On this page of StockholderLetter.com we present the latest annual shareholder letter from NEXPOINT DIVERSIFIED REAL ESTATE TRUST — ticker symbol NXDT. Reading current and past NXDT letters to shareholders can bring important insights into the investment thesis.

 •  4/20/2026 Letter Continued (Full PDF)
 •  4/26/2023 NXDT Stockholder Letter
 •  4/22/2024 NXDT Stockholder Letter
 •  4/25/2025 NXDT Stockholder Letter
 •  More "Investment Companies & Venture Capital" Category Stockholder Letters
 •  NXDT Benford's Law Stock Score = 94

NXDT Shareholder/Stockholder Letter Transcript:

2025
Annual
Report
NXDT.NEXPOINT.COM
NexPoint Diversified Real Estate Trust is a diversified real estate investment trust (   REIT   ) focused on
investing in various commercial real estate property types, such as single-family rentals, multifamily,
self-storage, life science, o   ce, industrial, hospitality, net lease, retail, and small-bay industrial across the
capital structure, including but not limited to mortgage debt, mezzanine debt, and common and preferred
equity.
NEXP O IN T DIVE R S I FI E D RE AL ESTAT E TRUST ( NYSE: NXDT)
NXDT.NEXPOINT.COM | IR@NEXPOINT.COM | 300 CRESCENT CT. STE. 700 DALLAS, TX 75201


April 20, 2026
TO MY FELLOW SHAREHOLDERS,
2025 was a strategic repositioning for NexPoint Diversified Real Estate Trust (NYSE: NXDT)
(   NXDT    or the    Company   ), during which we focused on further building a durable
foundation to support long-term value creation. Throughout the year, our team remained
disciplined in executing our strategy of repositioning, developing, and managing diversified
real estate investments across the United States.
As a diversified real estate investment trust (   REIT   ), NXDT is positioned to pursue
opportunities across multiple property types and points within the capital structure. We
believe this flexibility allows us to navigate evolving market conditions and allocate capital
where we see the most compelling risk-adjusted opportunities.
Executing a Disciplined Investment Strategy
NXDT   s primary investment objective is to generate both current income and long-term
capital appreciation. We seek to achieve this objective by investing across a broad range
of residential and commercial real estate assets, including equity, mortgage debt,
mezzanine debt, and preferred equity. Our target property types include, among others,
single-family rental (   SFR   ), multifamily, self-storage, life science, office, industrial,
hospitality, net lease, retail and small-bay industrial properties. To a limited extent, the
Company may also hold or transact in certain non-real estate securities.
Our investment approach emphasizes opportunistic and value-add strategies focused on
assets with intrinsic value and credit quality. Through active asset management,
development, and selective dispositions, we aim to enhance portfolio cash flow and asset
values, supporting long-term capital appreciation for our shareholders. In addition, NXDT
selectively pursues real estate credit investments when we believe certain subsectors are
positioned to outperform within the broader real estate cycle.
We believe this diversified and flexible investment approach is well suited to the current
market environment. While our strategy may evolve over time in response to changing
economic conditions, we view adaptability as a key differentiator for NXDT within the
diversified REIT landscape.
Note: See    Cautionary Statement Regarding Forward-Looking Statements    in our Form 10-K for the year ended
December 31, 2025, accompanying this letter.

Key 2025 Highlights
As of December 31, 2025, our outstanding portfolio totaled approximately $1.1 billion, of
which our real estate assets totaled approximately $0.5 billion. Our real estate assets were
composed of 46.1% Residential, 16.9% Self-Storage, 18.0% Office, 8.0% Life Sciences,
and 11.0% other real estate.
The Company completed several operational and investment highlights in the year.
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Investments in AMS C-Store JV, LLC: During 2025, NXDT invested an aggregate of
$16.3 million in AMS C-Store JV, LLC (   AMS   ) in exchange for preferred equity
interests. These investments provide an 18% cumulative, compounding preferred
return and a full return of invested capital prior to any participation by common
members. AMS operates a real estate development platform focused on acquiring,
developing, and operating newly constructed 7-Eleven convenience store projects in
high-growth markets across Texas.
NHT Acquisition: On April 17, 2025, the Company took NexPoint Hospitality Trust
(   NHT   ) private in a merger transaction, acquiring all remaining units of NHT which
were not previously owned by the Company and fully consolidating the hospitality
portfolio under the Company   s sole ownership.
Marriott Uptown Refinance: On January 21, 2025, Marriott Uptown completed a
$95 million refinancing of a loan held by the special purpose entity that owns
Marriott Uptown, generating approximately $15 million of cash distributions to the
Company. On October 20, 2025, the Company received an additional $3.2 million
in cash distributions upon the hotel achieving certain performance thresholds under
the refinancing.
Share Repurchase Program: During 2025, the Company commenced repurchases
under its share repurchase program and repurchased approximately $1.9 million
of its common shares. We may utilize various methods to effect the repurchases,
and the timing and extent of the repurchases will depend upon several factors,
including market and business conditions, regulatory requirements and other
corporate considerations.
Series B Preferred Offering: In January 2025, NXDT launched a continuous public
offering of up to 16.0 million shares of its newly designated 9.00% Series B
Cumulative Redeemable Preferred Shares (   Series B Preferred Shares   ) at a public
offering price of $25.00 per share. As of December 31, 2025, the Company had
issued Series B Preferred Shares for gross proceeds of approximately $22.4 million,
providing additional capital flexibility to support portfolio growth.
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Positioned for Growth
We believe the progress made in 2025 has positioned NXDT for its next phase of growth.
With a diversified portfolio, flexible investment mandate, and the support of the NexPoint
platform, management remains focused on disciplined execution and long-term value
creation. We appreciate the continued support of our shareholders and look forward to
building on the foundation established during the year.
Sincerely,
James D. Dondero, President

Note: The names of the directors and executive officers and brief bios are contained under the headings    Proposal
1     Election of Trustees    and    Executive Officers    in the proxy statement on pages 4 and 33, respectively, which
are included with this Annual Report to Shareholders.
3

4/20/2026 Letter Continued (Full PDF)

 

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