Company: NXDT
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001356115-25-000014
Chunk: 115

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1A
Chunk 115
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 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 the Series B 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 NAV and NAV per common share below is intended to be the Applicable NAV (as defined in the statement of preferences of the Series B Preferred Shares) for purposes of the offering of the Series B Preferred Shares. The below table presents the NAV calculation (in thousands, except per common share amounts):

As OfTotal AssetsTotal LiabilitiesSeries A Preferred Shares (1)Series B Preferred Shares (2)NCINAVDiluted Common Shares OutstandingNAV Per Common ShareMarch 31, 20251,179,554 (381,554)(83,252)(200)4,915 719,463 44,118 $16.31 

(1)Represents the liquidation preference, net of approximately $738 thousand issuance costs, from the issuance of the Company’s 5.50% Series A Cumulative Preferred Shares.

(2)Represents the liquidation preference, net of approximately $100 thousand issuance costs, from the issuance of the Company’s 9.00% Series B Cumulative Preferred Shares.

Liquidity and Capital Resources

Our short-term liquidity requirements consist primarily of funds necessary to pay for debt maturities, operating expenses and other expenditures including:

•capital expenditures to continue the ongoing development of Cityplace;

•capital expenditures necessary to maintain