Company: NXDT
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001628280-25-052132
Chunk: 77

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-11-13
Form: 10-Q
Item: Item 1A
Chunk 77
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 income tax (expense) benefit of $0.4 million associated with the TRSs for the nine months ended September 30, 2025 and $(1.6) million associated with the TRSs for the nine months ended September 30, 2024. The tax expense for the nine months ended September 30, 2025 is comprised of an income tax expense of $1.1 million, offset with a return-to-tax provision of $0.5 million and a decrease of income tax estimate of $1.0 million for a net benefit of $0.4 million for the nine months ended September 30, 2025 that is recorded on the Consolidated Statements of Operations and Comprehensive Income (Loss). The tax expense for the nine months ended September 30, 2024 is partially offset by the annual change in valuation allowance on a deferred tax asset of $0.2 million for a net expense of $1.6 million for the nine months ended September 30, 2024, that is recorded on the Consolidated Statements of Operations and Comprehensive Income.

Change in unrealized gains (losses). Unrealized gains (losses) from our investments accounted for at fair value was $(77.5) million for the nine months ended September 30, 2025, compared to $2.3 million for the nine months ended September 30, 2024, which was a decrease of approximately $(79.8) million. The losses for the nine months ended September 30, 2025 were largely driven by mark-to-market losses on VB OP Units of $22.9 million, NexPoint SFR OP partnership units of $13.4 million, IQHQ LP interests of $15.1 million and NREF OP Units of $7.4 million. The gains for the nine months ended September 30, 2024 were largely driven by redemptions of the legacy CLO positions, which generated realized losses and a positive change in unrealized, mark-to-market gains on VB OP Units of $7.8 million, offset by NREF OP Units of $9.3 million, and NREF common stock of $4.0 million.

Realized gains (losses). Realized gains (losses) were $5.0 million for the nine months ended September 30, 2025, compared to $(21.9) million for the nine months ended September 30, 2024, which was an