ii) LIBOR plus 1.60% to 2.25%, depending on the maximum consolidated leverage ratio. The unused portion of the term loan facility is also subject to an unused fee of 0.20%. With some exceptions, any prepayment of the term loan facility prior to May 2017 will be subject to a prepayment fee up to 2% of the outstanding principal amount. The term loan facility matures in May 2022. As of August 5, 2015, no amount has been drawn under the term loan facility. We have six months from the effective date to draw on the term loan facility and anticipate that we will fully draw on this facility prior to November 2015. Proceeds from the term loan facility may be used for acquisitions, refinancing of certain existing debt and other general corporate purposes.

        At June 30, 2015 and December 31, 2014, we were in compliance with all of our respective financial covenants.

        On April 1, 2015, we paid off a mortgage with an outstanding balance of $12,364,000 using the unsecured credit facility.

        At June 30, 2015 and December 31, 2014, accrued interest and unused commitment fees payable of $976,000 and $967,000, respectively, are included in accounts payable and accrued expenses.

        Future principal payments on our debt (face value) at June 30, 2015 are as follows:

Years Ending December 31,	Mortgages Payable		Other(1)		Total
	(in thousands)
2015 (Six Months Ending December 31, 2015)	$	61,363	$	—	$	61,363
2016		4,354		415,000		419,354
2017		4,642		—		4,642
2018		24,300		—		24,300
2019		1,519		—		1,519
Thereafter		109,977		27,070		137,047
	$	206,155	$	442,070	$	648,225

(1)

Represents the junior subordinated notes and unsecured credit facility.

8. STOCK-BASED COMPENSATION PLANS

        On March 11, 2014, we granted awards of 2,000 restricted shares of Common Stock to each of the independent members of the Board of Directors (6,000 in aggregate) which awards were effective upon the receipt of stockholder approval of the amendment of the 2005 Equity Incentive Plan on April 28, 2014. The shares of Common Stock vested in March 2015 based on a year of continuous service. In April 2015, an additional 2,000 restricted shares of Common Stock were granted to each of the independent members of the Board of Directors (6,000 in aggregate) under the 2005 Equity Incentive Plan, which will vest over a year of continuous service. Compensation expense related to these restricted shares of Common Stock is recognized over the vesting period. We recorded compensation

23

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

8. STOCK-BASED COMPENSATION PLANS (Continued)

expense of $27,000 and $31,000 for the three months ended June 30, 2015 and 2014, respectively, and $59,000 and $31,000 for the six months ended June 30, 2015 and 2014, respectively, related to these restricted shares of Common Stock.

        We issued an aggregate of 4,000 restricted shares of Common Stock to two of our executive officers comprised of 2,000 shares of Common Stock issued on May 6, 2014 and 2,000 shares of Common Stock issued on March 6, 2015. The restricted shares of Common Stock vest based on two years of continuous service with one-third of the shares of Common Stock vesting immediately upon issuance and one-third vesting at the end of each of the next two years. Compensation expense related to these restricted shares of Common Stock is recognized over the vesting period. We recognized compensation expense of $8,000 and $19,000 for the three months ended June 30, 2015 and 2014, respectively, and $26,000 and $19,000 for the six months ended June 30, 2015 and 2014, respectively, related to these restricted shares of Common Stock.

        As of June 30, 2015, there was $103,000 of total unrecognized compensation expense related to these restricted shares of Common Stock which will be recognized over the next two years.

        In addition, on June 12, 2014, we granted 11,850 options with an exercise price of $23.16 (the closing price of our Common Stock on such date). We recorded compensation expense of $8,000 for the three and six months ended June 30, 2014 related to this option grant. These options were forfeited effective January 31, 2015.

9. EARNINGS PER SHARE ("EPS")

        The computations of basic EPS are based on our weighted average shares outstanding. The basic weighted average common shares outstanding were 97,589,000 and 97,571,000 for the three months ended June 30, 2015 and 2014, respectively, and 97,586,000 and 96,758,000 for the six months ended June 30, 2015 and 2014, respectively. For the three months ended June 30, 2015 and 2014, the weighted average shares outstanding were increased by 0 and 5,000 shares, respectively, to reflect the dilutive effect of stock options; for the six months ended June 30, 2015 and 2014, the dilutive effect of stock options was 0 and 6,000 shares, respectively. EPS for the year to date period may differ from the sum of quarterly EPS amounts due to the required method of computing EPS in the respective periods.

        For purposes of calculating basic EPS for the three and six months ended June 30, 2014, the approximately 65,000,000 shares of preferred stock issued in connection with the Merger were assumed to have been converted into approximately 91,040,000 shares of Common Stock. As of the Acquisition Date, a subsidiary of CIM REIT had agreed to vote its 97.8% post-Merger ownership of CIM Commercial in favor of an increase in the number of authorized CIM Commercial shares of Common Stock to one billion (200,000,000 after giving effect to the reverse stock split), thereby satisfying the condition for the automatic conversion of these shares. The actual conversion of the shares of preferred stock to shares of Common Stock occurred on April 29, 2014.

24

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

10. DIVIDENDS DECLARED

        Dividends declared during the six months ended June 30, 2015 and 2014 consisted of the following:

        On March 6, 2015 and June 12, 2015, we declared common share dividends of $0.21875 per share of Common Stock which were paid on March 27, 2015 and June 29, 2015, respectively.

        CIM Urban paid a distribution of $16,100,000 in 2014 prior to the Acquisition Date ($0.1685 per share of Common Stock, as converted).

        On March 24, 2014, we declared a common share dividend of $0.05 per share of Common Stock and a preferred dividend of $0.0403 per share of preferred stock ($0.0285 per share of Common Stock as converted) which were paid on March 28, 2014.

        On April 28, 2014, we declared a dividend in the aggregate amount of $1,964,000 to the preferred stockholders ($0.0302 per share of preferred stock and $0.0215 per share of Common Stock as converted) in connection with the conversion of shares of preferred stock to shares of Common Stock, which was paid on June 27, 2014.

        On June 12, 2014, we declared a common share dividend of $0.21875 per share of Common Stock which was paid on June 27, 2014.

        In addition, dividends of $59,286,000 ($27.975 per share of Common Stock) were paid to the PMC Commercial stockholders in connection with the Merger, which includes the $27.50 per share of Common Stock special dividend plus the $0.475 pro rata portion of PMC Commercial's regular quarterly cash dividend.

11. FAIR VALUE OF FINANCIAL INSTRUMENTS

        A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy for inputs used in measuring fair value is as follows:

Level 1 Inputs—Quoted prices in active markets for identical assets or liabilities

Level 2 Inputs—Observable inputs other than quoted prices in active markets for identical assets and liabilities

Level 3 Inputs—Unobservable inputs

        In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

25

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

11. FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

        The estimated fair values of those financial instruments which are not recorded at fair value on a recurring basis on our consolidated balance sheets were as follows:

	June 30, 2015				December 31, 2014
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value		Level
	(in thousands)
Assets held for sale:
Loans receivable subject to credit risk	$	140,385	$	146,482	$	147,648	$	154,252		3
SBA 7(a) loans receivable, subject to secured borrowings		38,793		39,596		41,404		41,901		3
Commercial real estate loans		19,673		19,639		—		—		3
Liabilities:
Secured borrowings—government guaranteed loans, included in liabilities associated with assets held for sale		39,280		39,280		41,901		41,901		3
Junior subordinated notes		24,942		24,955		24,906		24,877		3
Mortgages payable		207,702		211,953		223,808		231,806		3
Unsecured credit facilities		415,000		415,000		360,000		360,000		3

        Management's estimation of the fair value of our financial instruments is based on a Level 3 valuation in the fair value hierarchy established for disclosure of how a company values its financial instruments. In general, quoted market prices from active markets for the identical financial instrument (Level 1 inputs), if available, should be used to value a financial instrument. If quoted prices are not available for the identical financial instrument, then a determination should be made if Level 2 inputs are available. Level 2 inputs include quoted prices for similar financial instruments in active markets for identical or similar financial instruments in markets that are not active (i.e., markets in which there are few transactions for the financial instruments, the prices are not current, price quotations vary substantially, or in which little information is released publicly). There is limited reliable market information for our financial instruments and we utilize other methodologies based on unobservable inputs for valuation purposes since there are no Level 1 or Level 2 inputs available. Accordingly, Level 3 inputs are used to measure fair value.

        In general, estimates of fair value may differ from the carrying amounts of the financial assets and liabilities primarily as a result of the effects of discounting future cash flows. Considerable judgment is required to interpret market data and develop estimates of fair value. Accordingly, the estimates presented are made at a point in time and may not be indicative of the amounts we could realize in a current market exchange.

        Loans Receivable Subject to Credit Risk—Loans receivable were initially recorded at estimated fair value at the Acquisition Date. Loans receivable originated subsequent to the Acquisition Date are recorded at cost upon origination and adjusted by net loan origination fees and discounts. In order to determine the estimated fair value of our loans receivable, we use a present value technique for the

26

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

11. FAIR VALUE OF FINANCIAL INSTRUMENTS (Continued)

anticipated future cash flows using certain assumptions. At June 30, 2015, our assumptions included discount rates ranging from 6.75% to 15.00% and prepayment rates of 15.00%. At December 31, 2014, our assumptions included discount rates ranging from 5.90% to 14.90% and prepayment rates of 15.00%.

        SBA 7(a) Loans Receivable, Subject to Secured Borrowings—These loans receivable represent the government guaranteed portion of loans which were sold with the proceeds received from the sale reflected as secured borrowings-government guaranteed loans (a liability associated with assets held for sale on our consolidated balance sheets (Note 6)). There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal. In order to determine the estimated fair value of these loans receivable, we use a present value technique for the anticipated future cash flows taking into consideration the lack of credit risk using a prepayment rate of 15.00%.

        Commercial Real Estate Loans—In order to determine the estimated fair value of our commercial real estate loan receivable which consists of one mezzanine loan, we use a present value technique for the anticipated future cash flows using certain assumptions including a discount rate of 9.72%. There is no prepayment anticipated and no potential credit deterioration anticipated on this loan.

        Secured Borrowings—Government Guaranteed Loans—The carrying amount of secured borrowings-government guaranteed loans approximates fair value, as the interest rates on these secured borrowings approximate current market interest rates, and includes the unamortized deferred cash premiums collected on the sale of the government guaranteed portions of the related loans, which are included in liabilities associated with assets held for sale.

        Junior Subordinated Notes—The fair value of the junior subordinated notes is estimated based on current interest rates available for debt instruments with similar terms. Discounted cash flow analysis is generally used to estimate the fair value of our junior subordinated notes. The rate used was 4.11% and 3.83% at June 30, 2015 and December 31, 2014, respectively.

        Unsecured Credit Facilities—The carrying amount is a reasonable estimation of fair value as the interest rates on the unsecured credit facilities are variable and are at current market interest rates.

        Mortgage Notes Payable—The fair values of mortgage notes are estimated based on current interest rates available for debt instruments with similar terms. The fair value of our mortgages payable is sensitive to fluctuations in interest rates. Discounted cash flow analysis is generally used to estimate the fair value of our mortgages payable, using rates ranging from 4.20% to 4.55% at June 30, 2015 and 3.92% to 4.12% at December 31, 2014.

12. RELATED-PARTY TRANSACTIONS

        CIM Urban REIT Management, LP (the "Advisor"), an affiliate of CIM REIT, provides asset management services to CIM Urban. For these services, CIM Urban pays asset management fees to the

27

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

12. RELATED-PARTY TRANSACTIONS (Continued)

Advisor on a quarterly basis in arrears. The fee is calculated as a percentage of the daily average adjusted fair value of our investments, as defined, as follows:

Daily Average Adjusted Fair Value of CIM Urban's Investments
				Quarterly Fee Percentage
From Greater of		To and Including
(in thousands)
$	—	$	500,000		0.2500	%
	500,000		1,000,000		0.2375	%
	1,000,000		1,500,000		0.2250	%
	1,500,000		4,000,000		0.2125	%
	4,000,000		20,000,000		0.1000	%

        The Advisor earned asset management fees of $6,176,000 and $5,798,000 for the three months ended June 30, 2015 and 2014, respectively, and $12,318,000 and $11,479,000 for the six months ended June 30, 2015 and 2014, respectively. At June 30, 2015 and December 31, 2014, asset management fees of $6,285,000 and $5,867,000, respectively, were due to the Advisor.

        CIM Management, Inc. and certain of its affiliates (collectively, the "CIM Management Entities"), all affiliates of CIM REIT, provide property management, leasing, and development services to CIM Urban. The CIM Management Entities earned property management fees, which are included in rental and other property operating expenses, totaling $1,463,000 and $1,272,000 for the three months ended June 30, 2015 and 2014, respectively, and $2,926,000 and $ 2,531,000 for the six months ended June 30, 2015 and 2014, respectively. CIM Urban also reimbursed the CIM Management Entities $2,229,000 and $1,749,000 during the three months ended June 30, 2015 and 2014, respectively, and $4,286,000 and $3,793,000 for the six months ended June 30, 2015 and 2014, respectively, for the cost of on-site personnel incurred on behalf of CIM Urban, which is included in rental and other property operating expenses. The CIM Management Entities earned leasing commissions of $40,000 and $839,000 for the three months ended June 30, 2015 and 2014, respectively, and $93,000 and $1,351,000 for the six months ended June 30, 2015 and 2014, respectively, which were capitalized to deferred charges. In addition, the CIM Management Entities earned development management fees of $222,000 and $157,000 for the three months ended June 30, 2015 and 2014, respectively, and $447,000 and $244,000 for the six months ended June 30, 2015 and 2014, respectively, which were capitalized to investments in real estate.

        At June 30, 2015 and December 31, 2014, fees payable and expense reimbursements due to the CIM Management Entities of $1,785,000 and $2,518,000, respectively, were included in due to related parties. Also included in due to related parties at June 30, 2015 and December 31, 2014 was ($88,000) and $76,000, respectively, due (from) to the CIM Management Entities and related parties.

        On the Acquisition Date, pursuant to the terms of the Merger Agreement, CIM Commercial and its subsidiaries entered into the Master Services Agreement (the "Master Services Agreement") with CIM Service Provider, LLC (the "Manager") pursuant to which the Manager provides or arranges for other service providers to provide management and administration services to CIM Commercial and its

28

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

12. RELATED-PARTY TRANSACTIONS (Continued)

subsidiaries following the Merger. Pursuant to the Master Services Agreement, CIM Commercial pays a base service fee (the "Base Service Fee") to the Manager initially set at $1,000,000 per year (subject to an annual escalation by a specified inflation factor beginning on January 1, 2015), payable quarterly in arrears. Based on the annual escalation factor, the Base Service Fee for 2015 is $1,010,000. The Base Service Fee began to accrue on the Acquisition Date and was pro-rated based on the number of days during the first quarter in which the Master Services Agreement was in effect. The Manager earned a Base Service Fee of $253,000 and $250,000 for the three months ended June 30, 2015 and 2014, respectively, and $506,000 and $306,000 for the six months ended June 30, 2015 and 2014, respectively. In addition, pursuant to the terms of the Master Services Agreement, the Manager may receive compensation for performing certain services for CIM Commercial and its subsidiaries that are not covered under the Base Service Fee. During the six months ended June 30, 2015 and 2014, such services performed by the Manager included accounting, tax, reporting, internal audit, legal, compliance, risk management, IT, human resources and corporate communications. The Manager's compensation is based on the salaries and benefits of the employees of the Manager and/or its affiliates who performed these services (allocated based on the percentage of time spent on the affairs of CIM Commercial and its subsidiaries). We expensed $899,000 and $290,000 for the three months ended June 30, 2015 and 2014, respectively, and $1,590,000 and $290,000 for the six months ended June 30, 2015 and 2014, respectively, for such services. At June 30, 2015 and December 31, 2014, $1,825,000 and $725,000 was due to the Manager, respectively, for such services.

        As of January 1, 2015, all of our employees moved to CIM SBA Staffing, LLC, ("CIM SBA"), an affiliate of CIM Group, L.P. ("CIM Group"), except for two of our executives, who became jointly employed by us and CIM SBA and their employment agreements with us continue in full force and effect. In connection with this move, on January 1, 2015, we entered into a Staffing and Reimbursement Agreement with CIM SBA and our subsidiary, PMC Commercial Lending, LLC, which provides that CIM SBA will provide personnel and resources to us and that we will reimburse CIM SBA for the costs and expenses of providing such personnel and resources. For the three months ended June 30, 2015, we expensed $1,093,000 and $128,000 related to services subject to reimbursement by us under this agreement which are included in discontinued operations and asset management and other fees to related parties, respectively; for the six months ended June 30, 2015, we expensed $2,236,000 and $251,000 related to such services which are included in discontinued operations and asset management and other fees to related parties, respectively.

13. COMMITMENTS AND CONTINGENCIES

        Loan Commitments—Commitments to extend credit are agreements to lend to a customer provided the terms established in the contract are met. Our outstanding loan commitments and approvals to fund loans were $20,384,000 at June 30, 2015, the majority of which were for prime-based loans to be originated by our subsidiary engaged in SBA 7(a) Program loans, the government guaranteed portion of which is intended to be sold. Commitments generally have fixed expiration dates. Since some commitments are expected to expire without being drawn upon, total commitment amounts do not necessarily represent future cash requirements.

29

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

13. COMMITMENTS AND CONTINGENCIES (Continued)

        General—In connection with the ownership and operation of real estate properties, we have certain obligations for the payment of tenant improvement allowances and lease commissions in connection with new leases and renewals. CIM Commercial had a total of $23,883,000 in future obligations under leases to fund tenant improvements and other future construction obligations at June 30, 2015.

        Employment Agreements—We have employment agreements with two of our executive officers. Under certain circumstances, as defined within the agreements, the agreements provide for (1) severance compensation or change in control payments to the executive officer in an amount equal to 2.99 times the average of the last three years' annual compensation paid to the executive officer and (2) death and disability payments in an amount equal to two times and one time, respectively, the annual salary paid to the executive officer. In addition, to the extent the executive is employed by us on January 1, 2016 and such executive is not entitled to any disability, death or severance payments, the executive would receive share awards as a retention bonus which would vest immediately upon grant. In aggregate, the executive officers would receive 105,000 share awards. We recorded compensation expense of $316,000 and $315,000 for the three months ended June 30, 2015 and 2014, respectively, related to these share awards; for the six months ended June 30, 2015 and 2014, such compensation expense was $632,000 and $315,000, respectively. At June 30, 2015, there was $631,000 of total unrecognized compensation expense relating to these share awards that will be recognized during 2015.

        Litigation—At December 31, 2014, we recorded a liability of $4,475,000 at one of our multifamily investments. The $4,475,000 liability, together with an additional tax abatement reimbursement related to the period from January 1, 2015 to March 11, 2015, was settled in February 2015 for a total of $4,721,000. Prior to our acquisition of the property, the former owners of the property enrolled the property in a property tax abatement program under Section 421-a of the New York Real Property Tax Law. At the time we acquired the property, the property was being used for corporate housing. This use continued from the time of acquisition and terminated in March 2015. The New York State Attorney General's office recently determined that the use of the property for corporate housing was inconsistent with the tax abatement program. In cooperation with the New York State Attorney General, we refunded the tax abatements received during the period we owned the property while it was being used for corporate housing. Our agreement with the New York State Attorney General does not affect the ability of the property to receive tax abatements in the future.

        We are not currently involved in any other material pending or threatened legal proceeding nor, to our knowledge, is any material legal proceeding currently threatened against us, other than routine litigation arising in the ordinary course of business. In the normal course of business, we are periodically a party to certain legal actions and proceedings involving matters that are generally incidental to our business. While the outcome of these legal actions and proceedings cannot be predicted with certainty, in management's opinion, the resolution of these legal proceedings and actions will not have a material adverse effect on our consolidated financial position, results of operations or cash flows.

30

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

13. COMMITMENTS AND CONTINGENCIES (Continued)

        SBA Related—If the SBA establishes that a loss on an SBA guaranteed loan is attributable to significant technical deficiencies in the manner in which the loan was originated, funded or serviced under the SBA 7(a) Program, the SBA may seek recovery of the principal loss related to the deficiency from us. With respect to the guaranteed portion of SBA loans that have been sold, the SBA will first honor its guarantee and then seek compensation from us in the event that a loss is deemed to be attributable to technical deficiencies. Based on historical experience, we do not expect that this contingency is probable to be asserted. However, if asserted, it could have a material adverse effect on our consolidated financial position, results of operations or cash flows.

        Environmental Matters—In connection with the ownership and operation of real estate properties, we may be potentially liable for costs and damages related to environmental matters, including asbestos-containing materials. We have not been notified by any governmental authority of any noncompliance, liability, or other claim in connection with any of the properties, and we are not aware of any other environmental condition with respect to any of the properties that management believes will have a material adverse effect on our consolidated financial position, results of operations or cash flows.

        Rent Expense—The ground lease for a property provides for current annual rent of $503,000, payable quarterly, inclusive of an increase on June 1, 2015, and increases every five years thereafter based on the greater of 15% or 50% of the increase in the Consumer Price Index during a five-year adjustment period. In addition, commencing on June 1, 2040 and June 1, 2065, the rent payable during the balance of the lease term shall be increased by an amount equal to 10% of the rent payable during the immediately preceding lease year. The lease term is through May 31, 2089. If the landlord decides to sell the leased property, we have the right of first refusal.

        Rent expense under this lease, which includes straight line rent and amortization of acquired below-market ground lease, was $438,000 for each of the three months ended June 30, 2015 and 2014, and $876,000 for each of the six months ended June 30, 2015 and 2014. We record rent expense on a straight line basis. Straight line rent liability of $11,625,000 and $11,038,000 is included in other liabilities in the accompanying consolidated balance sheets as of June 30, 2015 and December 31, 2014, respectively.

        We lease office space in Dallas, Texas under a lease which expires in May 2018. We recorded rent expense of $72,000 and $49,000 for the three months ended June 30, 2015 and 2014, respectively, and $130,000 and $65,000 for the six months ended June 30, 2015 and the period from the Acquisition Date through June 30, 2014, respectively, which is included in discontinued operations.

31

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

13. COMMITMENTS AND CONTINGENCIES (Continued)

        Scheduled future noncancelable minimum lease payments at June 30, 2015 are as follows:

Years Ending December 31,	(in thousands)
2015 (Six months ending December 31, 2015)	$	361
2016		743
2017		749
2018		607
2019		503
Thereafter		128,528
	$	131,491

14. FUTURE MINIMUM LEASE RENTALS

        Future minimum rental revenues under long-term operating leases at June 30, 2015, excluding tenant reimbursements of certain costs, are as follows:

Years Ending December 31,	Governmental Tenants		Other Tenants		Total
	(in thousands)
2015 (Six months ending December 31, 2015)	$	27,985	$	52,995	$	80,980
2016		48,608		94,676		143,284
2017		43,210		90,231		133,441
2018		40,568		70,328		110,896
2019		38,207		58,932		97,139
Thereafter		118,653		203,760		322,413
	$	317,231	$	570,922	$	888,153

15. CONCENTRATIONS

        Tenant Revenue Concentrations—Rental revenues from the U.S. General Services Administration and other government agencies (collectively, "Governmental Tenants"), which primarily occupy properties located in Washington, D.C., accounted for approximately 22.9% and 24.5% of our rental and other property income for the three months ended June 30, 2015 and 2014, respectively, and 22.8% and 25.1% for the six months ended June 30, 2015 and 2014, respectively. At June 30, 2015 and December 31, 2014, $6,915,000 and $7,168,000, respectively, was due from Governmental Tenants (see Note 14).

        Geographical Concentrations of Investments in Real Estate—As of June 30, 2015 and December 31, 2014, we owned 21 office properties, five multifamily properties, and three hotel properties, located in four states and Washington, D.C.

32

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

15. CONCENTRATIONS (Continued)

        Our revenue concentrations from properties are as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
California		63.0	%		60.2	%		62.8	%		60.3	%
Washington, D.C.		24.5			23.9			24.2			24.3
Texas		7.8			7.7			7.6			7.7
North Carolina		4.5			6.1			4.5			5.6
New York		0.2			2.1			0.9			2.1
		100.0	%		100.0	%		100.0	%		100.0	%

        Our real estate investment concentrations from properties are as follows:

	June 30, 2015			December 31, 2014
California		52.5	%		52.3	%
Washington, D.C.		31.1			31.2
Texas		7.4			7.4
North Carolina		5.4			5.5
New York		3.6			3.6
		100.0	%		100.0	%

16. SEGMENT DISCLOSURE

        In accordance with ASC Topic 280, Segment Reporting, our reportable segments consist of three types of commercial real estate properties, namely, office, hotel and multifamily, as well as a segment for our lending operations, which is held for sale as of June 30, 2015. Management internally evaluates the operating performance and financial results of the segments based on net operating income. We also have certain general and administrative level activities, including public company expenses, legal, accounting, and tax preparation that are not considered separate operating segments. The reportable segments are accounted for on the same basis of accounting as described in the notes to our audited consolidated financial statements for the year ended December 31, 2014 included in our Annual Report on Form 10-K filed with the SEC on March 16, 2015.

        We evaluate the performance of our real estate segments based on net operating income, which is defined as rental and other property income and tenant reimbursements less property and related expenses, and excludes nonproperty income and expenses, interest expense, depreciation and amortization, corporate related general and administrative expenses, and transaction costs.

33

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

16. SEGMENT DISCLOSURE (Continued)

        The net operating income of our reportable segments is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015		2014
	(in thousands)
Office:
Revenues	$	47,084	$	45,181	$	93,699	$	88,455
Property expenses:
Operating		20,060		17,933		39,451		35,586
General and administrative		113		76		426		392
Total property expenses		20,173		18,009		39,877		35,978
Segment net operating income—office		26,911		27,172		53,822		52,477
Hotel:
Revenues		15,822		14,798		31,541		29,137
Property expenses:
Operating		9,987		9,923		20,664		19,769
General and administrative		38		36		79		73
Total property expenses		10,025		9,959		20,743		19,842
Segment net operating income—hotel		5,797		4,839		10,798		9,295
Multifamily:
Revenues		4,013		5,208		8,918		10,192
Property expenses:
Operating		2,938		2,583		5,579		4,670
General and administrative		90		54		173		79
Total property expenses		3,028		2,637		5,752		4,749
Segment net operating income—multifamily		985		2,571		3,166		5,443
Total segment net operating income	$	33,693	$	34,582	$	67,786	$	67,215

34

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

16. SEGMENT DISCLOSURE (Continued)

        A reconciliation of segment net operating income to net income is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
	(in thousands)
Total segment net operating income	$	33,693		$	34,582		$	67,786		$	67,215
Interest		(5,586	)		(4,565	)		(10,989	)		(8,602	)
General and administrative		(1,714	)		(2,191	)		(3,869	)		(2,587	)
Asset management fees and other fees to related parties		(7,456	)		(6,338	)		(14,665	)		(12,075	)
Transaction costs		(373	)		(32	)		(801	)		(500	)
Depreciation and amortization		(17,566	)		(17,286	)		(36,694	)		(33,915	)
Bargain purchase gain		—			—			—			4,918
Income from continuing operations		998			4,170			768			14,454
Discontinued operations
Income from operations of assets held for sale		3,984			4,344			6,946			5,277
Net income from discontinued operations		3,984			4,344			6,946			5,277
Net income		4,982			8,514			7,714			19,731
Net income attributable to noncontrolling interests		(6	)		(115	)		(6	)		(113	)
Net income attributable to stockholders	$	4,976		$	8,399		$	7,708		$	19,618

        The condensed assets for each of the segments as of June 30, 2015 and December 31, 2014, along with capital expenditures and loan originations for the six months ended June 30, 2015 and 2014, are as follows:

	June 30, 2015		December 31, 2014
	(in thousands)
Condensed assets:
Office	$	1,517,155	$	1,534,610
Hotel		177,284		174,679
Multifamily		170,241		171,226
Lending assets held for sale		217,418		208,799
Non-segment assets		8,690		5,368
Total assets	$	2,090,788	$	2,094,682

35

CIM COMMERCIAL TRUST CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

AS OF JUNE 30, 2015, AND DECEMBER 31, 2014, AND FOR THE THREE
AND SIX MONTHS ENDED JUNE 30, 2015 AND 2014

(UNAUDITED)

16. SEGMENT DISCLOSURE (Continued)

	Six Months Ended June 30,
	2015		2014
	(in thousands)
Capital expenditures(1):
Office	$	14,200	$	11,428
Hotel		738		721
Multifamily		882		429
Total capital expenditures		15,820		12,578
Loan originations included in assets held for sale		41,121		25,191
Total capital expenditures and loan originations	$	56,941	$	37,769

(1)

Represents additions and improvements to real estate investments, excluding acquisitions.

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Item 2.
Management's Discussion and Analysis of Financial Condition and Results of Operations

This Form 10-Q contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), which are intended to be covered by the safe harbors created thereby. Such forward-looking statements can be identified by the use of forward-looking terminology such as "may," "will," "expect," "intend," "believe," "anticipate," "seek," "plan," "estimate," or "continue," or the negative thereof or other variations or similar words or phrases. These statements include the plans and objectives of management for future operations, including, but not limited to, plans and objectives relating to future growth and availability of funds. The forward-looking statements included herein are based on current expectations and there can be no assurance that these expectations will be attained. 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. Although we believe that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could be inaccurate and, therefore, there can be no assurance that the forward-looking statements included in this Form 10-Q will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that our objectives and plans will be achieved. Readers are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made. We do not undertake to update them to reflect changes that occur after the date they are made.

The following discussion of our financial condition at June 30, 2015 and results of operations for the three and six months ended June 30, 2015 and 2014 should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2014. For a more detailed description of the risks affecting our financial condition and results of operations, see "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2014.

All references to Common Stock and related per share data have been adjusted in this Form 10-Q to reflect the reverse stock split.

EXECUTIVE SUMMARY

Business Overview

        Our principal business is to acquire, own, and operate Class A and creative office properties in vibrant and improving urban communities throughout the United States. These communities are located in areas that include traditional downtown areas and suburban main streets, which have high barriers-to-entry, high population density, improving demographic trends and a propensity for growth. We believe that the critical mass of redevelopment in such areas creates positive externalities, which enhance the value of substantially stabilized assets in the area. We believe that these assets will provide greater returns than similar assets in other markets, as a result of the improving demographics, public commitment, and significant private investment that characterize these areas.

        Our real estate business is managed by affiliates of CIM Group. CIM Group is a vertically-integrated, full-service investment manager with multi-disciplinary expertise and in-house research, acquisition, investment, development, finance, leasing, and management capabilities. CIM Group is headquartered in Los Angeles and has offices in Oakland, California; Bethesda, Maryland; Dallas, Texas; and New York, New York.

37

Properties

        As of June 30, 2015, our investments, excluding assets held for sale, consisted of (i) 21 office properties comprised of approximately 5.6 million rentable square feet, (ii) five multifamily properties comprised of 930 units, (iii) three hotels comprised of 1,070 rooms, (iv) three parking garages, two of which have street level retail space, and (v) one development site.

Strategy

        Our investment strategy is centered around CIM Group's community qualification process. We believe this strategy provides us with a significant competitive advantage when making urban real estate investments. The qualification process generally takes between six months and five years and is a critical component of CIM Group's investment evaluation. CIM Group examines the characteristics of a market to determine whether the district justifies the extensive efforts CIM Group undertakes in reviewing and making potential investments in its Qualified Communities. Qualified Communities generally fall into one of two categories: (i) transitional urban districts and (ii) well-established, thriving urban areas (typically major central business districts). CIM Group typically spends significant time and resources qualifying targeted investment communities prior to making any acquisitions. Since 1994, CIM Group has qualified 97 communities and has deployed capital in 48 of these qualified communities. Although we may not invest exclusively in Qualified Communities, it is expected that most of our investments will be identified through this systematic process.

        We have been reviewing our strategies with respect to certain of our non-office real estate portfolio. As a result of such review, we intend to seek to divest our hotel properties as well as an office building in Orange County, California. We believe that the sales of these properties, together with the plan approved previously by the Board of Directors to sell the lending business, will allow us to increase our focus on stabilized Class A and creative office properties located in vibrant and improving urban communities throughout the United States. We continuously evaluate our portfolio and such review may result in additional dispositions that no longer fit our overall objectives.

The Merger

        On July 8, 2013, PMC Commercial entered into the Merger Agreement with CIM REIT, an affiliate of CIM Group, and subsidiaries of the respective parties. The Merger Agreement provided for the business combination of CIM REIT's wholly owned subsidiary, CIM Urban, and PMC Commercial. Pursuant to the Merger Agreement, Urban II, an affiliate of CIM REIT, received 4,400,000 shares of newly-issued PMC Commercial Common Stock and approximately 65,000,000 shares of newly-issued PMC Commercial preferred stock. Following the Merger and subsequent increase in our authorized number of shares, each share of preferred stock was converted into 1.4 shares of PMC Commercial Common Stock, resulting in the issuance of approximately 95,440,000 shares of common stock in the aggregate in connection with the Merger, representing approximately 97.8% of PMC Commercial's outstanding shares of common stock.

        All shares of PMC Commercial Common Stock that were outstanding immediately prior to the closing of the Merger continued to remain outstanding following the Acquisition Date. In addition, stockholders of record of PMC Commercial at the close of the business day prior to the Acquisition Date received a special cash dividend of $27.50 per share of PMC Commercial Common Stock plus that pro-rata portion of PMC Commercial's regular quarterly cash dividend accrued through the Acquisition Date, each of which was paid on March 25, 2014.

        Furthermore, on April 28, 2014, we filed the Reverse Split Amendment to effectuate a one-for-five reverse stock split of our Common Stock, effective April 29, 2014. Pursuant to the reverse stock split, each five shares of Common Stock issued and outstanding immediately prior to the effective time of the reverse stock split were converted into one share of Common Stock. All per share and outstanding

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share information included herein from before the Reverse Split Amendment has been presented to reflect the reverse stock split unless otherwise noted.

        The Merger was completed on March 11, 2014. Upon completion of the Merger, PMC Commercial became the parent of CIM Urban. PMC Commercial reincorporated from Texas to Maryland on April 28, 2014 and, on the same day, changed its name from "PMC Commercial Trust" to "CIM Commercial Trust Corporation."

        The Merger was accounted for as a reverse acquisition under the acquisition method of accounting with CIM Urban considered to be the accounting acquirer based upon the terms of the Merger Agreement.

Lending Segment

        We will continue to deploy a portion of our capital to our real estate lending platform through our wholly owned subsidiary (d/b/a PMC Commercial Trust) that originates and services loans under the U.S. SBA 7(a) Program as well as through other lending programs which allow us to achieve attractive risk adjusted returns on its loans.

        To take advantage of the expertise of CIM, we have begun to originate commercial real estate loans for properties that are primarily located in CIM Group's Qualified Communities. We are targeting investments between $20 million and $100 million with a focus on developing a diversified pool of loans. These loans are typically short duration (five years or less, inclusive of extension options), floating rate and are expected to be:

•

limited and/or non-recourse junior (mezzanine, b-note or 2nd lien) and senior construction loans; or

•

limited and/or non-recourse junior (mezzanine, b-note or 2nd lien) and senior acquisition, bridge or repositioning loans.

        We intend to participate a portion of these loans with, and/or syndicate a portion of these loans to, one or more institutional investors.

        We have reflected the lending segment as held for sale at June 30, 2015 and December 31, 2014, based on a plan approved by the Board of Directors to sell the lending business that, when completed, will result in the deconsolidation of the lending segment, allowing us to increase our focus on Class A and creative office properties while independently expanding, diversifying and growing the lending business.

Funds from Operations ("FFO")

        We believe that FFO is a widely recognized and appropriate measure of the performance of a REIT and that it is frequently used by security analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO represents net income (loss), computed in accordance with U.S. GAAP, excluding gains (or losses) from sales of real estate, real estate depreciation and amortization (other than amortization of deferred financing costs), and after adjustments for non-controlling interests. We calculate FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts ("NAREIT").

        Like any metric, FFO should not be used as the only measure of our performance because it excludes depreciation and amortization and captures neither the changes in the value of our real estate properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effect and could materially impact our operating results. Other REITs may not calculate FFO in accordance with NAREIT; accordingly, our FFO may not be comparable to those other REITs'

39

FFO. Therefore, FFO should be considered only as a supplement to net income as a measure of our performance and should not be used as a supplement to or substitute measure for cash flow from operating activities computed in accordance with U.S. GAAP. FFO should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to pay dividends.

        The following table sets forth a reconciliation of net income to FFO:

	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015		2014
	(in thousands)
Net income attributable to stockholders	$	4,976	$	8,399	$	7,708	$	19,618
Depreciation and amortization		17,566		17,286		36,694		33,915
Net income attributable to noncontrolling interests		6		115		6		113
FFO	$	22,548	$	25,800	$	44,408	$	53,646

        FFO decreased to $22,548,000, or 12.6%, for the three months ended June 30, 2015, compared to $25,800,000 for the three months ended June 30, 2014. The decrease was primarily attributable to a decrease of $1,586,000 in multifamily net operating income, primarily from recent vacancy in our New York property which is in the process of being re-leased as individual units, an increase of $1,118,000 in asset management fees and other fees to related parties, an increase of $1,021,000 in interest expense from higher debt levels, and an increase of $341,000 in acquisition related costs, partially offset by an increase of $958,000 in hotel net operating income.

        FFO decreased to $44,408,000, or 17.2%, for the six months ended June 30, 2015, compared to $53,646,000 for the six months ended June 30, 2014. The decrease was primarily attributable to the recognition of the bargain purchase gain of $4,918,000 in the first six months of 2014, an increase of $2,590,000 in asset management fees and other fees to related parties, an increase of $2,387,000 in interest expense from higher debt levels, an increase of $1,282,000 in corporate general and administrative expenses, and a decrease of $2,277,000 in multifamily net operating income, primarily from our New York property which is in the process of being re-leased as individual units, partially offset by an increase of $1,345,000 in office net operating income primarily due to revenues related to the office properties acquired in April and October 2014, and revenue increases at certain properties in the Los Angeles area, which experienced higher occupancy during the first six months of 2015 compared to the first six months of 2014, an increase of $1,503,000 in hotel net operating income primarily due to RevPAR growth, and a $1,669,000 increase from the operations of the lending segment included in discontinued operations, which in the first six months of 2014 included activity for the period from Acquisition Date to June 30, 2014.

Rental Rate Trends

        Office Rental Rates:    The following table sets forth the annualized rent per occupied square foot across our office portfolio:

	As of June 30,
	2015		2014
Annualized rent per occupied square foot(1)	$	36.37	$	35.77

(1)

Represents gross monthly base rent under commenced leases, multiplied by twelve. This amount reflects total cash rent before abatements. Total abatements for the twelve months ended June 30, 2015 and 2014 were approximately $7,200,000 and $12,000,000,

40

respectively. Where applicable, annualized rent has been grossed up by adding annualized expense reimbursements to base rent. Annualized rent for certain office properties includes rent attributable to retail.

        Over the next four quarters, we expect to see expiring cash rents as set forth in the table below:

	For the Three Months Ended
	September 30, 2015		December 31, 2015		March 31, 2016		June 30, 2016
Expiring Cash Rents:
Expiring square feet(1)		301,974		264,609		63,648		59,061
Expiring rent per square foot(2)	$	33.09	$	48.03	$	42.75	$	43.03

(1)

All month-to-month tenants occupying a total of 72,317 square feet are included in the expiring leases in the first quarter listed.

(2)

Represents gross monthly base rent, as of June 30, 2015, under leases expiring during the periods above, multiplied by twelve. This amount reflects total cash rent before abatements. Where applicable, annualized rent has been grossed up by adding annualized expense reimbursements to base rent.

        During the three and six months ended June 30, 2015, we executed leases with terms longer than 12 months totaling 125,262 and 278,691 square feet, respectively. The table below sets forth information on certain of our executed leases during the three and six months ended June 30 2015, excluding space that was vacant for more than one year.

	Number of Leases(1)(2)		Rentable Square Feet(2)		New Cash Rents per Square Foot(2)(3)		Expiring Cash Rents per Square Foot(2)(3)
Three Months Ended June 30, 2015(3)		10		65,360	$	36.86	$	37.68
Six Months Ended June 30, 2015(3)		21		180,180	$	38.45	$	41.83

(1)

Based on the number of tenants.

(2)

Excludes leases for which the space was vacant longer than one year, month-to-month leases, leases with an original term of less than 12 months, related party leases, and spaces where the previous tenant was a related party.

(3)

Cash rents represent gross annual base rent. This amount reflects total cash rent before abatements. Where applicable, annualized rent has been grossed up by adding annualized expense reimbursements to base rent.

        Quarterly fluctuations in submarkets, buildings and term of the expiring leases cause large variations in these numbers and make predicting the changes in rent in any specific quarter difficult. Our rental rates and occupancy are impacted by general economic conditions, including the pace of regional and economic growth and access to capital. Therefore, we cannot give any assurance that leases will be renewed or that available space will be re-leased at rental rates equal to or above the current market rates. Additionally, decreased demand and other negative trends or unforeseeable events that impair our ability to timely renew or re-lease space could have further negative effects on our future financial condition, results of operations and cash flows.

41

        Multifamily Rates:    The following table sets forth the monthly rent per occupied unit across our multifamily portfolio:

	As of June 30,
	2015		2014
Monthly rent per occupied unit(1)	$	1,712	$	1,853

(1)

Represents gross monthly base rent under commenced leases, divided by occupied units. This amount reflects total cash rent before concessions. The New York property is in the process of being re-leased as individual units. Monthly rent per occupied unit excluding the New York property is $1,570 and $1,527 as of June 30, 2015 and 2014, respectively.

        Occupancy Rates:    The following table sets forth the occupancy rates across our office and multifamily real estate portfolios:

	As of June 30,
	2015			2014
Office portfolio		85.2	%		82.1	%
Multifamily portfolio(1)		89.0	%		96.6	%

(1)

The multifamily occupancy as of June 30, 2015 reflects 36.4% occupancy for our New York property, as our corporate housing tenant terminated its lease in March 2015 and we are in the process of re-leasing the property as individual units. The occupancy rate for the multifamily portfolio excluding the New York property is 96.1% as of both June 30, 2015 and 2014.

        Hotel Statistics:    The following table sets forth the occupancy, average daily rate ("ADR") and revenue per available room ("RevPAR") for the hotel portfolio:

	For the Six Months Ended June 30,
	2015			2014
Rental Rate Trends—Hotel Statistics
Occupancy		84.5	%		82.3	%
ADR	$	130.77		$	122.51
RevPAR	$	110.56		$	100.83

Secondary Market Loan Sales

        Our lending division, which is reflected as held for sale at June 30, 2015 and December 31, 2014, sells loans originated pursuant to the SBA 7(a) Program. The SBA guaranteed portion of these loans are sold in legal sale transactions to either dealers in government guaranteed loans or institutional investors as the loans are fully funded. These government guaranteed portions of loans may be sold for (1) a cash premium and the minimum 1% SBA required servicing spread, (2) significant future servicing spread and no cash premium or (3) future servicing spread and a cash premium of 10%. We are required to permanently treat certain of the proceeds received from these legally sold portions of loans (those loans sold solely for future servicing spread and those loans sold for a cash premium of 10% and future servicing spread) as secured borrowings (debt), which are included in the accompanying consolidated balance sheet as liabilities associated with assets held for sale, and 100% of the loans are included in assets held for sale.

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RESULTS OF OPERATIONS

Three Months Ended June 30, 2015 Compared to Three Months Ended June 30, 2014

Overview

	Three Months Ended June 30,				Change
	2015		2014		$			%
	(dollars in thousands)
Total revenues	$	66,919	$	65,187	$	1,732			2.7	%
Total expenses	$	65,921	$	61,017	$	4,904			8.0	%
Income from operations of assets held for sale	$	3,984	$	4,344	$	(360	)		(8.3	)%
Net income	$	4,982	$	8,514	$	(3,532	)		(41.5	)%

        Net income decreased to $4,982,000 for the three months ended June 30, 2015, compared to $8,514,000 for the corresponding period in 2014. The decrease was primarily attributable to a decrease of $1,586,000 in multifamily net operating income, primarily from recent vacancy in our New York property which is in the process of being re-leased as individual units, an increase of $1,118,000 in asset management fees and other fees to related parties, an increase of $1,021,000 in interest expense from higher debt levels, and an increase of $341,000 in acquisition related costs, partially offset by an increase of $958,000 in hotel net operating income.

        CIM Commercial operates in four segments: office, hotel and multifamily properties and lending. The lending segment is classified as held for sale at June 30, 2015 and December 31, 2014 and included in discontinued operations. Set forth and described below are summary segment results for our three segments included in continuing operations.

Summary Segment Results

	Three Months Ended June 30,				Change
	2015		2014		$			%
	(dollars in thousands)
Revenues:
Office	$	47,084	$	45,181	$	1,903			4.2	%
Hotel		15,822		14,798		1,024			6.9	%
Multifamily		4,013		5,208		(1,195	)		(22.9	)%
Expenses:
Office		20,173		18,009		2,164			12.0	%
Hotel		10,025		9,959		66			0.7	%
Multifamily		3,028		2,637		391			14.8	%

Revenues

        Office Revenue:    Revenues include rental revenues from office properties, expense reimbursements and lease termination income. Office properties revenue increased to $47,084,000, or 4.2%, for the three months ended June 30, 2015 compared to $45,181,000 for the corresponding period in 2014, primarily due to revenues related to the office properties acquired in April 2014 and October 2014, and revenue increases at certain properties in Los Angeles, California, which experienced higher occupancy during the second quarter of 2015 compared to the second quarter of 2014. Additionally, certain properties in the metro Washington D.C. area and Los Angeles, California experienced higher expense reimbursements revenue during the second quarter of 2015 compared to the second quarter of 2014. The increase in revenue at California and the metro Washington D.C. area properties is partially offset

43

by a decrease at our North Carolina property due to recognition of fees related to early termination of a large tenant in April 2014.

        Hotel Revenue:    Hotel revenue increased to $15,822,000, or 6.9%, for the second quarter of 2015 compared to $14,798,000 for the second quarter of 2014. The increase is primarily due to the RevPAR growth at our three hotels, due to increases in both occupancy and rates.

        Multifamily Revenue:    Multifamily revenue decreased to $4,013,000, or 22.9%, for the second quarter of 2015 compared to $5,208,000 for the second quarter of 2014. The decrease is primarily due to lower multifamily revenue at our New York property for the second quarter of 2015, as our corporate housing tenant terminated its lease in March 2015 and the property is in the process of being re-leased as individual units.

Expenses

        Office Expenses:    Office properties expenses increased to $20,173,000, or 12.0%, for the second quarter of 2015 compared to $18,009,000 for the second quarter of 2014. The increase is primarily due to an increase in real estate taxes and tenant reimbursable expenses at our California and metro Washington D.C. area properties. We expect the increases in real estate taxes will be sustained for our Washington D.C. area properties for the remainder of the year.

        Hotel Expenses:    Hotel expenses increased to $10,025,000, or 0.7%, for the second quarter of 2015 compared to $9,959,000 for the second quarter of 2014. The increase is primarily due to increased variable costs associated with higher occupancy during the second quarter of 2015 compared to the second quarter of 2014 at our three hotel properties, offset by a decrease in real estate taxes at our hotel property in Sacramento, California due to a reduction of tax accruals following the receipt of the actual tax assessment.

        Multifamily Expenses:    Multifamily expenses increased to $3,028,000, or 14.8%, for the second quarter of 2015 compared to $2,637,000 for the second quarter of 2014. The increase is primarily due to an increase in expenses associated with re-leasing our New York property as individual units during the second quarter of 2015, partially offset by a decrease in real estate taxes at one of our Dallas properties, due to a tax appeal refund.

        Interest Expense:    Interest expense, which is not allocated to our segments, was $5,586,000 for the three months ended June 30, 2015, an increase of $1,021,000, or 22.4%, compared to the corresponding period in 2014. The increase is mainly due to incremental credit facility borrowings during the last six months of 2014 and in the first six months of 2015 and an increase in amortization of deferred loan costs related to the September 2014 credit facility, partially offset by lower interest expense from amortizing fixed-rate mortgages as a result of the repayment of approximately $12,364,000 in fixed rate mortgages in April 2015.

        General and Administrative Expenses:    General and administrative expenses, which are not allocated to our operating segments, decreased to $1,714,000 for the second quarter of 2015 compared to $2,191,000 for the corresponding period in 2014. The decrease is primarily due to nonrecurring expenses related to the Merger during the second quarter of 2014, and a decrease in salaries, which are included in asset management and other fees to related parties for the three months ended June 30, 2015, as a result of the transfer of our employees to an affiliate effective January 1, 2015 (see Note 12).

        Transaction Costs:    Transaction costs totaling $373,000 for the second quarter of 2015 represent a $341,000 increase from $32,000 for the second quarter of 2014. The costs incurred during the second quarter of 2015 represent abandoned project costs, costs related to the planned disposition of the lending segment which is held for sale, and costs associated with evaluating strategies for exiting certain

44

of our non-office real estate portfolio. The costs incurred during the second quarter of 2014 are associated with the acquisition of one of our office properties in April 2014.

        Asset Management and Other Fees to Related Parties:    Asset management fees totaled $6,176,000 for the second quarter of 2015 compared to $5,798,000 for the second quarter of 2014. Asset management fees are calculated based on a percentage of the average adjusted fair value of CIM Urban's investments, which are appraised in the fourth quarter of each year. The higher fees reflect a net increase in the fair value of CIM Urban's real estate investments based on the December 31, 2014 appraised values, as well as incremental capital expenditures incurred in the first six months of 2015. In addition, pursuant to the Master Services Agreement entered into on the Acquisition Date, CIM Commercial pays a Base Service Fee equal to $1,000,000 per year (subject to an annual escalation by a specified inflation factor beginning on January 1, 2015, which increased the fee to $1,010,000) to the Manager, a related party. Fees to the Manager totaled $253,000 for the second quarter of 2015 compared to $250,000 for the second quarter of 2014. In addition, pursuant to the terms of the Master Services Agreement, the Manager may receive compensation and/or reimbursement for performing certain services for CIM Commercial and its subsidiaries that are not covered under the Base Service Fee. For the three months ended June 30, 2015, we expensed $899,000 for such services, compared to $290,000 in the second quarter of 2014. For the three months ended June 30, 2015, we also expensed $128,000 related to corporate services subject to reimbursement by us under the CIM SBA Staffing and Reimbursement Agreement, pursuant to which all our employees moved to CIM SBA Staffing, an affiliate of CIM Group, effective January 1, 2015. Such costs were included in general and administrative expenses in prior year comparable periods.

        Depreciation and Amortization Expense:    Depreciation and amortization expense for the three months ended June 30, 2015 was $17,566,000, an increase of $280,000, or 1.6%, compared to the corresponding period in 2014. The increase is primarily due to the depreciation expense associated with additional capital expenditures and the acquisition of the office properties in April 2014 and October 2014, partially offset by decreased amortization of certain acquisition-related assets that became fully depreciated.

Discontinued Operations

        Income from Operations of Assets Held for Sale:    Income from operations of assets held for sale represents revenues and expenses from our lending segment, including interest income on loans and other loan related fee income, offset by expenses, which include general and administrative expenses, fees to related party, direct interest expense, and provision for income taxes. Income from operations of assets held for sale decreased to $3,984,000 in the second quarter of 2015, compared to $4,344,000 in the second quarter of 2014, mainly due to a decrease in interest and other income resulting primarily from lower volume of secondary market loan sales and lower prepayment fee income during the second quarter of 2015, partially offset by a decrease in interest expense, mainly due to repayment of debt in September 2014.

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Six Months Ended June 30, 2015 Compared to Six Months Ended June 30, 2014

Overview

	Six Months Ended June 30,				Change
	2015		2014		$			%
	(dollars in thousands)
Total revenues	$	134,158	$	127,784	$	6,374			5.0	%
Total expenses	$	133,390	$	118,248	$	15,142			12.8	%
Bargain purchase gain		—	$	4,918	$	(4,918	)		—
Income from operations of assets held for sale	$	6,946	$	5,277	$	1,669			31.6	%
Net income	$	7,714	$	19,731	$	(12,017	)		(60.9	)%

        Net income decreased to $7,714,000 for the first six months of 2015, compared to $19,731,000 for the first six months of 2014. The decrease was primarily attributable to the recognition of the bargain purchase gain of $4,918,000 in the first six months of 2014, an increase of $2,779,000 in depreciation and amortization expense, an increase of $2,590,000 in asset management fees and other fees to related parties, an increase of $2,387,000 in interest expense from higher debt levels, an increase of $1,282,000 in corporate general and administrative expenses, and a decrease of $2,277,000 in multifamily net operating income, primarily from our New York property which is in the process of being re-leased as individual units, partially offset by an increase of $1,345,000 in office net operating income primarily due to revenues related to the office properties acquired in April 2014 and October 2014, and revenue increases at certain properties in the Los Angeles area, which experienced higher occupancy during the first six months of 2015 compared to the first six months of 2014, an increase of $1,503,000 in hotel net operating income due to RevPAR growth, and a $1,669,000 increase from the operations of the lending segment included in discontinued operations, which in the first six months of 2014 included activity for the period from Acquisition Date to June 30, 2014.

        Set forth and described below are summary segment results for our three segments included in continuing operations.

Summary Segment Results

	Six Months Ended June 30,				Change
	2015		2014		$			%
	(dollars in thousands)
Revenues:
Office	$	93,699	$	88,455	$	5,244			5.9	%
Hotel		31,541		29,137		2,404			8.3	%
Multifamily		8,918		10,192		(1,274	)		(12.5	)%
Expenses:
Office		39,877		35,978		3,899			10.8	%
Hotel		20,743		19,842		901			4.5	%
Multifamily		5,752		4,749		1,003			21.1	%

Revenues

        Office Revenue:    Revenues include rental revenues from office properties, expense reimbursements and lease termination income. Office properties revenue increased to $93,699,000, or 5.9%, for the six months ended June 30, 2015 compared to $88,455,000 for the corresponding period in 2014, primarily due to revenues related to the office properties acquired in April 2014 and October 2014, and revenue increases at certain properties in Los Angeles, California, which experienced higher occupancy during

46

the first six months of 2015 compared to the first six months of 2014. Additionally, certain properties in the metro Washington D.C. area experienced higher expense reimbursements revenue during the first six months of 2015 compared to the first six months of 2014. The increase in revenue at California and the metro Washington D.C. area properties is partially offset by a decrease at our North Carolina property due to recognition of fees related to early termination of a large tenant in April 2014.

        Hotel Revenue:    Hotel revenue increased to $31,541,000, or 8.3%, for the first six months of 2015 compared to $29,137,000 for the first six months of 2014. The increase is primarily due to the RevPAR growth at our three hotels, due to increases in both occupancy and rates.

        Multifamily Revenue:    Multifamily revenue decreased to $8,918,000, or 12.5%, for the first six months of 2015 compared to $10,192,000 for the first six months of 2014. The decrease is primarily due to lower multifamily revenue at our New York property for the first six months of 2015, as our corporate housing tenant terminated its lease in March 2015 and the property is in the process of being re-leased as individual units, partially offset by an increase at our Dallas properties, resulting from increased rates.

Expenses

        Office Expenses:    Office properties expenses increased to $39,877,000, or 10.8%, for the first six months of 2015 compared to $35,978,000 for the first six months of 2014. The increase is primarily due to expenses related to the office properties we acquired in April 2014 and October 2014 and an increase in real estate taxes and tenant reimbursable expenses at our California and metro Washington D.C. area properties, offset by a decrease in electricity expense at the metro Washington D.C. area properties. We expect the increases in real estate taxes will be sustained for our Washington D.C. area properties for the remainder of the year.

        Hotel Expenses:    Hotel expenses increased to $20,743,000, or 4.5%, for the first six months of 2015 compared to $19,842,000 for the first six months of 2014. The increase is primarily due to increased variable costs associated with higher occupancy during the first six months of 2015 compared to the first six months of 2014 at our three hotel properties, partially offset by a decrease in real estate taxes at our hotel property in Sacramento, California due to a reduction of tax accruals following the receipt of the actual tax assessment.

        Multifamily Expenses:    Multifamily expenses increased to $5,752,000, or 21.1%, for the first six months of 2015 compared to $4,749,000 for the first six months of 2014. The increase is primarily due to an increase in expenses associated with re-leasing our New York property as individual units during the second quarter of 2015, an increase in real estate taxes as a result of reassessments at our Texas properties, and an increase in real estate taxes at our New York property following the loss of tax abatements for part of the first quarter of 2015 while it was being leased by a corporate housing operator.

        Interest Expense:    Interest expense, which is not allocated to our segments, was $10,989,000 for the six months ended June 30, 2015, an increase of $2,387,000 or 27.7%, compared to the corresponding period in 2014. The increase is mainly due to incremental credit facility borrowings during the last six months of 2014 and in the first six months of 2015, and an increase in amortization of deferred loan costs related to the September 2014 credit facility, partially offset by lower interest expense from amortizing fixed-rate mortgages as a result of the repayment of approximately $12,364,000 in fixed rate mortgages in April 2015.

        General and Administrative Expenses:    General and administrative expenses, which are not allocated to our operating segments, increased to $3,869,000 for the first six months of 2015 compared to $2,587,000 for the corresponding period in 2014. The increase is primarily due to public company

47

expenses, including external audit and legal fees, partially offset by a decrease in salaries, which are included in asset management and other fees to related parties for the first six months of 2015, as a result of the transfer of our employees to an affiliate effective January 1, 2015 (see Note 12).

        Transaction Costs:    Transaction costs totaling $801,000 for the first six months of 2015 represent a $301,000 increase from $500,000 for the first six months of 2014. The costs incurred during the first six months of 2015 represent abandoned project costs, costs related to the planned disposition of the lending segment which is held for sale, and costs associated with evaluating strategies for exiting certain of our non-office real estate portfolio. The costs incurred during the first six months of 2014 are mainly associated with the Merger, including due diligence costs, legal fees and accounting expenses.

        Asset Management and Other Fees to Related Parties:    Asset management fees totaled $12,318,000 for the first six months of 2015 compared to $11,479,000 for the first six months of 2014. Asset management fees are calculated based on a percentage of the average adjusted fair value of CIM Urban's investments, which are appraised in the fourth quarter of each year. The higher fees reflect a net increase in the fair value of CIM Urban's real estate investments based on the December 31, 2014 appraised values, as well as incremental capital expenditures incurred in first six months of 2015. In addition, pursuant to the Master Services Agreement entered into on the Acquisition Date, CIM Commercial pays a Base Service Fee initially set at $1,000,000 per year (subject to an annual escalation by a specified inflation factor beginning on January 1, 2015, which increased the fee to $1,010,000) to the Manager, a related party. Fees to the Manager totaled $506,000 for the first six months of 2015 compared to $306,000 for the period from the Acquisition Date to June 30, 2014. In addition, pursuant to the terms of the Master Services Agreement, the Manager may receive compensation and/or reimbursement for performing certain services for CIM Commercial and its subsidiaries that are not covered under the Base Service Fee. For the six months ended June 30, 2015, we expensed $1,590,000 for such services, compared to $290,000 in the first six months of 2014. For the six months ended June 30, 2015, we also expensed $251,000 related to corporate services subject to reimbursement by us under the CIM SBA Staffing and Reimbursement Agreement, pursuant to which all our employees moved to CIM SBA Staffing, an affiliate of CIM Group, effective January 1, 2015. Such costs were included in general and administrative expenses in prior comparable periods.

        Depreciation and Amortization Expense:    Depreciation and amortization expense for the six months ended June 30, 2015 was $36,694,000, an increase of $2,779,000, or 8.2%, compared to the corresponding period in 2014. The increase is primarily due to the depreciation expense associated with additional capital expenditures, the acquisition of the office properties in April and October 2014, and the acceleration of depreciation for certain assets at a property in Southern California where the tenant ceased operations and vacated our building, partially offset by decreased amortization of certain acquisition-related assets that became fully depreciated.

Discontinued Operations

        Income from Operations of Assets Held for Sale:    Income from operations of assets held for sale represents revenues and expenses from our lending segment, including interest income on loans and other loan related fee income, offset by expenses, which include general and administrative expenses, fees to related party, direct interest expense, and provision for income taxes. Income from operations of assets held for sale increased to $6,946,000 in the first six months of 2015, compared to $5,277,000 in the first six months of 2014, mainly due to the inclusion of a full six months of operations for our lending segment in the first half of 2015, while in the first six months of 2014 the lending operations are included beginning on the Acquisition Date through June 30, 2014.

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Liquidity and Capital Resources

Sources and Uses of Funds

Credit Facilities

        In February 2012, CIM Urban entered into an unsecured revolving line of credit with a bank syndicate, which allowed for maximum borrowings of $100,000,000. Outstanding advances under the line of credit bore interest at LIBOR plus 1.75% to 2.50% until August 2013. In August 2013, the unsecured revolving line was amended, and outstanding advances under the line bore interest at LIBOR plus 1.25% to 1.85%. The line of credit was also subject to an unused commitment fee of 0.25% or 0.35% depending on the amount of aggregate unused commitments. This line of credit was terminated and repaid in full in September 2014.

        In August 2013, CIM Urban entered into another unsecured revolving line of credit with a bank syndicate, as amended in April 2014, which allowed for maximum borrowings of $200,000,000. Outstanding advances under the line bore interest at LIBOR plus 1.25% to 1.85%. The line of credit was also subject to an unused commitment fee of 0.25% or 0.35% depending on the amount of aggregate unused commitments. This line of credit was terminated and repaid in full in September 2014.

        In September 2014, CIM Commercial entered into an $850,000,000 unsecured credit facility with a bank syndicate consisting of a $450,000,000 revolver, a $325,000,000 term loan and a $75,000,000 delayed-draw term loan. The credit facility can be increased to $1,150,000,000, under certain conditions. CIM Commercial is subject to certain financial maintenance covenants and a minimum property ownership condition. Outstanding advances under the revolver bear interest at (i) the base rate, plus 0.20% to 1.00% or (ii) LIBOR plus 1.20% to 2.00%, depending on the maximum consolidated leverage ratio. Outstanding advances under the term loans bear interest at (i) the base rate, plus 0.15% to 0.95% or (ii) LIBOR plus 1.15% to 1.95%, depending on the maximum consolidated leverage ratio. The revolver is also subject to an unused commitment fee of 0.15% or 0.25% depending on the amount of aggregate unused commitments. The delayed draw term loan was also subject to an unused line fee of 0.25%. The credit facility matures in September 2016 and provides for two one-year extension options under certain conditions. As of June 30, 2015 and December 31, 2014, $415,000,000 ($15,000,000 under the revolver and $400,000,000 under the term loans) and $360,000,000 ($35,000,000 under the revolver and $325,000,000 under the term loans), respectively, was outstanding under the credit facility and $435,000,000 and $490,000,000, respectively, was available for future borrowings. As of August 5, 2015, $415,000,000 ($15,000,000 under the revolver and $400,000,000 under the term loans) was outstanding under the credit facility and $435,000,000 was available for future borrowings. Proceeds from the unsecured credit facility were used for acquisitions, general corporate purposes and to repay $323,000,000 outstanding under our prior unsecured credit facilities. At June 30, 2015 and December 31, 2014, the interest rate on our unsecured credit facility ranged from 1.34% to 1.39% and 1.31% to 1.37%, respectively.

        In May 2015, CIM Commercial entered into an unsecured term loan facility with a bank syndicate pursuant to which CIM Commercial can borrow up to a maximum of $385,000,000. The term loan facility ranks pari passu with CIM Commercial's $850,000,000 credit facility described above; covenants under the term loan facility are substantially the same as those in the $850,000,000 credit facility. Outstanding advances under the term loan facility bear interest at (i) the base rate plus 0.60% to 1.25% or (ii) LIBOR plus 1.60% to 2.25%, depending on the maximum consolidated leverage ratio. The unused portion of the term loan facility is also subject to an unused fee of 0.20%. With some exceptions, any prepayment of the term loan facility prior to May 2017 will be subject to a prepayment fee up to 2% of the outstanding principal amount. The term loan facility matures in May 2022. As of August 5, 2015, no amount has been drawn under the term loan facility. We have six months from the effective date to draw on the term loan facility and anticipate that we will fully draw on this facility

49

prior to November 2015. Proceeds from the term loan facility may be used for acquisitions, refinancing of certain existing debt and other general corporate purposes.

        At June 30, 2015 and December 31, 2014, we were in compliance with all of our respective financial covenants.

        On April 1, 2015, we paid off a mortgage with an outstanding balance of $12,364,000 using the unsecured credit facility.

        During the second half of 2015, we plan to pay off two outstanding mortgages with a combined balance of $59,290,000 at June 30, 2015 using proceeds from the unsecured term loan facility or the unsecured credit facility.

        We have substantial borrowing capacity, and may finance our future activities through any of the following methods: (i) offerings of common shares, preferred shares, senior unsecured securities, or other equity and debt securities; (ii) the use and potential expansion of our existing revolving credit lines including the use of the credit line we obtained in September 2014, the term loan facility that closed in May 2015, or the use of a new credit line; (iii) the addition of senior, recourse or non-recourse debt using target acquisitions as well as existing investments as collateral; and/or (iv) the sale of existing investments. We expect to maintain leverage levels that are comparable to those of other commercial property REITs engaged in business strategies similar to our own.

        Our long-term liquidity needs will consist primarily of funds necessary to acquire properties and to pay for development or repositioning of properties, non-recurring capital expenditures and refinancing of indebtedness. We may not have sufficient funds on hand or may not be able to obtain additional financing to cover all of these long-term cash requirements. The nature of our business, and the requirements imposed by REIT rules that we distribute a substantial majority of our REIT taxable income on an annual basis in the form of dividends, may cause us to have substantial liquidity needs over the long-term. We will seek to satisfy our long-term liquidity needs through cash flows from operations, long-term borrowings, debt and/or equity issuances and/or, to the extent appropriate, property dispositions. These sources of funding may not be available on attractive terms or at all. If we cannot obtain additional funding for our long-term liquidity needs, our investments may generate lower cash flows or decline in value, or both, which may cause us to reduce our dividend or sell assets at a time when we would not otherwise do so.

Available Borrowings, Cash Balances and Capital Resources

        We have typically financed our capital needs through investor equity commitments, long-term secured mortgages and short-term lines of credit. As of June 30, 2015 and December 31, 2014, we had total indebtedness, exclusive of debt included in liabilities associated with assets held for sale, of $647,644,000 and $608,714,000, respectively. Included in total indebtedness is $415,000,000 and $360,000,000 of borrowings under credit facilities with total capacity of $850,000,000 at June 30, 2015 and December 31, 2014, respectively. As of August 5, 2015, no amount has been drawn under our new $385,000,000 term loan facility.

Cash Flow Analysis

        As a REIT, our cash flows from operations are typically used to fund our dividends.

        Our cash and cash equivalents, inclusive of cash associated with assets held for sale, totaled $31,194,000 and $27,552,000 at June 30, 2015 and December 31, 2014, respectively. Our cash flows from operating activities are primarily dependent upon the occupancy level of our real estate assets, the rental rates achieved through our leases, the collectability of rent and recoveries from our tenants, and cash flows associated with loans originated at our lending segment. Our cash flows from operating activities are also impacted by fluctuations in operating expenses and other general and administrative

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costs. Net cash provided by operating activities totaled $37,050,000 for the six months ended June 30, 2015, an increase of $380,000 compared to the corresponding period in 2014.

        Our cash flows from investing activities are primarily related to property acquisitions and sales, expenditures for development and redevelopment projects, capital expenditures and cash flows associated with loans originated at our lending segment. Net cash used in investing activities for the six months ended June 30, 2015 was $24,315,000, a decrease of $13,805,000, compared to the corresponding period in 2014. The decrease was primarily due to $44,936,000 in acquisitions of real estate properties in the first six months of 2014, partially offset by a $3,185,000 decrease in cash and cash equivalents related to the cash acquired in the Merger during the first six months of 2014, an increase in loans funded of $16,245,000, and a decrease of $12,290,000 in principal collected on loans due to a reduction in prepayments on our loans receivable.

        Our cash flows from financing activities are generally impacted by borrowings and capital activities. Net cash used in financing activities for the six months ended June 30, 2015 was $9,093,000, an increase of $13,777,000 compared to net cash provided by financial activities of $4,684,000 in the corresponding period in 2014. We used funds from financing activities primarily to pay dividends of $42,963,000 during the six months ended June 30, 2015 compared to distributions of $101,642,000 in the aggregate ($42,356,000 to partners and stockholders and $59,286,000 for the acquisition of PMC Commercial) during the corresponding period in 2014. We had net borrowings, inclusive of borrowings of the lending segment held for sale, of $36,943,000 for the six months ended June 30, 2015 compared to $106,713,000 for the corresponding period in 2014. Additionally, deferred loan costs of $3,415,000 were paid during the six months ended June 30, 2015 primarily related to the $385,000,000 unsecured term loan facility.

CONTRACTUAL OBLIGATIONS, COMMITMENTS AND CONTINGENCIES

        During the six months ended June 30, 2015, there were no material changes outside the ordinary course of business in the information regarding specified contractual obligations contained in our Annual Report on Form 10-K for the year ended December 31, 2014.

OFF BALANCE SHEET ARRANGEMENTS

        At June 30, 2015, we did not have any off-balance sheet arrangements.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

        Our recently issued accounting pronouncements are described in Note 3 to the consolidated financial statements included in this Form 10-Q.

DIVIDENDS

        Our stockholders are entitled to receive dividends when and as declared by the Board of Directors. In determining our dividend policy, the Board of Directors considers many factors including, but not limited to, expectations for future earnings, REIT taxable income (loss) and maintenance of REIT status, the economic environment and portfolio performance. Consequently, the dividend rate on a quarterly basis does not necessarily correlate directly to any individual factor. There can be no assurance that the future dividends declared by our Board of Directors will not differ materially from historical dividend levels.

        On March 6, 2015 and June 12, 2015, we declared common share dividends of $0.21875 per share of Common Stock which were paid on March 27, 2015 and June 29, 2015, respectively.

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ITEM 3.
Quantitative and Qualitative Disclosures About Market Risk

        The fair value of our mortgages payable is sensitive to fluctuations in interest rates. Discounted cash flow analysis is generally used to estimate the fair value of our mortgages payable, using rates ranging from 4.20% to 4.55% at June 30, 2015 and 3.92% to 4.12% at December 31, 2014. Mortgages payable with book values of $207,702,000 and $223,808,000 as of June 30, 2015 and December 31, 2014, respectively, have fair values of approximately $211,953,000 and $231,806,000, respectively.

        Our future income, cash flows and fair values relevant to financial instruments are dependent upon prevalent market interest rates. Market risk refers to the risk of loss from adverse changes in market prices and interest rates. We are exposed to market risk in the form of changes in interest rates and the potential impact such changes may have on the cash flows from our floating rate debt or the fair values of our fixed rate debt. At June 30, 2015 and December 31, 2014, excluding premiums and discounts on assumed mortgages and including the debt associated with assets held for sale, $206,155,000 (or 30.1%) and $221,847,000 (or 34.3%) of our debt, respectively, was fixed rate mortgage loans, and $478,444,000 (or 69.9%) and $425,809,000 (or 65.7%), respectively, was floating rate borrowings. Based on the level of floating rate debt outstanding at June 30, 2015 and December 31, 2014, a 12.5 basis point change in LIBOR would result in an annual impact to our earnings of approximately $598,000 and $532,000, respectively. We calculate interest rate sensitivity by multiplying the amount of floating rate debt by the change in rate. The sensitivity analysis does not take into consideration possible changes in the balances or fair value of our floating rate debt.

ITEM 4.
Controls and Procedures

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

        As of the end of the period covered by this report, we carried out an evaluation under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based upon this evaluation, as of June 30, 2015, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act, are recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

        There have been no changes in our internal control over financial reporting that occurred during the quarter ended June 30, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

52

PART II
Other Information

Item 1.    Legal Proceedings

        We are not currently involved in any material pending or threatened legal proceeding nor, to our knowledge, is any material legal proceeding currently threatened against us, other than routine litigation arising in the ordinary course of business. In the normal course of business we are periodically party to certain legal actions and proceedings involving matters that are generally incidental to our business. While the outcome of these legal actions and proceedings cannot be predicted with certainty, in management's opinion, the resolution of these legal proceedings and actions will not have a material adverse effect on our consolidated financial position, results of operations or cash flows.

Item 1a.    Risk Factors

        There have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K for the year ended December 31, 2014.

Item 2.    Unregistered Sales of Equity and Use of Proceeds

        None.

Item 3.    Defaults Upon Senior Securities

        None.

Item 4.    Mine Safety Disclosures

        Not applicable.

Item 5.    Other Information

        None.

Item 6.    Exhibits

10.1	Second Amendment to Credit Agreement, dated as of May 1, 2015, among CIM Commercial Trust Corporation, each Lender party thereto and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on May 4, 2015).
10.2	Term Loan Agreement, dated as of May 8, 2015, among CIM Commercial Trust Corporation, each guarantor party thereto, Wells Fargo Bank, National Association, as Administrative Agent, Wells Fargo Securities,  LLC and Capital One, National Association, as Joint Lead Arrangers and Joint Bookrunners, Capital One, National Association as Syndication Agent, PNC Bank, National Association as Documentation Agent and each lender party thereto (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on May 8, 2015).
10.3	CIM Commercial Trust Corporation 2015 Equity Incentive Plan, adopted on May 6, 2015 (incorporated by reference to the Registrant's definitive Proxy Statement filed with the SEC on April 17, 2015).
*31.1	Section 302 Officer Certification—Chief Executive Officer
*31.2	Section 302 Officer Certification—Chief Financial Officer

53

*32.1	Section 906 Officer Certification—Chief Executive Officer
*32.2	Section 906 Officer Certification—Chief Financial Officer
*101	Interactive data files pursuant to Rule 405 of Regulation S-T:

*

Filed herewith.

54

SIGNATURES

        Pursuant to the requirements 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.

	CIM COMMERCIAL TRUST CORPORATION
Dated: August 10, 2015	By:	/s/ CHARLES E. GARNER II Charles E. Garner II Chief Executive Officer
Dated: August 10, 2015	By:	/s/ DAVID THOMPSON David Thompson Chief Financial Officer

55

Exhibit Index

Exhibit Number		Exhibit Description
	10.1	Second Amendment to Credit Agreement, dated as of May 1, 2015, among CIM Commercial Trust Corporation, each Lender party thereto and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on May 4, 2015).
	10.2	Term Loan Agreement, dated as of May 8, 2015, among CIM Commercial Trust Corporation, each guarantor party thereto, Wells Fargo Bank, National Association, as Administrative Agent, Wells Fargo Securities,  LLC and Capital One, National Association, as Joint Lead Arrangers and Joint Bookrunners, Capital One, National Association as Syndication Agent, PNC Bank, National Association as Documentation Agent and each lender party thereto (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed with the SEC on May 8, 2015).
	10.3	CIM Commercial Trust Corporation 2015 Equity Incentive Plan, adopted on May 6, 2015 (incorporated by reference to the Registrant's definitive Proxy Statement filed with the SEC on April 17, 2015).
	*31.1	Section 302 Officer Certification—Chief Executive Officer
	*31.2	Section 302 Officer Certification—Chief Financial Officer
	*32.1	Section 906 Officer Certification—Chief Executive Officer
	*32.2	Section 906 Officer Certification—Chief Financial Officer
	*101	Interactive data files pursuant to Rule 405 of Regulation S-T:

*

Filed herewith.

56

EX-31.1

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Exhibit 31.1

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Charles E. Garner II, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of CIM Commercial Trust Corporation;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)

evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)

disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 10, 2015 /s/ CHARLES E. GARNER II
Charles E. Garner II
Chief Executive Officer

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Exhibit 31.1

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

EX-31.2

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Exhibit 31.2

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, David Thompson, certify that:

1.

I have reviewed this quarterly report on Form 10-Q of CIM Commercial Trust Corporation;

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.

The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)

evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)

disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.

The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 10, 2015 /s/ DAVID THOMPSON
David Thompson
Chief Financial Officer

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Exhibit 31.2

CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

EX-32.1

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EXHIBIT 32.1

CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

        In connection with the Quarterly Report of CIM Commercial Trust Corporation (the "Company") on Form 10-Q for the period ended June 30, 2015 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Charles E. Garner II, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

        1.     The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

        2.     The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ CHARLES E. GARNER II
Charles E. Garner II
Chief Executive Officer
August 10, 2015

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EXHIBIT 32.1

CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

EX-32.2

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EXHIBIT 32.2

CERTIFICATION PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

        In connection with the Quarterly Report of CIM Commercial Trust Corporation (the "Company") on Form 10-Q for the period ended June 30, 2015 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, David Thompson, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

        1.     The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

        2.     The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ DAVID THOMPSON
David Thompson
Chief Financial Officer
August 10, 2015

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EXHIBIT 32.2

CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

XML

MERGER (Details 2) - USD ($)		3 Months Ended	6 Months Ended
	Mar. 11, 2014	Jun. 30, 2014	Jun. 30, 2014
Liabilities
Bargain purchase gain			$ (4,918,000)
PMC Commercial
Liabilities
Merger related costs		$ 0	$ 468,000
PMC Commercial | CIM Urban Partners, L.P
Assets
Cash and cash equivalents	$ 3,185,000
Loans receivable	207,140,000
Accounts receivable and interest receivable	755,000
Other assets	5,396,000
Intangible assets	2,957,000
Net assets acquired	219,433,000
Liabilities
Debt	99,849,000
Accounts payable and accrued expenses	7,396,000
Special dividend liability and dividend payable	59,286,000
Other liabilities	3,374,000
Total liabilities assumed	169,905,000
Net identifiable assets acquired	49,528,000
Bargain purchase gain	(4,918,000)
Net purchase price	$ 44,610,000

XML

EARNINGS PER SHARE (''EPS'') (Details 2) - shares	3 Months Ended	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2014	Jun. 30, 2015	Dec. 31, 2014	Apr. 29, 2014	Apr. 28, 2014	Mar. 11, 2014
Earnings per share
Common stock, authorized shares			200,000,000	200,000,000		1,000,000,000
Common shares authorized with effect to the reverse stock split					200,000,000
CIM Urban REIT
Earnings per share
Shares issued in connection with the Merger	91,040,000	91,040,000
Number of shares to be issued on conversion of preferred stock expressed as a percentage of outstanding stock							97.80%
CIM Urban REIT | Preferred Stock
Earnings per share
Shares issued in connection with the Merger	65,000,000	65,000,000

XML

DISCONTINUED OPERATIONS (Details 4) - Held for sale - Lending division - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Principal payments on, and estimated amortization of debt
2015 (Six months ending December 31, 2015)	$ 895
2016	1,229
2017	1,269
2018	1,314
2019	1,361
Thereafter	30,306
Debt	36,374
Secured borrowings - government guaranteed loans
Principal payments on, and estimated amortization of debt
Debt	$ 36,374	$ 38,739

XML

DIVIDENDS DECLARED (Details) - USD ($)					3 Months Ended	6 Months Ended
	Jun. 12, 2014	Apr. 28, 2014	Mar. 24, 2014	Mar. 10, 2014	Jun. 12, 2015	Jun. 30, 2015	Jun. 30, 2014
Dividend declared
Common stock as converted dividend declared (in dollars per share)			$ 0.0285
Dividend paid							$ 16,100,000
Dividend paid							$ 59,286,000
Common stock dividend declared (in dollars per share)	$ 0.21875	$ 0.0215	0.05		$ 0.21875	$ 0.4375	$ 0.26875
Preferred dividend declared (in dollars per share)		$ 0.0302	$ 0.0403				$ 0.0705
Aggregate amount of dividend declared to preferred shareholders		$ 1,964,000					$ 4,585,000
CIM Urban Partners, L.P
Dividend declared
Common stock as converted dividend declared (in dollars per share)				$ 0.1685
Dividend paid				$ 16,100,000
PMC Commercial | CIM Urban Partners, L.P
Dividend declared
Dividend paid				$ 59,286,000
Dividend paid per common stock (in dollars per share)				$ 27.975
Payment in cash - special dividend (in dollars per share)				27.50
Pro rata portion of regular quarterly cash dividend (in dollars per share)				$ 0.475

XML

DISCONTINUED OPERATIONS (Details 2) - Lending division - Held for sale - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Loans receivable
Loans receivable	$ 198,760	$ 188,899
Deferred capitalized costs - net	347	292
Loan loss reserves	(256)	(139)
Net loans receivable	198,851	189,052
Commercial mortgage loans
Loans receivable
Loans receivable	99,955	108,864
SBA 7(a) loans, subject to secured borrowings
Loans receivable
Loans receivable	38,719	41,328
SBA 7(a) Loans
Loans receivable
Loans receivable	40,447	$ 38,707
Commercial real estate loans
Loans receivable
Loans receivable	$ 19,639

XML

COMMITMENTS AND CONTINGENCIES (Tables)

6 Months Ended

Jun. 30, 2015

COMMITMENTS AND CONTINGENCIES.

Schedule of future noncancelable minimum lease payments

Years Ending December 31,	(in thousands)
2015 (Six months ending December 31, 2015)	$	361
2016		743
2017		749
2018		607
2019		503
Thereafter		128,528
	$	131,491

XML

RELATED-PARTY TRANSACTIONS (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014	Mar. 11, 2014
Related-party transactions
Due (from) to related parties	$ 9,807,000		$ 9,807,000		$ 9,186,000
Management Company | Asset management fees
Related-party transactions
Fees	6,176,000	$ 5,798,000	12,318,000	$ 11,479,000
Due (from) to related parties	6,285,000		6,285,000		5,867,000
Management Company | Property management fees
Related-party transactions
Fees	$ 1,463,000	1,272,000	$ 2,926,000	2,531,000
Management Company | 0 - 500,000
Related-party transactions
Fee percentage	0.25%		0.25%
Management Company | 0 - 500,000 | Maximum
Related-party transactions
Daily average gross fair value of investments	$ 500,000,000		$ 500,000,000
Management Company | 500,000 - 1,000,000
Related-party transactions
Fee percentage	0.2375%		0.2375%
Management Company | 500,000 - 1,000,000 | Minimum
Related-party transactions
Daily average gross fair value of investments	$ 500,000,000		$ 500,000,000
Management Company | 500,000 - 1,000,000 | Maximum
Related-party transactions
Daily average gross fair value of investments	$ 1,000,000,000		$ 1,000,000,000
Management Company | 1,000,000 - 1,500,000
Related-party transactions
Fee percentage	0.225%		0.225%
Management Company | 1,000,000 - 1,500,000 | Minimum
Related-party transactions
Daily average gross fair value of investments	$ 1,000,000,000		$ 1,000,000,000
Management Company | 1,000,000 - 1,500,000 | Maximum
Related-party transactions
Daily average gross fair value of investments	$ 1,500,000,000		$ 1,500,000,000
Management Company | 1,500,000 - 4,000,000
Related-party transactions
Fee percentage	0.2125%		0.2125%
Management Company | 1,500,000 - 4,000,000 | Minimum
Related-party transactions
Daily average gross fair value of investments	$ 1,500,000,000		$ 1,500,000,000
Management Company | 1,500,000 - 4,000,000 | Maximum
Related-party transactions
Daily average gross fair value of investments	$ 4,000,000,000		$ 4,000,000,000
Management Company | 4,000,000 - 20,000,000
Related-party transactions
Fee percentage	0.10%		0.10%
Management Company | 4,000,000 - 20,000,000 | Minimum
Related-party transactions
Daily average gross fair value of investments	$ 4,000,000,000		$ 4,000,000,000
Management Company | 4,000,000 - 20,000,000 | Maximum
Related-party transactions
Daily average gross fair value of investments	20,000,000,000		20,000,000,000
CIM Management Entities
Related-party transactions
Due (from) to related parties	1,785,000		1,785,000		2,518,000
Leasing commissions	40,000	839,000	93,000	1,351,000
CIM Management Entities | Personnel
Related-party transactions
Fees	2,229,000	1,749,000	4,286,000	3,793,000
CIM Management Entities | Development management fees
Related-party transactions
Fees	222,000	157,000	447,000	244,000
CIM Management Entities and related parties
Related-party transactions
Due (from) to related parties	(88,000)		(88,000)		76,000
Manager | Master Services Agreement
Related-party transactions
Base service fee for the current year	1,010,000		1,010,000
Due (from) to related parties	1,825,000		1,825,000		$ 725,000
Fees payable per year under agreement						$ 1,000,000
Compensation expensed for performing other services	899,000	290,000	1,590,000	290,000
Manager | Base Service Fee
Related-party transactions
Fees	253,000	$ 250,000	506,000	$ 306,000
CIM SBA
Related-party transactions
Executives jointly employed			2
CIM SBA | Personnel
Related-party transactions
Fees	128,000		251,000
Personnel expenses	$ 1,093,000		$ 2,236,000

XML

MERGER (Tables)

6 Months Ended

Jun. 30, 2015

Merger

Schedule of fair value of consideration transferred, based on market price of PMC Commercial shares on Acquisition Date

	(in thousands, except per share data)
PMC Commercial common stock outstanding		2,119
Equity consideration price per share of common stock	$	21.05
Fair value of the equity consideration		44,610
Payment in cash—special dividend		58,279
Total purchase price	$	102,889

PMC Commercial

Merger

Schedule of allocation of purchase price

	(in thousands)
Assets
Cash and cash equivalents	$	3,185
Loans receivable		207,140
Accounts receivable and interest receivable		755
Other assets		5,396
Intangible assets		2,957
Total assets acquired		219,433
Liabilities
Debt		99,849
Accounts payable and accrued expenses		7,396
Special dividend liability and dividend payable		59,286
Other liabilities		3,374
Total liabilities assumed		169,905
Net identifiable assets acquired		49,528
Bargain purchase gain		(4,918	)
Net purchase price	$	44,610

XML

DEBT (Details) - Range [Domain] - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Debt
Gross debt	$ 648,225,000
Total Debt	647,644,000	$ 608,714,000
Mortgages Payable
Debt
Gross debt	206,155,000	221,847,000
Premiums and discounts on assumed mortgages	1,547,000	1,961,000
Total Debt	207,702,000	223,808,000
Mortgage loan with a fixed interest of 7.66% per annum, due on December 1, 2015
Debt
Gross debt	$ 26,000,000	$ 26,783,000
Fixed interest rate (as a percent)	7.66%	7.66%
Period of amortization schedule	20 years	20 years
Amount of balance due on maturity	$ 25,324,000	$ 25,324,000
Mortgage loan with a fixed interest of 4.50% per annum, due on January 5, 2027
Debt
Gross debt	$ 46,000,000	$ 46,000,000
Fixed interest rate (as a percent)	4.50%	4.50%
Period of amortization schedule	10 years	10 years
Amount of balance due on maturity	$ 42,008,000	$ 42,008,000
Mortgage loan with a fixed interest of 5.56% per annum, due on July 1, 2015
Debt
Gross debt		$ 12,442,000
Fixed interest rate (as a percent)	5.56%	5.56%
Period of amortization schedule	10 years	10 years
Amount of balance due on maturity		$ 12,288,000
Mortgage loan with a fixed interest of 6.65% per annum, due on July 15, 2018
Debt
Gross debt	$ 30,656,000	$ 32,070,000
Fixed interest rate (as a percent)	6.65%	6.65%
Period of amortization schedule	25 years	25 years
Amount of balance due on maturity	$ 21,136,000	$ 21,136,000
Mortgage loan with a fixed interest of 5.06% per annum, due on September 1, 2015
Debt
Gross debt	$ 33,290,000	$ 33,734,000
Fixed interest rate (as a percent)	5.06%	5.06%
Amount of balance due on maturity	$ 33,068,000	$ 33,068,000
Mortgage loan with a fixed interest of 5.39% per annum, due on March 1, 2021
Debt
Gross debt	$ 40,188,000	$ 40,526,000
Fixed interest rate (as a percent)	5.39%	5.39%
Amount of balance due on maturity	$ 35,695,000	$ 35,695,000
Mortgage loan with a fixed interest of 5.18% per annum, due on June 5, 2021
Debt
Gross debt	$ 30,021,000	$ 30,292,000
Fixed interest rate (as a percent)	5.18%	5.18%
Amount of balance due on maturity	$ 26,232,000	$ 26,232,000
Other debt
Debt
Gross debt	442,070,000	387,070,000
Total Debt	439,942,000	384,906,000
Junior subordinated notes
Debt
Gross debt	27,070,000	27,070,000
Premiums and discounts on assumed mortgages	(2,128,000)	(2,164,000)
Face amount	$ 27,070,000	$ 27,070,000
Junior subordinated notes | LIBOR
Debt
Interest rate margin (as a percent)	3.25%	3.25%
Unsecured credit facilities
Debt
Gross debt	$ 415,000,000	$ 360,000,000

XML

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Loans Receivable
(Decrease) increase in impairment allowance on loans receivable	$ 36,000		$ (65,000)
Impairments on loans receivable		$ 0		$ 0
Deferred Rent Receivable and Charges
Deferred rent receivable	55,313,000		55,313,000		$ 53,622,000
Deferred loan costs, gross	10,941,000		10,941,000		7,521,000
Deferred loan costs, accumulated amortization	3,251,000		3,251,000		1,741,000
Deferred leasing costs, gross	56,511,000		56,511,000		55,145,000
Deferred leasing costs, accumulated amortization	$ 19,462,000		$ 19,462,000		$ 16,917,000

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ORGANIZATION AND OPERATIONS (Details)	Apr. 29, 2014 $ / shares shares	Jun. 30, 2015 $ / shares shares	Dec. 31, 2014 $ / shares shares	Apr. 28, 2014 shares
Organization and operations
Common shares authorized		200,000,000	200,000,000	1,000,000,000
Common shares authorized before amendment with effect to the reverse stock split				20,000,000
Common shares authorized with effect to the reverse stock split	200,000,000
Reverse stock split ratio	0.2
Common stock, par value (in dollars per share) | $ / shares	$ 0.001	$ 0.001	$ 0.001
PMC Commercial
Organization and operations
Common shares authorized before amendment				100,000,000
Common shares authorized				1,000,000,000

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STOCK-BASED COMPENSATION PLANS (Details)					1 Months Ended	3 Months Ended		6 Months Ended		10 Months Ended
	Mar. 06, 2015 shares	Jun. 12, 2014 $ / shares shares	May. 06, 2014 shares	Mar. 11, 2014 shares	Apr. 30, 2015 shares	Jun. 30, 2015 USD ($)	Jun. 30, 2014 USD ($)	Jun. 30, 2015 USD ($)	Jun. 30, 2014 USD ($)	Mar. 05, 2015 item shares
Share-based compensation plans
Options granted		11,850
Restricted share awards
Share-based compensation plans
Unrecognized compensation expense | $						$ 103,000		$ 103,000
Recognition period								2 years
Options
Share-based compensation plans
Stock-based compensation expense | $							$ 8,000		$ 8,000
Option exercise price | $ / shares		$ 23.16
Independent directors | Restricted share awards
Share-based compensation plans
Award granted to each independent members of the board of directors				2,000	2,000
Granted (in shares)				6,000	6,000
Stock-based compensation expense | $						27,000	31,000	$ 59,000	31,000
Executive officers | Restricted share awards
Share-based compensation plans
Granted (in shares)	2,000		2,000							4,000
Stock-based compensation expense | $						$ 8,000	$ 19,000	$ 26,000	$ 19,000
Number of executive officers | item										2
Award vesting period										2 years
Percentage of award vesting immediately and at the end of each of the next two years										33.00%

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SEGMENT DISCLOSURE (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015 USD ($)	Jun. 30, 2014 USD ($)	Jun. 30, 2015 USD ($) item	Jun. 30, 2014 USD ($)
Segment disclosure
Number of types of commercial real estate properties | item			3
Revenues	$ 66,919	$ 65,187	$ 134,158	$ 127,784
Property expenses:
General and administrative	1,955	2,357	4,547	3,131
EXPENSES	65,921	61,017	133,390	118,248
Reportable segments
Property expenses:
Total segment net operating income	33,693	34,582	67,786	67,215
Reportable segments | Office
Segment disclosure
Revenues	47,084	45,181	93,699	88,455
Property expenses:
Operating	20,060	17,933	39,451	35,586
General and administrative	113	76	426	392
EXPENSES	20,173	18,009	39,877	35,978
Total segment net operating income	26,911	27,172	53,822	52,477
Reportable segments | Hotel
Segment disclosure
Revenues	15,822	14,798	31,541	29,137
Property expenses:
Operating	9,987	9,923	20,664	19,769
General and administrative	38	36	79	73
EXPENSES	10,025	9,959	20,743	19,842
Total segment net operating income	5,797	4,839	10,798	9,295
Reportable segments | Multi-family
Segment disclosure
Revenues	4,013	5,208	8,918	10,192
Property expenses:
Operating	2,938	2,583	5,579	4,670
General and administrative	90	54	173	79
EXPENSES	3,028	2,637	5,752	4,749
Total segment net operating income	$ 985	$ 2,571	$ 3,166	$ 5,443

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DISCONTINUED OPERATIONS (Details 3) - Lending division - Held for sale - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Debt
Debt	$ 36,374
Total Debt	39,280	$ 41,901
Secured borrowings - government guaranteed loans
Debt
Debt	36,374	38,739
Unamortized Premiums or discounts on debt instruments	2,906	3,162
Total Debt	$ 39,280	$ 41,901
Secured borrowing principal on loans sold for a premium and excess spread-variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 4.03% and 3.92% at June 30, 2015 and December 31 , 2014 ,respectively
Debt
Weighted average coupon rate (as a percent)	4.03%	3.92%
Debt	$ 31,358	$ 33,654
Secured borrowing principal on loans sold for excess spread, variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 1.58%
Debt
Weighted average coupon rate (as a percent)	1.58%	1.58%
Debt	$ 5,016	$ 5,085

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MERGER

6 Months Ended

Jun. 30, 2015

MERGER

MERGER

2. MERGER

        The Merger Agreement provided for the business combination of CIM REIT's wholly owned subsidiary, CIM Urban, and PMC Commercial. Pursuant to the Merger Agreement, an affiliate of CIM REIT received 4,400,000 shares of newly-issued PMC Commercial Common Stock and approximately 65,000,000 shares of newly-issued PMC Commercial preferred stock. Following the Merger and subsequent increase in our authorized number of shares, each share of preferred stock was converted into 1.4 shares of PMC Commercial Common Stock, resulting in the issuance of 95,440,000 shares of common stock in the aggregate in connection with the Merger, representing approximately 97.8% of PMC Commercial's outstanding shares of common stock.

        All shares of PMC Commercial Common Stock that were outstanding immediately prior to the closing of the Merger continued to remain outstanding following the Acquisition Date. In addition, stockholders of record of PMC Commercial at the close of the business day prior to the Acquisition Date received a special cash dividend of $27.50 per share of common stock plus that pro-rata portion of PMC Commercial's regular quarterly cash dividend accrued through the Acquisition Date, each of which was paid on March 25, 2014.

        The Merger was accounted for as a reverse acquisition under the acquisition method of accounting with CIM Urban considered to be the accounting acquirer based upon the terms of the Merger Agreement. Based on the determination that CIM Urban was the accounting acquirer in the transaction, CIM Urban allocated the purchase price to the fair value of PMC Commercial's assets and liabilities as of the Acquisition Date.

        Accordingly, the accompanying financial statements include (1) the historical financial information for CIM Urban for all periods presented, (2) the assets and liabilities of PMC Commercial acquired on March 11, 2014 and still owned or held by us in the consolidated balance sheet as of December 31, 2014 and June 30, 2015, respectively, and (3) the results of PMC Commercial's operations and cash flows in the consolidated statements of operations and comprehensive income and cash flows from the Acquisition Date. The equity of CIM Commercial is the historical equity of CIM Urban retroactively restated to reflect the number of shares of stock issued by PMC Commercial pursuant to the Merger Agreement. In connection with the reverse acquisition, for purposes of presenting equity for CIM Commercial, the historical stockholders of PMC Commercial were deemed to have been issued 2,119,244 shares of Common Stock (2,226,509 shares of Common Stock, less 107,265 shares of treasury stock) on the Acquisition Date.

        Consideration Transferred—The fair value of the consideration transferred in the reverse acquisition is determined based on the number of shares of stock the accounting acquirer would have to issue to the stockholders of the accounting acquiree in order to provide the same ratio of ownership in the combined entity following the completion of the Merger, and was determined to be the outstanding stock of PMC Commercial as of the Acquisition Date. The fair value of the consideration transferred was based on the most reliable measure, which was determined to be the market price of PMC Commercial stock as of the Acquisition Date. The computation of the fair value of the consideration transferred, based on the market price of PMC Commercial stock on the Acquisition Date, is as follows:

	(in thousands, except per share data)
PMC Commercial common stock outstanding		2,119
Equity consideration price per share of common stock	$	21.05
Fair value of the equity consideration		44,610
Payment in cash—special dividend		58,279
Total purchase price	$	102,889

        Purchase Price Allocation—As CIM Urban was the accounting acquirer in the business combination, it has allocated the purchase price to PMC Commercial's individually identifiable assets acquired and liabilities assumed based on their estimated fair values on the Acquisition Date. A bargain purchase gain was recorded as of the Acquisition Date in the amount equal to the excess of the fair value of the identifiable net assets acquired over the total purchase price.

        The following table summarizes the allocation of the purchase price:

	(in thousands)
Assets
Cash and cash equivalents	$	3,185
Loans receivable		207,140
Accounts receivable and interest receivable		755
Other assets		5,396
Intangible assets		2,957
Total assets acquired		219,433
Liabilities
Debt		99,849
Accounts payable and accrued expenses		7,396
Special dividend liability and dividend payable		59,286
Other liabilities		3,374
Total liabilities assumed		169,905
Net identifiable assets acquired		49,528
Bargain purchase gain		(4,918	)
Net purchase price	$	44,610

        In order to allow CIM Commercial to increase its focus on Class A and creative office properties, our board of directors (the "Board of Directors") approved a plan for the lending business that, when completed, will result in the deconsolidation of the lending segment. As a result, the lending segment was held for sale at June 30, 2015 and December 31, 2014 (see Note 6).

        For the three and six months ended June 30, 2014, Merger related costs of $0 and $468,000, respectively, were included in transaction costs.

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SEGMENT DISCLOSURE (Details 2) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Segment disclosure
Interest	$ (5,586)	$ (4,565)	$ (10,989)	$ (8,602)
General and administrative	(1,955)	(2,357)	(4,547)	(3,131)
Asset management fees and other fees to related parties	(7,456)	(6,338)	(14,665)	(12,075)
Transaction costs	(373)	(32)	(801)	(500)
Depreciation and amortization	(17,566)	(17,286)	(36,694)	(33,915)
Bargain purchase gain				4,918
INCOME FROM CONTINUING OPERATIONS	998	4,170	768	14,454
Income from operations of assets held for sale	3,984	4,344	6,946	5,277
INCOME FROM DISCONTINUED OPERATIONS	3,984	4,344	6,946	5,277
NET INCOME	4,982	8,514	7,714	19,731
Net income attributable to noncontrolling interests	(6)	(115)	(6)	(113)
NET INCOME ATTRIBUTABLE TO STOCKHOLDERS	4,976	8,399	7,708	19,618
Reportable segments
Segment disclosure
Total segment net operating income	33,693	34,582	67,786	67,215
Reconciliation
Segment disclosure
Interest	(5,586)	(4,565)	(10,989)	(8,602)
General and administrative	(1,714)	(2,191)	(3,869)	(2,587)
Asset management fees and other fees to related parties	(7,456)	(6,338)	(14,665)	(12,075)
Transaction costs	(373)	(32)	(801)	(500)
Depreciation and amortization	$ (17,566)	$ (17,286)	$ (36,694)	$ (33,915)

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INVESTMENTS IN REAL ESTATE (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
INVESTMENTS IN REAL ESTATE
Land	$ 354,035,000		$ 354,035,000		$ 354,035,000
Land improvements	28,071,000		28,071,000		28,071,000
Buildings and improvements	1,504,902,000		1,504,902,000		1,501,603,000
Furniture, fixtures, and equipment	8,914,000		8,914,000		10,875,000
Tenant improvements	142,306,000		142,306,000		131,446,000
Work in progress	5,862,000		5,862,000		10,764,000
Investments in real estate	2,044,090,000		2,044,090,000		2,036,794,000
Accumulated depreciation	(343,676,000)		(343,676,000)		(320,857,000)
Net investments in real estate	1,700,414,000		1,700,414,000		$ 1,715,937,000
Depreciation expense	$ 15,063,000	$ 14,705,000	$ 31,343,000	$ 28,852,000

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DISCONTINUED OPERATIONS (Tables)

6 Months Ended

Jun. 30, 2015

DISCONTINUED OPERATIONS

Reconciliation of the carrying amounts of assets and liabilities that are classified as held for sale

	June 30, 2015		December 31, 2014
	(in thousands)
Assets held for sale
Loans receivable, net	$	198,851	$	189,052
Cash and cash equivalents		8,642		9,937
Restricted cash		965		916
Accounts receivable and interest receivable, net		733		738
Other intangible assets		2,957		2,957
Other assets		5,270		5,199
Total assets held for sale	$	217,418	$	208,799
Liabilities associated with assets held for sale
Debt	$	39,280	$	41,901
Accounts payable and accrued expenses		2,101		2,709
Other liabilities		4,001		5,181
Total liabilities associated with assets held for sale	$	45,382	$	49,791

Schedule of loans receivable

	June 30, 2015			December 31, 2014
	(in thousands)
Commercial mortgage loans	$	99,955		$	108,864
SBA 7(a) loans, subject to secured borrowings		38,719			41,328
SBA 7(a) loans		40,447			38,707
Commercial real estate loans		19,639			—
Loans receivable		198,760			188,899
Deferred capitalized costs, net		347			292
Loan loss reserves		(256	)		(139	)
Net loans receivable	$	198,851		$	189,052

Schedule of debt

	June 30, 2015		December 31, 2014
	(in thousands)
Secured borrowing principal on loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 4.03% and 3.92% at June 30, 2015 and December 31, 2014, respectively	$	31,358	$	33,654
Secured borrowing principal on loans sold for excess spread, variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 1.58%		5,016		5,085
		36,374		38,739
Unamortized premiums on loans sold for a premium and excess spread		2,906		3,162
Total secured borrowings—government guaranteed loans	$	39,280	$	41,901

Schedule of future principal payments on our debt

Years Ending December 31,	Secured Borrowings Principal(1)
	(in thousands)
2015 (Six months ending December 31, 2015)	$	895
2016		1,229
2017		1,269
2018		1,314
2019		1,361
Thereafter		30,306
	$	36,374

(1)           Principal payments are generally dependent upon cash flows received from the underlying loans. Our estimate of their repayment is based on scheduled principal payments on the underlying loans. Our estimate will differ from actual amounts to the extent we experience prepayments and/or loan liquidations or charge-offs. No payment is due unless payments are received from the borrowers on the underlying loans.

Reconciliation of the revenue and expenses classified as discontinued operations

	Three Months Ended June 30, 2015		Three Months Ended June 30, 2014
	(in thousands)
Revenue—Interest and other income	$	5,768	$	6,271
Expenses:
Interest expense		120		374
Fees to related party(1)		1,093		—
General and administrative(1)		294		1,253
Provision for income taxes		277		300
Total expenses		1,784		1,927
Income from operations of assets held for sale	$	3,984	$	4,344

(1)           Salaries and related benefits of $1,018,000 were included in general and administrative expense for the three months ended June 30, 2014 while, as a result of the transfer of our employees to an affiliate (see Note 12), such expenses were included in fees to related party for the three months ended June 30, 2015.

	Six Months Ended June 30, 2015		From the Acquisition Date through June 30, 2014
	(in thousands)
Revenue—Interest and other income	$	10,946	$	7,797
Expenses:
Interest expense		421		554
Fees to related party(1)		2,236		—
General and administrative(1)		868		1,658
Provision for income taxes		475		308
Total expenses		4,000		2,520
Income from operations of assets held for sale	$	6,946	$	5,277

(1)           Salaries and related benefits of $1,325,000 were included in general and administrative expense for the period from the Acquisition Date through June 30, 2014 while, as a result of the transfer of our employees to an affiliate (see Note 12), such expenses were included in fees to related party for the six months ended June 30, 2015.

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OTHER INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2015

OTHER INTANGIBLE ASSETS

Schedule of intangible assets and liabilities and related accumulated amortization and accretion

	Assets															Liabilities
June 30, 2015	Acquired Above-Market Leases			Acquired In-Place Leases			Tax Abatement			Franchise Affiliation Fee			Acquired Below-Market Ground Lease			Acquired Below-Market Leases
	(in thousands)
Gross balance	$	1,072		$	21,431		$	4,273		$	3,936		$	11,685		$	(19,750	)
Accumulated amortization		(867	)		(16,269	)		(2,047	)		(3,179	)		(1,352	)		12,403
	$	205		$	5,162		$	2,226		$	757		$	10,333		$	(7,347	)
Average useful life (in years)		6			8			8			10			84			8

	Assets															Liabilities
December 31, 2014	Acquired Above-Market Leases			Acquired In-Place Leases			Tax Abatement			Franchise Affiliation Fee			Acquired Below-Market Ground Lease			Acquired Below-Market Leases
	(in thousands)
Gross balance	$	2,402		$	22,680		$	4,273		$	3,936		$	11,685		$	(20,333	)
Accumulated amortization		(2,039	)		(16,470	)		(1,771	)		(2,981	)		(1,282	)		11,676
	$	363		$	6,210		$	2,502		$	955		$	10,403		$	(8,657	)
Average useful life (in years)		7			8			8			10			84			8

Schedule of future amortization and accretion of acquisition related intangible assets and liabilities

	Assets										Liabilities
Years Ending December 31,	Acquired Above-Market Leases		Acquired In-Place Leases		Tax Abatement		Franchise Affiliation Fee		Acquired Below-Market Ground Lease		Acquired Below-Market Leases
	(in thousands)
2015 (Six months ending December 31, 2015)	$	83	$	793	$	275	$	196	$	70	$	(1,259	)
2016		88		1,346		551		394		140		(2,502	)
2017		26		915		551		167		140		(2,399	)
2018		8		666		551		—		140		(963	)
2019		—		488		298		—		140		(224	)
Thereafter		—		954		—		—		9,703		—
	$	205	$	5,162	$	2,226	$	757	$	10,333	$	(7,347	)

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FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands		6 Months Ended	12 Months Ended
	Dec. 31, 2014	Jun. 30, 2015	Dec. 31, 2014
Loans receivable subject to credit risk
Fair Value Inputs [Abstract]
Rate of prepayment (as a percent)	15.00%	15.00%
SBA 7(a) loans, subject to secured borrowings
Fair Value Inputs [Abstract]
Rate of prepayment (as a percent)		15.00%
Commercial real estate loans
Fair Value Inputs [Abstract]
Discount rate used to estimate fair value (as a percent)		9.72%
Rate of prepayment (as a percent)		0.00%
Potential credit deterioration (as a percent)		0.00%
Minimum | Loans receivable subject to credit risk
Fair Value Inputs [Abstract]
Discount rate used to estimate fair value (as a percent)		6.75%	5.90%
Maximum | Loans receivable subject to credit risk
Fair Value Inputs [Abstract]
Discount rate used to estimate fair value (as a percent)		15.00%	14.90%
Carrying Amount
Liabilities:
Junior subordinated notes	$ 24,906	$ 24,942	$ 24,906
Mortgages payable	223,808	207,702	223,808
Unsecured credit facilities	360,000	415,000	360,000
Secured borrowings - government guaranteed loans	41,901	39,280	41,901
Carrying Amount | Loans receivable subject to credit risk
Assets:
Loans receivable	147,648	140,385	147,648
Carrying Amount | SBA 7(a) loans, subject to secured borrowings
Assets:
Loans receivable	41,404	38,793	41,404
Carrying Amount | Commercial real estate loans
Assets:
Loans receivable		19,673
Estimated Fair Value | Level 3
Liabilities:
Junior subordinated notes	24,877	24,955	24,877
Mortgages payable	231,806	211,953	231,806
Unsecured credit facilities	360,000	415,000	360,000
Secured borrowings - government guaranteed loans	41,901	39,280	41,901
Estimated Fair Value | Level 3 | Loans receivable subject to credit risk
Assets:
Loans receivable	154,252	146,482	154,252
Estimated Fair Value | Level 3 | SBA 7(a) loans, subject to secured borrowings
Assets:
Loans receivable	$ 41,901	39,596	$ 41,901
Estimated Fair Value | Level 3 | Commercial real estate loans
Assets:
Loans receivable		$ 19,639
Mortgages payable. | Minimum
Fair Value Inputs [Abstract]
Discount rate used to estimate fair value (as a percent)		4.20%	3.92%
Mortgages payable. | Maximum
Fair Value Inputs [Abstract]
Discount rate used to estimate fair value (as a percent)		4.55%	4.12%
Junior subordinated notes
Fair Value Inputs [Abstract]
Discount rate used to estimate fair value (as a percent)		4.11%	3.83%

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OTHER INTANGIBLE ASSETS (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Intangible assets and liabilities
Amortization expenses	$ 17,566,000	$ 17,286,000	$ 36,694,000	$ 33,915,000
Intangible liabilities
Net	(7,347,000)		(7,347,000)		$ (8,657,000)
Future accretion of acquisition related intangible liabilities
Net	(7,347,000)		(7,347,000)		(8,657,000)
Acquired Below-Market Leases
Intangible assets and liabilities
Amortization expenses	655,000	697,000	1,310,000	1,345,000
Intangible liabilities
Gross balance	(19,750,000)		(19,750,000)		(20,333,000)
Accumulated amortization	12,403,000		12,403,000		11,676,000
Net	(7,347,000)		$ (7,347,000)		$ (8,657,000)
Average useful life			8 years		8 years
Future accretion of acquisition related intangible liabilities
2015 (Six months ending December 31, 2015)	(1,259,000)		$ (1,259,000)
2016	(2,502,000)		(2,502,000)
2017	(2,399,000)		(2,399,000)
2018	(963,000)		(963,000)
2019	(224,000)		(224,000)
Net	(7,347,000)		(7,347,000)		$ (8,657,000)
Acquired Above-Market Leases
Intangible assets and liabilities
Amortization expenses	79,000	98,000	158,000	435,000
Intangible assets
Gross balance	1,072,000		1,072,000		2,402,000
Accumulated amortization	(867,000)		(867,000)		(2,039,000)
Net	205,000		$ 205,000		$ 363,000
Average useful life			6 years		7 years
Future amortization of acquisition related intangible assets
2015 (Six months ending December 31, 2015)	83,000		$ 83,000
2016	88,000		88,000
2017	26,000		26,000
2018	8,000		8,000
Net	205,000		205,000		$ 363,000
Acquired In-Place Leases
Intangible assets and liabilities
Amortization expenses	519,000	587,000	1,048,000	1,199,000
Intangible assets
Gross balance	21,431,000		21,431,000		22,680,000
Accumulated amortization	(16,269,000)		(16,269,000)		(16,470,000)
Net	5,162,000		$ 5,162,000		$ 6,210,000
Average useful life			8 years		8 years
Future amortization of acquisition related intangible assets
2015 (Six months ending December 31, 2015)	793,000		$ 793,000
2016	1,346,000		1,346,000
2017	915,000		915,000
2018	666,000		666,000
2019	488,000		488,000
Thereafter	954,000		954,000
Net	5,162,000		5,162,000		$ 6,210,000
Tax Abatement
Intangible assets and liabilities
Amortization expenses	138,000	138,000	276,000	276,000
Intangible assets
Gross balance	4,273,000		4,273,000		4,273,000
Accumulated amortization	(2,047,000)		(2,047,000)		(1,771,000)
Net	2,226,000		$ 2,226,000		$ 2,502,000
Average useful life			8 years		8 years
Future amortization of acquisition related intangible assets
2015 (Six months ending December 31, 2015)	275,000		$ 275,000
2016	551,000		551,000
2017	551,000		551,000
2018	551,000		551,000
2019	298,000		298,000
Net	2,226,000		2,226,000		$ 2,502,000
Advance Bookings
Intangible assets and liabilities
Amortization expenses	0	67,000	0	134,000
Franchise Affiliation Fee
Intangible assets and liabilities
Amortization expenses	99,000	99,000	198,000	198,000
Intangible assets
Gross balance	3,936,000		3,936,000		3,936,000
Accumulated amortization	(3,179,000)		(3,179,000)		(2,981,000)
Net	757,000		$ 757,000		$ 955,000
Average useful life			10 years		10 years
Future amortization of acquisition related intangible assets
2015 (Six months ending December 31, 2015)	196,000		$ 196,000
2016	394,000		394,000
2017	167,000		167,000
Net	757,000		757,000		$ 955,000
Acquired Below-Market Ground Lease
Intangible assets and liabilities
Amortization expenses	35,000	$ 35,000	70,000	$ 70,000
Intangible assets
Gross balance	11,685,000		11,685,000		11,685,000
Accumulated amortization	(1,352,000)		(1,352,000)		(1,282,000)
Net	10,333,000		$ 10,333,000		$ 10,403,000
Average useful life			84 years		84 years
Future amortization of acquisition related intangible assets
2015 (Six months ending December 31, 2015)	70,000		$ 70,000
2016	140,000		140,000
2017	140,000		140,000
2018	140,000		140,000
2019	140,000		140,000
Thereafter	9,703,000		9,703,000
Net	$ 10,333,000		$ 10,333,000		$ 10,403,000

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DEBT (Tables)

6 Months Ended

Jun. 30, 2015

DEBT

Schedule of debt

	June 30, 2015			December 31, 2014
	(in thousands)
Mortgage loan with a fixed interest rate of 7.66% per annum, with monthly payments of principal and interest. The loan has a 20-year amortization schedule with a $25,324,000 balance due on December 1, 2015. The loan is nonrecourse.	$	26,000		$	26,783
Mortgage loan with a fixed interest rate of 4.50% per annum, with monthly payments of interest only for 10 years, and payments of interest and principal starting in February 2022. The loan has a $42,008,000 balance due on January 5, 2027. The loan is nonrecourse.		46,000			46,000
Mortgage loan with a fixed interest rate of 5.56% per annum, with monthly payments of principal and interest. The loan had a 10-year amortization schedule with a $12,288,000 balance due on July 1, 2015. The loan was nonrecourse. The loan was paid in full in April 2015.		—			12,442
Mortgage loan with a fixed interest rate of 6.65% per annum, with monthly payments of principal and interest. The loan has a 25-year amortization schedule with a $21,136,000 balance due on July 15, 2018. The loan is nonrecourse.		30,656			32,070
Mortgage loan with a fixed interest rate of 5.06% per annum, with monthly payments of principal and interest, and a balance of $33,068,000 due on September 1, 2015. The loan is nonrecourse.		33,290			33,734
Mortgage loans with a fixed interest rate of 5.39% per annum, with monthly payments of principal and interest, and a balance of $35,695,000 due on March 1, 2021. The loans are nonrecourse.		40,188			40,526
Mortgage loan with a fixed interest rate of 5.18% per annum, with monthly payments of principal and interest, and a balance of $26,232,000 due on June 5, 2021. The loan is nonrecourse.		30,021			30,292
		206,155			221,847
Premiums and discounts on assumed mortgages		1,547			1,961
Total Mortgages Payable		207,702			223,808
Junior subordinated notes with a variable interest rate which resets quarterly based on the 90-day LIBOR plus 3.25%, with quarterly interest only payments. Balance due at maturity on March 30, 2035.		27,070			27,070
Unsecured credit facilities		415,000			360,000
		442,070			387,070
Discount on junior subordinated notes		(2,128	)		(2,164	)
Total Other		439,942			384,906
Total Debt	$	647,644		$	608,714

Schedule of principal payments on, and estimated amortization of debt (face value)

Years Ending December 31,	Mortgages Payable		Other(1)		Total
	(in thousands)
2015 (Six Months Ending December 31, 2015)	$	61,363	$	—	$	61,363
2016		4,354		415,000		419,354
2017		4,642		—		4,642
2018		24,300		—		24,300
2019		1,519		—		1,519
Thereafter		109,977		27,070		137,047
	$	206,155	$	442,070	$	648,225

(1)           Represents the junior subordinated notes and unsecured credit facility.

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FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2015

FAIR VALUE OF FINANCIAL INSTRUMENTS

Schedule of estimated fair values of financial instruments not recorded at fair value on consolidated balance sheets

	June 30, 2015				December 31, 2014
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value		Level
	(in thousands)
Assets held for sale:
Loans receivable subject to credit risk	$	140,385	$	146,482	$	147,648	$	154,252		3
SBA 7(a) loans receivable, subject to secured borrowings		38,793		39,596		41,404		41,901		3
Commercial real estate loans		19,673		19,639		—		—		3
Liabilities:
Secured borrowings—government guaranteed loans, included in liabilities associated with assets held for sale		39,280		39,280		41,901		41,901		3
Junior subordinated notes		24,942		24,955		24,906		24,877		3
Mortgages payable		207,702		211,953		223,808		231,806		3
Unsecured credit facilities		415,000		415,000		360,000		360,000		3

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ORGANIZATION AND OPERATIONS

6 Months Ended

Jun. 30, 2015

ORGANIZATION AND OPERATIONS

ORGANIZATION AND OPERATIONS

1. ORGANIZATION AND OPERATIONS

        CIM Commercial Trust Corporation ("CIM Commercial") together with its wholly-owned subsidiaries (which, together with CIM Commercial may be referred to as "we," "us" or "our") primarily acquires, owns, and operates Class A and creative office properties in vibrant and improving urban communities throughout the United States. These communities are located in areas that include traditional downtown areas and suburban main streets, which have high barriers to entry, high population density, improving demographic trends and a propensity for growth. We also obtain income from the yield and other related fee income earned on our investments from our lending activities, which have principally been to borrowers in the hospitality industry. As discussed in Note 6, the lending segment is held for sale at June 30, 2015 and December 31, 2014. We were originally organized in 1993 as PMC Commercial Trust ("PMC Commercial"), a Texas real estate investment trust.

        On July 8, 2013, PMC Commercial entered into a merger agreement (the "Merger Agreement") with CIM Urban REIT, LLC ("CIM REIT") and subsidiaries of the respective parties. CIM REIT was a private commercial REIT and was the owner of CIM Urban Partners, LP ("CIM Urban"). The transaction (the "Merger") was completed on March 11, 2014 (the "Acquisition Date"). The Merger was accounted for as a reverse acquisition under the acquisition method of accounting with CIM Urban considered to be the accounting acquirer based upon the terms of the Merger Agreement. Based on the determination that CIM Urban was the accounting acquirer in the transaction, CIM Urban allocated the purchase price to the fair value of PMC Commercial's assets and liabilities as of the Acquisition Date.

        On April 28, 2014, PMC Commercial's charter was amended to increase the authorized shares of common stock of PMC Commercial from 100,000,000 to 1,000,000,000 shares (20,000,000 and 200,000,000 after giving effect to the reverse stock split described below) and PMC Commercial changed its state of incorporation (the "Reincorporation") from Texas to Maryland by means of a merger of PMC Commercial with and into a newly formed, wholly-owned Maryland corporation subsidiary. Also on April 28, 2014, we changed our name from "PMC Commercial Trust" to "CIM Commercial Trust Corporation." Our common stock ("Common Stock") is currently traded on the NASDAQ Global Market (symbol "CMCT").

        On April 28, 2014, we filed Articles of Amendment (the "Reverse Split Amendment") to effectuate a one-for-five reverse stock split of the Common Stock, effective April 29, 2014. Pursuant to the reverse stock split, each five shares of Common Stock issued and outstanding immediately prior to the effective time of the reverse stock split were converted into one share of Common Stock. Fractional shares of Common Stock were not issued as a result of the reverse stock split; instead, holders of pre-split shares of Common Stock who otherwise would have been entitled to receive a fractional share of Common Stock received an amount in cash equal to the product of the fraction of a share multiplied by the closing price of the Common Stock (as adjusted for the one-for-five reverse stock split). In connection with and immediately following the filing of the Reverse Split Amendment, we filed Articles of Amendment (the "Par Value Amendment") to decrease the par value of the Common Stock issued and outstanding to $0.001 per share, effective April 29, 2014, subsequent to the effective time of the Reverse Split Amendment. All per share and outstanding share information has been presented to reflect the reverse stock split.

        CIM Commercial has qualified and intends to continue to qualify as a real estate investment trust ("REIT"), as defined in the Internal Revenue Code of 1986, as amended.

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RELATED-PARTY TRANSACTIONS (Tables)

6 Months Ended

Jun. 30, 2015

RELATED-PARTY TRANSACTIONS

Schedule of calculation of asset management fees payable to related party as a percentage of the daily average gross fair value of investments

Daily Average Adjusted Fair Value of CIM Urban's Investments
				Quarterly Fee Percentage
From Greater of		To and Including
(in thousands)
$	—	$	500,000		0.2500	%
	500,000		1,000,000		0.2375	%
	1,000,000		1,500,000		0.2250	%
	1,500,000		4,000,000		0.2125	%
	4,000,000		20,000,000		0.1000	%

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Investments in Real Estate
Impairment of long-lived assets	$ 0	$ 0	$ 0	$ 0
Buildings and improvements | Minimum
Investments in Real Estate
Estimated useful lives			15 years
Buildings and improvements | Maximum
Investments in Real Estate
Estimated useful lives			40 years
Furniture, fixtures, and equipment | Minimum
Investments in Real Estate
Estimated useful lives			3 years
Furniture, fixtures, and equipment | Maximum
Investments in Real Estate
Estimated useful lives			5 years

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EARNINGS PER SHARE (''EPS'') (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
EARNINGS PER SHARE ("EPS")
Weighted average shares outstanding	97,589,000	97,571,000	97,586,000	96,758,000
Options
Earnings per share
Increase in weighted average shares outstanding to reflect the dilutive effect of share options (in shares)	0	5,000	0	6,000

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CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
ASSETS
Investments in real estate - net	$ 1,700,414	$ 1,715,937
Cash and cash equivalents	22,552	17,615
Restricted cash	7,612	8,861
Accounts receivable - net	12,450	10,754
Deferred rent receivable and charges - net	100,052	97,630
Other intangible assets - net	18,683	20,433
Other assets	11,607	14,653
Assets held for sale-net	217,418	208,799
TOTAL ASSETS	2,090,788	2,094,682
LIABILITIES:
Debt	647,644	608,714
Accounts payable and accrued expenses	29,840	35,512
Intangible liabilities - net	7,347	8,657
Due to related parties	9,807	9,186
Other liabilities	25,142	23,006
Liabilities associated with assets held for sale	45,382	49,791
Total liabilities	$ 765,162	$ 734,866
COMMITMENTS AND CONTINGENCIES (Note 13)
EQUITY:
Common stock, $0.001 par value; 200,000,000 shares authorized; 97,696,863 and 97,688,863 shares issued; and 97,589,598 and 97,581,598 shares outstanding at June 30, 2015 and December 31, 2014, respectively	$ 98	$ 98
Additional paid-in capital	1,825,098	1,824,381
Distributions in excess of earnings	(495,608)	(460,623)
Stockholders' equity before treasury stock	1,329,588	1,363,856
Less: Treasury stock, at cost, 107,265 shares outstanding	(4,901)	(4,901)
Total stockholders' equity	1,324,687	1,358,955
Noncontrolling interests	939	861
Total equity	1,325,626	1,359,816
TOTAL LIABILITIES AND EQUITY	$ 2,090,788	$ 2,094,682

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DISCONTINUED OPERATIONS (Details) - USD ($)	3 Months Ended	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2015	Dec. 31, 2014
Disposal Group, Including Discontinued Operation, Assets [Abstract]
Assets held for sale	$ 217,418,000	$ 217,418,000	$ 208,799,000
Liabilities of assets held for sale
Total liabilities associated with assets held for sale	45,382,000	45,382,000	49,791,000
Lending division | Held for sale
DISCONTINUED OPERATIONS
Transaction costs	61,000	224,000
Disposal Group, Including Discontinued Operation, Assets [Abstract]
Loans receivable-net	198,851,000	198,851,000	189,052,000
Cash and cash equivalents	8,642,000	8,642,000	9,937,000
Restricted cash	965,000	965,000	916,000
Accounts receivable and interest receivable-net	733,000	733,000	738,000
Other intangible assets	2,957,000	2,957,000	2,957,000
Other assets	5,270,000	5,270,000	5,199,000
Assets held for sale	217,418,000	217,418,000	208,799,000
Liabilities of assets held for sale
Debt	39,280,000	39,280,000	41,901,000
Accounts payable and accrued expenses	2,101,000	2,101,000	2,709,000
Other liabilities	4,001,000	4,001,000	5,181,000
Total liabilities associated with assets held for sale	$ 45,382,000	$ 45,382,000	$ 49,791,000

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CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares				3 Months Ended	6 Months Ended
	Jun. 12, 2014	Apr. 28, 2014	Mar. 24, 2014	Jun. 12, 2015	Jun. 30, 2015	Jun. 30, 2014
CONSOLIDATED STATEMENTS OF EQUITY
Dividends declared, common (in dollars per share)	$ 0.21875	$ 0.0215	$ 0.05	$ 0.21875	$ 0.4375	$ 0.26875
Dividends declared, preferred (in dollars per share)		$ 0.0302	$ 0.0403			$ 0.0705

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FUTURE MINIMUM LEASE RENTALS (Details) $ in Thousands	Jun. 30, 2015 USD ($)
Future minimum lease rentals
2015 (Six months ending December 31, 2015)	$ 80,980
2016	143,284
2017	133,441
2018	110,896
2019	97,139
Thereafter	322,413
Total	888,153
Governmental Tenants
Future minimum lease rentals
2015 (Six months ending December 31, 2015)	27,985
2016	48,608
2017	43,210
2018	40,568
2019	38,207
Thereafter	118,653
Total	317,231
Other Tenants
Future minimum lease rentals
2015 (Six months ending December 31, 2015)	52,995
2016	94,676
2017	90,231
2018	70,328
2019	58,932
Thereafter	203,760
Total	$ 570,922

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CONCENTRATIONS (Tables)

6 Months Ended

Jun. 30, 2015

Revenues

Concentrations

Schedule of concentration risk from properties

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
California		63.0	%		60.2	%		62.8	%		60.3	%
Washington, D.C.		24.5			23.9			24.2			24.3
Texas		7.8			7.7			7.6			7.7
North Carolina		4.5			6.1			4.5			5.6
New York		0.2			2.1			0.9			2.1
		100.0	%		100.0	%		100.0	%		100.0	%

Real estate investments

Concentrations

Schedule of concentration risk from properties

	June 30, 2015			December 31, 2014
California		52.5	%		52.3	%
Washington, D.C.		31.1			31.2
Texas		7.4			7.4
North Carolina		5.4			5.5
New York		3.6			3.6
		100.0	%		100.0	%

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CONCENTRATIONS

6 Months Ended

Jun. 30, 2015

CONCENTRATIONS

CONCENTRATIONS

15. CONCENTRATIONS

        Tenant Revenue Concentrations—Rental revenues from the U.S. General Services Administration and other government agencies (collectively, "Governmental Tenants"), which primarily occupy properties located in Washington, D.C., accounted for approximately 22.9% and 24.5% of our rental and other property income for the three months ended June 30, 2015 and 2014, respectively, and 22.8% and 25.1% for the six months ended June 30, 2015 and 2014, respectively. At June 30, 2015 and December 31, 2014, $6,915,000 and $7,168,000, respectively, was due from Governmental Tenants (see Note 14).

        Geographical Concentrations of Investments in Real Estate—As of June 30, 2015 and December 31, 2014, we owned 21 office properties, five multifamily properties, and three hotel properties, located in four states and Washington, D.C.

        Our revenue concentrations from properties are as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
California		63.0	%		60.2	%		62.8	%		60.3	%
Washington, D.C.		24.5			23.9			24.2			24.3
Texas		7.8			7.7			7.6			7.7
North Carolina		4.5			6.1			4.5			5.6
New York		0.2			2.1			0.9			2.1
		100.0	%		100.0	%		100.0	%		100.0	%

        Our real estate investment concentrations from properties are as follows:

	June 30, 2015			December 31, 2014
California		52.5	%		52.3	%
Washington, D.C.		31.1			31.2
Texas		7.4			7.4
North Carolina		5.4			5.5
New York		3.6			3.6
		100.0	%		100.0	%

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SEGMENT DISCLOSURE (Tables)

6 Months Ended

Jun. 30, 2015

SEGMENT DISCLOSURE

Schedule of net operating income of reportable segments

	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015		2014
	(in thousands)
Office:
Revenues	$	47,084	$	45,181	$	93,699	$	88,455
Property expenses:
Operating		20,060		17,933		39,451		35,586
General and administrative		113		76		426		392
Total property expenses		20,173		18,009		39,877		35,978
Segment net operating income—office		26,911		27,172		53,822		52,477
Hotel:
Revenues		15,822		14,798		31,541		29,137
Property expenses:
Operating		9,987		9,923		20,664		19,769
General and administrative		38		36		79		73
Total property expenses		10,025		9,959		20,743		19,842
Segment net operating income—hotel		5,797		4,839		10,798		9,295
Multifamily:
Revenues		4,013		5,208		8,918		10,192
Property expenses:
Operating		2,938		2,583		5,579		4,670
General and administrative		90		54		173		79
Total property expenses		3,028		2,637		5,752		4,749
Segment net operating income—multifamily		985		2,571		3,166		5,443
Total segment net operating income	$	33,693	$	34,582	$	67,786	$	67,215

Schedule of reconciliation of segment net operating income to net income attributable to stockholders

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
	(in thousands)
Total segment net operating income	$	33,693		$	34,582		$	67,786		$	67,215
Interest		(5,586	)		(4,565	)		(10,989	)		(8,602	)
General and administrative		(1,714	)		(2,191	)		(3,869	)		(2,587	)
Asset management fees and other fees to related parties		(7,456	)		(6,338	)		(14,665	)		(12,075	)
Transaction costs		(373	)		(32	)		(801	)		(500	)
Depreciation and amortization		(17,566	)		(17,286	)		(36,694	)		(33,915	)
Bargain purchase gain		—			—			—			4,918
Income from continuing operations		998			4,170			768			14,454
Discontinued operations
Income from operations of assets held for sale		3,984			4,344			6,946			5,277
Net income from discontinued operations		3,984			4,344			6,946			5,277
Net income		4,982			8,514			7,714			19,731
Net income attributable to noncontrolling interests		(6	)		(115	)		(6	)		(113	)
Net income attributable to stockholders	$	4,976		$	8,399		$	7,708		$	19,618

Schedule of reconciliation of condensed assets of segments to consolidated total assets

	June 30, 2015		December 31, 2014
	(in thousands)
Condensed assets:
Office	$	1,517,155	$	1,534,610
Hotel		177,284		174,679
Multifamily		170,241		171,226
Lending assets held for sale		217,418		208,799
Non-segment assets		8,690		5,368
Total assets	$	2,090,788	$	2,094,682

Schedule of capital expenditures and loan originations

	Six Months Ended June 30,
	2015		2014
	(in thousands)
Capital expenditures(1):
Office	$	14,200	$	11,428
Hotel		738		721
Multifamily		882		429
Total capital expenditures		15,820		12,578
Loan originations included in assets held for sale		41,121		25,191
Total capital expenditures and loan originations	$	56,941	$	37,769

(1)           Represents additions and improvements to real estate investments, excluding acquisitions.

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2015

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Information

        Interim Financial Information—The accompanying interim consolidated financial statements of CIM Commercial have been prepared by our management in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim consolidated financial statements do not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods. Operating results for the three and six months ended June 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. Our accompanying interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K filed with the SEC on March 16, 2015.

Principles of Consolidation

        Principles of Consolidation—The consolidated financial statements include the accounts of CIM Commercial and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

Investments in Real Estate

        Investments in Real Estate—Real estate acquisitions are recorded at cost as of the acquisition date. Costs related to the acquisition of properties are expensed as incurred. Investments in real estate are stated at depreciated cost. Depreciation and amortization are recorded on a straight line basis over the estimated useful lives as follows:

Buildings and improvements	15 - 40 years
Furniture, fixtures, and equipment	3 - 5 years
Tenant improvements	Shorter of the useful lives or the terms of the related leases

        Improvements and replacements are capitalized when they extend the useful life, increase capacity, or improve the efficiency of the asset. Ordinary repairs and maintenance are expensed as incurred.

        Investments in real estate are evaluated for impairment on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. The estimated fair value of the asset group identified for step two of the impairment testing under U.S. GAAP is based on either the income approach with market discount rate, terminal capitalization rate and rental rate assumptions being most critical, or on the sales comparison approach to similar properties. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell. No impairment of long-lived assets was recognized during the three and six months ended June 30, 2015 and 2014.

Loans Receivable

        Loans Receivable—Our loans receivable included in assets held for sale are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, retained loan discounts and loan loss reserves. For loans originated under the Small Business Administration's ("SBA") 7(a) Guaranteed Loan Program ("SBA 7(a) Program"), we sell the portion of the loan that is guaranteed by the SBA. Upon sale of the SBA guaranteed portion of the loan, the unguaranteed portion of the loan retained by us is valued on a fair value basis and a discount (the "Retained Loan Discount") is recorded as a reduction in basis of the retained portion of the loan.

        At the Acquisition Date, the carrying value of our loans was adjusted to the estimated fair market value and acquisition discounts of $33,907,000 were recorded, which are being accreted to interest income, included in income from operations of assets held for sale, using the effective interest method. The amount of acquisition discounts that have not yet been accreted to income at June 30, 2015 was $23,828,000.

        A loan receivable is generally classified as non-accrual (a "Non- Accrual Loan") if (i) it is past due as to payment of principal or interest for a period of 60 days or more, (ii) any portion of the loan is classified as doubtful or is charged-off or (iii) the repayment in full of the principal and/or interest is in doubt. Generally, loans are charged-off when management determines that we will be unable to collect any remaining amounts due under the loan agreement, either through liquidation of collateral or other means. Interest income, included in income from operations of assets held for sale, on a Non-Accrual Loan is recognized on either the cash basis or the cost recovery basis.

        On a quarterly basis, and more frequently if indicators exist, we evaluate the collectability of our loans receivable. Our evaluation of collectability involves judgment, estimates, and a review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers' business models and future operations in accordance with Accounting Standards Codification ("ASC") 450-20,Contingencies—Loss Contingencies, and ASC 310-10,Receivables. The allowance for losses on our impaired loans receivable decreased by $36,000 and increased by $65,000 during the three and six months ended June 30, 2015, respectively. No impairment on loans receivable was recorded for the three and six months ended June 30, 2014. We establish a general loan loss reserve when available information indicates that it is probable a loss has occurred based on the carrying value of the portfolio and the amount of the loss can be reasonably estimated. Significant judgment is required in determining the general loan loss reserve, including estimates of the likelihood of default and the estimated fair value of the collateral. The general loan loss reserve includes those loans, which may have negative characteristics which have not yet become known to us. In addition to the reserves established on loans not considered impaired that have been evaluated under a specific evaluation, we establish the general loan loss reserve using a consistent methodology to determine a loss percentage to be applied to loan balances. These loss percentages are based on many factors, primarily cumulative and recent loss history and general economic conditions.

Deferred Rent Receivable and Charges

        Deferred Rent Receivable and Charges—Deferred rent receivable and charges consist of deferred rent, deferred loan costs and deferred leasing costs. Deferred rent receivable was $55,313,000 and $53,622,000 at June 30, 2015 and December 31, 2014, respectively. Deferred loan costs, which represent legal and third-party fees incurred in connection with our borrowing activities, are capitalized and amortized to interest expense on a straight line basis over the life of the related loan, approximating the effective interest method. Deferred loan costs of $10,941,000 and $7,521,000 are presented net of accumulated amortization of $3,251,000 and $1,741,000 at June 30, 2015 and December 31, 2014, respectively. Deferred leasing costs, which represent lease commissions and other direct costs associated with the acquisition of tenants, are capitalized and amortized on a straight line basis over the terms of the related leases. Deferred leasing costs of $56,511,000 and $55,145,000 are presented net of accumulated amortization of $19,462,000 and $16,917,000 at June 30, 2015 and December 31, 2014, respectively.

Noncontrolling Interests

        Noncontrolling Interests—Noncontrolling interests represent the interests in various properties owned by third parties.

Discontinued Operations

        Discontinued Operations—We classify assets as held for sale when they meet the necessary criteria, which include: a) management commits to and actively embarks upon a plan to sell the assets, b) the assets to be sold are available for immediate sale in their present condition, c) the sale is expected to be completed within one year under terms usual and customary for such sales and d) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. We believe that we meet these criteria because the plan for sale has been approved by the Board of Directors, there are no known significant contingencies related to the sale and management believes it is probable that the sale will be completed within one year.

        Assets held for sale are recorded at the lower of cost or estimated fair value less cost to sell. Revenues and expenses related to assets held for sale are presented as discontinued operations for all periods presented in the consolidated statements of operations and comprehensive income.

Consolidation Considerations for Our Investments in Real Estate

        Consolidation Considerations for Our Investments in Real Estate—ASC 810-10,Consolidation, addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights that would require the entity to be consolidated. We analyze our investments in real estate in accordance with this accounting standard to determine whether they are variable interest entities, and if so, whether we are the primary beneficiary. Our judgment with respect to our level of influence or control over an entity and whether we are the primary beneficiary of a variable interest entity involves consideration of various factors, including the form of our ownership interest, our voting interest, the size of our investment (including loans), and our ability to participate in major policy-making decisions. Our ability to correctly assess our influence or control over an entity affects the presentation of these investments in our consolidated financial statements.

Use of Estimates

        Use of Estimates—The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reclassifications

        Reclassifications—Certain prior period amounts have been reclassified to conform with the current period presentation. These reclassifications had no effect on previously reported net income or cash flows.

Recently Issued Accounting Pronouncements

        Recently Issued Accounting Pronouncements—In April 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2014-08,Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360). Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,which amends the definition of a discontinued operation and requires entities to provide additional disclosures about disposal transactions that do not meet the discontinued-operations criteria. The revised guidance is effective prospectively to all disposals (or classifications as held for sale) that occur in annual periods (and interim periods therein) beginning on or after December 15, 2014, with early adoption permitted. Entities are prohibited from applying the new ASU to any component, equity method investment, or acquired business that is classified as held for sale before the adoption date. We early adopted this guidance during the second quarter of 2014, and the adoption did not have a material impact on our consolidated financial statements.

        In May 2014, the FASB issued ASU No. 2014-09,Revenue from Contracts with Customers (Topic 606)which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including the guidance on real estate de-recognition for most transactions. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted for annual periods beginning after December 15, 2016. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance in the ASU. The modified approach provides entities relief from having to restate and present comparable prior-year financial statement information; however, entities will still need to evaluate existing contracts as of the date of initial adoption under the ASU to determine whether a cumulative adjustment is necessary. We are currently in the process of evaluating the impact of adoption of the new accounting guidance on our consolidated financial statements.

        In August 2014, the FASB issued ASU No. 2014-15Presentation of Financial Statements—Going Concern (Subtopic 205-40)which requires an entity's management to evaluate whether there are conditions or events, when considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date the financial statements are issued. The ASU is effective for the annual reporting period ending after December 15, 2016, and for annual and interim periods thereafter. Early application is permitted. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

        In February 2015, the FASB issued ASU No. 2015-02,Consolidation (Topic 810): Amendments to the Consolidation Analysis,which is intended to improve targeted areas of consolidation guidance for legal entities such as limited partnerships, limited liability corporations, and securitization structures (collateralized debt obligations, collateralized loan obligations, and mortgage-backed security transactions). In addition to reducing the number of consolidation models from four to two, the new standard simplifies the FASB Accounting Standards Codification and improves current U.S. GAAP by: placing more emphasis on risk of loss when determining a controlling financial interest; reducing the frequency of the application of related-party guidance when determining a controlling financial interest in a variable interest entity (VIE); and changing consolidation conclusions for public and private companies in several industries that typically make use of limited partnerships or VIEs. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. ASU 2015-02 may be applied retrospectively in previously issued financial statements for one or more years with a cumulative-effect adjustment to retained earnings as of the beginning of the first year restated. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

        In March 2015, the FASB issued ASU No. 2015-03,Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,which is intended to simplify the presentation of debt issuance costs. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2015. Early adoption is permitted for financial statements that have not been previously issued. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 7,714	$ 19,731
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred rent and amortization of intangible assets, liabilities and lease inducements	(2,893)	(1,874)
Depreciation and amortization	36,694	33,915
Bargain purchase gain		(4,918)
Straight line rent, below-market ground lease and amortization of intangible assets	1,000	933
Amortization of deferred loan costs	1,538	652
Amortization of premiums and discounts on debt	(634)	(562)
Unrealized premium adjustment	727	782
Amortization and accretion on loans receivable, net	(2,234)	(1,837)
Bad debt expense	982	126
Deferred income taxes	(26)	55
Stock-based compensation	717	373
Loans funded, held for sale to secondary market	(16,438)	(16,753)
Proceeds from sale of guaranteed loans	17,365	12,999
Principal collected on loans	2,365	2,071
Other operating activity	(192)	(300)
Changes in operating assets and liabilities:
Accounts receivable and interest receivable	(2,045)	(58)
Other assets	(1,681)	(2,151)
Accounts payable and accrued expenses	(3,956)	(6,287)
Deferred leasing costs	(2,926)	(4,542)
Other liabilities	352	2,232
Due to related parties	621	2,083
Net cash provided by operating activities	37,050	36,670
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to investments in real estate	(14,074)	(12,903)
Acquisition of real estate properties		(44,936)
Loans funded	(24,683)	(8,438)
Cash and cash equivalents acquired in connection with the merger		3,185
Principal collected on loans	13,058	25,348
Restricted cash	1,200	(536)
Other investing activity	184	160
Net cash used in investing activities	(24,315)	(38,120)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of mortgages payable	(15,692)	(3,194)
Proceeds from unsecured credit facilities, revolving credit facility and term note, net	55,000	110,000
Payment of principal on secured borrowings - government guaranteed loans	(2,365)	(2,071)
Proceeds from secured borrowings - government guaranteed loans		1,978
Payment of deferred loan costs	(3,415)	(447)
Payment of dividends	(42,693)	(26,256)
Payment of special dividend and dividend assumed in acquisition		(59,286)
Distributions pre-merger		(16,100)
Contributions from noncontrolling interests	110	10
Proceeds from issuance of stock		201
Retirement of fractional shares of common shares		(3)
Noncontrolling interests' distributions	(38)	(148)
Net cash (used in) provided by financing activities	(9,093)	4,684
Change in Cash balances included in assets held for sale	1,295	(2,593)
NET INCREASE IN CASH AND CASH EQUIVALENTS	4,937	641
CASH AND CASH EQUIVALENTS:
Beginning of period	17,615	16,796
End of period	22,552	17,437
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for interest	10,520	9,055
Federal income taxes paid	505	334
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES:
Additions to investments in real estate included in accounts payable and accrued expenses	5,115	3,168
Additions to investments in real estate included in other assets	4,244
Additions to deferred loan costs included in accounts payable and accrued expenses	$ 67	$ 120

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2015	Dec. 31, 2014
CONSOLIDATED BALANCE SHEETS
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized shares	200,000,000	200,000,000
Common stock, issued shares	97,696,863	97,688,863
Common stock, outstanding shares	97,589,598	97,581,598
Treasury stock, outstanding shares	107,265	107,265

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DIVIDENDS DECLARED

6 Months Ended

Jun. 30, 2015

DIVIDENDS DECLARED

DIVIDENDS DECLARED

10. DIVIDENDS DECLARED

        Dividends declared during the six months ended June 30, 2015 and 2014 consisted of the following:

        On March 6, 2015 and June 12, 2015, we declared common share dividends of $0.21875 per share of Common Stock which were paid on March 27, 2015 and June 29, 2015, respectively.

        CIM Urban paid a distribution of $16,100,000 in 2014 prior to the Acquisition Date ($0.1685 per share of Common Stock, as converted).

        On March 24, 2014, we declared a common share dividend of $0.05 per share of Common Stock and a preferred dividend of $0.0403 per share of preferred stock ($0.0285 per share of Common Stock as converted) which were paid on March 28, 2014.

        On April 28, 2014, we declared a dividend in the aggregate amount of $1,964,000 to the preferred stockholders ($0.0302 per share of preferred stock and $0.0215 per share of Common Stock as converted) in connection with the conversion of shares of preferred stock to shares of Common Stock, which was paid on June 27, 2014.

        On June 12, 2014, we declared a common share dividend of $0.21875 per share of Common Stock which was paid on June 27, 2014.

        In addition, dividends of $59,286,000 ($27.975 per share of Common Stock) were paid to the PMC Commercial stockholders in connection with the Merger, which includes the $27.50 per share of Common Stock special dividend plus the $0.475 pro rata portion of PMC Commercial's regular quarterly cash dividend.

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Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Aug. 05, 2015
Document and Entity Information
Entity Registrant Name	CIM Commercial Trust Corp
Entity Central Index Key	0000908311
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		97,589,598
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q2

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FAIR VALUE OF FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2015

FAIR VALUE OF FINANCIAL INSTRUMENTS

FAIR VALUE OF FINANCIAL INSTRUMENTS

11. FAIR VALUE OF FINANCIAL INSTRUMENTS

        A fair value measurement is based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy for inputs used in measuring fair value is as follows:

Level 1 Inputs—Quoted prices in active markets for identical assets or liabilities

Level 2 Inputs—Observable inputs other than quoted prices in active markets for identical assets and liabilities

Level 3 Inputs—Unobservable inputs

        In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

        The estimated fair values of those financial instruments which are not recorded at fair value on a recurring basis on our consolidated balance sheets were as follows:

	June 30, 2015				December 31, 2014
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value		Level
	(in thousands)
Assets held for sale:
Loans receivable subject to credit risk	$	140,385	$	146,482	$	147,648	$	154,252		3
SBA 7(a) loans receivable, subject to secured borrowings		38,793		39,596		41,404		41,901		3
Commercial real estate loans		19,673		19,639		—		—		3
Liabilities:
Secured borrowings—government guaranteed loans, included in liabilities associated with assets held for sale		39,280		39,280		41,901		41,901		3
Junior subordinated notes		24,942		24,955		24,906		24,877		3
Mortgages payable		207,702		211,953		223,808		231,806		3
Unsecured credit facilities		415,000		415,000		360,000		360,000		3

        Management's estimation of the fair value of our financial instruments is based on a Level 3 valuation in the fair value hierarchy established for disclosure of how a company values its financial instruments. In general, quoted market prices from active markets for the identical financial instrument (Level 1 inputs), if available, should be used to value a financial instrument. If quoted prices are not available for the identical financial instrument, then a determination should be made if Level 2 inputs are available. Level 2 inputs include quoted prices for similar financial instruments in active markets for identical or similar financial instruments in markets that are not active (i.e., markets in which there are few transactions for the financial instruments, the prices are not current, price quotations vary substantially, or in which little information is released publicly). There is limited reliable market information for our financial instruments and we utilize other methodologies based on unobservable inputs for valuation purposes since there are no Level 1 or Level 2 inputs available. Accordingly, Level 3 inputs are used to measure fair value.

        In general, estimates of fair value may differ from the carrying amounts of the financial assets and liabilities primarily as a result of the effects of discounting future cash flows. Considerable judgment is required to interpret market data and develop estimates of fair value. Accordingly, the estimates presented are made at a point in time and may not be indicative of the amounts we could realize in a current market exchange.

        Loans Receivable Subject to Credit Risk—Loans receivable were initially recorded at estimated fair value at the Acquisition Date. Loans receivable originated subsequent to the Acquisition Date are recorded at cost upon origination and adjusted by net loan origination fees and discounts. In order to determine the estimated fair value of our loans receivable, we use a present value technique for the anticipated future cash flows using certain assumptions. At June 30, 2015, our assumptions included discount rates ranging from 6.75% to 15.00% and prepayment rates of 15.00%. At December 31, 2014, our assumptions included discount rates ranging from 5.90% to 14.90% and prepayment rates of 15.00%.

        SBA 7(a) Loans Receivable, Subject to Secured Borrowings—These loans receivable represent the government guaranteed portion of loans which were sold with the proceeds received from the sale reflected as secured borrowings-government guaranteed loans (a liability associated with assets held for sale on our consolidated balance sheets (Note 6)). There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal. In order to determine the estimated fair value of these loans receivable, we use a present value technique for the anticipated future cash flows taking into consideration the lack of credit risk using a prepayment rate of 15.00%.

        Commercial Real Estate Loans—In order to determine the estimated fair value of our commercial real estate loan receivable which consists of one mezzanine loan, we use a present value technique for the anticipated future cash flows using certain assumptions including a discount rate of 9.72%. There is no prepayment anticipated and no potential credit deterioration anticipated on this loan.

        Secured Borrowings—Government Guaranteed Loans—The carrying amount of secured borrowings-government guaranteed loans approximates fair value, as the interest rates on these secured borrowings approximate current market interest rates, and includes the unamortized deferred cash premiums collected on the sale of the government guaranteed portions of the related loans, which are included in liabilities associated with assets held for sale.

        Junior Subordinated Notes—The fair value of the junior subordinated notes is estimated based on current interest rates available for debt instruments with similar terms. Discounted cash flow analysis is generally used to estimate the fair value of our junior subordinated notes. The rate used was 4.11% and 3.83% at June 30, 2015 and December 31, 2014, respectively.

        Unsecured Credit Facilities—The carrying amount is a reasonable estimation of fair value as the interest rates on the unsecured credit facilities are variable and are at current market interest rates.

        Mortgage Notes Payable—The fair values of mortgage notes are estimated based on current interest rates available for debt instruments with similar terms. The fair value of our mortgages payable is sensitive to fluctuations in interest rates. Discounted cash flow analysis is generally used to estimate the fair value of our mortgages payable, using rates ranging from 4.20% to 4.55% at June 30, 2015 and 3.92% to 4.12% at December 31, 2014.

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
REVENUES:
Rental and other property income	$ 63,171	$ 60,804	$ 126,569	$ 120,626
Expense reimbursements	3,263	2,646	6,444	4,997
Interest and other income	485	1,737	1,145	2,161
REVENUES	66,919	65,187	134,158	127,784
EXPENSES:
Rental and other property operating	32,985	30,439	65,694	60,025
Asset management fees and other fees to related parties	7,456	6,338	14,665	12,075
Interest	5,586	4,565	10,989	8,602
General and administrative	1,955	2,357	4,547	3,131
Transaction costs	373	32	801	500
Depreciation and amortization	17,566	17,286	36,694	33,915
EXPENSES	65,921	61,017	133,390	118,248
Bargain purchase gain (Note 2)				4,918
INCOME FROM CONTINUING OPERATIONS	998	4,170	768	14,454
DISCONTINUED OPERATIONS:
Income from operations of assets held for sale	3,984	4,344	6,946	5,277
INCOME FROM DISCONTINUED OPERATIONS	3,984	4,344	6,946	5,277
NET INCOME	4,982	8,514	7,714	19,731
Net income attributable to noncontrolling interests	(6)	(115)	(6)	(113)
NET INCOME ATTRIBUTABLE TO STOCKHOLDERS	4,976	8,399	7,708	19,618
COMPREHENSIVE INCOME	$ 4,976	$ 8,399	$ 7,708	$ 19,618
BASIC AND DILUTED INCOME PER SHARE:
Continuing operations	$ 0.01	$ 0.04	$ 0.01	$ 0.15
Discontinued operations	0.04	0.05	0.07	0.05
Net income	$ 0.05	$ 0.09	$ 0.08	$ 0.20
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic (in shares)	97,589	97,571	97,586	96,758
Diluted (in shares)	97,589	97,576	97,586	96,764

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OTHER INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2015

OTHER INTANGIBLE ASSETS

OTHER INTANGIBLE ASSETS

5. OTHER INTANGIBLE ASSETS

        A schedule of our intangible assets and liabilities and related accumulated amortization and accretion as of June 30, 2015 and December 31, 2014 is as follows:

	Assets															Liabilities
June 30, 2015	Acquired Above-Market Leases			Acquired In-Place Leases			Tax Abatement			Franchise Affiliation Fee			Acquired Below-Market Ground Lease			Acquired Below-Market Leases
	(in thousands)
Gross balance	$	1,072		$	21,431		$	4,273		$	3,936		$	11,685		$	(19,750	)
Accumulated amortization		(867	)		(16,269	)		(2,047	)		(3,179	)		(1,352	)		12,403
	$	205		$	5,162		$	2,226		$	757		$	10,333		$	(7,347	)
Average useful life (in years)		6			8			8			10			84			8

	Assets															Liabilities
December 31, 2014	Acquired Above-Market Leases			Acquired In-Place Leases			Tax Abatement			Franchise Affiliation Fee			Acquired Below-Market Ground Lease			Acquired Below-Market Leases
	(in thousands)
Gross balance	$	2,402		$	22,680		$	4,273		$	3,936		$	11,685		$	(20,333	)
Accumulated amortization		(2,039	)		(16,470	)		(1,771	)		(2,981	)		(1,282	)		11,676
	$	363		$	6,210		$	2,502		$	955		$	10,403		$	(8,657	)
Average useful life (in years)		7			8			8			10			84			8

        The amortization of the above-market leases which decreased rental and other property income was $79,000 and $98,000 for the three months ended June 30, 2015 and 2014, respectively, and $158,000 and $435,000 for the six months ended June 30, 2015 and 2014, respectively. The amortization of the below-market leases included in rental and other property income was $655,000 and $697,000 for the three months ended June 30, 2015 and 2014, respectively, and $1,310,000 and $1,345,000 for the six months ended June 30, 2015 and 2014, respectively. The amortization of in-place leases included in depreciation and amortization expense was $519,000 and $587,000 for the three months ended June 30, 2015 and 2014, respectively, and $1,048,000 and $1,199,000 for the six months ended June 30, 2015 and 2014, respectively. Included in depreciation and amortization expense is franchise affiliation fee amortization of $99,000 for each of the three months ended June 30, 2015 and 2014, and $198,000 for each of the six months ended June 30, 2015 and 2014. The amortization of advance bookings included in depreciation and amortization expense was $0 and $67,000 for the three months ended June 30, 2015 and 2014, respectively, and $0 and $134,000 for the six months ended June 30, 2015 and 2014, respectively. Tax abatement amortization of $138,000 for each of the three months ended June 30, 2015 and 2014, and $276,000 for each of the six months ended June 30, 2015 and 2014 is included in rental and other property operating expenses. Amortization of below-market ground lease obligation of $35,000 for each of the three months ended June 30, 2015 and 2014, and $70,000 for each of the six months ended June 30, 2015 and 2014 is included in rental and other property operating expenses.

        A schedule of future amortization and accretion of acquisition related intangible assets and liabilities as of June 30, 2015 is as follows:

	Assets										Liabilities
Years Ending December 31,	Acquired Above-Market Leases		Acquired In-Place Leases		Tax Abatement		Franchise Affiliation Fee		Acquired Below-Market Ground Lease		Acquired Below-Market Leases
	(in thousands)
2015 (Six months ending December 31, 2015)	$	83	$	793	$	275	$	196	$	70	$	(1,259	)
2016		88		1,346		551		394		140		(2,502	)
2017		26		915		551		167		140		(2,399	)
2018		8		666		551		—		140		(963	)
2019		—		488		298		—		140		(224	)
Thereafter		—		954		—		—		9,703		—
	$	205	$	5,162	$	2,226	$	757	$	10,333	$	(7,347	)

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INVESTMENTS IN REAL ESTATE

6 Months Ended

Jun. 30, 2015

INVESTMENTS IN REAL ESTATE

INVESTMENTS IN REAL ESTATE

4. INVESTMENTS IN REAL ESTATE

        Investments in real estate consist of the following:

	June 30, 2015			December 31, 2014
	(in thousands)
Land	$	354,035		$	354,035
Land improvements		28,071			28,071
Buildings and improvements		1,504,902			1,501,603
Furniture, fixtures, and equipment		8,914			10,875
Tenant improvements		142,306			131,446
Work in progress		5,862			10,764
Investments in real estate		2,044,090			2,036,794
Accumulated depreciation		(343,676	)		(320,857	)
Net investments in real estate	$	1,700,414		$	1,715,937

        We recorded depreciation expense of $15,063,000 and $14,705,000 for the three months ended June 30, 2015 and 2014, respectively, and $31,343,000 and $28,852,000 for the six months ended June 30, 2015 and 2014, respectively.

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SEGMENT DISCLOSURE

6 Months Ended

Jun. 30, 2015

SEGMENT DISCLOSURE

SEGMENT DISCLOSURE

16. SEGMENT DISCLOSURE

        In accordance with ASC Topic 280,Segment Reporting, our reportable segments consist of three types of commercial real estate properties, namely, office, hotel and multifamily, as well as a segment for our lending operations, which is held for sale as of June 30, 2015. Management internally evaluates the operating performance and financial results of the segments based on net operating income. We also have certain general and administrative level activities, including public company expenses, legal, accounting, and tax preparation that are not considered separate operating segments. The reportable segments are accounted for on the same basis of accounting as described in the notes to our audited consolidated financial statements for the year ended December 31, 2014 included in our Annual Report on Form 10-K filed with the SEC on March 16, 2015.

        We evaluate the performance of our real estate segments based on net operating income, which is defined as rental and other property income and tenant reimbursements less property and related expenses, and excludes nonproperty income and expenses, interest expense, depreciation and amortization, corporate related general and administrative expenses, and transaction costs.

        The net operating income of our reportable segments is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015		2014
	(in thousands)
Office:
Revenues	$	47,084	$	45,181	$	93,699	$	88,455
Property expenses:
Operating		20,060		17,933		39,451		35,586
General and administrative		113		76		426		392
Total property expenses		20,173		18,009		39,877		35,978
Segment net operating income—office		26,911		27,172		53,822		52,477
Hotel:
Revenues		15,822		14,798		31,541		29,137
Property expenses:
Operating		9,987		9,923		20,664		19,769
General and administrative		38		36		79		73
Total property expenses		10,025		9,959		20,743		19,842
Segment net operating income—hotel		5,797		4,839		10,798		9,295
Multifamily:
Revenues		4,013		5,208		8,918		10,192
Property expenses:
Operating		2,938		2,583		5,579		4,670
General and administrative		90		54		173		79
Total property expenses		3,028		2,637		5,752		4,749
Segment net operating income—multifamily		985		2,571		3,166		5,443
Total segment net operating income	$	33,693	$	34,582	$	67,786	$	67,215

        A reconciliation of segment net operating income to net income is as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
	(in thousands)
Total segment net operating income	$	33,693		$	34,582		$	67,786		$	67,215
Interest		(5,586	)		(4,565	)		(10,989	)		(8,602	)
General and administrative		(1,714	)		(2,191	)		(3,869	)		(2,587	)
Asset management fees and other fees to related parties		(7,456	)		(6,338	)		(14,665	)		(12,075	)
Transaction costs		(373	)		(32	)		(801	)		(500	)
Depreciation and amortization		(17,566	)		(17,286	)		(36,694	)		(33,915	)
Bargain purchase gain		—			—			—			4,918
Income from continuing operations		998			4,170			768			14,454
Discontinued operations
Income from operations of assets held for sale		3,984			4,344			6,946			5,277
Net income from discontinued operations		3,984			4,344			6,946			5,277
Net income		4,982			8,514			7,714			19,731
Net income attributable to noncontrolling interests		(6	)		(115	)		(6	)		(113	)
Net income attributable to stockholders	$	4,976		$	8,399		$	7,708		$	19,618

        The condensed assets for each of the segments as of June 30, 2015 and December 31, 2014, along with capital expenditures and loan originations for the six months ended June 30, 2015 and 2014, are as follows:

	June 30, 2015		December 31, 2014
	(in thousands)
Condensed assets:
Office	$	1,517,155	$	1,534,610
Hotel		177,284		174,679
Multifamily		170,241		171,226
Lending assets held for sale		217,418		208,799
Non-segment assets		8,690		5,368
Total assets	$	2,090,788	$	2,094,682

	Six Months Ended June 30,
	2015		2014
	(in thousands)
Capital expenditures(1):
Office	$	14,200	$	11,428
Hotel		738		721
Multifamily		882		429
Total capital expenditures		15,820		12,578
Loan originations included in assets held for sale		41,121		25,191
Total capital expenditures and loan originations	$	56,941	$	37,769

(1)           Represents additions and improvements to real estate investments, excluding acquisitions.

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RELATED-PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2015

RELATED-PARTY TRANSACTIONS

RELATED-PARTY TRANSACTIONS

12. RELATED-PARTY TRANSACTIONS

        CIM Urban REIT Management, LP (the "Advisor"), an affiliate of CIM REIT, provides asset management services to CIM Urban. For these services, CIM Urban pays asset management fees to the Advisor on a quarterly basis in arrears. The fee is calculated as a percentage of the daily average adjusted fair value of our investments, as defined, as follows:

Daily Average Adjusted Fair Value of CIM Urban's Investments
				Quarterly Fee Percentage
From Greater of		To and Including
(in thousands)
$	—	$	500,000		0.2500	%
	500,000		1,000,000		0.2375	%
	1,000,000		1,500,000		0.2250	%
	1,500,000		4,000,000		0.2125	%
	4,000,000		20,000,000		0.1000	%

        The Advisor earned asset management fees of $6,176,000 and $5,798,000 for the three months ended June 30, 2015 and 2014, respectively, and $12,318,000 and $11,479,000 for the six months ended June 30, 2015 and 2014, respectively. At June 30, 2015 and December 31, 2014, asset management fees of $6,285,000 and $5,867,000, respectively, were due to the Advisor.

        CIM Management, Inc. and certain of its affiliates (collectively, the "CIM Management Entities"), all affiliates of CIM REIT, provide property management, leasing, and development services to CIM Urban. The CIM Management Entities earned property management fees, which are included in rental and other property operating expenses, totaling $1,463,000 and $1,272,000 for the three months ended June 30, 2015 and 2014, respectively, and $2,926,000 and $ 2,531,000 for the six months ended June 30, 2015 and 2014, respectively. CIM Urban also reimbursed the CIM Management Entities $2,229,000 and $1,749,000 during the three months ended June 30, 2015 and 2014, respectively, and $4,286,000 and $3,793,000 for the six months ended June 30, 2015 and 2014, respectively, for the cost of on-site personnel incurred on behalf of CIM Urban, which is included in rental and other property operating expenses. The CIM Management Entities earned leasing commissions of $40,000 and $839,000 for the three months ended June 30, 2015 and 2014, respectively, and $93,000 and $1,351,000 for the six months ended June 30, 2015 and 2014, respectively, which were capitalized to deferred charges. In addition, the CIM Management Entities earned development management fees of $222,000 and $157,000 for the three months ended June 30, 2015 and 2014, respectively, and $447,000 and $244,000 for the six months ended June 30, 2015 and 2014, respectively, which were capitalized to investments in real estate.

        At June 30, 2015 and December 31, 2014, fees payable and expense reimbursements due to the CIM Management Entities of $1,785,000 and $2,518,000, respectively, were included in due to related parties. Also included in due to related parties at June 30, 2015 and December 31, 2014 was ($88,000) and $76,000, respectively, due (from) to the CIM Management Entities and related parties.

        On the Acquisition Date, pursuant to the terms of the Merger Agreement, CIM Commercial and its subsidiaries entered into the Master Services Agreement (the "Master Services Agreement") with CIM Service Provider, LLC (the "Manager") pursuant to which the Manager provides or arranges for other service providers to provide management and administration services to CIM Commercial and its subsidiaries following the Merger. Pursuant to the Master Services Agreement, CIM Commercial pays a base service fee (the "Base Service Fee") to the Manager initially set at $1,000,000 per year (subject to an annual escalation by a specified inflation factor beginning on January 1, 2015), payable quarterly in arrears. Based on the annual escalation factor, the Base Service Fee for 2015 is $1,010,000. The Base Service Fee began to accrue on the Acquisition Date and was pro-rated based on the number of days during the first quarter in which the Master Services Agreement was in effect. The Manager earned a Base Service Fee of $253,000 and $250,000 for the three months ended June 30, 2015 and 2014, respectively, and $506,000 and $306,000 for the six months ended June 30, 2015 and 2014, respectively. In addition, pursuant to the terms of the Master Services Agreement, the Manager may receive compensation for performing certain services for CIM Commercial and its subsidiaries that are not covered under the Base Service Fee. During the six months ended June 30, 2015 and 2014, such services performed by the Manager included accounting, tax, reporting, internal audit, legal, compliance, risk management, IT, human resources and corporate communications. The Manager's compensation is based on the salaries and benefits of the employees of the Manager and/or its affiliates who performed these services (allocated based on the percentage of time spent on the affairs of CIM Commercial and its subsidiaries). We expensed $899,000 and $290,000 for the three months ended June 30, 2015 and 2014, respectively, and $1,590,000 and $290,000 for the six months ended June 30, 2015 and 2014, respectively, for such services. At June 30, 2015 and December 31, 2014, $1,825,000 and $725,000 was due to the Manager, respectively, for such services.

        As of January 1, 2015, all of our employees moved to CIM SBA Staffing, LLC, ("CIM SBA"), an affiliate of CIM Group, L.P. ("CIM Group"), except for two of our executives, who became jointly employed by us and CIM SBA and their employment agreements with us continue in full force and effect. In connection with this move, on January 1, 2015, we entered into a Staffing and Reimbursement Agreement with CIM SBA and our subsidiary, PMC Commercial Lending, LLC, which provides that CIM SBA will provide personnel and resources to us and that we will reimburse CIM SBA for the costs and expenses of providing such personnel and resources. For the three months ended June 30, 2015, we expensed $1,093,000 and $128,000 related to services subject to reimbursement by us under this agreement which are included in discontinued operations and asset management and other fees to related parties, respectively; for the six months ended June 30, 2015, we expensed $2,236,000 and $251,000 related to such services which are included in discontinued operations and asset management and other fees to related parties, respectively.

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STOCK-BASED COMPENSATION PLANS

6 Months Ended

Jun. 30, 2015

STOCK-BASED COMPENSATION PLANS

STOCK-BASED COMPENSATION PLANS

8. STOCK-BASED COMPENSATION PLANS

        On March 11, 2014, we granted awards of 2,000 restricted shares of Common Stock to each of the independent members of the Board of Directors (6,000 in aggregate) which awards were effective upon the receipt of stockholder approval of the amendment of the 2005 Equity Incentive Plan on April 28, 2014. The shares of Common Stock vested in March 2015 based on a year of continuous service. In April 2015, an additional 2,000 restricted shares of Common Stock were granted to each of the independent members of the Board of Directors (6,000 in aggregate) under the 2005 Equity Incentive Plan, which will vest over a year of continuous service. Compensation expense related to these restricted shares of Common Stock is recognized over the vesting period. We recorded compensation expense of $27,000 and $31,000 for the three months ended June 30, 2015 and 2014, respectively, and $59,000 and $31,000 for the six months ended June 30, 2015 and 2014, respectively, related to these restricted shares of Common Stock.

        We issued an aggregate of 4,000 restricted shares of Common Stock to two of our executive officers comprised of 2,000 shares of Common Stock issued on May 6, 2014 and 2,000 shares of Common Stock issued on March 6, 2015. The restricted shares of Common Stock vest based on two years of continuous service with one-third of the shares of Common Stock vesting immediately upon issuance and one-third vesting at the end of each of the next two years. Compensation expense related to these restricted shares of Common Stock is recognized over the vesting period. We recognized compensation expense of $8,000 and $19,000 for the three months ended June 30, 2015 and 2014, respectively, and $26,000 and $19,000 for the six months ended June 30, 2015 and 2014, respectively, related to these restricted shares of Common Stock.

        As of June 30, 2015, there was $103,000 of total unrecognized compensation expense related to these restricted shares of Common Stock which will be recognized over the next two years.

        In addition, on June 12, 2014, we granted 11,850 options with an exercise price of $23.16 (the closing price of our Common Stock on such date). We recorded compensation expense of $8,000 for the three and six months ended June 30, 2014 related to this option grant. These options were forfeited effective January 31, 2015.

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CONCENTRATIONS (Details)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2015 USD ($) item	Jun. 30, 2014	Jun. 30, 2015 USD ($) item	Jun. 30, 2014	Dec. 31, 2014 USD ($) item
Concentrations
Concentration risk (as a percent)			100.00%	100.00%
Number of states in which real estate properties are owned	4		4		4
Office
Concentrations
Number of real estate properties owned	21		21		21
Multi-family
Concentrations
Number of real estate properties owned	5		5		5
Hotel
Concentrations
Number of real estate properties owned	3		3		3
California
Concentrations
Concentration risk (as a percent)			62.80%	60.30%
Washington, D.C.
Concentrations
Concentration risk (as a percent)			24.20%	24.30%
Texas
Concentrations
Concentration risk (as a percent)			7.60%	7.70%
North Carolina
Concentrations
Concentration risk (as a percent)			4.50%	5.60%
New York
Concentrations
Concentration risk (as a percent)			0.90%	2.10%
Revenues | Tenant Revenue Concentrations | Governmental Tenants
Concentrations
Concentration risk (as a percent)	22.90%	24.50%	22.80%	25.10%
Amount due from Governmental Tenants | $	$ 6,915,000		$ 6,915,000		$ 7,168,000
Revenues | Geographical concentrations
Concentrations
Concentration risk (as a percent)	100.00%	100.00%
Revenues | Geographical concentrations | California
Concentrations
Concentration risk (as a percent)	63.00%	60.20%
Revenues | Geographical concentrations | Washington, D.C.
Concentrations
Concentration risk (as a percent)	24.50%	23.90%
Revenues | Geographical concentrations | Texas
Concentrations
Concentration risk (as a percent)	7.80%	7.70%
Revenues | Geographical concentrations | North Carolina
Concentrations
Concentration risk (as a percent)	4.50%	6.10%
Revenues | Geographical concentrations | New York
Concentrations
Concentration risk (as a percent)	0.20%	2.10%
Real estate investments | Geographical concentrations
Concentrations
Concentration risk (as a percent)			100.00%		100.00%
Real estate investments | Geographical concentrations | California
Concentrations
Concentration risk (as a percent)			52.50%		52.30%
Real estate investments | Geographical concentrations | Washington, D.C.
Concentrations
Concentration risk (as a percent)			31.10%		31.20%
Real estate investments | Geographical concentrations | Texas
Concentrations
Concentration risk (as a percent)			7.40%		7.40%
Real estate investments | Geographical concentrations | North Carolina
Concentrations
Concentration risk (as a percent)			5.40%		5.50%
Real estate investments | Geographical concentrations | New York
Concentrations
Concentration risk (as a percent)			3.60%		3.60%

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DISCONTINUED OPERATIONS

6 Months Ended

Jun. 30, 2015

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS

6. DISCONTINUED OPERATIONS

        We have reflected the lending segment, which was acquired on the Acquisition Date as disclosed in Note 2, as held for sale at June 30, 2015 and December 31, 2014, based on a plan approved by the Board of Directors to sell the lending business that, when completed, will result in the deconsolidation of the lending segment. In connection with our plan, we have expensed transaction costs of $61,000 and $224,000 during the three and six months ended June 30, 2015, respectively.

        The following is a reconciliation of the carrying amounts of assets and liabilities that are classified as held for sale on the consolidated balance sheets as of June 30, 2015 and December 31, 2014:

	June 30, 2015		December 31, 2014
	(in thousands)
Assets held for sale
Loans receivable, net	$	198,851	$	189,052
Cash and cash equivalents		8,642		9,937
Restricted cash		965		916
Accounts receivable and interest receivable, net		733		738
Other intangible assets		2,957		2,957
Other assets		5,270		5,199
Total assets held for sale	$	217,418	$	208,799
Liabilities associated with assets held for sale
Debt	$	39,280	$	41,901
Accounts payable and accrued expenses		2,101		2,709
Other liabilities		4,001		5,181
Total liabilities associated with assets held for sale	$	45,382	$	49,791

        Loans receivable, net consist of the following:

	June 30, 2015			December 31, 2014
	(in thousands)
Commercial mortgage loans	$	99,955		$	108,864
SBA 7(a) loans, subject to secured borrowings		38,719			41,328
SBA 7(a) loans		40,447			38,707
Commercial real estate loans		19,639			—
Loans receivable		198,760			188,899
Deferred capitalized costs, net		347			292
Loan loss reserves		(256	)		(139	)
Net loans receivable	$	198,851		$	189,052

        Commercial Mortgage Loans—Represents loans to small businesses collateralized by first liens on the real estate of the related business.

        SBA 7(a) Loans, Subject to Secured Borrowings—Represents the government guaranteed portion of loans which were sold with the proceeds received from the sale reflected as "secured borrowings—government guaranteed loans." There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal.

        SBA 7(a) Loans—Represents the non-government guaranteed retained portion of loans originated under the SBA 7(a) Program and the government guaranteed portion of loans that have not yet been fully funded or sold.

        Commercial Real Estate Loans—Represents a mezzanine loan secured by an indirect ownership interest in an entity that either directly or indirectly owns parcels of commercial real estate. It is short term and has a variable interest rate.

        Debt consists of the following:

	June 30, 2015		December 31, 2014
	(in thousands)
Secured borrowing principal on loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 4.03% and 3.92% at June 30, 2015 and December 31, 2014, respectively	$	31,358	$	33,654
Secured borrowing principal on loans sold for excess spread, variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 1.58%		5,016		5,085
		36,374		38,739
Unamortized premiums on loans sold for a premium and excess spread		2,906		3,162
Total secured borrowings—government guaranteed loans	$	39,280	$	41,901

        Secured Borrowings—Government Guaranteed Loans—Represents sold SBA 7(a) Program loans which are treated as secured borrowings since the loan sales did not meet the derecognition criteria provided for in ASC 860-30,Transfers and Servicing. To the extent secured borrowings include cash premiums, these premiums are included in secured borrowings and amortized as a reduction to interest expense over the life of the loan using the effective interest method and fully amortized when the loan is repaid in full.

        Future principal payments on the debt (face value) at June 30, 2015 are as follows:

Years Ending December 31,	Secured Borrowings Principal(1)
	(in thousands)
2015 (Six months ending December 31, 2015)	$	895
2016		1,229
2017		1,269
2018		1,314
2019		1,361
Thereafter		30,306
	$	36,374

(1)           Principal payments are generally dependent upon cash flows received from the underlying loans. Our estimate of their repayment is based on scheduled principal payments on the underlying loans. Our estimate will differ from actual amounts to the extent we experience prepayments and/or loan liquidations or charge-offs. No payment is due unless payments are received from the borrowers on the underlying loans.

        The following is the detail of income from operations of assets held for sale classified as discontinued operations on the consolidated statement of operations and comprehensive income:

	Three Months Ended June 30, 2015		Three Months Ended June 30, 2014
	(in thousands)
Revenue—Interest and other income	$	5,768	$	6,271
Expenses:
Interest expense		120		374
Fees to related party(1)		1,093		—
General and administrative(1)		294		1,253
Provision for income taxes		277		300
Total expenses		1,784		1,927
Income from operations of assets held for sale	$	3,984	$	4,344

(1)           Salaries and related benefits of $1,018,000 were included in general and administrative expense for the three months ended June 30, 2014 while, as a result of the transfer of our employees to an affiliate (see Note 12), such expenses were included in fees to related party for the three months ended June 30, 2015.

	Six Months Ended June 30, 2015		From the Acquisition Date through June 30, 2014
	(in thousands)
Revenue—Interest and other income	$	10,946	$	7,797
Expenses:
Interest expense		421		554
Fees to related party(1)		2,236		—
General and administrative(1)		868		1,658
Provision for income taxes		475		308
Total expenses		4,000		2,520
Income from operations of assets held for sale	$	6,946	$	5,277

(1)           Salaries and related benefits of $1,325,000 were included in general and administrative expense for the period from the Acquisition Date through June 30, 2014 while, as a result of the transfer of our employees to an affiliate (see Note 12), such expenses were included in fees to related party for the six months ended June 30, 2015.

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DEBT

6 Months Ended

Jun. 30, 2015

DEBT

DEBT

7. DEBT

        Information on our debt is as follows:

	June 30, 2015			December 31, 2014
	(in thousands)
Mortgage loan with a fixed interest rate of 7.66% per annum, with monthly payments of principal and interest. The loan has a 20-year amortization schedule with a $25,324,000 balance due on December 1, 2015. The loan is nonrecourse.	$	26,000		$	26,783
Mortgage loan with a fixed interest rate of 4.50% per annum, with monthly payments of interest only for 10 years, and payments of interest and principal starting in February 2022. The loan has a $42,008,000 balance due on January 5, 2027. The loan is nonrecourse.		46,000			46,000
Mortgage loan with a fixed interest rate of 5.56% per annum, with monthly payments of principal and interest. The loan had a 10-year amortization schedule with a $12,288,000 balance due on July 1, 2015. The loan was nonrecourse. The loan was paid in full in April 2015.		—			12,442
Mortgage loan with a fixed interest rate of 6.65% per annum, with monthly payments of principal and interest. The loan has a 25-year amortization schedule with a $21,136,000 balance due on July 15, 2018. The loan is nonrecourse.		30,656			32,070
Mortgage loan with a fixed interest rate of 5.06% per annum, with monthly payments of principal and interest, and a balance of $33,068,000 due on September 1, 2015. The loan is nonrecourse.		33,290			33,734
Mortgage loans with a fixed interest rate of 5.39% per annum, with monthly payments of principal and interest, and a balance of $35,695,000 due on March 1, 2021. The loans are nonrecourse.		40,188			40,526
Mortgage loan with a fixed interest rate of 5.18% per annum, with monthly payments of principal and interest, and a balance of $26,232,000 due on June 5, 2021. The loan is nonrecourse.		30,021			30,292
		206,155			221,847
Premiums and discounts on assumed mortgages		1,547			1,961
Total Mortgages Payable		207,702			223,808
Junior subordinated notes with a variable interest rate which resets quarterly based on the 90-day LIBOR plus 3.25%, with quarterly interest only payments. Balance due at maturity on March 30, 2035.		27,070			27,070
Unsecured credit facilities		415,000			360,000
		442,070			387,070
Discount on junior subordinated notes		(2,128	)		(2,164	)
Total Other		439,942			384,906
Total Debt	$	647,644		$	608,714

        The mortgages payable are secured by deeds of trust on certain of the properties and assignments of rents.

        The junior subordinated notes may be redeemed at par at our option.

        In February 2012, CIM Urban entered into an unsecured revolving line of credit with a bank syndicate, which allowed for maximum borrowings of $100,000,000. Outstanding advances under the line of credit bore interest at LIBOR plus 1.75% to 2.50% until August 2013. In August 2013, the unsecured revolving line was amended, and outstanding advances under the line of credit bore interest at LIBOR plus 1.25% to 1.85%. The line of credit was also subject to an unused commitment fee of 0.25% or 0.35% depending on the amount of aggregate unused commitments. This line of credit was terminated and repaid in full in September 2014.

        In August 2013, CIM Urban entered into another unsecured revolving line of credit with a bank syndicate, as amended in April 2014, which allowed for maximum borrowings of $200,000,000. Outstanding advances under the line of credit bore interest at LIBOR plus 1.25% to 1.85%. The line of credit was also subject to an unused commitment fee of 0.25% or 0.35% depending on the amount of aggregate unused commitments. This line of credit was terminated and repaid in full in September 2014.

        In September 2014, CIM Commercial entered into an $850,000,000 unsecured credit facility with a bank syndicate consisting of a $450,000,000 revolver, a $325,000,000 term loan and a $75,000,000 delayed-draw term loan. The credit facility can be increased to $1,150,000,000 under certain conditions. CIM Commercial is subject to certain financial maintenance covenants and a minimum property ownership condition. Outstanding advances under the revolver bear interest at (i) the base rate, plus 0.20% to 1.00% or (ii) LIBOR plus 1.20% to 2.00%, depending on the maximum consolidated leverage ratio. Outstanding advances under the term loans bear interest at (i) the base rate, plus 0.15% to 0.95% or (ii) LIBOR plus 1.15% to 1.95%, depending on the maximum consolidated leverage ratio. The revolver is also subject to an unused commitment fee of 0.15% or 0.25% depending on the amount of aggregate unused commitments. The delayed draw term loan was also subject to an unused line fee of 0.25%. The credit facility matures in September 2016 and provides for two one-year extension options under certain conditions. As of June 30, 2015 and December 31, 2014, $415,000,000 ($15,000,000 under the revolver and $400,000,000 under the term loans) and $360,000,000 ($35,000,000 under the revolver and $325,000,000 under the term loans), respectively, was outstanding under the credit facility and $435,000,000 and $490,000,000, respectively, was available for future borrowings. Proceeds from the unsecured credit facility were used for acquisitions and general corporate purposes and to repay $323,000,000 outstanding under our prior unsecured credit facilities. At June 30, 2015 and December 31, 2014, the interest rate on this unsecured credit facility ranged from 1.34% to 1.39% and 1.31% to 1.37%, respectively.

        In May 2015, CIM Commercial entered into an unsecured term loan facility with a bank syndicate pursuant to which CIM Commercial can borrow up to a maximum of $385,000,000. The term loan facility ranks pari passu with CIM Commercial's $850,000,000 credit facility described above; covenants under the term loan facility are substantially the same as those in the $850,000,000 credit facility. Outstanding advances under the term loan facility bear interest at (i) the base rate plus 0.60% to 1.25% or (ii) LIBOR plus 1.60% to 2.25%, depending on the maximum consolidated leverage ratio. The unused portion of the term loan facility is also subject to an unused fee of 0.20%. With some exceptions, any prepayment of the term loan facility prior to May 2017 will be subject to a prepayment fee up to 2% of the outstanding principal amount. The term loan facility matures in May 2022. As of August 5, 2015, no amount has been drawn under the term loan facility. We have six months from the effective date to draw on the term loan facility and anticipate that we will fully draw on this facility prior to November 2015. Proceeds from the term loan facility may be used for acquisitions, refinancing of certain existing debt and other general corporate purposes.

        At June 30, 2015 and December 31, 2014, we were in compliance with all of our respective financial covenants.

        On April 1, 2015, we paid off a mortgage with an outstanding balance of $12,364,000 using the unsecured credit facility.

        At June 30, 2015 and December 31, 2014, accrued interest and unused commitment fees payable of $976,000 and $967,000, respectively, are included in accounts payable and accrued expenses.

        Future principal payments on our debt (face value) at June 30, 2015 are as follows:

Years Ending December 31,	Mortgages Payable		Other(1)		Total
	(in thousands)
2015 (Six Months Ending December 31, 2015)	$	61,363	$	—	$	61,363
2016		4,354		415,000		419,354
2017		4,642		—		4,642
2018		24,300		—		24,300
2019		1,519		—		1,519
Thereafter		109,977		27,070		137,047
	$	206,155	$	442,070	$	648,225

(1)           Represents the junior subordinated notes and unsecured credit facility.

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EARNINGS PER SHARE (''EPS'')

6 Months Ended

Jun. 30, 2015

EARNINGS PER SHARE ("EPS")

EARNINGS PER SHARE ("EPS")

9. EARNINGS PER SHARE ("EPS")

        The computations of basic EPS are based on our weighted average shares outstanding. The basic weighted average common shares outstanding were 97,589,000 and 97,571,000 for the three months ended June 30, 2015 and 2014, respectively, and 97,586,000 and 96,758,000 for the six months ended June 30, 2015 and 2014, respectively. For the three months ended June 30, 2015 and 2014, the weighted average shares outstanding were increased by 0 and 5,000 shares, respectively, to reflect the dilutive effect of stock options; for the six months ended June 30, 2015 and 2014, the dilutive effect of stock options was 0 and 6,000 shares, respectively. EPS for the year to date period may differ from the sum of quarterly EPS amounts due to the required method of computing EPS in the respective periods.

        For purposes of calculating basic EPS for the three and six months ended June 30, 2014, the approximately 65,000,000 shares of preferred stock issued in connection with the Merger were assumed to have been converted into approximately 91,040,000 shares of Common Stock. As of the Acquisition Date, a subsidiary of CIM REIT had agreed to vote its 97.8% post-Merger ownership of CIM Commercial in favor of an increase in the number of authorized CIM Commercial shares of Common Stock to one billion (200,000,000 after giving effect to the reverse stock split), thereby satisfying the condition for the automatic conversion of these shares. The actual conversion of the shares of preferred stock to shares of Common Stock occurred on April 29, 2014.

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SEGMENT DISCLOSURE (Details 3) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Segment disclosure
Total assets	$ 2,090,788		$ 2,094,682
Lending assets held for sale	217,418		208,799
Total capital expenditures	15,820	$ 12,578
Loan originations included in assets held for sale	41,121	25,191
Total capital expenditures and loan originations	56,941	37,769
Office
Segment disclosure
Total capital expenditures	14,200	11,428
Hotel
Segment disclosure
Total capital expenditures	738	721
Multi-family
Segment disclosure
Total capital expenditures	882	$ 429
Reportable segments
Segment disclosure
Lending assets held for sale	217,418		208,799
Reportable segments | Office
Segment disclosure
Total assets	1,517,155		1,534,610
Reportable segments | Hotel
Segment disclosure
Total assets	177,284		174,679
Reportable segments | Multi-family
Segment disclosure
Total assets	170,241		171,226
Non-segment
Segment disclosure
Total assets	$ 8,690		$ 5,368

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FUTURE MINIMUM LEASE RENTALS (Tables)

6 Months Ended

Jun. 30, 2015

FUTURE MINIMUM LEASE RENTALS

Summary of future minimum rental revenues under long-term operating leases excluding tenant reimbursements of certain costs

Years Ending December 31,	Governmental Tenants		Other Tenants		Total
	(in thousands)
2015 (Six months ending December 31, 2015)	$	27,985	$	52,995	$	80,980
2016		48,608		94,676		143,284
2017		43,210		90,231		133,441
2018		40,568		70,328		110,896
2019		38,207		58,932		97,139
Thereafter		118,653		203,760		322,413
	$	317,231	$	570,922	$	888,153

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DEBT (Detail 2)		1 Months Ended
	Apr. 01, 2015 USD ($)	May. 31, 2015 USD ($)	Sep. 30, 2014 USD ($) item	Aug. 31, 2013 USD ($)	Feb. 29, 2012 USD ($)	Aug. 05, 2015 USD ($)	Jun. 30, 2015 USD ($)	Dec. 31, 2014 USD ($)
Debt
Accrued interest and unused commitment fee payable							$ 976,000	$ 967,000
Principal payments on, and estimated amortization of debt
2015 (Six Months Ending December 31, 2015)							61,363,000
2016							419,354,000
2017							4,642,000
2018							24,300,000
2019							1,519,000
Thereafter							137,047,000
Total Debt							648,225,000
Unsecured revolving line of credit entered into February 2012 | CIM Urban Partners, L.P
Debt
Maximum borrowing capacity					$ 100,000,000
Unused commitment fee dependent upon amount of aggregate unused commitments, one (as a percent)				0.25%
Unused commitment fee dependent upon amount of aggregate unused commitments, two (as a percent)				0.35%
Unsecured revolving line of credit entered into February 2012 | LIBOR | CIM Urban Partners, L.P | Minimum
Debt
Interest rate margin (as a percent)				1.25%	1.75%
Unsecured revolving line of credit entered into February 2012 | LIBOR | CIM Urban Partners, L.P | Maximum
Debt
Interest rate margin (as a percent)				1.85%	2.50%
Unsecured revolving line of credit entered into August 2013 | CIM Urban Partners, L.P
Debt
Maximum borrowing capacity				$ 200,000,000
Unused commitment fee dependent upon amount of aggregate unused commitments, one (as a percent)				0.25%
Unused commitment fee dependent upon amount of aggregate unused commitments, two (as a percent)				0.35%
Unsecured revolving line of credit entered into August 2013 | LIBOR | CIM Urban Partners, L.P | Minimum
Debt
Interest rate margin (as a percent)				1.25%
Unsecured revolving line of credit entered into August 2013 | LIBOR | CIM Urban Partners, L.P | Maximum
Debt
Interest rate margin (as a percent)				1.85%
Mortgages Payable
Debt
Repayments of debt	$ 12,364,000
Principal payments on, and estimated amortization of debt
2015 (Six Months Ending December 31, 2015)							61,363,000
2016							4,354,000
2017							4,642,000
2018							24,300,000
2019							1,519,000
Thereafter							109,977,000
Total Debt							206,155,000	221,847,000
Other debt
Principal payments on, and estimated amortization of debt
2016							415,000,000
Thereafter							27,070,000
Total Debt							442,070,000	387,070,000
Unsecured credit facility entered into in September 2014
Debt
Maximum borrowing capacity			$ 850,000,000
Amount available for future borrowings							435,000,000	490,000,000
Amount outstanding under the facility							$ 415,000,000	$ 360,000,000
Period of extension option			1 year
Upsized borrowing capacity			$ 1,150,000,000
Number of extension | item			2
Unsecured credit facility entered into in September 2014 | Minimum
Debt
Interest rate (as a percent)							1.34%	1.31%
Unsecured credit facility entered into in September 2014 | Maximum
Debt
Interest rate (as a percent)							1.39%	1.37%
Unsecured credit facility entered into in September 2014, revolver
Debt
Maximum borrowing capacity			$ 450,000,000
Amount outstanding under the facility							$ 15,000,000	$ 35,000,000
Unused commitment fee dependent upon amount of aggregate unused commitments, one (as a percent)			0.15%
Unused commitment fee dependent upon amount of aggregate unused commitments, two (as a percent)			0.25%
Principal payments on, and estimated amortization of debt
Unused line fee (as a percent)			0.25%
Unsecured credit facility entered into in September 2014, revolver | Base rate | Minimum
Debt
Interest rate margin (as a percent)			0.20%
Unsecured credit facility entered into in September 2014, revolver | Base rate | Maximum
Debt
Interest rate margin (as a percent)			1.00%
Unsecured credit facility entered into in September 2014, revolver | LIBOR | Minimum
Debt
Interest rate margin (as a percent)			1.20%
Unsecured credit facility entered into in September 2014, revolver | LIBOR | Maximum
Debt
Interest rate margin (as a percent)			2.00%
Unsecured credit facility entered into in September 2014, term loan
Debt
Maximum borrowing capacity			$ 325,000,000
Amount outstanding under the facility							400,000,000	325,000,000
Unsecured credit facility entered into in September 2014, term loan | Base rate | Minimum
Debt
Interest rate margin (as a percent)			0.15%
Unsecured credit facility entered into in September 2014, term loan | Base rate | Maximum
Debt
Interest rate margin (as a percent)			0.95%
Unsecured credit facility entered into in September 2014, term loan | LIBOR | Minimum
Debt
Interest rate margin (as a percent)			1.15%
Unsecured credit facility entered into in September 2014, term loan | LIBOR | Maximum
Debt
Interest rate margin (as a percent)			1.95%
Unsecured credit facility entered into in September 2014, delayed-draw term loan
Debt
Maximum borrowing capacity			$ 75,000,000
Unsecured term facility entered into in May 2015
Debt
Maximum borrowing capacity		$ 385,000,000
Amount outstanding under the facility						$ 0
Unused commitment fee dependent upon amount of aggregate unused commitments, one (as a percent)		0.20%
Prepayment fee		2.00%
Period to draw on the term facility		6 months
Unsecured term facility entered into in May 2015 | Base rate | Minimum
Debt
Interest rate margin (as a percent)		0.60%
Unsecured term facility entered into in May 2015 | Base rate | Maximum
Debt
Interest rate margin (as a percent)		1.25%
Unsecured term facility entered into in May 2015 | LIBOR | Minimum
Debt
Interest rate margin (as a percent)		1.60%
Unsecured term facility entered into in May 2015 | LIBOR | Maximum
Debt
Interest rate margin (as a percent)		2.25%
Unsecured credit facilities
Debt
Pay-off of unsecured revolving line and term note			$ 323,000,000
Principal payments on, and estimated amortization of debt
Total Debt							$ 415,000,000	$ 360,000,000

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FUTURE MINIMUM LEASE RENTALS

6 Months Ended

Jun. 30, 2015

FUTURE MINIMUM LEASE RENTALS

FUTURE MINIMUM LEASE RENTALS

14. FUTURE MINIMUM LEASE RENTALS

        Future minimum rental revenues under long-term operating leases at June 30, 2015, excluding tenant reimbursements of certain costs, are as follows:

Years Ending December 31,	Governmental Tenants		Other Tenants		Total
	(in thousands)
2015 (Six months ending December 31, 2015)	$	27,985	$	52,995	$	80,980
2016		48,608		94,676		143,284
2017		43,210		90,231		133,441
2018		40,568		70,328		110,896
2019		38,207		58,932		97,139
Thereafter		118,653		203,760		322,413
	$	317,231	$	570,922	$	888,153

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2015

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Schedule of estimated useful lives of real estate investment assets

Buildings and improvements	15 - 40 years
Furniture, fixtures, and equipment	3 - 5 years
Tenant improvements	Shorter of the useful lives or the terms of the related leases

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DISCONTINUED OPERATIONS (Details 5) - USD ($)	3 Months Ended		4 Months Ended	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Expenses:
Income from operations of assets held for sale	$ 3,984,000	$ 4,344,000		$ 6,946,000	$ 5,277,000
Salaries and related benefits		1,018,000	$ 1,325,000
Lending division | Held for sale
DISCONTINUED OPERATIONS
Revenue - Interest and other income	5,768,000	6,271,000	7,797,000	10,946,000
Expenses:
Interest expense	120,000	374,000	554,000	421,000
Fees to related party	1,093,000			2,236,000
General and administrative	294,000	1,253,000	1,658,000	868,000
Provision for income taxes	277,000	300,000	308,000	475,000
Total expenses	1,784,000	1,927,000	2,520,000	4,000,000
Income from operations of assets held for sale	$ 3,984,000	$ 4,344,000	$ 5,277,000	$ 6,946,000

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) - PMC Commercial - USD ($)	Jun. 30, 2015	Mar. 11, 2014
Loans receivable
Discount on acquisition		$ 33,907,000
Unamortized amount of acquisition discounts of loans receivable	$ 23,828,000

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CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands	Common Stock	Preferred Stock	Additional Paid-in Capital	Distributions In Excess of Earnings	Treasury Stock	Noncontrolling Interests	Total
Balance at Dec. 31, 2013	$ 220	$ 650	$ 1,772,821	$ (399,953)		$ 2,745	$ 1,376,483
Balance (in shares) at Dec. 31, 2013	4,400,000	65,028,571
Increase (Decrease) in Stockholders' Equity
Distributions pre-merger				(16,100)			(16,100)
Contributions from noncontrolling interests						10	10
Distributions to noncontrolling interests						(148)	(148)
Reverse acquisition capital transaction	$ 111		49,400		$ (4,901)		44,610
Reverse acquisition capital transaction (in shares)	2,119,244
Conversion of preferred stock to common stock	$ 910	$ (650)	(260)
Conversion of preferred stock to common stock (in shares)	91,039,999	(65,028,571)
Change in par value	$ (1,143)		1,143
Exercise of stock options			201				201
Exercised (in shares)	14,500
Stock based compensation expense			373				373
Stock based compensation expense (in shares)	8,000
Retirement of fractional shares			(3)				(3)
Retirement of fractional shares (in shares)	(145)
Common dividends				(21,671)			(21,671)
Preferred dividends				(4,585)			(4,585)
Net income (loss)				19,618		113	19,731
Balance at Jun. 30, 2014	$ 98		1,823,675	(422,691)	(4,901)	2,720	1,398,901
Balance (in shares) at Jun. 30, 2014	97,581,598
Balance at Dec. 31, 2014	$ 98		1,824,381	(460,623)	(4,901)	861	1,359,816
Balance (in shares) at Dec. 31, 2014	97,581,598
Increase (Decrease) in Stockholders' Equity
Contributions from noncontrolling interests						110	110
Distributions to noncontrolling interests						(38)	(38)
Stock based compensation expense			717				717
Stock based compensation expense (in shares)	8,000
Common dividends				(42,693)			(42,693)
Net income (loss)				7,708		6	7,714
Balance at Jun. 30, 2015	$ 98		$ 1,825,098	$ (495,608)	$ (4,901)	$ 939	$ 1,325,626
Balance (in shares) at Jun. 30, 2015	97,589,598

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BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2015

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        For more information regarding our significant accounting policies and estimates, please refer to "Basis of Presentation and Summary of Significant Accounting Policies" contained in Note 3 to our consolidated financial statements for the year ended December 31, 2014, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 16, 2015.

        Interim Financial Information—The accompanying interim consolidated financial statements of CIM Commercial have been prepared by our management in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim consolidated financial statements do not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods. Operating results for the three and six months ended June 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. Our accompanying interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K filed with the SEC on March 16, 2015.

        Principles of Consolidation—The consolidated financial statements include the accounts of CIM Commercial and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

        Investments in Real Estate—Real estate acquisitions are recorded at cost as of the acquisition date. Costs related to the acquisition of properties are expensed as incurred. Investments in real estate are stated at depreciated cost. Depreciation and amortization are recorded on a straight line basis over the estimated useful lives as follows:

Buildings and improvements	15 - 40 years
Furniture, fixtures, and equipment	3 - 5 years
Tenant improvements	Shorter of the useful lives or the terms of the related leases

        Improvements and replacements are capitalized when they extend the useful life, increase capacity, or improve the efficiency of the asset. Ordinary repairs and maintenance are expensed as incurred.

        Investments in real estate are evaluated for impairment on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. The estimated fair value of the asset group identified for step two of the impairment testing under U.S. GAAP is based on either the income approach with market discount rate, terminal capitalization rate and rental rate assumptions being most critical, or on the sales comparison approach to similar properties. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell. No impairment of long-lived assets was recognized during the three and six months ended June 30, 2015 and 2014.

        Loans Receivable—Our loans receivable included in assets held for sale are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, retained loan discounts and loan loss reserves. For loans originated under the Small Business Administration's ("SBA") 7(a) Guaranteed Loan Program ("SBA 7(a) Program"), we sell the portion of the loan that is guaranteed by the SBA. Upon sale of the SBA guaranteed portion of the loan, the unguaranteed portion of the loan retained by us is valued on a fair value basis and a discount (the "Retained Loan Discount") is recorded as a reduction in basis of the retained portion of the loan.

        At the Acquisition Date, the carrying value of our loans was adjusted to the estimated fair market value and acquisition discounts of $33,907,000 were recorded, which are being accreted to interest income, included in income from operations of assets held for sale, using the effective interest method. The amount of acquisition discounts that have not yet been accreted to income at June 30, 2015 was $23,828,000.

        A loan receivable is generally classified as non-accrual (a "Non- Accrual Loan") if (i) it is past due as to payment of principal or interest for a period of 60 days or more, (ii) any portion of the loan is classified as doubtful or is charged-off or (iii) the repayment in full of the principal and/or interest is in doubt. Generally, loans are charged-off when management determines that we will be unable to collect any remaining amounts due under the loan agreement, either through liquidation of collateral or other means. Interest income, included in income from operations of assets held for sale, on a Non-Accrual Loan is recognized on either the cash basis or the cost recovery basis.

        On a quarterly basis, and more frequently if indicators exist, we evaluate the collectability of our loans receivable. Our evaluation of collectability involves judgment, estimates, and a review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers' business models and future operations in accordance with Accounting Standards Codification ("ASC") 450-20,Contingencies—Loss Contingencies, and ASC 310-10,Receivables. The allowance for losses on our impaired loans receivable decreased by $36,000 and increased by $65,000 during the three and six months ended June 30, 2015, respectively. No impairment on loans receivable was recorded for the three and six months ended June 30, 2014. We establish a general loan loss reserve when available information indicates that it is probable a loss has occurred based on the carrying value of the portfolio and the amount of the loss can be reasonably estimated. Significant judgment is required in determining the general loan loss reserve, including estimates of the likelihood of default and the estimated fair value of the collateral. The general loan loss reserve includes those loans, which may have negative characteristics which have not yet become known to us. In addition to the reserves established on loans not considered impaired that have been evaluated under a specific evaluation, we establish the general loan loss reserve using a consistent methodology to determine a loss percentage to be applied to loan balances. These loss percentages are based on many factors, primarily cumulative and recent loss history and general economic conditions.

        Deferred Rent Receivable and Charges—Deferred rent receivable and charges consist of deferred rent, deferred loan costs and deferred leasing costs. Deferred rent receivable was $55,313,000 and $53,622,000 at June 30, 2015 and December 31, 2014, respectively. Deferred loan costs, which represent legal and third-party fees incurred in connection with our borrowing activities, are capitalized and amortized to interest expense on a straight line basis over the life of the related loan, approximating the effective interest method. Deferred loan costs of $10,941,000 and $7,521,000 are presented net of accumulated amortization of $3,251,000 and $1,741,000 at June 30, 2015 and December 31, 2014, respectively. Deferred leasing costs, which represent lease commissions and other direct costs associated with the acquisition of tenants, are capitalized and amortized on a straight line basis over the terms of the related leases. Deferred leasing costs of $56,511,000 and $55,145,000 are presented net of accumulated amortization of $19,462,000 and $16,917,000 at June 30, 2015 and December 31, 2014, respectively.

        Noncontrolling Interests—Noncontrolling interests represent the interests in various properties owned by third parties.

        Discontinued Operations—We classify assets as held for sale when they meet the necessary criteria, which include: a) management commits to and actively embarks upon a plan to sell the assets, b) the assets to be sold are available for immediate sale in their present condition, c) the sale is expected to be completed within one year under terms usual and customary for such sales and d) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. We believe that we meet these criteria because the plan for sale has been approved by the Board of Directors, there are no known significant contingencies related to the sale and management believes it is probable that the sale will be completed within one year.

        Assets held for sale are recorded at the lower of cost or estimated fair value less cost to sell. Revenues and expenses related to assets held for sale are presented as discontinued operations for all periods presented in the consolidated statements of operations and comprehensive income.

        Consolidation Considerations for Our Investments in Real Estate—ASC 810-10,Consolidation, addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights that would require the entity to be consolidated. We analyze our investments in real estate in accordance with this accounting standard to determine whether they are variable interest entities, and if so, whether we are the primary beneficiary. Our judgment with respect to our level of influence or control over an entity and whether we are the primary beneficiary of a variable interest entity involves consideration of various factors, including the form of our ownership interest, our voting interest, the size of our investment (including loans), and our ability to participate in major policy-making decisions. Our ability to correctly assess our influence or control over an entity affects the presentation of these investments in our consolidated financial statements.

        Use of Estimates—The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

        Reclassifications—Certain prior period amounts have been reclassified to conform with the current period presentation. These reclassifications had no effect on previously reported net income or cash flows.

        Recently Issued Accounting Pronouncements—In April 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2014-08,Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360). Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,which amends the definition of a discontinued operation and requires entities to provide additional disclosures about disposal transactions that do not meet the discontinued-operations criteria. The revised guidance is effective prospectively to all disposals (or classifications as held for sale) that occur in annual periods (and interim periods therein) beginning on or after December 15, 2014, with early adoption permitted. Entities are prohibited from applying the new ASU to any component, equity method investment, or acquired business that is classified as held for sale before the adoption date. We early adopted this guidance during the second quarter of 2014, and the adoption did not have a material impact on our consolidated financial statements.

        In May 2014, the FASB issued ASU No. 2014-09,Revenue from Contracts with Customers (Topic 606)which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including the guidance on real estate de-recognition for most transactions. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted for annual periods beginning after December 15, 2016. Entities have the option of using either a full retrospective or a modified approach to adopt the guidance in the ASU. The modified approach provides entities relief from having to restate and present comparable prior-year financial statement information; however, entities will still need to evaluate existing contracts as of the date of initial adoption under the ASU to determine whether a cumulative adjustment is necessary. We are currently in the process of evaluating the impact of adoption of the new accounting guidance on our consolidated financial statements.

        In August 2014, the FASB issued ASU No. 2014-15Presentation of Financial Statements—Going Concern (Subtopic 205-40)which requires an entity's management to evaluate whether there are conditions or events, when considered in the aggregate, that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date the financial statements are issued. The ASU is effective for the annual reporting period ending after December 15, 2016, and for annual and interim periods thereafter. Early application is permitted. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

        In February 2015, the FASB issued ASU No. 2015-02,Consolidation (Topic 810): Amendments to the Consolidation Analysis,which is intended to improve targeted areas of consolidation guidance for legal entities such as limited partnerships, limited liability corporations, and securitization structures (collateralized debt obligations, collateralized loan obligations, and mortgage-backed security transactions). In addition to reducing the number of consolidation models from four to two, the new standard simplifies the FASB Accounting Standards Codification and improves current U.S. GAAP by: placing more emphasis on risk of loss when determining a controlling financial interest; reducing the frequency of the application of related-party guidance when determining a controlling financial interest in a variable interest entity (VIE); and changing consolidation conclusions for public and private companies in several industries that typically make use of limited partnerships or VIEs. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. ASU 2015-02 may be applied retrospectively in previously issued financial statements for one or more years with a cumulative-effect adjustment to retained earnings as of the beginning of the first year restated. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

        In March 2015, the FASB issued ASU No. 2015-03,Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs,which is intended to simplify the presentation of debt issuance costs. These amendments require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the amendments in this ASU. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2015. Early adoption is permitted for financial statements that have not been previously issued. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements.

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COMMITMENTS AND CONTINGENCIES (Details)	1 Months Ended	3 Months Ended		4 Months Ended	6 Months Ended
	Feb. 28, 2015 USD ($)	Jun. 30, 2015 USD ($) item	Jun. 30, 2014 USD ($)	Jun. 30, 2014 USD ($)	Jun. 30, 2015 USD ($) item shares	Jun. 30, 2014 USD ($)	Dec. 31, 2014 USD ($)
Commitments and contingencies
Outstanding loan commitments and approvals to fund loans		$ 20,384,000			$ 20,384,000
Future obligations under leases to fund tenant improvements and in other future construction obligation		23,883,000			23,883,000
Liability related to the settlement of a 421a tax abatement dispute							$ 4,475,000
Settlement of liability related to the settlement of a 421a tax abatement dispute	$ 4,721,000
Future noncancelable minimum lease payments
2015 (Six months ending December 31, 2015)		361,000			361,000
2016		743,000			743,000
2017		749,000			749,000
2018		607,000			607,000
2019		503,000			503,000
Thereafter		128,528,000			128,528,000
Total		131,491,000			131,491,000
Ground lease for one of the project
Commitments and contingencies
Current annual rent					$ 503,000
Period after which the annual rental payment will be increased by greater of 15% or 50% of the increase in the Consumer Price Index					5 years
Increase in annual rental payment after every 5 years, option one (as a percent)					15.00%
Increase in annual rental payment after every 5 years, option two (as a percent)					50.00%
Adjustment period used to calculate increase in the Consumer Price Index					5 years
Increase in rent payable during the balance of the lease term expressed as a percentage of rent payable during the immediately preceding lease year commencing on June 1, 2040 and 2065					10.00%
Rent expense		438,000	$ 438,000		$ 876,000	$ 876,000
Straight line rent liability		11,625,000			11,625,000		$ 11,038,000
Office space in Dallas, Texas
Commitments and contingencies
Rent expense		72,000	49,000	$ 65,000	130,000
Restricted share awards
Commitments and contingencies
Unrecognized compensation expense		$ 103,000			$ 103,000
Executive officers
Commitments and contingencies
Number of employees covered under employment agreement | item					2
Multiplier used for the calculation of severance compensation or change in control payments | item		2.99			2.99
Period of annual compensation paid to employee used to calculate severance compensation or change in control payments					3 years
Multiplier used for the calculation of payments in the event of death of employee | item		2			2
Multiplier used for the calculation of payments in the event of disability to employee | item		1			1
Executive officers | Restricted share awards
Commitments and contingencies
Stock-based compensation expense		$ 8,000	19,000		$ 26,000	19,000
Employment agreements | Executive officers | Restricted share awards
Commitments and contingencies
Share awards to be granted as retention bonus under employment agreement | shares					105,000
Stock-based compensation expense		316,000	$ 315,000		$ 632,000	$ 315,000
Unrecognized compensation expense		$ 631,000			$ 631,000

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INVESTMENTS IN REAL ESTATE (Tables)

6 Months Ended

Jun. 30, 2015

INVESTMENTS IN REAL ESTATE

Schedule of investments in real estate

	June 30, 2015			December 31, 2014
	(in thousands)
Land	$	354,035		$	354,035
Land improvements		28,071			28,071
Buildings and improvements		1,504,902			1,501,603
Furniture, fixtures, and equipment		8,914			10,875
Tenant improvements		142,306			131,446
Work in progress		5,862			10,764
Investments in real estate		2,044,090			2,036,794
Accumulated depreciation		(343,676	)		(320,857	)
Net investments in real estate	$	1,700,414		$	1,715,937

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MERGER (Details) $ / shares in Units, $ in Thousands			3 Months Ended	6 Months Ended
	Apr. 29, 2014	Mar. 11, 2014 USD ($) $ / shares shares	Jun. 30, 2014 shares	Jun. 30, 2014 shares	Jun. 30, 2015 shares	Dec. 31, 2014 shares	Mar. 25, 2014 $ / shares
Merger
Treasury stock					107,265	107,265
Reverse stock split ratio	0.2
Consideration Transferred
Common stock outstanding					97,589,598	97,581,598
Common Stock
Merger
Shares issued				2,119,244
Consideration Transferred
Common stock outstanding		2,119,244
CIM Urban REIT
Merger
Shares issued			91,040,000	91,040,000
Number of shares to be issued on conversion of preferred stock expressed as a percentage of outstanding stock		97.80%
CIM Urban REIT | Preferred Stock
Merger
Shares issued			65,000,000	65,000,000
PMC Commercial | CIM Urban REIT
Merger
Shares issued		2,226,509
Treasury stock		107,265
Number of shares to be issued on conversion of each preferred stock		1.4
Aggregate shares of common stock issued in the merger		95,440,000
Number of shares to be issued on conversion of preferred stock expressed as a percentage of outstanding stock		97.80%
Special cash dividend issued to shareholders of record at the close of the business day prior to the closing of transactions (in dollars per share) | $ / shares							$ 27.50
Consideration Transferred
Common stock outstanding		2,119,000
Equity consideration price per share of common stock (in dollars per share) | $ / shares		$ 21.05
Fair value of the equity consideration | $		$ 44,610
Payment in cash - special dividend | $		58,279
Total purchase price | $		$ 102,889
PMC Commercial | CIM Urban REIT | Common Stock
Merger
Shares issued		4,400,000
PMC Commercial | CIM Urban REIT | Preferred Stock
Merger
Shares issued		65,000,000

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2015

COMMITMENTS AND CONTINGENCIES.

COMMITMENTS AND CONTINGENCIES

13. COMMITMENTS AND CONTINGENCIES

        Loan Commitments—Commitments to extend credit are agreements to lend to a customer provided the terms established in the contract are met. Our outstanding loan commitments and approvals to fund loans were $20,384,000 at June 30, 2015, the majority of which were for prime-based loans to be originated by our subsidiary engaged in SBA 7(a) Program loans, the government guaranteed portion of which is intended to be sold. Commitments generally have fixed expiration dates. Since some commitments are expected to expire without being drawn upon, total commitment amounts do not necessarily represent future cash requirements.

        General—In connection with the ownership and operation of real estate properties, we have certain obligations for the payment of tenant improvement allowances and lease commissions in connection with new leases and renewals. CIM Commercial had a total of $23,883,000 in future obligations under leases to fund tenant improvements and other future construction obligations at June 30, 2015.

        Employment Agreements—We have employment agreements with two of our executive officers. Under certain circumstances, as defined within the agreements, the agreements provide for (1) severance compensation or change in control payments to the executive officer in an amount equal to 2.99 times the average of the last three years' annual compensation paid to the executive officer and (2) death and disability payments in an amount equal to two times and one time, respectively, the annual salary paid to the executive officer. In addition, to the extent the executive is employed by us on January 1, 2016 and such executive is not entitled to any disability, death or severance payments, the executive would receive share awards as a retention bonus which would vest immediately upon grant. In aggregate, the executive officers would receive 105,000 share awards. We recorded compensation expense of $316,000 and $315,000 for the three months ended June 30, 2015 and 2014, respectively, related to these share awards; for the six months ended June 30, 2015 and 2014, such compensation expense was $632,000 and $315,000, respectively. At June 30, 2015, there was $631,000 of total unrecognized compensation expense relating to these share awards that will be recognized during 2015.

        Litigation—At December 31, 2014, we recorded a liability of $4,475,000 at one of our multifamily investments. The $4,475,000 liability, together with an additional tax abatement reimbursement related to the period from January 1, 2015 to March 11, 2015, was settled in February 2015 for a total of $4,721,000. Prior to our acquisition of the property, the former owners of the property enrolled the property in a property tax abatement program under Section 421-a of the New York Real Property Tax Law. At the time we acquired the property, the property was being used for corporate housing. This use continued from the time of acquisition and terminated in March 2015. The New York State Attorney General's office recently determined that the use of the property for corporate housing was inconsistent with the tax abatement program. In cooperation with the New York State Attorney General, we refunded the tax abatements received during the period we owned the property while it was being used for corporate housing. Our agreement with the New York State Attorney General does not affect the ability of the property to receive tax abatements in the future.

        We are not currently involved in any other material pending or threatened legal proceeding nor, to our knowledge, is any material legal proceeding currently threatened against us, other than routine litigation arising in the ordinary course of business. In the normal course of business, we are periodically a party to certain legal actions and proceedings involving matters that are generally incidental to our business. While the outcome of these legal actions and proceedings cannot be predicted with certainty, in management's opinion, the resolution of these legal proceedings and actions will not have a material adverse effect on our consolidated financial position, results of operations or cash flows.

        SBA Related—If the SBA establishes that a loss on an SBA guaranteed loan is attributable to significant technical deficiencies in the manner in which the loan was originated, funded or serviced under the SBA 7(a) Program, the SBA may seek recovery of the principal loss related to the deficiency from us. With respect to the guaranteed portion of SBA loans that have been sold, the SBA will first honor its guarantee and then seek compensation from us in the event that a loss is deemed to be attributable to technical deficiencies. Based on historical experience, we do not expect that this contingency is probable to be asserted. However, if asserted, it could have a material adverse effect on our consolidated financial position, results of operations or cash flows.

        Environmental Matters—In connection with the ownership and operation of real estate properties, we may be potentially liable for costs and damages related to environmental matters, including asbestos-containing materials. We have not been notified by any governmental authority of any noncompliance, liability, or other claim in connection with any of the properties, and we are not aware of any other environmental condition with respect to any of the properties that management believes will have a material adverse effect on our consolidated financial position, results of operations or cash flows.

        Rent Expense—The ground lease for a property provides for current annual rent of $503,000, payable quarterly, inclusive of an increase on June 1, 2015, and increases every five years thereafter based on the greater of 15% or 50% of the increase in the Consumer Price Index during a five-year adjustment period. In addition, commencing on June 1, 2040 and June 1, 2065, the rent payable during the balance of the lease term shall be increased by an amount equal to 10% of the rent payable during the immediately preceding lease year. The lease term is through May 31, 2089. If the landlord decides to sell the leased property, we have the right of first refusal.

        Rent expense under this lease, which includes straight line rent and amortization of acquired below-market ground lease, was $438,000 for each of the three months ended June 30, 2015 and 2014, and $876,000 for each of the six months ended June 30, 2015 and 2014. We record rent expense on a straight line basis. Straight line rent liability of $11,625,000 and $11,038,000 is included in other liabilities in the accompanying consolidated balance sheets as of June 30, 2015 and December 31, 2014, respectively.

        We lease office space in Dallas, Texas under a lease which expires in May 2018. We recorded rent expense of $72,000 and $49,000 for the three months ended June 30, 2015 and 2014, respectively, and $130,000 and $65,000 for the six months ended June 30, 2015 and the period from the Acquisition Date through June 30, 2014, respectively, which is included in discontinued operations.

        Scheduled future noncancelable minimum lease payments at June 30, 2015 are as follows:

Years Ending December 31,	(in thousands)
2015 (Six months ending December 31, 2015)	$	361
2016		743
2017		749
2018		607
2019		503
Thereafter		128,528
	$	131,491