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NexPoint Residential Trust
NexPoint Residential Trust is a publicly traded REIT formed by James Dondero in 2015, holding over 15,000 apartment units in the Sun Belt.
NexPoint Residential Trust
NexPoint Residential Trust was formed in 2015 as an exchange-listed real estate investment trust managed by Dallas-based NexPoint Advisors, an affiliate of Highland Capital Management founded by James Dondero. It went public via an initial public offering that year, raising capital specifically to acquire and operate workforce housing. Dondero designed the vehicle to give public-market investors direct exposure to value-add Class B and Class C apartment properties — a strategy he had pursued privately for years through related entities. The trust buys under-managed 1980s- and 1990s-vintage garden-style apartment complexes, renovates unit interiors and common areas, raises rents to prevailing market levels, and holds for income plus appreciation. The portfolio is geographically concentrated in the Sun Belt — Texas and Florida account for the bulk of net operating income, with additional exposure to Georgia, North Carolina, and Tennessee. Confirmed positions include properties in Dallas-Fort Worth, Houston, Orlando, Tampa, and Atlanta. The trust has historically avoided gateway coastal cities, preferring high-migration markets with business-friendly climates and no rent control. NexPoint Residential Trust is structured as an UPREIT, which allows property sellers to contribute assets in exchange for operating partnership units, deferring capital gains. NexPoint Advisors provides the external management team under an advisory agreement. Senior executives Brian Mitts, Matthew McGraner, and James Dondero also hold key roles across the larger NexPoint ecosystem — which includes NexPoint Real Estate Finance, NexPoint Strategic Opportunities Fund, and the NexPoint Diversified Real Estate Trust. In January 2022, the trust completed a major balance-sheet simplification: it refinanced its entire debt stack with a single fixed-rate $750 million credit facility from a bank syndicate (per the firm, January 2022). This replaced floating-rate exposure with long-dated fixed-rate financing, insulating the trust from rate hikes that subsequently roiled the broader REIT sector. The trust's structural differentiator is its public-vehicle wrapper around a strategy typically housed in a blind-pool private-equity fund — individual investors can buy a share of a value-add Sun Belt apartment portfolio with daily liquidity. That public-REIT structure imposes transparency, disclosure, and liquidity demands that private holders avoid, but the market has historically priced NXRT at a discount to net asset value when Dondero or Highland's broader credit reputation is under scrutiny.
General information
Firm type
Asset Manager
Year founded
2015
AUM
Undisclosed
Location
Region
North America
Country
United States
City
Dallas
Corporate office
Dallas, TX, United States
Principals
James Dondero
Chairman of the Board
Brian Mitts
Chief Executive Officer, President, and Chief Financial Officer
Sector focus
Frequently asked questions
Who actually makes the day-to-day investment decisions at NexPoint Residential Trust?
Brian Mitts runs NexPoint Residential as CEO and CFO, overseeing the operating team within NexPoint Advisors. The advisory firm is entirely external and controlled by James Dondero's broader NexPoint organization. Material acquisitions and the overarching portfolio strategy are approved by the NXRT board of directors, where Dondero serves as Chairman.
How is NXRT different from a private apartment fund?
NXRT is a New York Stock Exchange-listed REIT, which means any investor can buy or sell common shares instantly. That daily liquidity contrasts with private real estate funds, which lock capital for years. The trade-off for that liquidity is that the trust publishes quarterly financials and must price its portfolio to the public market, which has historically valued NXRT at a discount to the private-market appraised value of its properties.
Does NexPoint Residential Trust develop new apartments or only buy existing ones?
The trust does not develop ground-up construction. It acquires existing 1980s- and 1990s-vintage garden-style apartment communities in the Sun Belt, then renovates unit interiors, upgrades common areas, and brings management practices in line with institutional standards. The value-add comes from closing the gap between in-place rents and market rates after improvements.
What is the relationship between NexPoint Residential Trust and Highland Capital Management?
James Dondero co-founded Highland Capital Management, which historically advised credit hedge funds and registered funds. NexPoint Advisors — the external manager to NXRT — evolved from the real estate platform originally housed within Highland. Today NXRT is managed by the NexPoint affiliated group, which Dondero controls. The two entities share executive officers and back-office infrastructure, but NXRT is a standalone NYSE-listed REIT with its own independent board.
Does the trust participate in joint ventures or co-invest alongside external partners?
The trust wholly owns its properties and typically does not enter joint ventures at the asset level. It holds ownership through an umbrella partnership REIT structure, acquiring fee-simple interests. NexPoint Residential Trust has occasionally raised equity through common and preferred stock offerings to institutional buyers, but those transactions are securities purchases, not shared asset governance.
Which markets does NexPoint Residential Trust explicitly avoid?
NXRT's disclosures confirm it avoids traditional coastal gateway cities — New York, Los Angeles, San Francisco, Boston, and Washington, D.C. are absent from the portfolio. It also avoids markets with rent-control regulations. The trust concentrates instead on high-migration Sun Belt metros where new supply can be absorbed by population growth and the regulatory environment is landlord-friendly.
How did NexPoint Residential Trust protect its balance sheet during the 2022 rate-hiking cycle?
In January 2022, the trust refinanced its floating-rate credit facilities into a single $750 million fixed-rate term facility syndicated by a group of banks. Because the debt is fixed-rate and staggered in maturity, the trust avoided the immediate margin compression that hit many REITs reliant on floating-rate credit lines during the subsequent rate-hiking cycle.
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