8. Redeemable common shares

The Company was capitalized through the purchase by Starwood Real Estate Income Holdings, L.P. of 50 common shares for an aggregate purchase price of $1,000. On November 30, 2023, in connection with the Initial Capitalization (as defined below), the Company issued an aggregate of 1,575,000 of its common shares to Starwood Real Estate Income Holdings, L.P., an affiliate of the Advisor (“Starwood RE Income Holdings”) at a price per share of $20.00 for an aggregate purchase price of $31.5 million (which were subsequently converted into Class E shares in connection with the Company’s amended Declaration of Trust). Additionally, on December 1, 2023, the Company issued 28,000 Class E shares to other affiliates of Starwood Capital and investors eligible to purchase Class E shares at a price per share of $20.00 for an aggregate purchase price of $0.6 million in its continuous, blind pool private offering.

At March 31, 2026, all issued and outstanding Class E shares redeemable common shares are classified as temporary equity pursuant to ASC 480-10-S99. These shares are classified as temporary equity given that among other reasons (i) with respect to Class E shares held by Starwood Capital or its affiliate that were issued in connection with the Initial Capitalization, Starwood Capital may request to have such Class E shares repurchased by the Company from time to time, subject to certain limitations and terms set forth in the definitive subscription agreement relating to the Initial Capitalization and (ii) with respect to Class E shares held by the Advisor or its affiliate that were issued in respect of Management Fees and/or Performance Fees, the Company is required to repurchase such shares upon the request of the Advisor, subject to the terms of the Advisory Agreement (as defined below). The fair value of the Class E common shares are subsequently adjusted to equal what the repurchase amount would be as if repurchase were to occur at the reporting date. As of March 31, 2026 and December 31, 2025, the Class E common shares are remeasured using the NAV per share as of March 31, 2026 and December 31, 2025, respectively, with any adjustment between the carrying value and the redemption value recorded in shareholders' equity.

Starwood Capital agreed, from time to time, to purchase from the Company an aggregate amount of not less than $150.0 million in Class E shares, at a price per share equal to the Company’s most recently determined NAV of its Class E shares (the “Initial Capitalization”). As of March 31, 2026, Starwood Capital had purchased an aggregate of $31.5 million pursuant to the Initial Capitalization, with $118.5 million remaining uncalled by the Company. Starwood Capital may, from time to time, request to have such Class E shares repurchased by the Company at a price per share equal to the most recently determined NAV per Class E share as of the repurchase date. The Class E shares issued in the Initial Capitalization are not eligible for repurchase pursuant to the Company’s share repurchase plan and are therefore not subject to the quarterly repurchase limit or the Early Repurchase Deduction.

Distributions