NexPoint Real Estate Finance, Inc.

The Company consolidated ownership of Mag & May, which is a 240-unit multifamily property in Fort Worth, Texas, as of December 31, 2025. The Company’s ownership is subject to mortgage debt with an outstanding principal balance of approximately $42.7 million as of December 31, 2025.

For additional information regarding these properties, see Note 8 to our consolidated financial statements.

• NREF OP IV TRS, LLC Delaware⁴
• NREF OP IV, L.P. Delaware⁴
• NREF Palisades, LLC Delaware⁴
• NREF Ridgeview, LLC Delaware⁴
• NREF Rosemont, LLC Delaware⁴
• NREF SK, LLC Delaware⁴
• NREF Sub OP GP, LLC Delaware⁴
• NREF Tivoli North Land, LLC Delaware⁴
• NexPoint Buffalo Pointe Holdings, LLC Delaware⁴
• NexPoint Buffalo Pointe, LLC Delaware⁴
• NexPoint Hughes Leaseco, LLC Delaware⁴
• NexPoint Hughes Manager, LLC Delaware⁴
• NexPoint Life Sciences DST Delaware⁴
• NexPoint Real Estate Finance Operating Partnership, L.P. Delaware⁴
• Nexpoint Hughes DST Delaware⁴
• Nexpoint WLIF I Borrower, LLC Delaware⁴
• Nexpoint WLIF II Borrower, LLC Delaware⁴
• SPG Alexander JV LLC Delaware⁴

• The lack of liquidity in certain of our target assets may adversely affect our business.
• Our success depends on the availability of attractive loans and investments and our Manager’s ability to identify, structure, consummate, leverage, manage, realize and redeploy returns on our loans and investments.
• Any distressed loans or investments we make, or loans and investments that later become distressed, may subject us to losses and other risks relating to bankruptcy proceedings.
• We may not have control over certain of our loans and investments.
• CMBS B-Pieces, CMBS I/O Strips, mezzanine loans, preferred equity and other investments that are subordinated or otherwise junior in an issuer’s capital structure and that involve privately negotiated structures expose us to greater risk of loss.
• Our investments in CMBS pose additional risks, including the risk that we will not be able to recover some or all of our investment and the risk that we will not be able to hedge or transfer our CMBS B-Piece or CMBS I/O Strip investments for a significant period of time.
• Loans on properties in development or redevelopment involve a greater risk of loss than conventional mortgage loans.
• We may not realize gains or income from our investments.
• Real estate valuation is inherently subjective and uncertain.
• Some of our portfolio investments may be recorded at fair value not readily available and, as a result, there will be uncertainty as to the value of these investments.
• We may experience a decline in the fair value of our assets.
• The due diligence process that our Manager undertakes in regard to investment opportunities may not reveal all facts that may be relevant in connection with an investment and if our Manager incorrectly evaluates the risks of our loans and investments, we may experience losses.
• Insurance on loans and real estate securities collateral may not cover all losses.
• Acts of violence or war or a prolonged economic slowdown may affect the real estate industry generally and our business, financial condition and results of operations.
• Risks Related to Our Industry
• If we were required to register with the U.S. Commodity Futures Trading Commission (the “CFTC”) as a Commodity Pool Operator, it could materially adversely affect our business, financial condition and results of operations.
• We may need to foreclose on certain of the loans and/or exercise our “foreclosure option” under the terms of our investments we originate or acquire, which could result in losses that harm our results of operations and financial condition.
• Liability relating to environmental matters may impact the value of properties that we may acquire or the properties underlying our investments.
• We may be subject to lender liability claims, and if we are held liable under such claims, we could be subject to losses.
• Our ability to generate returns for our stockholders through our investment, finance and operating strategies is subject to then-existing market conditions, and we may make significant changes to these strategies in response to changing market conditions.
• If we fail to develop, enhance and implement strategies to adapt to changing conditions in the real estate industry and capital markets, our financial condition and results of operations may be materially and adversely affected.
• Any credit ratings assigned to our loans and investments will be subject to ongoing evaluations and revisions and we cannot assure you that those ratings will not be downgraded.
• Rapid changes in the values of our real estate investments may make it more difficult for us to maintain our qualification as a REIT or exclusion from regulation under the Investment Company Act.
• We may be subject to losses arising from current and future guarantees of debt and contingent obligations of our subsidiaries.
• Risks Related To Legal, Regulatory and Accounting Issues
• We are a “smaller reporting company” under the federal securities laws and will be subject to reduced public company reporting requirements.
• Failure of our internal control over financial reporting could harm our business, financial condition and results of operations.
• Changes in accounting rules and other policy or regulatory changes could occur at any time and could impact us in significantly negative ways that we are unable to predict or protect against.
• Allowance for credit losses are particularly difficult to estimate in a turbulent economic environment
• Risks Related to Our Indebtedness and Financing Strategy
• We have a substantial amount of indebtedness which may limit our financial and operating activities and may adversely affect our ability to incur additional debt to fund future needs.
• Any credit facilities (including term loans and revolving facilities), debt securities, repurchase agreements, warehouse facilities and securitizations may impose restrictive covenants, which may restrict our flexibility to determine our operating policies and investment strategy.
• Inability to access funding could have a material adverse effect on our results of operations, financial condition and business.
• We are subject to counterparty risk associated with our debt obligations.
• Hedging may adversely affect our earnings, which could reduce our cash available for distribution to our stockholders.
• We are subject to counterparty risk associated with our hedging activities.
• We may enter into hedging transactions that could expose us to contingent liabilities in the future.
• We may fail to qualify for, or choose not to elect, hedge accounting treatment.
• Any credit facilities (including term loans and revolving facilities), repurchase agreements, warehouse facilities and securitizations that we may use to finance our assets may require us to provide additional collateral or pay down debt.
• If a counterparty to a repurchase agreement defaults on its obligation to resell the underlying security back to us at the end of the purchase agreement term, or if the value of the underlying asset has declined as of the end of that term, or if we default on our obligations under the repurchase agreement, we may incur losses.
• Risks Related to Our Corporate Structure
• We may not be able to operate our business successfully, find suitable investments, or generate sufficient revenue to make or sustain distributions to our stockholders.
• We depend upon key personnel of our Manager and its affiliates.
• We are dependent upon our Manager and its affiliates to conduct our day-to-day operations; thus, adverse changes in their financial health or our relationship with them could cause our operations to suffer.
• Our Manager manages our portfolio pursuant to very broad investment guidelines and is not required to seek the approval of our Board for each investment, financing, asset allocation or hedging decision made by it, which may result in our making riskier investments and which could materially and adversely affect us.
• We may not replicate the historical results achieved by other entities managed or sponsored by affiliates of our Manager, members of our Manager’s management team or by our Sponsor or its affiliates.
• Our Manager maintains a contractual as opposed to a fiduciary relationship with us. Our Manager’s liability is limited under the Management Agreement, and we have agreed to indemnify our Manager against certain liabilities.
• We may change our targeted investments without stockholder consent.
• We will pay substantial fees and expenses to our Manager and its affiliates, which payments increase the risk that you will not earn a profit on your investment.
• If we internalize our management functions, we may not achieve the perceived benefits of the internalization transaction.
• There are significant potential conflicts of interest that could affect our investment returns.
• The Chapter 11 bankruptcy filing by Highland may have materially adverse consequences on our business, financial condition and results of operations.
• Litigation against James Dondero and others may have materially adverse consequences on our business, financial condition and results of operations.
• We may compete with other entities affiliated with our Manager and our Sponsor for investments.
• Our Manager, our Sponsor and their respective affiliates, officers and employees face competing demands relating to their time, and this may cause our operating results to suffer.
• Our Manager and its affiliates will face conflicts of interest, including significant conflicts created by our Manager’s compensation arrangements with us, including compensation which may be required to be paid to our Manager if the Management Agreement is terminated, which could result in actions that are not necessarily in the long-term best interest of our stockholders.
• Our charter permits our Board to issue stock with terms that may subordinate the rights of our stockholders or discourage a third party from acquiring us in a manner that could otherwise result in a premium price to our stockholders.
• Our rights and the rights of our stockholders to recover claims against our directors and officers are limited by Maryland law and our organizational documents, which could reduce your and our recovery against them if they cause us to incur losses.
• Our bylaws designate the Circuit Court for Baltimore City, Maryland as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders and provide that claims relating to causes of action under the Securities Act may only be brought in federal district courts, which could limit stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees and could discourage lawsuits against us and our directors, officers and employees.
• Certain provisions of the MGCL may limit the ability of a third party to acquire control of us.
• Risks Related to Our REIT Status and Other Tax Items
• We have elected to be treated as a REIT commencing with our taxable year ended December 31, 2020. Our failure to qualify or maintain our qualification as a REIT for U.S. federal income tax purposes would reduce the amount of funds we have available for distribution and limit our ability to make distributions to our stockholders.
• Even if we qualify as a REIT for U.S. federal income tax purposes, we may be subject to other tax liabilities that reduce our cash flow and our ability to make distributions to you.
• To maintain our REIT qualification, we may be forced to borrow funds during unfavorable market conditions, and the unavailability of such capital on favorable terms at the desired times, or at all, may cause us to curtail our investment activities and/or to dispose of assets at inopportune times, which could adversely affect our financial condition, results of operations, cash flow and value of our securities.
• The failure of a mezzanine loan to qualify as a real estate asset could adversely affect our ability to qualify as a REIT.
• There is a lack of clear authority governing the characterization of our mezzanine loans or preferred equity investments for REIT qualification purposes.
• The “taxable mortgage pool” rules may increase the taxes that we or our stockholders may incur and may limit the manner in which we effect future securitizations.
• Complying with REIT requirements may cause us to forego otherwise attractive opportunities or liquidate otherwise attractive investments.