Company: NXDT
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001356115-25-000003
Chunk: 942

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-03-31
Form: 10-K
Item: Item 9C
Chunk 942
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 common share during the period.

The year ended December 31, 2024 as compared to the year ended December 31, 2023

FFO was $(7.6) million for the year ended December 31, 2024, compared to $(101.7) million for the year ended December 31, 2023, which was an increase of approximately $94.1 million. The change in our FFO between the year 

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ended December 31, 2024 and the year ended December 31, 2023 primarily relates to a decrease in unrealized losses, primarily attributed to redemptions of the CLO positions, which reclassified the change in unrealized losses to realized gains of approximately $22.8 million.

AFFO was $(8.6) million for the year ended December 31, 2024, compared to $2.5 million for the year ended December 31, 2023, which was a decrease of approximately $11.1 million. The change in our AFFO between the year ended December 31, 2024 and the year ended December 31, 2023 primarily relates to the consolidation of NHT, resulting in an increase in property operating expenses, interest expense and corporate general and administrative expenses. 

Net Asset Value

The SEC does not provide rules on the methodology we must use to determine our NAV or NAV per common share. The determination of NAV involves a number of subjective assumptions, estimates and judgments that may not be accurate or complete. We believe there is no established practice among REITs for calculating NAV. Different firms using different property-specific, general real estate, capital markets, economic and other assumptions, estimates and judgments could derive a NAV that could be significantly different from our NAV. Thus, other public REITs methodologies used to calculate NAV may differ materially from ours. Additionally, our NAV differs from the values of our real estate assets as calculated in accordance with GAAP, in that we calculate NAV based on the consolidated balance sheets as total assets minus total liabilities, less any equity attributable to preferred shareholders (such as the Series A Preferred Shares) and noncontrolling interests. Our NAV per common share is calculated by dividing our NAV by our diluted common shares outstanding, which represents the aggregate of our common shares outstanding plus any unvested restricted share units as of the last day of the reporting period. We calculate NAV per common share on a quarterly basis beginning with the quarter ended December 31, 2024.

The presentation of