NexPoint Diversified Real Estate Trust Reports Revenue Growth to $29.1 Million, Net Loss of $35.1 Million

NexPoint Diversified Real Estate Trust reported significant financial developments in its latest 10-Q filing for the quarter ended March 31, 2025. The company generated total revenues of $29.1 million, a substantial increase from $12.8 million in the same period last year. This growth was primarily driven by the consolidation of the NexPoint Hospitality Trust (NHT) segment, which contributed $10.4 million in room revenue and $0.9 million in food and beverage revenue. However, the company also reported a net loss of $35.1 million, compared to a loss of $21.5 million in the prior year, largely due to unrealized losses on investments.

In terms of operational changes, NexPoint completed the acquisition of a controlling interest in NHT, which was finalized on April 17, 2025, through a merger that dissolved NHT. This strategic move is expected to enhance the company's portfolio and operational efficiency. The company also sold its held-for-sale properties, including the Las Colinas Homewood Suites for approximately $14 million and the Addison Property for about $6.4 million, further streamlining its asset base.

The company’s total assets decreased to $1.18 billion as of March 31, 2025, down from $1.22 billion at the end of 2024. This decline was attributed to a reduction in real estate held for sale and a decrease in equity method investments. The total liabilities also decreased to $381.6 million from $391.3 million, reflecting the company's efforts to manage its debt levels effectively. As of the reporting date, NexPoint had 44.5 million common shares outstanding, an increase from 42.7 million shares at the end of the previous year.

Looking ahead, NexPoint aims to refocus its asset allocation strategy, targeting sectors where its management has extensive expertise, such as residential, self-storage, and life sciences. The company plans to opportunistically sell $100 million to $150 million in assets to free up capital for reinvestment. Additionally, the company has extended the maturity date of its NexBank Revolver to November 21, 2025, providing further liquidity to support its operational and investment strategies. The management remains optimistic about navigating the current economic landscape, despite challenges posed by inflation and rising interest rates.