NexPoint Residential Trust has sold Old Farm in Houston and Silverbrook in Dallas to institutional investors, generating approximately $67 million to $69 million of net sales proceeds. Multifamily Dive reports that the REIT will reduce portfolio-level debt by approximately $156 million as a result.
Investment analyst Robert Stevenson from Janney Montgomery Scott commented positively on the transaction, saying it is a positive for NexPoint: “Reducing expensive floating rate debt is beneficial, as NexPoint had been underperforming other apartment REITs year to date due largely to its balance sheet.” At an earnings call recently, CIO Matt McGraner noted that NexPoints began tackling its balance sheet issues back in November 2022 when it refinanced 22 properties and lowered weighted average floating rate spreads while extending maturities seven plus years. He added all disposition proceeds should be used for reducing expensive debt and repurchasing common stock.
The sale of Old Farm and Silverbrook marks another step towards improving financial stability at Nexpoint Residential Trust through reducing costly debts while providing additional capital resources for potential future investments or buybacks of common stock shares.
