NREF 10-K & 10-Q changes, risk factors and insider trading

•unfavorable changes in economic conditions and their effects on the real estate industry generally and our operations and financial condition, including inflation, high interest rates, tightening monetary policy or recession, which may limit our ability to access funding and generate returns for our stockholders, as well as the risk we make significant changes to our strategies in a market downturn, or fail to do so;

•risks associated with ownership of real estate, including properties in transition, subjectivity of valuation, environmental matters and lack of liquidity in certain asset classes;

•the exposure of our loans and investments to risks similar to debt-oriented real estate investments generally, including the risk of delinquency, foreclosure and loss in any of our commercial real estate-related investments that are secured, directly or indirectly, by real property;

•fluctuations in interest rate and credit spreads that could reduce our ability to generate income on our loans and investments;

•competition for desirable loans and investments;

•the concentration of our loans and investments in terms of type of interest, geography, asset types and sponsors;

•the risk of downgrade of any credit ratings assigned to our loans and investments;

•the risk that any distressed loans or investments we may make may subject us to bankruptcy risks;

•risks associated with CMBS securitizations and with investments in synthetic form;

•our dependence on information systems and risks associated with breaches of our data security or our use of artificial intelligence;

•costs associated with being a public company, including compliance with securities laws;

•the risk of adverse impact to our business if there are deficiencies in our disclosure controls and procedures or internal control over financial reporting;

•risks associated with pandemics, including the future outbreak of other highly infectious or contagious diseases;

•risks associated with our substantial current indebtedness and indebtedness we may incur in the future;

•risks associated with insurance, derivatives or hedging activity, including counterparty risk;

•our dependence on our Manager, its affiliates and personnel to conduct our day-to-day operations and identify and realize returns on our loans and investments within very broad investment guidelines and without fiduciary duties to us or a requirement to seek Board approval;

•risks associated with the Manager’s ability to terminate the Management Agreement (as defined below) and risks associated with any potential internalization of our management functions;

•conflicts of interest and competing demands for time faced by our Manager, our Sponsor and their respective affiliates, officers and employees, and other significant potential conflicts of interest including in connection with (i) substantial fees and expenses we pay to our Manager and its affiliates which may increase the risk that you will not earn a profit on your investment and (ii) competition with entities affiliated with our Manager and our Sponsor for investments;

•the risk of failure to maintain our status as a REIT and make required distributions to maintain such status, failure of which may materially limit our cash available for distribution to our stockholders and the risk of failure to maintain our status if values of our real estate investments rapidly change;

•the risk of failure of our OP to be taxable as a partnership for U.S. federal income tax purposes, possibly causing us to fail to qualify for or to maintain REIT status;

•compliance with REIT requirements, which may limit our ability to hedge our liabilities effectively and cause us to forgo otherwise attractive opportunities, liquidate certain of our investments or incur tax liabilities;

•the risk that certain of our business activities are potentially subject to the prohibited transaction tax and that even if we qualify as a REIT we may be subject to other tax liabilities that may reduce our tax flows and distributions on our capital stock;

•the ineligibility of dividends payable by REITs for the reduced tax rates available for some dividends;

•the ability of our Board to revoke our REIT qualification without stockholder approval;

•our ability to change our major policies, operations and targeted investments without stockholder consent and our Board’s issuance of and ability to further issue debt securities or equity securities that may adversely impact the value or priority of or have dilutive effect on shares of our capital stock or discourage a third-party acquisition;

•risks associated with (i) provisions in our governing documents that may limit stockholders’ choice of forum for disputes with us or discourage an acquisition of our securities or a change in control, including stock ownership restrictions and limits and (ii) provisions of Maryland law, including the Maryland General Corporation Law (the “MGCL”), that may limit the ability for a third-party acquisition;

•recent and potential legislative or regulatory changes or other actions with respect to tax, securitization, financial or other matters affecting REITs, the mortgage industry or debt-oriented real estate investments generally;

•the general volatility of the capital and credit markets and the impact on the market for our capital stock;

•the risk that we may not realize gains or income from our investments, that the repayments of our loans and investments may cause our financial performance and returns to investors to suffer or that we may experience a decline in the fair value of our assets;

•risks associated with the Highland BankruptcyCapital Management, L.P. (as"Highland") defined below),bankruptcy, including possible materially adverse consequences on our business, financial condition and results of operations;

•risks associated with holding shares of the Series A Preferred Stock, including limited voting rights, possible volatility in price and trading volume, subordination to our debt, dilution upon future issuances, possible lack of conversion rights on a change of control and the lack of a rating on the Series A Preferred Stock;

•risks associated with holding shares of the Series B Preferred Stock and Series C Preferred Stock, including limited voting rights, subordination to our debt, lack of a rating on the Series B Preferred Stock and dilution upon future issuances;

•risk of failure to generate sufficient cash flows to service outstanding indebtedness or pay distributions on our capital stock at expected levels, and the risk that we may borrow funds or use funds from other sources to pay distributions; and risks associated with the concentration of our share ownership.

•acts of nature, including extreme weather, earthquakes, floods and other natural disasters, as result of climate change or otherwise, which may result in uninsured losses;

•acts of war, terrorism, social unrest or civil disturbances, including the consequences of such acts;

•adverse changes in national and local economic and market conditions;

•changes in governmental laws and regulations, fiscal policies and zoning ordinances and the related costs of compliance with laws and regulations and ordinances;

•costs of remediation and liabilities associated with environmental conditions including, but not limited to, indoor mold; and the potential for uninsured or under-insured property losses.

•tenant mix and tenant bankruptcies;

•success of tenant businesses;

•property management decisions, including with respect to capital improvements, particularly in older building structures;

•property location and condition;

•competition from other properties offering the same or similar services;

•changes in laws that increase operating expenses or limit rents that may be charged;

•any need to address environmental contamination at the property;

•changes in national, regional or local economic conditions and/or specific industry segments;

•declines in regional or local real estate values;

•declines in regional or local rental or occupancy rates;

•changes in interest rates and in the state of the debt and equity capital markets, including diminished availability or lack of debt financing for commercial real estate;

•changes in real estate tax rates and other operating expenses;

•changes in governmental rules, regulations and fiscal policies, including environmental legislationpolicies;

•natural disasters, acts of war, terrorism, social unrest and civil disturbances, which may decrease the availability of or increase the cost of insurance or result in uninsured losses; and adverse changes in zoning laws.

Macroeconomic trends including inflation, high interest rates, tariffs, recession, major bank failures or sustained financial market illiquidity may adversely affect our financial condition and results of operations.

In addition, actions by the Federal Reserve, as well as efforts by other central banks globally to combat inflation and restore price stability and other global events, may raise the prospect or severity of a recession. The warwars in Ukraine and the Israel-Hamas war,Iran and other international tensions or escalations of conflict may add, instability to the uncertainty driving socioeconomic forces, which may continue to have an impact on global trade and result in inflation or economic instability. The U.S. government announced a comprehensive set of tariffs in the second quarter of 2025. Following the pause of certain of these tariffs, the majority of the previously announced tariffs have been implemented. The U.S. government has indicated that it could impose additional tariffs on particular countries and impose global tariffs on certain goods. Such tariffs could impact our results of operations by increasing the costs of various goods, including construction materials. The impact of such tariffs is subject to uncertainties regarding the timing of their implementation, the magnitude of such tariffs and possible exemption for certain goods, among other unknowns. Present conditions and the state of the U.S and global economies make it difficult to predict whether and/or when and to what extent a recession will occur in the near future. Should a recession occur, it could negatively impact the value of commercial and residential real estate and the value of our investments, potentially materially. Should a recession occur, there can be no guarantee that the Company’s efforts will prevent any negative impacts to the value of the Company’s investments. Further, an extended federal government shutdown resulting from failing to pass budget appropriations, adopt continuing funding resolutions, or raise the debt ceiling, and other budgetary decisions limiting or delaying deferral government spending, may negatively impact U.S. or global economic conditions, including corporate and consumer spending, and liquidity of capital markets.

ApproximatelyAs 22.8%of December 31, 2025, excluding the CMBS consolidation, approximately 10.5% of our portfolio is in the SFR asset class and approximately 25.1%25.6% of the unpaid principal balance in our portfolio is located in Georgia and Texas. In the future, our investments may continue to be concentrated in terms of type of interest (i.e. fixed vs. floating), geography, asset type and sponsors, as we are not required to observe specific diversification criteria, except as may be set forth in the investment guidelines adopted by our Board. Therefore, our investments in our target assets are and could in the future be, secured by properties concentrated in a limited number of geographic locations or concentrated in certain property types that are subject to higher risk of default or foreclosure.

We are a commercial mortgage REIT incorporated in Maryland on June 7, 2019. Our strategy is to originate, structure and invest in first-lien mortgage loans, mezzanine loans, preferred equity, convertible notes, multifamily properties and common equity investments, as well as multifamily and SFR CMBS securitizations, promissory notes, revolving credit facilities and stock warrants, or our target assets. We primarily focus on investments in real estate sectors where our senior management team has operating expertise, including in the multifamily, SFR, self-storageself-storage, industrial and life science sectors predominantly in the top 50 MSAs. In addition, we target lending or investing in properties that are stabilized or have a light-transitional business plan.stabilized.

G&A expenses. G&A expenses include, but are not limited to, audit fees, legal fees, listing fees, Board fees, equity-based and other compensation expenses, investor-relations costs and payments of reimbursements to our Manager. The Manager will be reimbursed for expenses it incurs on behalf of the Company. However, our Manager is responsible, and we will not reimburse our Manager or its affiliates, for the salaries or benefits to be paid to personnel of our Manager or its affiliates who serve as our officers, except that 50% of the salary of our VP of Finance is allocated to us and we may grant equity awards to our officers under the Amended and Restated NexPoint Real Estate Finance, Inc. 2020 Long Term Incentive Plan (the "Amended and Restated LTIP"). Direct payment of operating expenses by us, which includes compensation expense relating to equity awards granted under the Amended and Restated LTIP or the NexPoint Real Estate Finance, Inc. 2020 Long Term Incentive Plan (the “Original LTIP” as amended and restated by the Amended and Restated LTIP, the “LTIP”), together with reimbursement of operating expenses to our Manager, plus the Annual Fee, may not exceed 2.5% of equity book value determined in accordance with GAAP, for any calendar year or portion thereof, provided, however, that this limitation will not apply to Offering Expenses, legal, accounting, financial, due diligence and other service fees incurred in connection with extraordinary litigation and mergers and acquisitions and other events outside the ordinary course of our business or any out-of-pocket acquisition or due diligence expenses incurred in connection with the acquisition or disposition of certain real estate related investments. To the extent total corporate G&A expenses would otherwise exceed 2.5% of equity book value, our Manager will waive all or a portion of its Annual Fee to keep our total corporate G&A expenses at or below 2.5% of equity book value.

Net interest income. Net interest income was $28.1 million for the year ended December 31, 2024 compared to $16.8 million for the year ended December 31, 2023 which was an increase of approximately $11.3 million. The increase between the periods is primarily due to additional investments in preferred equity, revolving credit facilities and senior loans in the portfolio compared to the prior period. As of December 31, 2024 we ownowned 83 discrete investments compared to 87 as of December 31, 2023.

Starting in the second quarter of 2024, EAD per diluted common share and CAD per diluted common share are based on adjusted weighted average common shares outstanding - diluted. Adjusted weighted average common shares outstanding - diluted is a non-GAAP measure calculated by subtracting the dilutive effect of potential redemptions of Series B Preferred shares for shares of our common stock from weighted average common shares outstanding - diluted. Beginning in the fourth quarter of 2025, adjusted weighted average common shares outstanding – diluted also subtracts the dilutive effect of potential redemptions of Series C Preferred shares for shares of our common stock from weighted average common shares outstanding – diluted. We believe providing adjusted weighted average common shares outstanding - diluted and EAD per diluted common share and CAD per diluted common share based on adjusted weighted average common shares outstanding - diluted is helpful to our investors in their assessment of our performance without the potential dilutive effectiveeffect of the Series B Preferred and Series C Preferred shares. We have the right to redeem the Series B Preferred and Series C Preferred shares for cash or shares of our common stock.stock (collectively, the "Series B and C Preferred Redemptions"). Additionally, the Series B Preferred and Series C Preferred redemptions are capped at 2% of the outstanding Series B Preferred and Series C Preferred shares per month, 5% per quarter and 20% per year.year, respectively. The Company maintains sufficient liquidity to pay cash to cover any redemptions up to the quarterly redemption cap. Further, it is the Company's intent to not settle the Series B and C Preferred redemptionsRedemptions in shares of common stock when the Company's common stock price is below book value.

Prior period EAD per diluted common share and CAD per diluted common share have not been updated to reflect this adjustment as the dilutive effect of the Series B and C Preferred redemptionsRedemptions were immaterial to prior periods.

(2)Unrealized gains are the net change in unrealized loss on investments held at fair value applicable to common stockholders.

(3)Starting in the second quarter of 2024, EAD per diluted common share, CAD per diluted common share and adjusted weighted average common shares outstanding - diluted do not include the dilutive effect of the potential redemption of Series B Preferred StockStock, and, beginning in the fourth quarter of 2025, the Series C Preferred Stock, for common shares. Prior periods have not been updated to reflect this adjustment because the dilutive effect of potential Series B Preferred redemptions were immaterial to prior periods. In the year ended December 31, 2024, the adjusted weighted average common shares outstanding - diluted for the first quarter does not exclude the dilutive effect of the potential redemption of Series B Preferred Stock for common shares.

(1)Our total portfolio represents the current principal amount of the consolidated senior loans, CMBS I/O Strips, mezzanine loans, preferred equity, multifamily properties, promissory notes, revolving credit facilities and stock warrants as well as the net equity of our CMBS B-Piece investments.

(2)Net equity represents the carrying value less borrowings collateralized by the investment.

(3)Current yield is the annualized income earned divided by the cost basis of the investment.

(4)The weighted-average life is weighted on current principal balance and assumes no prepayments. The maturity date for preferred equity investments represents the maturity date of the senior mortgage, as the preferred equity investments require repayment upon the sale or refinancing of the asset.

(6)The CMBS B-Pieces are shown on an unconsolidated basis reflecting the value of our investments.

(7)The number shown represents the notional value on which interest is calculated for the CMBS I/O Strips. CMBS I/O Strips receive no principal payments and the notional value decreases as the underlying loans are paid off.

(10)Real Estate is a 204-unit multifamily property. As of December 31, 2024,2025, the property was 95.6%deconsolidated occupied, with effective rent per occupied unit of $1,801 per month..

(11)Real Estate is a 280-unit multifamily property. As of December 31, 2024,2025, the property was 93.9%92% occupied with effective rent per occupied unit of $1,637$1,469.61 per month.

(1)Cost is used in lieu of principal balance for CMBS I/O Strips.

We are a commercial mortgage REIT incorporated in Maryland on June 7, 2019. Our strategy is to originate, structure and invest in first-lien mortgage loans, mezzanine loans, preferred equity, convertible notes, multifamily properties and common equity investments, as well as multifamily and SFR CMBS securitizations, promissory notes, revolving credit facilities and stock warrants, or our target assets. We primarily focus on investments in real estate sectors where our senior management team has operating expertise, including in the multifamily, SFR, self-storage, industrialindustrial, marina and life science sectors predominantly in the top 50 MSAs. In addition, we target lending or investing in properties that are stabilized.

We are externally managed by our Manager, a subsidiary of our Sponsor, an SEC-registered investment advisor, which has extensive real estate experience, having completed as of MarchJune 31,30, 2026 approximately $22.2$22.6 billion of gross real estate transactions since the beginning of 2012. In addition, our Sponsor, together with its affiliates, including NexBank, is one of the most experienced global alternative credit managers managing approximately $13.9$14.2 billion of loans and debt or credit related investments as of MarchJune 31,30, 2026 and has managed credit investments for over 25 years. We believe our relationship with our Sponsor benefits us by providing access to resources including research capabilities, an extensive relationship network, other proprietary information, scalability, and a vast wealth of knowledge of information on real estate in our target assets and sectors.

On October 16, 2019, Highland, a former affiliate of our Sponsor, filed for Chapter 11 bankruptcy protection with the United States Bankruptcy Court for the District of Delaware (the “Highland Bankruptcy”), which was subsequently transferred to the United States Bankruptcy Court for the Northern District of Texas (the “Bankruptcy Court”). On October 15, 2021, Marc S. Kirschner, as litigation trustee of a litigation subtrust formed pursuant to Highland’s plan of reorganization and disclosure statement which became effective on August 11, 2021 and was subsequently amended, filed a lawsuit (the “Bankruptcy Trust Lawsuit”) against various persons and entities, including our Sponsor and James Dondero. The Bankruptcy Trust Lawsuit does not include claims related to our business or our assets or operations. On March 24, 2023, the litigation trustee filed a motion seeking to voluntarily stay the Bankruptcy Trust Lawsuit, which was granted by the Bankruptcy Court on April 4, 2023. On June 30, 2025, the Bankruptcy Court approved a settlement agreement between Highland and Hunter Mountain Investment Trust (“HMIT”) pursuant to which the claims asserted in the Bankruptcy Trust Lawsuit were assigned to HMIT. PartiesHMIT in interest havesubsequently filed a motion to vacatelift the HMITstay settlement, andof the Bankruptcy Trust LawsuitLawsuit, haswhich beenwas stayedgranted pendingand abecame rulingeffective on thatJuly motion.15, 2026.

In addition, on February 8, 2023, UBS Securities LLC and its affiliate (collectively, “UBS”) filed a lawsuit in the Supreme Court of the State of New York, County of New York against Mr. Dondero and a number of other persons and entities seeking to collect on $1.3 billion in judgments UBS obtained against entities that were managed indirectly by Highland (the “UBS Lawsuit”). On February 26, 2024, the respondents, including Mr. Dondero, filed motions to dismiss the UBS Lawsuit. A hearing was held on July 8, 2024. The court dismissed the claims against one respondent, CLO HoldCo, Ltd., for lack of personal jurisdiction in a July 12, 2024 order. On August 24, 2024, UBS filed a notice of appeal for that dismissal order, but withdrew its appeal on December 31, 2025. On March 26, 2025, the court entered an order denying the remaining motions to dismiss and directed the respondents to file an answer to the UBS Lawsuit within 20 days, which they did. Mr. Dondero and the other remaining respondents are appealing the denial of the motion to dismiss to the Appellate Division of the Supreme Court of the State of New York. The appeal was argued on April 8, 2026. The Supreme Court rescheduled a status conference in the UBS Lawsuit previously set for AprilJuly 14, 2026 to JulySeptember 14,15, 2026. Neither the Bankruptcy Trust Lawsuit nor the UBS Lawsuit include claims related to our business or our assets or operations. Our Sponsor and Mr. Dondero have informed us they believe the Bankruptcy Trust Lawsuit has no merit, and Mr. Dondero has informed us he believes the UBS Lawsuit has no merit; we have been advised that the defendants named in each of the lawsuits intend to vigorously defend against the claims. We do not expect the Bankruptcy Trust Lawsuit or the UBS Lawsuit will have a material effect on our business, results of operations or financial condition.

The Company acquired or originated the following investments through the Subsidiary OPs in the three months ended MarchJune 31,30, 2026. The amounts in the table below are as of the purchase or investment date.

Current yield and coupon as of MarchJune 31,30, 2026.

The following investments were redeemed or sold during the three months ended MarchJune 31,30, 2026:

Results of Operations for the Three and Six Months Ended MarchJune 31,30, 2026 and 2025

The following table sets forth a summary of our operating results for the three months ended MarchJune 31,30, 2026 and 2025 (in thousands):

The change in our net income for the three months ended MarchJune 31,30, 2026 as compared to the net income for the three months ended MarchJune 31,30, 2025 primarily relates to an increase in other income including changes in net assets related to consolidated CMBS VIEs, preferred stock and warrants, and a lower unrealized loss on common stock investments. Our net income attributable to common stockholders for the three months ended MarchJune 31,30, 2026 was approximately $10.0$5.4 million. We earned approximately $15.3$16.5 million in net interest income, generated income of $17.3$10.8 million in other income, incurred operating expenses of $10.0 million, allocated $0.9 million of income to Series A Preferred stockholders, allocated $9.1$9.0 million of income to Series B Preferred stockholders, allocated $0.3$0.7 million of income to Series C Preferred stockholders and allocated $2.4$1.3 million of income to redeemable non-controlling interests for the three months ended MarchJune 31,30, 2026.

Net interest income. Net interest income was $15.3$16.5 million for the three months ended MarchJune 31,30, 2026 compared to $11.5$12.1 million for the three months ended MarchJune 31,30, 2025 which was an increase of approximately $3.8$4.5 million. The increase between the periods is primarily due to additional investments in preferred equity, revolving credit facilities, senior loans and mezzanine loans in the portfolio compared to the prior period. As of MarchJune 31,30, 2026 we own 9085 discrete investments compared to 8586 as of MarchJune 31,30, 2025.

Other income. Other income was $17.3$10.8 million for the three months ended MarchJune 31,30, 2026 compared to $22.7$19.5 million for the three months ended MarchJune 31,30, 2025 which was a decrease of approximately $5.4$8.7 million. This was primarily due to a decrease in unrealized gainslosses related to preferred stock and stock warrant investments as well as an increase in dividend income.

G&A expenses. G&A expenses were $3.3$2.8 million for the three months ended MarchJune 31,30, 2026 compared to $2.5$3.8 million for the three months ended MarchJune 31,30, 2025 which was ana increasedecrease of approximately $0.8$0.9 million. The increasedecrease between the periods was primarily due to a $0.1$0.3 million increase in legal fees and a $0.7 million increasedecrease in accounting feesfees, a decrease of $0.2 million in other expenses, a $0.4 million decrease in payroll compared to the prior period.

ManagementLoan servicing fees. ManagementLoan servicing fees were $2.2$0.3 million for the three months ended MarchJune 31,30, 2026 compared to $1.4$0.4 million for the three months ended MarchJune 31,30, 2025 which was ana increasedecrease of approximately $0.8$0.1 million. The increasedecrease between the periods was primarily due to anrepayments, increasepaydowns inand Equityportfolio asrunoff definedwhich byreduced the Managementaverage Agreement.outstanding balance of loans requiring servicing during the current period..

The following table provides a reconciliation of EAD and CAD to GAAP net income including the dilutive effect of noncontrolling interests and adjusted weighted average common shares outstanding - diluted to weighted average common shares outstanding - diluted for the three and six months ended MarchJune 31,30, 2026 and 2025 (in thousands, except per share amounts):

Our portfolio consists of senior loans, CMBS B-Pieces, CMBS I/O Strips, mezzanine loans, preferred equity investments, common equity investments, preferred stock, multifamily properties, promissory notes, revolving credit facilities and stock warrants with a combined unpaid principal balance of $1.4 billion as of MarchJune 31,30, 2026 and assumes the CMBS Entities’ assets and liabilities are not consolidated. The following table sets forth additional information relating to our portfolio as of MarchJune 31,30, 2026 (dollars in thousands):

Real Estate is a 280-unit multifamily property. As of MarchJune 31,30, 2026, the property was 93.6%90.0% occupied with effective rent per occupied unit of $1,491$1,465 per month.

Real Estate is a 240-unit multifamily property. As of MarchJune 31,30, 2026, the property was 77.1%79.6% occupied with effective rent per occupied unit of $1,362$1,518 per month.

The following table details overall statistics for our portfolio as of MarchJune 31,30, 2026 (dollars in thousands):

Our short-term liquidity requirements consist primarily of funds necessary to pay for our ongoing commitments to repay borrowings, maintain our investments, make distributions to our stockholders and other general business needs. Our investments generate liquidity on an ongoing basis through principal and interest payments, prepayments and dividends. We believe that our available cash, expected operating cash flows, and potential debt or equity financings will provide sufficient funds for our operations, anticipated scheduled debt payments, any potential obligations to fulfill unfunded commitments and dividend requirements for the twelve-month period following MarchJune 31,30, 2026.

Prior to the Formation Transaction, two of our subsidiaries entered into the Credit Facility. Under the Credit Facility, these entities borrowed approximately $788.8 million in connection with their acquisition of the Underlying Loans. No additional borrowings can be made under the Credit Facility, and our obligations will be secured by the Underlying Loans. The Credit Facility was assumed by the Company as part of the Formation Transaction. As such, the remaining outstanding balance of $788.8 million was contributed to the Company on February 11, 2020. Our borrowings under the Credit Facility will mature on July 12, 2029; however, if an Underlying Loan matures prior to July 12, 2029, we will be required to repay the portion of the Credit Facility that is allocated to that loan. As of MarchJune 31,30, 2026, the outstanding balance on the Credit Facility was $97.4$61.2 million.

On March 15, 2022, the Company, the OP and the Manager separately entered into separate Equity Distribution Agreements with each of the Sales Agents, pursuant to which the Company may issue and sell from time to time under its ATM Program. The Equity Distribution Agreements provide for the issuance and sale of common stock or Series A Preferred Stock by the Company through a sales agent acting as a sales agent or directly to the sales agent acting as principal for its own account at a price agreed upon at the time of sale. As of MarchJune 31,30, 2026, pursuant to the Equity Distribution Agreements, the Company has sold 531,728 shares of its common stock and zero shares of Series A Preferred Stock for total gross sales of $12.6 million. For additional information about the ATM Program, see Note 11 to our consolidated financial statements.

On November 2, 2023, the Company announced the launch of a continuous public offering of up to 16,000,000 shares of its Series B Preferred Stock at a price to the public of $25.00 per share, for gross proceeds of $400.0 million. On October 1, 2025, the Company increased the size of its Series B Preferred Stock offering to 17,200,000 shares for gross proceeds of $430.0 million. Beginning on the first day of the calendar month following the date of original issuance, the Series B Preferred Stock are redeemable at the option of the holder at a redemption price per share equal to the liquidation preference of $25.00 per share, plus all accrued but unpaid cash dividends and less certain redemption fees. After the first day of the calendar month following the second anniversary of the original issue date, the Company also has the option to redeem, in whole or in part, subject to certain restrictions in the Company's charter and the articles supplementary setting forth the terms of the Series B Preferred Stock, at a redemption price per share equal to the liquidation preference of $25.00 per share, plus any accrued but unpaid cash dividends. In all optional redemptions, the Company has the right, in its sole discretion, to pay the redemption in cash or in equal value of shares of the Company’s common stock for so long as the common stock is listed or admitted to trading on the NYSE or another national securities exchange or automated quotation system. The Dealer Manager served as the Company’s dealer manager in connection with the offering. The Dealer Manager used its reasonable best efforts to sell the shares of Series B Preferred Stock offered in the offering, and the Company paid the Dealer Manager, subject to the discounts and other special circumstances described or referenced therein, (i) the Series B Selling Commissions and (ii) the Series B Dealer Manager Fee. The Company completed the last close on December 5, 2025 and terminated the Series B Preferred offering. As of MarchJune 31,30, 2026, the Company hashad sold 16,186,525 shares of Series B Preferred Stock for total gross proceeds of $395.6 million.

On November 4, 2025, the Company announced the launch of a continuous public offering of up to 8,000,000 shares of its Series C Preferred Stock at a price to the public of $25.00 per share, for gross proceeds of $200.0 million. Beginning on the first day of the calendar month following the date of original issuance, the Series C Preferred Stock are redeemable at the option of the holder at a redemption price per share equal to the liquidation preference of $25.00 per share, plus all accrued but unpaid cash dividends and less certain redemption fees. After the first day of the calendar month following the second anniversary of the original issue date, the Company also has the option to redeem, in whole or in part, subject to certain restrictions in the Company's charter and the articles supplementary setting forth the terms of the Series C Preferred Stock, at a redemption price per share equal to the liquidation preference of $25.00 per share, plus any accrued but unpaid cash dividends. In all optional redemptions, the Company has the right, in its sole discretion, to pay the redemption in cash or in equal value of shares of the Company’s common stock for so long as the common stock is listed or admitted to trading on the NYSE, NYSE Texas or another national securities exchange or automated quotation system. The Dealer Manager serves as the Company’s dealer manager in connection with the offering. The Dealer Manager uses its reasonable best efforts to sell the shares of Series C Preferred Stock offered in the offering, and the Company pays the Dealer Manager, subject to the discounts and other special circumstances described or referenced therein, (i) the Series C Selling Commissions and (ii) the Series C Dealer Manager Fee. The Dealer Manager, subject to federal and state securities laws, will reallow all or any portion of the Series C Selling Commissions and may reallow a portion of the Series C Dealer Manager Fee to other securities dealers that the Dealer Manager may retain who sold the shares of Series C Preferred Stock as is described more fully in the agreements between such dealers and the Dealer Manager. The Company expects that the offering will terminate on the earlier of the date the Company sells all 8,000,000 shares of the Series C Preferred Stock in the offering or December 29, 2026 (which is the third anniversary of the effective date of the Company’s registration statement), which may be extended by the Board in its sole discretion. The Board may elect to terminate this offering at any time. AsFor ofthe Marchthree 31,months ended June 30, 2026, the Company has sold 894,673904,978 shares of Series C Preferred Stock for total gross proceeds of $22.1$22.6 million.

The Company hashad an aggregate principal amount of $180.0 million of its 5.75% Notes outstandingwhich as of March 31, 2026. Thethe Company repaid the 5.75% Notes at maturity on May 1, 2026.

In 2025, the OP issued a $45.0 million aggregate principal amount of its 2026 OP Notes for proceeds of approximately $42.6 million, after original issue discount, which were used to repay the 7.50% OPSenior Unsecured Notes due 2025 of the OP at maturity.

We may seek additional sources of liquidity from further repurchase facilities, other borrowings and future offerings of common and preferred equity and debt securities and contributions from existing holders of the OP or Subsidiary OPs. In addition, we may apply our existing cash and cash equivalents and cash flows from operations to any liquidity needs. As of MarchJune 31,30, 2026, our cash and cash equivalents werewas $22.6$6.4 million.

The following table presents selected data from our Consolidated Statements of Cash Flows for the threesix months ended MarchJune 31,30, 2026 and 2025 (in thousands):

The threesix months ended MarchJune 31,30, 2026 as compared to the threesix months ended MarchJune 31,30, 2025

Cash flows from operating activities. During the threesix months ended MarchJune 31,30, 2026, net cash provided by operating activities was $9.4$3.4 million, compared to net cash provided by operating activities of $16.0$19.4 million for the threesix months ended MarchJune 31,30, 2025. This decrease primarily relates to the changes in provision for credit loss and paid in kind income.

Cash flows from investing activities. During the threesix months ended MarchJune 31,30, 2026, net cash provided by investing activities was $84.7$108.9 million, compared to net cash provided by investing activities of $71.3$89.6 million for the threesix months ended MarchJune 31,30, 2025. The increase primarily relates to an increase in proceeds from payments received on mortgage loans held for investment Cash flows from financing activities. During the three months ended March 31, 2026, net cash used in financing activities was $103.2 million, compared to net cash used in financing activities of $70.9 million for the three months ended March 31, 2025. The increase primarily relates to an increase in the principal repayments on borrowings under secured financing agreements and a decrease in the borrowing under secured financing agreements, as well as the increase of the Re-REMIC of the CMBS held in variable interest entities.investment.

We are also a “smaller reporting company” as defined in the Securities Exchange Act,Act of 1934, and may elect to take advantage of certain of the scaled disclosures available to smaller reporting companies.

As of MarchJune 31,30, 2026, we had one off balance sheet arrangement that has or is reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

On December 8, 2022 and in connection with a restructuring of NSP, the Company, through REIT Sub, together with NXDT, an entity that is advised by an affiliate of the Manager, the Co-Guarantors, as guarantors, entered into the NSP Sponsor Guaranty Agreement in favor of Extra Space pursuant to which REIT Sub and the Co-Guarantors guaranteed obligations of NSP with respect to accrued dividends on NSP’s newly created Series D preferred stock and two promissory notes in an aggregate principal amount of approximately $64.2 million issued to Extra Space. The guaranties by REIT Sub and the Co-Guarantors are capped at $97.6 million, and each of REIT Sub and the Co-Guarantors generally guaranteed the foregoing obligations of NSP up to the cap amount on a pro rata basis with respect to its percentage ownership of NSP’s common stock. On February 15, 2023, NSP paid down approximately $15.0 million of these promissory notes, resulting in an aggregate principal amount of approximately $49.2 million. On December 8, 2023, NSP paid down the remaining principal balance of $49.2 million. The NSP Series D preferred stock remains outstanding as of MarchJune 31,30, 2026. As of MarchJune 31,30, 2026, the outstanding NSP Series D Preferred Stock accrued dividends was $15.1$16.0 million and the Company and NexPoint Diversified Real Estate Trust are jointly and severally liable for 85.9% of the guaranteed amount equal to $13.0$13.7 million.

On March 14, 2023, the Company, through one of the Subsidiary OPs, committed to fund $24.0 million of preferred equity with respect to a ground up construction horizontal single-family property located in Phoenix, Arizona, of which $1.4$0.6 million was unfunded as of MarchJune 31,30, 2026. The preferred equity investment provides a floating annual return that is the greater of prime rate plus 5.0% or 11.25%, compounded monthly with a MOIC of 1.30x and 1.0% placement fee. The Company was also issued a common interest at the time of its first funding of preferred equity on May 16, 2023. The common interest allows the Company to receive a 10% profit share once aggregate distributions exceed the 20% IRR hurdle as shown below. There was no value ascribed to the common interest as of MarchJune 31,30, 2026. Further, once the Company's preferred equity and accrued interestreturn has been repaid, any additional cash flow and net sale proceeds shall be distributed as follows:

On February 10, 2023, the Company, through one of the Subsidiary OPs, through a unit purchase agreement, committed to purchase $30.3 million of the preferred units with respect to a multifamily property development located in Forney, Texas, which has been fully funded as of MarchJune 31,30, 2026. Further, the Company committed to purchase $4.3 million of common equity with respect to the same property, of which $0.8$0.3 million was unfunded as of MarchJune 31,30, 2026.

On February 10, 2023, the Company, through one of the Subsidiary OPs, through a unit purchase agreement, committed to purchase $30.3 million of the preferred units with respect to a multifamily property development located in Richmond, Virginia, which has been fully funded as of MarchJune 31,30, 2026. Further, the Company committed to purchase $4.3 million of common equity with respect to the same property, of which $0.8 million was unfunded as of MarchJune 31,30, 2026.

On January 16, 2026, the Company loaned $16.7 million to NSP OC and certain subsidiaries of NSP OC and of our Sponsor, as co-borrowers. In connection with the loan, NSP OC issued the NSP Note pursuant to which NSP OC may borrow up to a maximum commitment of $40.0 million. The NSP Note bears interest at 14%14.0% per annum, which is payable in kind, is interest only during the term of the NSP Note and matures on January 16, 2031. Borrowings under the NSP Note are secured by a first-priority lien on certain income streams and related deposit accounts of the co-borrowers and are subordinated in right and time of payment to NSP’s outstanding Series D Preferred Stock. On March 25, 2026, OSL purchased $7.5 million aggregate principal amount of the NSP Note and obtained the right, but not the obligation, to participate in any future advances up to its then-current pro rata share. Effective on March 30, 2026, HFRO, HGLB, NXDT, and NRES purchased aggregate principal amounts of $2.5 million, $1.0 million, $1.3 million and $0.1 million, respectively, and each has the right, but not the obligation to participate in any future advances up to its then-current pro rata share. The Company also funded an additional $1.3 million and the NSP Note has $17.3$16.8 million outstandingunfunded as of MarchJune 31,30, 2026.

SFR OP Promissory Note II Commitments

SFR OP issued the SFR OP Note II to the Company on July 10, 2024. The SFR OP Note II bears interest at 15%, which is payable in kind, is interest only during the term of the SFR OP Note II and initially matured on July 10, 2025. On August 25, 2025, the Company, through REIT Sub.Sub, extended the maturity date to July 10, 2026, and increased the maximum amount available under the SFR OP Note II to $15.0 million. TheIn 2026, the Company fundedfurther $3.5extended millionthe throughmaturity Decemberdate 31,to 2024.July 10, 2027. SFR OP paid down $1.9 million of principal on April 29, 2025. The Company funded $3.4 million, $5.0 million, $2.5 million on July 31, 2025, August 24, 2025, and September 24, 2025, respectively. The Company's maximum commitment under the loan is $15.0 million, of which $2.5 million was unfunded as of MarchJune 31,30, 2026.