Company: NREF
Filing Date: 2025-05-12
Form Type: 10-Q
Source: 0001786248-25-000010
Chunk: 25

Company: NexPoint Real Estate Finance, Inc.
Filing Date: 2025-05-12
Form: 10-Q
Item: Item 8
Chunk 25
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 that are considered VIEs as the power to direct activities is not proportional to ownership interests. The investments are accounted for under the equity method and classified as Equity method investments.The Company owns approximately 12.3% of the total outstanding common equity of Slater Apartments ("SK Apartments"). The investment is held in an entity that is considered a VIE as the power to direct activities is not proportional to ownership interests. The investments are accounted for under the equity method and classified as Equity method investments.The Company owns approximately 79.1% of total outstanding membership interests of Capital Acquisitions Partners, LLC ("CAP"). The investment is held in an entity that is considered a VIE as the power to direct activities is not proportional to ownership interests. The investment is accounted for under the equity method and classified as Equity method investments.Preferred Stock Investments, at fair valueOn November 9, 2023, the Company invested in the Series D-1 preferred stock (“Series D-1”) of IQHQ, Inc. ("IQHQ"), a privately held life sciences real estate investment trust. The Series D-1 dividend accumulates quarterly at a 10.5% dividend rate per annum. The Series D-1 are not deemed to be in-substance common stock and are accounted for as investments in equity securities measured at fair value. The securities do not have a readily determinable fair value, and the Company does not elect the measurement alternative. The Company owns approximately 11.8% of the total outstanding shares of the Series D-1 as of March 31, 2025.The investment in the Series D-1 is a Level 3 asset in the fair value hierarchy and was initially measured using the entry price of the asset. As of March 31, 2025, the Company valued this investment at par, which is supported by a discounted cash flow based on the present value of the expected future cash flows of the underlying investment.On January 2, 2025, the Company invested in the Series E preferred stock ("Series E") of IQHQ through the IQHQ Subscription Agreement (as defined in Note 15). The Series E dividend accumulates quarterly at a 16.5% dividend rate per annum. The Series E are not deemed to be in-substance common stock and are accounted for as investments in equity securities measured at fair value. The securities do not have a readily determinable fair value, and the Company does not elect the measurement alternative. The Company owns approximately 38.3% of the total outstanding shares of the