| Item 2.01. | Completion of Acquisition or Disposition of Assets. |
On January 28, 2019, NexPoint Residential Trust, Inc. (the “Company”), through its operating partnership, NexPoint Residential Trust Operating Partnership, L.P. (“NXRT OP”), acquired a three-property portfolio in Phoenix, Arizona from an unaffiliated third party for approximately $132 million. The properties, The Heritage Apartment Homes, a204-unit property built in 1995, Bella Vista Apartment Homes, a248-unit property built in 1995, and The Enclave Apartment Homes, a204-unit property built in 1994 (collectively, the “Phoenix Portfolio”), are situated on approximately 7.9, 13.8 and 11.4 acres of land, respectively. The Phoenix Portfolio had average monthly rents of $1,230 and 95.3% physical occupancy at acquisition and adds 656 units to the Company’s existing Phoenix portfolio of 1,199 units. In addition, the acquisition also adds an additional 425 units to the Company’s interior upgrade pipeline.
The Phoenix Portfolio acquisition was structured as a reverse 1031 exchange to facilitate the Company’s continued plan to recycle capital in a tax efficient manner from dispositions of its rehabbed assets into well-located, “covered-land” assets withvalue-add potential in the Company’s core target markets. The Company funded the purchase price with cash on hand, borrowings of approximately $52.8 million under a new revolving credit facility entered into with SunTrust Bank, as administrative agent, and the lenders party thereto and approximately $79.0 million in new first mortgages with Freddie Mac, each of which were entered into on January 28, 2019. Following the completion of the reverse 1031 exchange and execution of the Company’svalue-add plans, management expects the Phoenix Portfolio’sloan-to-value ratio to stabilize to approximately 50%. A presentation further detailing the merits of the acquisition of the Phoenix Portfolio can be found under “News & Presentations” in the Investor Relations section of the Company’s website (www.nexpointliving.com).
| Item 9.01. | Financial Statements and Exhibits. |
(a)Financial Statements. The financial information relating to the Phoenix Portfolio required under Rule3-14 of RegulationS-X will be filed by an amendment to this report no later than April 15, 2019, which is the first business day that is 71 calendar days from the date that this report must be filed.
(b)Pro Forma Financial Information. The pro forma financial information required under Article 11 of RegulationS-X will be filed by an amendment to this report no later than April 15, 2019, which is the first business day that is 71 calendar days from the date that this report must be filed.
(d)Exhibits. None.
Cautionary Notice Regarding Forward-Looking Statements
This report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based on management’s current expectations, assumptions and beliefs. Forward-looking statements can often be identified by words such as “expect,” “intend” and similar expressions, and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding expectedvalue-add plans,loan-to-value ratio and plan to recycle capital. They are not guarantees of future results and are subject to risks, uncertainties, assumptions and anticipated sales of properties that could cause actual results to differ materially from those expressed in any forward-looking statement. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the Company’s Annual Report on Form10-K for the year ended December 31, 2017 and the Company’s other filings with the Securities and Exchange Commission for a more complete discussion of the risks and other factors that could affect any forward-looking statements. Except as required by law, the Company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this report.
