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of Contents](#TOC)\n\n​\n\n​\n\n**UNITED STATES**\n\n**SECURITIES AND EXCHANGE COMMISSION**\n\n**WASHINGTON, D.C. 20549**\n\n**FORM ****10-K**\n\n**(Mark One)**\n\n☒ **ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**\n\nFor the fiscal year ended December 31, 2025\n\n**OR**\n\n☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**\n\nFor the Transition period from to  \n\nCommission file number:******000-56082**\n\n**LODGING FUND REIT III, INC.**\n\n(Exact Name of Registrant as Specified in Its Charter)\n\n**Maryland**\n\n \n\n**83-0556111**\n\n(State or Other Jurisdiction of\n\nIncorporation or Organization)\n\n \n\n(I.R.S. Employer\n\nIdentification No.)\n\n​\n\n​\n\n​\n\n**1635 43rd Street South, Suite 205**\n\n**Fargo****,****North Dakota**\n\n \n\n**58103**\n\n(Address of Principal Executive Offices)\n\n \n\n(Zip Code)\n\n​\n\n**(****701****)****630-6500**\n\n(Registrant's telephone number, including area code)\n\nSecurities registered pursuant to Section 12(b) of the Act: **None**\n\n​\n\nTitle of each class\n\nTrading Symbol(s)\n\nName of each exchange on which registered\n\nNone\n\nN/A\n\nN/A\n\n​\n\nSecurities registered pursuant to Section 12(g) of the Act: Common Stock, $0.01 par value\n\nIndicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒\n\nIndicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒\n\nIndicate 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.\n\nYes ☒ No ☐\n\nIndicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No☐\n\nIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.\n\nLarge accelerated filer\n\n \n\n☐\n\nAccelerated filer\n\n​\n\n​\n\n☐\n\nNon-accelerated filer\n\n​\n\n☒\n\nSmaller reporting company\n\n​\n\n​\n\n☒\n\n​\n\n \n\n​\n\nEmerging growth company\n\n​\n\n \n\n☒\n\n​\n\nIf an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐\n\nIndicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.  ☐\n\n​\n\nIf securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐\n\n​\n\nIndicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐\n\n​\n\nIndicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒\n\nThe aggregate market value of the common stock held by non-affiliates of the registrant: No established market exists for the registrant’s shares of common stock. On June 1, 2018 the registrant launched its ongoing private offering of its shares of common stock, which shares are being offered at $10.00 per share, with discounts available for certain categories of purchasers. There were 10,014,043 shares of common stock held by non-affiliates as of June 30, 2025.\n\nAs of May 15, 2026, there were 10,017,042 outstanding shares of common stock of the registrant.\n\n**DOCUMENTS INCORPORATED BY REFERENCE**\n\nNone.\n\n​\n\n​\n\n​\n\n[Table of Contents](#TOC)\n\nTable of Contents\n\n​\n\n​\n\n[**Part I**](#PARTI_290386)\n\n[Item 1.](#Item1Business_549995)\n\n[Business](#Item1Business_549995)\n\n4\n\n[Item 1A.](#Item1ARiskFactors_527180)\n\n[Risk Factors](#Item1ARiskFactors_527180)\n\n11\n\n[Item 1B.](#Item1BUnresolvedStaffComments_538509)\n\n[Unresolved Staff Comments](#Item1BUnresolvedStaffComments_538509)\n\n37\n\n[Item 1C.](#Item1CCybersecurity_88756)\n\n[Cybersecurity](#Item1CCybersecurity_88756)\n\n38\n\n[Item 2.](#Item2Properties_160010)\n\n[Properties](#Item2Properties_160010)\n\n39\n\n[Item 3.](#Item3LegalProceedings_400945)\n\n[Legal Proceedings](#Item3LegalProceedings_400945)\n\n40\n\n[Item 4.](#Item4MineSafetyDisclosures_667902)\n\n[Mine Safety Disclosures](#Item4MineSafetyDisclosures_667902)\n\n41\n\n​\n\n​\n\n[**Part II**](#PARTII_827129)\n\n[Item 5.](#Item5MarketforRegistrantsCommonEquityRel)\n\n[Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#Item5MarketforRegistrantsCommonEquityRel)\n\n41\n\n[Item 6.](#Item6SelectedFinancialData_891788)\n\n[[Reserved]](#Item6SelectedFinancialData_891788)\n\n47\n\n[Item 7.](#Item7ManagementsDiscussionandAnalysisofF)\n\n[Management’s Discussion and Analysis of Financial Condition and Results of Operations](#Item7ManagementsDiscussionandAnalysisofF)\n\n47\n\n[Item 7A.](#Item7AQuantitativeandQualitativeDisclosu)\n\n[Quantitative and Qualitative Disclosures About Market Risk](#Item7AQuantitativeandQualitativeDisclosu)\n\n67\n\n[Item 8.](#Item8FinancialStatementsandSupplementary)\n\n[Financial Statements and Supplementary Data](#Item8FinancialStatementsandSupplementary)\n\n67\n\n[Item 9.](#Item9ChangesinandDisagreementsWithAccoun)\n\n[Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](#Item9ChangesinandDisagreementsWithAccoun)\n\n67\n\n[Item 9A.](#Item9AControlsandProcedures_249192)\n\n[Controls and Procedures](#Item9AControlsandProcedures_249192)\n\n68\n\n[Item 9B.](#Item9BOtherInformation_469445)\n\n[Other Information](#Item9BOtherInformation_469445)\n\n69\n\n[Item 9C.](#Item9C_Disclosure)\n\n[Disclosure Regarding Foreign Jurisdictions that Prevent Inspection](#Item9C_Disclosure)\n\n69\n\n​\n\n​\n\n[**Part III**](#PARTIII_812653)\n\n[Item 10.](#Item10DirectorsExecutiveOfficersandCorpo)\n\n[Directors, Executive Officers and Corporate Governance](#Item10DirectorsExecutiveOfficersandCorpo)\n\n70\n\n[Item 11.](#Item11ExecutiveCompensation_349825)\n\n[Executive Compensation](#Item11ExecutiveCompensation_349825)\n\n74\n\n[Item 12.](#Item12SecurityOwnershipofCertainBenefici)\n\n[Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#Item12SecurityOwnershipofCertainBenefici)\n\n76\n\n[Item 13.](#Item13CertainRelationshipsandRelatedTran)\n\n[Certain Relationships and Related Transactions, and Director Independence](#Item13CertainRelationshipsandRelatedTran)\n\n77\n\n[Item 14.](#Item14PrincipalAccountantFeesandServices)\n\n[Principal Accountant Fees and Services](#Item14PrincipalAccountantFeesandServices)\n\n81\n\n​\n\n​\n\n[**Part IV**](#PARTIV_856132)\n\n[Item 15.](#Item15ExhibitsandFinancialStatementSched)\n\n[Exhibits and Financial Statement Schedules](#Item15ExhibitsandFinancialStatementSched)\n\n83\n\n[Item 16.](#Item16Form10KSummary_292171)\n\n[Form 10-K Summary](#Item16Form10KSummary_292171)\n\n100\n\n​\n\n​\n\n​\n\n[Signatures](#SIGNATURES_360277)\n\n​\n\n​\n\n​\n\n[Index to Consolidated Financial Statements](#INDEXTOFINANCIALSTATEMENTS_765008)\n\nF-1\n\n[Report of Independent Registered Public Accounting Firm](#PLACEHOLDERFORRJI2025_748943)\n\nF-2\n\n​\n\n​\n\n​\n\ni\n\n[Table of Contents](#TOC)\n\nFORWARD-LOOKING STATEMENTS\n\nCertain statements included in this Annual Report on Form 10-K are forward-looking statements. Those statements include statements regarding the intent, belief or current expectations of the Company and members of our management team, as well as the assumptions on which such statements are based, and generally are identified by the use of words such as “may,” “will,” “should,” “expect,” “could,” “intend,” “anticipate,” “plan,” “estimate,” “believe,” “potential,” “continue,” “seek” or similar expressions. These statements include our plans and objectives for future operations, including plans and objectives relating to future growth and availability of funds, and are based on current expectations that involve numerous risks and uncertainties. Assumptions relating to these statements 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 accurately predict and many of which are beyond our control. Actual results may differ materially from those contemplated by such forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law.\n\nFor a discussion of some of the risks and uncertainties, although not all risks and uncertainties, that could cause actual results to differ materially from those presented in our forward-looking statements, see the risks identified in “Summary Risk Factors” below and under the section entitled “Risk Factors” in Part I, Item 1A of this Annual Report on Form 10-K. All forward-looking statements should be read in light of the risks identified in “Summary Risk Factors” below and in Part I, Item 1A of this Annual Report on Form 10-K. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results.\n\n**SUMMARY RISK FACTORS**\n\nOur business faces significant risks and uncertainties. Set forth below is a summary list of the principal risk factors as of the date of the filing of this Annual Report on Form 10-K that could materially and adversely affect our business, financial condition, results of operations and cash flows. This summary highlights certain of the risks that are discussed further in this Annual Report but does not address all of the risks that we face. You should carefully review and consider the full discussion of our risk factors in the section entitled “Risk Factors” in Part I, Item 1A of this Annual Report on Form 10-K.\n\nRisks Related to Our Business\n\n●Our business strategy depends significantly on achieving revenue and net income growth from anticipated increases in demand for hotel rooms, which will be adversely affected by weak economic conditions and other economic events, elevated interest rates and travel-related concerns. If demand does not increase or if demand weakens, our occupancy or revenues per available room may decline, making it more difficult for us to implement our business strategy and to meet any debt service obligations we have incurred and limiting our ability to pay distributions to our stockholders.\n\n●Our advisor, Legendary Capital REIT III, LLC (the “Advisor”), its executive officers and other key personnel, the employees of Legendary Capital, LLC (the “Sponsor”), an affiliate of the Advisor as well as certain of our officers and directors, whose services are essential to the Company, may be involved in other business ventures, and will face a conflict in allocating their time and other resources between us and the other activities in which they are or may become involved. Failure of the Advisor, its executive officers and key personnel, the employees of the Sponsor, and our officers and directors to devote sufficient time or resources to our operations could result in reduced returns to our stockholders.\n\n●We will pay certain prescribed fees and expenses to the Advisor and its affiliates regardless of the quality of services provided. These fees were not negotiated at arm’s length and therefore may be higher than fees payable to unaffiliated third parties for the same or similar services. Such fees may result in conflicts of interest between the Advisor and our stockholders due to the nature of the incentive fees and management fees.\n\n●We have paid distributions from proceeds from our ongoing private offering described below (the “Offering”) and, to the extent our board of directors declares future distributions, we may continue to fund\n\n1\n\n[Table of Contents](#TOC)\n\ndistributions with Offering proceeds. We have not established a limit on the amount of proceeds from our Offering that we may use to fund distributions. To the extent we fund distributions from sources other than our cash flow from operations, we will have less funds available for investment and the overall return to our stockholders may be reduced. We may fund distributions from other sources such as borrowings, which may constitute a return of capital.\n\n●If we are unable to raise substantial funds in our securities offerings, we may not be able to acquire a large portfolio of assets, which may cause the value of an investment in us to vary more widely with the performance of certain investments and cause our general and administrative expenses to constitute a greater percentage of our revenue.\n\n●We may be unable to identify properties that meet our investment criteria in a timely manner or on acceptable terms, and may be unable to consummate investment opportunities that we identify, which could result in reduced returns or reduce the amount available for distributions to our stockholders.\n\n●We intend to acquire only hotel properties. As a result, we will only have limited diversification as to the type of property we own. In the event of an economic recession affecting the economies of the areas in which the properties are located or a decline in values in general, our financial performance could be materially and adversely affected, which may limit our ability to pay distributions to our stockholders.\n\n●We and our hotel managers rely on information technology networks and systems, including the internet, to process, transmit and store electronic information, and to manage or support a variety of business processes, including financial transactions and records, personally identifiable information, reservations, billing and operating data. It is possible that our safety and security measures will not be able to prevent the systems’ improper functioning or damage, or the improper access or disclosure of personally identifiable information such as in the event of cyber-attacks. Security breaches, including physical or electronic break-ins, computer viruses, attacks by hackers and similar breaches, can create system disruptions, shutdowns or unauthorized disclosure of confidential information, which may subject us to liability claims or regulatory penalties and could have a material adverse effect on our business, financial condition and results of operations.\n\n●Although our board of directors has authorized management to pursue an exit strategy and position us for a sale or merger, there is no assurance that this process will result in the approval or completion of any specific transaction or outcome. The process of exploring strategic alternatives and marketing our assets could be time consuming and disruptive to our business operations and could divert management’s attention from our business, and we could incur substantial expenses associated with identifying and evaluating potential transactions. Further, any potential transaction would be dependent on a number of factors that may be beyond our control, including, among other things, market conditions, industry trends, the interest of third parties in a potential transaction with us and the availability of financing to potential buyers on favorable terms. There can be no assurance that we will successfully implement our strategy, or that any potential transaction or other strategic alternative will result in stockholder liquidity or provide a return to stockholders that equals or exceeds our estimated value per share.\n\n​\n\n2\n\n[Table of Contents](#TOC)\n\n**Risks Related to the Lodging Industry and Real Estate Industry**\n\n●We may be unable to dispose of our properties on advantageous terms or at all due to various factors, including weakness in our properties’ markets, unavailability of financing, changes in the financial condition of prospective purchasers or changes in general economic conditions, which could reduce our cash flow and limit our ability to make distributions to our stockholders.\n\n●Demand for our properties may be affected by various factors, including an over-supply or over-building of hotel properties in our properties’ markets and general economic conditions. If demand does not increase or if demand weakens, our occupancy or revenues per available room may decline, making it more difficult for us to implement our business strategy and to meet any debt service obligations we have incurred and limiting our ability to pay distributions to our stockholders.\n\n●Adverse economic, business or real estate developments in our markets, as well as low consumer confidence, declines in corporate budgets, elevated rates of inflation, newly-enacted political policies, and decreases in personal discretionary spending levels, may adversely affect our financial performance and the value of our properties and may limit our ability to pay distributions to our stockholders.\n\n●Competition for guests, including with other hotels, resorts and vacation rental marketplaces, may reduce our hotels’ revenues and profitability.\n\n●The hospitality industry is seasonal in nature. In addition, the hospitality industry is cyclical and demand generally follows the general economy on a lagged basis. The seasonality and cyclicality of our industry may contribute to fluctuations in our results of operations and financial condition.\n\n●We rely on management companies to operate our hotel properties, giving us less control than if we were managing the hotels ourselves.\n\n●Our success depends in part upon our management companies’ ability to attract, motivate and retain a sufficient number of qualified employees. Qualified individuals needed to fill these positions are in increasingly short supply in some areas. The inability to recruit and retain these individuals may adversely impact hotel operations and guest satisfaction, which could harm our business.\n\n​\n\nRisks Related to Debt Financing\n\n●We have incurred significant debt in connection with our property acquisitions. Our use of leverage increases the risk of an investment in us. Our mortgage loans are collateralized by our hotel properties, which will put those investments at risk of forfeiture if we are unable to repay such debts. Principal and interest payments on these loans reduce the amount of money that would otherwise be available for distribution to our stockholders.\n\n●Our ability to acquire, rehabilitate, renovate and manage our properties may be limited if we cannot obtain satisfactory financing, refinance or extend existing financing, which will depend on debt and capital markets conditions. In addition, we have loans with variable interest rates, and may incur additional variable rate debt in the future. Volatility in these markets could negatively impact such loans. Interest rates remain elevated, and higher interest rates required by lenders on loans that we have refinanced or extended recently have resulted in higher debt service costs. There can be no assurance that we will be able to obtain financing or refinance or extend existing financing on favorable terms, or at all.\n\n**Federal Income Tax Risks**\n\n●Failure to qualify as a REIT would reduce our net earnings available for investment or distribution to our stockholders.\n\n3\n\n[Table of Contents](#TOC)\n\nPART I"}