NEXPOINT DIVERSIFIED REAL ESTATE TRUST

The three months ended September 30, 2025 as compared to the three months ended September 30, 2024

The following tables set forth a summary of our operating results for the three months ended September 30, 2025 and 2024 (in thousands):

The net loss for the three months ended September 30, 2025 decreased by $3.1 million as compared to the three months ended September 30, 2024. The decrease between periods primarily relates to a decrease in expenses.

Rental income. Rental income was $1.6 million for the three months ended September 30, 2025, compared to $4.4 million for the three months ended September 30, 2024, which was a decrease of approximately $2.8 million. Rental income decreased between the periods due to an increase in the allowance for bad debt related to certain tenants.

Rooms. Rooms revenue was $4.8 million for the three months ended September 30, 2025, compared to $7.3 million for the three months ended September 30, 2024, which was a decrease of approximately $2.5 million. Rooms revenue decreased between the periods due to the disposition of Hospitality properties in 2025.

Food and beverage. F&B revenue was $0.6 million for the three months ended September 30, 2025, compared to $0.5 million for the three months ended September 30, 2024, which was an increase of approximately $0.1 million. The increase between the periods was due to increased food sales.

Interest and dividends. Interest and dividends totaled $10.2 million for the three months ended September 30, 2025, compared to $9.1 million for the three months ended September 30, 2024, which was an increase of approximately $1.1 million. The increase between the periods was primarily due to an increase in dividend income.

Other income. Other income was approximately $0.4 million for the three months ended September 30, 2025, compared to $0.9 million for the three months ended September 30, 2024, which was a decrease of approximately $0.5 million. The decrease between the periods due to a decrease in resort charges, due to the disposition of Hospitality properties in 2025.

Property operating expenses. Property operating expenses were $5.6 million for the three months ended September 30, 2025, compared to $6.3 million for the three months ended September 30, 2024, which was a decrease of approximately $0.7 million. The decrease between the periods was primarily due to the disposition of Hospitality properties in 2025.

Property management fees. Property management fees were $0.3 million for the three months ended September 30, 2025, compared to $0.7 million for the three months ended September 30, 2024, which was a decrease of approximately $0.4 million. The decrease between the periods was primarily due to the disposition of Hospitality properties in 2025.

Real estate taxes and insurance. Real estate taxes and insurance costs were $1.3 million for the three months ended September 30, 2025, compared to $1.6 million for the three months ended September 30, 2024, which was a decrease of approximately $0.3 million. Real estate taxes and insurance expenses consist primarily of expenses from our investment in Cityplace Tower and our Hospitality properties. The decrease between the periods was primarily due to the disposition of Hospitality properties in 2025.

Advisory and administrative fees. For the three months ended September 30, 2025, the Company incurred administrative fees and advisory fees of $3.2 million, compared to $4.0 million for the three months ended September 30, 2024, which was a decrease of approximately $0.8 million. The decrease between the periods is primarily attributed to a decrease in fees paid to the NHT Adviser.

Property general and administrative expenses. Property general and administrative expenses were $1.3 million for the three months ended September 30, 2025, compared to $2.1 million for the three months ended September 30, 2024, which was a decrease of approximately $0.8 million. The decrease between the periods was primarily due to the disposition of Hospitality properties in 2025.

Corporate general and administrative expenses. Corporate general and administrative expenses were $5.2 million for the three months ended September 30, 2025, compared to $2.8 million for the three months ended September 30, 2024, which was an increase of approximately $2.4 million. The increase between the periods was primarily due to an increase in professional fees.

Depreciation and amortization. Depreciation and amortization costs were $3.9 million for the three months ended September 30, 2025, compared to $4.5 million for the three months ended September 30, 2024, which was a decrease of approximately $0.6 million. The decrease between the periods was primarily due to the disposition of Hospitality properties in 2025.

Impairment loss. Impairment loss was $0.0 million for three months ended September 30, 2025, compared to $6.1 million for the three months ended September 30, 2024, which was a decrease of approximately $6.1 million. The decrease between the periods was due to a decrease in impairment charges recorded in 2025.

Interest expense. Interest expense was $6.9 million for the three months ended September 30, 2025, compared to $8.3 million for the three months ended September 30, 2024, which was a decrease of approximately $1.4 million. The decrease between the periods was primarily due a decrease in debt related to paydowns.

Equity in income (losses) of unconsolidated ventures. Equity in income (losses) of unconsolidated ventures was $(0.6) million for the three months ended September 30, 2025, compared to $0.4 million for the three months ended September 30, 2024, which was a decrease of approximately $1.0 million. The decrease between the periods was primarily due to a decrease in net income at Marriott Uptown.

Income tax (expense) benefit. The Company has recorded income tax (expense) benefit of $1.0 million associated with the TRSs for the three months ended September 30, 2025, and $0.7 million associated with the TRSs for the three months ended September 30, 2024. The tax expense (benefit) for the three months ended September 30, 2025 is partially decreased by the annual change in valuation allowance on a deferred tax asset of $0.2 million, an increase in income tax expense of $0.3 million, offset by a return-to-provision adjustment of $0.5 million and decrease of income tax estimate of $1.0 million for a net benefit of $1.0 million for the three months ended September 30, 2025, that is recorded on the

Consolidated Statements of Operations and Comprehensive Income (Loss). The tax expense for the three months ended September 30, 2024 is partially offset by the annual change in valuation allowance on a deferred tax asset of $0.4 million for a net expense of $0.7 million for the three 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 $(2.5) million for the three months ended September 30, 2025, compared to $(0.9) million for the three months ended September 30, 2024, which was a decrease of approximately $1.6 million. The losses for the three months ended September 30, 2025 were largely driven by mark-to-market losses on VineBrook Homes Operating Partnership, L.P. common units ("VB OP Units") of $5.3 million and NexPoint SFR Operating Partnership, L.P. (“NexPoint SFR OP”) partnership units of $4.6 million, and offset by mark-to-market gains on MidWave Wireless Inc. common stock of $6.2 million. The losses for the three months ended September 30, 2024 were largely driven by mark-to-market losses on VB OP Units of $7.8 million, IQHQ LP interests of $16.1 million, and offset by mark-to-market gains on common units of NREF OP (“NREF OP Units”) of $9.3 million, and NREF common stock of $4.0 million.