NEXPOINT DIVERSIFIED REAL ESTATE TRUST
For the period ended Jun 30, 2024. Filed Aug 9, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 9, 2024
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
- Consolidated Real Estate Investments
As of June 30, 2024, the major components of the Company’s investments in real estate held by SPEs the Company consolidates, which are included in "Consolidated Real Estate Investments" on the Consolidated Balance Sheet, were as follows (in thousands):
| Operating Properties · Land · Buildings and Improvements · Intangible Lease Assets · Intangible Lease Liabilities · Right of use assets · Construction in Progress · Furniture, Fixtures, and Equipment · Totals | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| White Rock Center | $1,315 | $10,471 | $1,921 | $(101) | $— | $— | $5 | $13,611 | ||||||||||||
| 5916 W Loop 289 | 1,081 | 2,938 | — | — | — | — | — | 4,019 | ||||||||||||
| Cityplace Tower | 18,812 | 194,998 | 9,058 | (6,669) | — | 19,103 | 356 | 235,658 | ||||||||||||
| NexPoint Dominion Land, LLC | 26,500 | — | — | — | — | — | — | 26,500 | ||||||||||||
| Dallas Hilton Garden Inn | 4,116 | — | 24,398 | — | — | — | — | — | — | 96 | — | 1,464 | — | 30,074 | ||||||
| Addison HomeWood Suites | 2,576 | — | 4,934 | — | — | — | — | — | — | 443 | — | 824 | — | 8,777 | ||||||
| Plano HomeWood Suites | 2,369 | — | 6,055 | — | — | — | — | — | — | 27 | — | 824 | — | 9,275 | ||||||
| Las Colinas HomeWood Suites | 3,209 | — | 14,386 | — | — | — | — | — | — | 323 | — | 1,407 | — | 19,325 | ||||||
| St. Petersburg Marriott | 5,829 | — | 33,425 | — | — | — | — | — | — | 1,714 | — | 2,298 | — | 43,266 | ||||||
| Hyatt Place Park City | 3,737 | — | 19,759 | — | — | — | — | — | — | 852 | — | 3,130 | — | 27,478 | ||||||
| Bradenton Hampton Inn & Suites | 837 | 24,905 | — | — | 1,465 | 417 | 2,826 | 30,450 | ||||||||||||
| HUB Research Triangle Park | 0 | — | — | — | — | — | — | — | — | — | 2,960 | — | — | 2,960 | ||||||
| Accumulated depreciation and amortization | — | (18,968) | (7,388) | 2,795 | (10) | — | (757) | (24,328) | ||||||||||||
| Total Operating Properties | $70,381 | $317,301 | $3,591 | $(3,975) | $1,455 | $25,935 | $12,377 | $427,065 | ||||||||||||
As of December 31, 2023, the major components of the Company’s investments in real estate held by SPEs the Company consolidates, which are included in "Consolidated Real Estate Investments" on the Consolidated Balance Sheet, were as follows (in thousands):
| Operating Properties | Land | Buildings and Improvements | Intangible Lease Assets | Intangible Lease Liabilities | Construction in Progress | Furniture, Fixtures, and Equipment | Totals |
|---|---|---|---|---|---|---|---|
| White Rock Center | $1,315 | $10,345 | $1,921 | $(101) | $— | $5 | $13,485 |
| 5916 W Loop 289 | 1,081 | 2,938 | — | — | — | — | 4,019 |
| Cityplace Tower | 18,812 | 192,930 | 9,058 | (6,669) | 19,177 | 357 | 233,665 |
| NexPoint Dominion Land, LLC | 26,500 | — | — | — | — | — | 26,500 |
| 47,708 | 206,213 | 10,979 | (6,770) | 19,177 | 362 | 277,669 | |
| Accumulated depreciation and amortization | — | (13,490) | (6,798) | 2,203 | — | (237) | (18,322) |
| Total Operating Properties | $47,708 | $192,723 | $4,181 | $(4,567) | $19,177 | $125 | $259,347 |
Depreciation expense was $3.7 million and $6.0 million for the three and six months ended June 30, 2024 and $2.3 million and $4.4 million for the three and six months ended June 30, 2023. Amortization expense related to the Company’s intangible lease assets was $0.3 million and $0.6 million for the three and six months ended June 30, 2024 and $1.2 million and $2.5 million for the three and six months ended June 30, 2023. Amortization expense related to the Company's intangible lease liabilities was $0.3 million and $0.6 million for the three and six months ended June 30, 2024 and $0.4 million and $0.7 million for the three and six months ended June 30, 2023. The net amount amortized as an increase to rental revenue for capitalized above and below-market lease intangibles was $0.2 million and $0.5 million for the three and six months ended June 30, 2024 and $0.4 million and $0.7 million for the three and six months ended June 30, 2023.
Acquisitions
During the six months ended June 30, 2024, as a result of the NHT Acquisition, the Company consolidated the following properties: Dallas Hilton Garden Inn, Addison HomeWood Suites, Plano HomeWood Suites, Las Colinas HomeWood Suites, St. Petersburg Marriott, Hyatt Place Park City, Bradenton Hampton Inn & Suites. There were no acquisitions by the Company for the six months ended June 30, 2023.
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