Debt no longer looms large for NexPoint Residential Trust as it turns the page on nearly all of its financial obligations.
The Dallas-based REIT has restructured $1.469 billion in debt over the last two months, the Dallas Business Journal reported. The move, encompassing 34 loans across 17 multifamily properties, restructures about 98 percent of NexPoint’s $1.503 billion debt, significantly delaying repayment obligations until 2028.
The refinancing, facilitated by JPMorgan Chase, lowers NexPoint’s weighted average interest rate by 50 basis points to 5.65 percent. When adjusted for interest rate swap contracts, the rate declines further to 2.95 percent — down from 3.44 percent. This reduction is expected to lower interest expenses while freeing up resources for future investments.
North Texas properties included in the refinancing are the Atera Apartments in Uptown Dallas, Venue at 8651 Apartments in Fort Worth, Summers Landing Apartments in Fort Worth, Cutter’s Point Apartments in Richardson and Arbors on Forest Ridge Apartments in Bedford.
Other properties span Sun Belt states like Florida, North Carolina, Tennessee and Arizona.
NexPoint Residential Trust operates as one of three REITs under the NexPoint umbrella, managed by hedge fund manager James Dondero. Its other REITs are NexPoint Diversified Real Estate Trust and NexPoint Hospitality Trust.
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The financial restructuring follows a recent 10.3 percent increase in NexPoint’s quarterly dividend, raising it to 51 cents per share. This marks a 147.6 percent increase in dividend payouts since the company’s founding in 2015.
In another recent, although much smaller, refinancing deal, Pillar Commercial recapitalized Collins Square, a 215,000-square-foot office building in Richardson that’s been anchored by Travelers since 2002.
— Andrew Terrell