2020 reit week presentation drafts2.q4cdn.com/471454804/files/doc_presentations/2020/06/... ·...

REIT WEEK 2020 | 2-4 JUNE 2020

Avant at Pembroke Pines

South Florida

Bella Solara

Las Vegas

Atera

Dallas

Old Farm

Houston

Arbors at Brentwood

Nashville

Rockledge

Atlanta

www.NexPointLiving.com

2

CAUTIONARY STATEMENTSFORWARD LOOKING STATEMENTS

This presentation includes forward-looking statements. These statements reflect the current views of the Company’s management with respect to future events and financial performance. These statements include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the Company’s business and industry in general, the affordable housing market, the Sun Belt rental market, preliminary May 2020 operational and collections data, statements regarding NXRT's guidance for financial results for the full year 2020 and related assumptions, net asset value and the related assumptions, expected acquisitions or dispositions, the expected redevelopment of units, as part of our value-add program, the projected average rent, rent change and ROI after redevelopment and potential to generate NOI and earnings growth. Statements that include the words “expect,” “intend,” “estimate,” “may,” “should,” “anticipate” and similar statements of a future or forward-looking nature identify forward-looking statements for purposes of the federal securities laws or otherwise. Forward-looking statements address matters that involve risks and uncertainties. Accordingly, there are or will be important factors that could cause the Company’s actual results to differ materially from those indicated in these statements. For a discussion of the factors that could change these forward-looking statements, see our annual and quarterly reports filed with the SEC. The statements made herein speak only as of the date of this presentation and the Company does not undertake to update this information except as required by law. Past performance does not guarantee future results. Performance during time periods shown is limited and may not reflect the performance in different economic and market cycles. There can be no assurance that similar performance will be experienced.

NON-GAAP FINANCIAL MEASURES

This presentation contains non-GAAP financial measures. A “non-GAAP financial measure” is defined as a numerical measure of a company’s financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with GAAP in the statements of income, balance sheets or statements of cash flows of the Company. The non-GAAP financial measures used within this presentation are funds from operations attributable to common stockholders (“FFO”), FFO per diluted share, Core FFO, Core FFO per diluted share, adjusted FFO attributable to common stockholders (“AFFO”), AFFO per diluted share, net operating income (“NOI”), and net debt. FFO is defined by the National Association of Real Estate Investment Trusts (“NAREIT), as net income (loss) computed in accordance with GAAP, excluding gains or losses from real estate dispositions, plus real estate depreciation and amortization. We compute FFO in accordance with NAREIT’s definition. Our presentation differs slightly in that we begin with net income (loss) before adjusting for amounts attributable to redeemable noncontrolling interests in NexPoint Residential Trust Operating Partnership, L.P. (the “OP”); we show the combined amounts attributable to such noncontrolling interests as an adjustment to arrive at FFO attributable to common stockholders. Core FFO makes certain adjustments to FFO, which are either not likely to occur on a regular basis or are otherwise not representative of the ongoing operating performance of our portfolio. Core FFO adjusts FFO to remove items such as casualty-related expenses/(recoveries), losses on extinguishment of debt and modification costs (including prepayment penalties and defeasance costs incurred and the write-off of unamortized deferred financing costs and fair market value adjustments of assumed debt related to the retirement of debt and costs incurred in connection with a debt modification that are expensed), the amortization of deferred financing costs incurred in connection with obtaining short-term debt financing and the noncontrolling interests related to these items. AFFO makes certain adjustments to Core FFO. There is no industry standard definition of AFFO and practice is divergent across the industry. AFFO adjusts Core FFO to remove items such as equity-based compensation expense and the amortization of deferred financing costs incurred in connection with obtaining long-term debt financing and the noncontrolling interests related to these items. NOI is calculated by adjusting net income (loss) to add back (1) the cost of funds, (2) acquisition costs, (3) advisory and administrative fees, (4) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP, (5) corporate general and administrative expenses, (6) other gains and losses that are specific to us, (7) casualty-related expenses/(recoveries) and casualty gain (loss), and (8) property general and administrative expenses that are not reflective of the continuing operations of the properties or are incurred on behalf of the Company at the property for expenses such as legal, professional and franchise tax fees. Net debt is calculated by subtracting cash and cash equivalents and restricted cash held for value-add upgrades from total debt outstanding. We believe that the use of FFO, Core FFO, AFFO, NOI, and net debt, combined with the required GAAP presentations, improves the understanding of operating results and debt levels of Real Estate Investment Trusts (“REIT”) among investors and makes comparisons of operating results and debt levels among such companies more meaningful. While FFO, Core FFO, AFFO, NOI and net debt are relevant and widely used measures of operating performance and debt levels of REITs, they do not represent cash flows from operations, net income (loss) or total debt as defined by GAAP and should not be considered an alternative to those measures in evaluating our liquidity, operating performance and debt levels. FFO, Core FFO, AFFO, and NOI do not purport to be indicative of cash available to fund our future cash requirements. We present net debt because we believe it provides our investors a better understanding of our leverage ratio. Net debt should not be considered an alternative to total debt, as we may not always be able to use our available cash to repay debt. Our computation of FFO, Core FFO, AFFO, NOI, and net debt may not be comparable to FFO, Core FFO, AFFO, NOI, and net debt reported by other REITs. See pages 36 and 37 of this presentation and our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q for reconciliations of our non-GAAP financial measures.

ADDITIONAL INFORMATION

For additional information, see our filings with the SEC. Our filings with the SEC are available on our website, www.nexpointliving.com, under the "Investor Relations" tab. Investors areurged to read our Annual Report on Form 10-K and our other filings with the SEC, including our Forms 10-Q and Forms 8-K, in their entirety.

3

NEXPOINT RESIDENTIAL TRUST, INC [NYSE:NXRT]

NexPoint Residential Trust, Inc. is a publicly traded REIT, with its shares listedon the New York Stock Exchange under the symbol "NXRT," and is primarilyfocused on acquiring, owning and operating well-located middle-incomemultifamily properties with "value-add" potential in large cities, primarily in theSoutheastern and Southwestern United States. NXRT is externally advised byNexPoint Real Estate Advisors, L.P., which is an affiliate of NexPoint Advisors,L.P., an SEC-registered investment adviser.

We pursue investments in multifamily real property, typically with a value-addcomponent, where we can invest capital to provide "life-style" amenities to"work-force" and middle-income housing. Our value-add strategies seek toprovide both improved communities for our residents and outsized returns forour shareholders. As of June 1, 2020, NXRT owned 14,300 units across theU.S. in Texas, Arizona, Georgia, Tennessee, Florida, Nevada, and NorthCarolina.

COMPANY OVERVIEW $32.69PRICE PER SHARE(1)

3.82%YIELD(1)

14.41%INSIDER OWNERSHIP(1)

$0.313Q2 2020 DIVIDEND PER SHARE

(1) AS OF THE CLOSE OF MARKET TRADING JUNE 1, 2020.

4


As of March 31, 2020, NXRT owned 38 multifamily properties, consisting of14,300 units, across 10 markets in 7 Southeastern and Southwestern U.S.states. As of June 1, 2020, the portfolio, excluding Cutter’s Point, was 94.5%occupied with an average effective monthly rent of $1,116 per occupied unit.

We believe NXRT is the only pure-play, publicly-traded REIT focused on value-add multifamily real property. The company is focused on acquiring, owningand operating well-located middle-income multifamily properties with "value-add" potential in large cities, primarily in the Southeastern and SouthwesternUnited States. We target markets that we believe have the followingcharacteristics:

• Attractive job growth and household formation fundamentals• High costs of homeownership or class A multifamily rental; and• Elevated or increasing construction or replacement costs for multifamily

real property

Our “value-add” program seeks to provide our residents with “life-style”amenities found in newly constructed multifamily property at a reasonable priceas well as increase shareholder value for our investors. As of the end of the firstquarter of 2020, we have completed interior renovations on 6,914 units,achieving 11.1% average rent premiums over the prior lease rate, whichequates to a 24.6% return on investment. Q1 2020 Same store revenue andNOI increased 5.3% and 5.6%, respectively, over the prior year period.

NXRT PORTFOLIO AND STRATEGY

(1) AS OF JUNE 1, 2020.(2) EXCLUDING CUTTER’S POINT.

14,300UNITS OWNED(1)

38PROPERTIES (1)

$1,116AVERAGE MONTHLY

RENT PER UNIT (1)(2)

94.5%PORTFOLIO

OCCUPANCY (1)(2)

5


Q3 2013

4Q 019

Q4 2014

Q2 2015

Q1 2020

Purchased first property for

$8.9M1

$700M in assets; 32 properties1

NXRT listed on the NYSE; $877M in assets

38 properties, 14,000+ units, and more than $1.8B

in assets

(1) PRIOR TO NXRT’S SPIN-OFF FROM NEXPOINT CREDIT STRATEGIES FUND (NYSE: NHF).(2) TOTAL RETURN BASED ON CUMULATIVE DIVIDENDS SINCE NXRT LISTING (APRIL 1, 2015) AND STOCK PRICE AS OF CLOSING OF TRADING JUNE 1, 2020.(3) MANAGEMENT'S PUBLISHED ESTIMATE OF NET ASSET VALUE PER COMMON SHARE (TAKEN AT THE MID-POINT) AS PRESENTED WITHIN THE COMPANY'S QUARTERLY FINANCIAL SUPPLEMENTAL FOR

EACH REPORTING PERIOD SINCE THE COMPANY COMPLETED ITS SPIN OFF FROM NEXPOINT CREDIT STRATEGIES FUND (NYSE: NHF).

+5.6%

$38.47

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

$55

0%

10%

20%

30%

40%

50%

SPIN

OFF

3Q

2015

1Q

2016

3Q

2016

1Q

2017

3Q

2017

1Q

2018

3Q

2018

1Q

2019

3Q

2019

1Q

2020

Same Store NOI Growth NAV per share (diluted) (1)

-50.00%

0.00%

50.00%

100.00%

150.00%

200.00%

250.00%

300.00%

350.00%

400.00%

4/1/2015 4/1/2016 4/1/2017 4/1/2018 4/1/2019 4/1/2020

NXRT RMZ

SIGNIFICANT TOTAL RETURN1,2

+187%

OUTPERFORMED RMZ

BY 178%

6

AFFORDABLE HOUSING STRENGTH & DURABILITY

Residential Demand Tailwinds: Declining home ownership, increasing studentdebt, and a number of other socio-economic and demographic trendscontinue to support rental demand

Resident retention in Class B properties expected to remain strong andpossibly rise as households have a higher probability to “do nothing” duringuncertain times

Management believes the Company’s properties have a better ability to pickup the aforementioned Class A to Class B trade out given the higher qualityproduct produced via the historic capital invested into each asset

Class A demand has the potential to be squeezed and to move down to lowerpriced class B apartments further insulating the Company’s earnings stream

Greg Willett, Chief Economist of RealPage expects a short-term, sharprecession but that demographics suggest renter demand should be strong forat least another decade with growth in NXRT’s prime renter cohort

THE NEXPOINT “HOUSE VIEW” ON HOUSING

(1) SOURCE: R.W. BAIRD RESEARCH; COSTAR, NAHB, US CENSUS, NATIONAL ASSOCIATION OF REALTORS, MLS, ZILLOW, COMPANY DISCLOSURES.(2) BEA.GOV: PERSONAL INCOME BY METROPOLITAN AREA 2018, DATA USA, AND STATISTA.COM / USES NXRT’S EFFECTIVE ANNUALIZED RENTAL INCOME AS OF

DECEMBER 31, 2019.

Per analysis performed by R.W. Baird, renting at an NXRT community presents a 42% discount to owning a home in the same market

FAVORABLE COST OF RENTING AT AN NXRT COMMUNITY (1)

REIT4Q19A

Rental RateBlended Avg Cost to Own

Portfolio Rent v. Blended Avg

Cost to Own (1)

Essex (ESS) $2,382 $4,077 42%

NexPoint (NXRT) $1,103 $1,892 42%

AvalonBay (AVB) $2,682 $4,138 35%

UDR (UDR)* $2,036 $3,049 33%

AIMCO (AIV) $2,140 $3,193 33%

Mid-America (MAA) $1,276 $1,815 30%

EQR (EQR) $2,858 $3,938 27%

Camden (CPT) $1,546 $2,087 26%

Bluerock (BRG) $1,319 $1,786 26%

Independence (IRT) $1,088 $1,393 22%

* For REITs only reporting revenue per occupied unit (UDR), assume pure rent income is 10% lower

RANK MARKETIncome as a % of

Annual Rent

1 Nashville 19%

2 Atlanta 19%

3 Dallas 19%

4 Phoenix 20%

5 Charlotte 20%

6 Houston 21%

7 Tampa 21%

8 Las Vegas 25%

9 Miami 26%

10 Orlando 31%

Weighted Average 22%

DURABLE RENTER DEMOGRAPHIC2

22%NXRT’s WEIGHTED AVERAGE INCOME

TO ANNUALIZED EFFECTIVE RENT

7

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Stratification of Annual Total Income by U.S. Household, 2019 Survey

AFFORDABLE HOUSING STRENGTH & DURABILITY

(1) SOURCE: UNITED STATES CENSUS BUREAU CURRENT POPULATION SURVEY (CPS) ANNUAL SOCIAL AND ECONOMIC (ASEC) SUPPLEMENT. 2019 DATA CALCULATION PRESUMES HOUSEHOLD INCOME IS ≥ 3X RENT. AVERAGE NXRT RENT ($1,116/MONTH) X 3 X 12 MONTHS = $39,996.

We believe middle market Class “B” affordable housing will outperform A & C in times of economic hardship

67.9 %of total U.S. household population can afford to live in a NXRT community (1)

The shaded area represents the

population of U.S. households earning

sufficient income to qualify for housing

in a NXRT community based upon

NXRT’s average monthly rental rate

87.3 million U.S. households

8

GEOGRAPHICAL FOOTPRINT ADVANTAGE

(1) US CENSUS: METROPOLITAN AND MICROPOLITAN STATISTICAL AREAS POPULATION TOTAL: 2010-2018.(2) US BLS: NONFARM PAYROLL CHANGE FROM MARCH 2019 TO MARCH 2020.

NET DOMESTIC MIGRATION1 JOB GROWTH – YEAR OVER YEAR2

RANK MARKETNET

MIGRATIONNXRT MSA

1 Dallas 411,593 NXRT

2 Phoenix 326,593 NXRT

3 Houston 261,990 NXRT

4 Austin 251,563

5 Tampa 241,495 NXRT

6 Atlanta 213,860 NXRT

7 Charlotte 204,273 NXRT

8 San Antonio 191,751

9 Denver 182,675

10 Orlando 172,935 NXRT

11 Las Vegas 154,139 NXRT

12 Nashville 143,192 NXRT

13 Seattle 132,301

14 Raleigh 127,688

15 Sarasota 123,568

86%NXRT UNITS IN THE

TOP 15 MSAs

31%OF ALL DOMESTIC

MOVES TO NXRT MSAs

RANK MARKET JOBS ADDED NXRT MSA

1 Dallas 86,200 NXRT

2 Houston 59,000 NXRT

3 Phoenix 58,100 NXRT

4 Los Angeles 44,900

5 Atlanta 43,400 NXRT

6 Denver 38,800

7 Wash. D.C. 31,500

8 Seattle 31,100

9 Nashville 30,100 NXRT

10 Tampa 27,200 NXRT

11 Austin 27,200

12 Orlando 19,700 NXRT

13 Salt Lake City 18,800

14 San Antonio 18,100

15 Miami (South Florida) 16,400 NXRT

88%NXRT UNITS IN THE

TOP 15 MSAs

42%OF ALL JOBS ADDED FROM MAR. ‘19

THROUGH MAR. ‘20

LOCATED IN NXRT MSAs

9

NXRT DEMOGRAPHIC STRENGTH & SUNBELT TAILWINDS

Low density suburban Sun Belt rental housing is expected to significantlyoutperform particularly higher density high-end infill housing product indensely populated coastal cities.

Relative affordability positions the portfolio well to capitalize on forecastdemand acceleration in NXRT’s well-located, high quality middle markethousing stock, wherein 67.9% of US households qualify to live.

Faster re-openings and less restrictive measures should be a net benefit overthe near term.

Longer term, an acceleration of trends already in place, such as employmentshifts and population migration favoring Sun Belt markets, will take shape.

“With lower costs of living, lower taxes, and lower density - NXRT's Sun Beltmarkets with vibrant suburbs seem likely to gain an increasing share of jobrelocations. Moreover, with average rents well below market averages, risingresident retention, and a deep pipeline of high-ROI value-add rehab unitsavailable - we think the resiliency of NXRT's workforce housing portfolio willcontinue to attract investor attention.” – Buck Horne, Raymond James 1

SHIFTING TRENDS FAVOR NXRT’S SUNBELT FOOTPRINT

(1) SOURCE: RAYMOND JAMES US EQUITY RESEARCH NOTE: NXRT - MAY 18, 2020.(2) SOURCE: INTERNAL COMPANY DATA AS REPORTED THROUGH MAY 26, 2020.

In response to COVID-19 and its uncertain effects on ongoing operations, NXRTcompleted an exhaustive review of all available resident demographic data, theresults of which were highly encouraging (select data presented below and right).

Houston, TX (8.4% of total unit exposure)

• Top five occupations as defined by the North American Industry Classification System (“NAICS”): Professional, Scientific, Technical Services (14.7%), Health Care, Social Assistance (8.9%), Retail Trade (7.3%), Accommodation & Food Service (7.0%), Transportation and Warehousing (6.1%)

• Recently named #5 Market in United States for Total Durable Employment, per Yardi Matrix analysis of Bureau of Labor Statistics data

Las Vegas, NV (8.2% of total unit exposure)

• Top five NAICS occupations: Accommodation & Food Service (19.0%), Health Care, Social Assistance (13.8%), Retail Trade (10.0%), Other Services (7.8%), Public Administration (7.2%)

Orlando, FL (8.3% of total unit exposure)

• Top five NAICS occupations : Retail Trade (18.7%), Arts, Entertainment , Recreating (14.5%), Health Care, Social Assistance (11.2%), Professional, Scientific, Technical Services (10.0%), Accommodation & Food Service (8.7%)

UNPACKING RESIDENT DATA IN SUSCEPTIBLE MARKETS

RANK MARKET

% of Residents on

Payment Plan

due to Layoff

1 Tampa 4.7%

2 Orlando 3.7%

3 Houston 3.1%

4 Nashville 2.8%

5 Dallas 2.3%

6 Las Vegas 2.0%

7 Charlotte 1.6%

8 South Florida 1.5%

9 Phoenix 1.4%

10 Atlanta 1.0%

Portfolio Total 2.3%

NXRT JOB LOSS EXPOSURE THRU MAY2

2.3%NXRT’s CURRENT EXPOSURE TO

TENANTS LAID OFF IN APRIL/MAY

2020

vs.

14.7% US NATIONAL

UNEMPLOYMENT RATE; APRIL 2020

10

NXRT UPDATE: COVID-19

Arizona: Minor restrictions in place; stay-at-home order expired May 15, 2020.

Florida: Minor restrictions in place; three-phased approach began May 4, 2020. Retail stores and restaurants allowed to reopen at 25% occupancy; gyms may open at 50% capacity. Miami-Dade, Broward and Palm Beach counties all now open.

Georgia: Minor restrictions in place; stay-at-home order expired April 30, 2020.

Nevada: Moderate restrictions in place; stay-at-home order expired May 15, 2020. Phase 2 began on May 29, 2020.

North Carolina: Moderate restrictions in place; state entered phase 2 on May 22, 2020 which will last until at least June 26, 2020.

Tennessee: Moderate restrictions in place; stay-at-home order expired May 8, 2020. On May 22, 2020, capacity restrictions were lifted in most counties.

Texas: Minor restrictions vary by region; currently in phase 2. Restaurants, retail stores, malls, and movie theatres are all allowed to reopen with 25% occupancy.

STATUS OF STATES RE-OPENING FROM COVID-19

(1) AS OF MAY 20, 2020.(2) AS OF MAY 26, 2020.

94.6%

97.3%

93.0%

94.0%

95.0%

96.0%

97.0%

98.0%

NMHC NXRT

Final April Collections

90.8%

98.5%

86.0%

88.0%

90.0%

92.0%

94.0%

96.0%

98.0%

100.0%

NMHC (1) NXRT (2)

May Collections

11

POSITIVE DEMAND INDICATORS

• Positive demand indicators improved beginning in April and have continued in

May as we’ve pivoted to virtual tours, self guided tours, etc.

0

100

200

300

400

500

600

700

Week Ending

NXRT: Total Shows

0

20

40

60

80

100

120

140

160

180

Week Ending

NXRT: Net Applications

12

OPERATIONS UPDATE

Collections

Total Portfolio (14,104 units)

Preliminary

May 2020 (1) April 2020 Q1 2020

Cash collections as % of scheduled rent 98.5% 97.3% 99.2%

% of units requesting assistance 2.0% 6.8% N/A

Breakdown of units requesting assistance

% of units paid full rent 81.5% 82.6% N/A

% of units paid partial rent 11.2% 10.0% N/A

% of units paid no rent 4.3% 4.3% N/A

% of units delinquent and not requesting assistance (2) 4.9% 1.1% N/A

Operating Statistics

Same-Store Portfolio (9,521 units)

Preliminary

May 2020 (1) April 2020 Q1 2020

Cash collections as % of scheduled rent 97.5% 96.8% 99.3%

New lease rates -1.6% -0.6% 2.4%

Renewal rates 3.1% 3.0% 3.4%

Financial occupancy 94.4% 94.0% 94.3%

Physical occupancy (3) 94.6% 94.2% 94.4%

(1) AS OF MAY 26, 2020.(2) REPRESENTS UNITS THAT HAD GREATER THAN $250 IN DELIQUENCY BALANCE IN APRIL AND MAY 2020.(3) PHYSICAL OCCUPANCY IS THE AVERAGE DAILY OCCUPANCY FOR EACH PERIOD.

13

STRATEGIC VALUE-ADDED INIATIVES

BEFORE AFTER

2020 REHAB PIPELINE

# of Units Cost/Unit Rent Premium/Month ROI

Full Interior Upgrades 1,373 $8,500 $150 21%

Partial Interior Upgrades 550 $2,240 $62 33%

Bespoke Upgrades2 1,329 $445 $18 48%

Washer/Dryers 859 $819 $45 65%

Smart Home Technology 3,000 $905 $35-45 53%

2020 REHAB PIPELINE – ORIGINAL BUDGET 1

(1) SOURCE: MANAGEMENT ESTIMATES BASED UPON PREVIOUSLY AVAILABLE INFORMATION; FINAL RESULTS MAY VARY.(2) INCLUDES BACKSPLASHES, NEW APPLIANCES, NEW LIGHTING, ETC.

NXRT has a significant pipeline of redevelopment opportunities that, when executed thoughtfully and strategically, has thepotential to extend the runway for years of above-average NOI and earnings growth. While the Company formally withdrew 2020Guidance due to uncertainty surrounding COVID-19 and its effects on operations, NXRT still sees significant demand for andopportunity to complete the bulk of its 2020 value-added initiatives.

14

NXRT BUYBACK SUMMARY

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

-60.0% -50.0% -40.0% -30.0% -20.0% -10.0% 0.0% 10.0% 20.0%

Sha

res

Re

pu

rch

ase

d

Premium/(Discount)

2,381,316 shares repurchased since inception

36% average discount to NAV

$61.2MM of shares repurchased

15

2020 NAV BUILD

(1) MANAGEMENT ESTIMATES BASED ON INDEPENDENT THIRD PARTY REVIEW OF OUR PROPERTIES.(2) FULL YEAR 2020 ADJUSTED NOI IS PRESENTED FOR THE EXISTING PORTFOLIO (37 PROPERTIES AT MARCH 31, 2020).(3) BASED ON GREEN STREET ADVISORS’ ‘RESIDENTIAL SECTORS’ REPORT DATED APRIL 19, 2020. FY 2020 ADJUSTED NOI DOES NOT CONSIDER ANY ADDITIONAL

ACQUISITION OR DISPOSITION ACTIVITY FOR THE REMAINDER OF THE YEAR.(4) INCLUDES APPROXIMATELY $15.4 MILLION THAT IS HELD FOR VALUE-ADD UPGRADES; REDUCED BY $15.4 MILLION FOR ESTIMATED 2020 REHAB EXPENDITURES.(5) INCLUDES APPROXIMATELY $0.8 MILLION IN FORWARD 12-MONTH PRINCIPAL PAYMENTS.(6) INCLUDES OUTSTANDING BALANCE AS OF MARCH 31, 2020.

(Dollar and share amounts in thousands, except per share data)

Property NOI Cap Rate Range (1) Value Range (2) NAV Summary

Contribution Min Max Min Max Component Min Max

Texas Tangible Assets

Dallas 15.6% 4.9% 5.2% $344,221 $374,854 Real Estate (2) $2,229,255 $2,426,500

Houston 7.5% 5.0% 5.3% 161,166 175,306 Cash 69,540

Restricted Cash - Renovation Reserves (4) 15,356

North Carolina Renovation Expenditures (4) (15,356)

Charlotte 3.7% 4.9% 5.2% 81,863 89,148 Cash Adjustments (5) (756)

Fair Market Value of Interest Rate Swaps -

Georgia Other Assets 27,475

Atlanta 10.2% 4.9% 5.2% 225,946 246,054 Value of Assets $2,325,513 $2,522,758

Tennessee

Nashville 13.2% 4.8% 5.1% 297,851 324,747 Tangible Liabilities

Credit & Bridge Facilities (6) $225,000

Florida Mortgage Debt 1,151,683

Orlando 8.7% 5.0% 5.3% 189,080 205,670 Total Outstanding Debt 1,376,683

Tampa 3.4% 4.7% 5.0% 77,189 84,264 Forward 12-month Principal Payments (6) (756)

South Florida 16.8% 4.7% 5.0% 383,759 418,937 Total Outstanding Debt (FY 2020 Est.) 1,375,927

Other Tangible Liabilities (at Book) 27,955

Derivative Liability 47,077

Nevada Value of Liabilities $1,450,959

Las Vegas 10.2% 5.0% 5.3% 219,647 238,918 Net Leverage (mid-point) 60%

Net Asset Value $874,555 $1,071,800

Arizona Shares outstanding - diluted (FY 2020 Est.) 25,298

Phoenix 10.7% 4.7% 5.0% 248,533 268,602 Est. NAV / Share $34.57 $42.37

Total / Ave 100.0% 4.8% 5.1% $2,229,255 $2,426,500 NAV / Share (mid-point) $38.47

NOI ESTIMATE IMPLIED VALUATION METRICS

4Q 2019 NOI Actual 28,327 Implied Real Estate Value $2,229,255 $2,426,500

1Q 2020 NOI Actual 29,985 No of Units (March 31, 2020) (2) 14,300

Low High

Implied Value/Apartment Unit $155.9 $169.7

2020 Adjusted NOI Est (3) $114,650 $117,650 Implied Value/Apartment Unit (mid-point) $162.8

16

APPENDIX

17

PERFORMANCE HIGHLIGHTS

Q1 2020 HIGHLIGHTS

KEY HIGHLIGHTS & TRANSACTION ACTIVITY:

• During Q1 2020, NXRT completed upgrades to 412 units and leased 215upgraded units, achieving an average rental increase of $118, or 11.5%, and a23.8% ROI on those units.

• Since inception, for the properties in our portfolio, NXRT hascompleted upgrades to 6,914 units, achieving an average rentalincrease of $102, or 11.1%, and a 24.6% ROI on those units

• During Q1 2020, NXRT executed 1,678 new leases with an average rate changeof +1.63%, and 1,948 renewals with an average rate change of +3.47%.

• NXRT sold three properties, monetizing attractive gains and improving theCompany’s portfolio composition (thru tax efficient capital recycling into well-located low-density “covered-land” assets in core markets) in an effort toreduce risk and enhance future earnings potential.

• Gross Sales Proceeds: $86.5M• Levered IRR: 34.3%• Multiple on invested capital: 3.97x

• January 3, 2020: NXRT entered into an interest rate swap agreement withKeyBank for a notional amount of $92.5M, with a fixed rate of 1.609% andmaturity date of September 1, 2026.

• March 4, 2020: NXRT entered into an interest rate swap agreement withSunTrust for a notional amount of $100M, with a fixed rate of 0.820% andmaturity date of June 1, 2026.

STOCK PRICE PERFORMANCE(1)

$13.6MCORE FFO

$30.0MNOI

$28.0MNET INCOME

(1) AS OF CLOSE OF TRADING JUNE 1, 2020.(2) TOTAL RETURN BASED ON CUMULATIVE DIVIDENDS SINCE INCEPTION AND STOCK PRICE AS OF CLOSING OF TRADING JUNE 1, 2020.

FINANCIAL RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2020:

• Net income: $28.0M

• NOI: $30.0M

• Core FFO: $13.6M, or $0.53/diluted share

•

• NXRT paid dividends totaling $9.0M, or $0.313/sh.

Same Store Results: Q1 2020 vs. Q1 2019

Occupancy 94.5% +90 bps

Effective Rents $1,035 +3.1%

Total revenues $31,800 +5.3%

NOI $17,847 +5.6%

0

5

10

15

20

25

30

35

40

45

50

55

60NXRT Stock Price NXRT Stock Price + Accumulated Dividends

SIGNIFICANT APPRECIATION2

+167.9%

18

OPERATING PERFORMANCE & INTERNAL GROWTH

(1) MANAGEMENT'S PUBLISHED ESTIMATE OF NET ASSET VALUE PER COMMON SHARE (TAKEN AT THE MID-POINT) AS PRESENTED WITHIN THE COMPANY'S QUARTERLY FINANCIAL SUPPLEMENTAL FOR EACH REPORTING PERIOD SINCE THE COMPANY COMPLETED ITS SPIN OFF FROM NEXPOINT CREDIT STRATEGIES FUND (NYSE: NHF).

(2) ASSUMES THE INVESTOR RECEIVED NXRT SHARES AT THE SPIN OFF AND HELD THEM THRU MARCH 31, 2020 (BASED ON NYSE CLOSE PRICE PER SHARE OF NXRT COMMON STOCK AS OF THE LAST TRADING DAY FOR EACH PERIOD (REMOVING INTRA-QUARTER VOLATILITY), PLUS CUMULATIVE QUARTERLY DIVIDENDS PAID PER COMMON SHARE).

+7.3%

+15.4%

+5.6%

$15.96

$46.31

$38.47

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

$55

0%

10%

20%

30%

40%

50%

SPIN OFF 3Q 2015 1Q 2016 3Q 2016 1Q 2017 3Q 2017 1Q 2018 3Q 2018 1Q 2019 3Q 2019 1Q 2020

Same Store Rental Revenue Growth Total Same Store Revenue Growth Same Store NOI Growth

NAV per share (diluted) (1) Total Return per Share (2)

CAGR (NAV) = 24.6%

NEXPOINT RESIDENTIAL TRUST SINCE THE SPIN OFF FROM NHF ON MARCH 31, 2015DELIVERING INTERNAL GROWTH & TOTAL RETURN THROUGH ACCRETIVE INVESTMENTS, ALIGNMENT OF INTERESTS,

TRANSPARENT & CONSISTENT PERFORMANCE IN A COMPELLING & DIFFERENTIATED PUBLIC REIT STRATEGY

19(1) SOURCE: PUBLIC FILINGS.

SAME-STORE QoQ NOI RESULTS AS REPORTED FOR THE PERIODS PRESENTED(1)

NXRT AIV CPT IRT MAA PEER AVERAGE

Last 4 Years Average 8.2% 4.2% 3.8% 5.1% 3.3% 4.1%

1Q20 5.6% 5.0% 5.7% 7.0% 4.8% 5.6%

4Q19 9.3% 2.9% 6.2% 9.6% 5.0% 5.9%

3Q19 4.4% 4.1% 4.7% 8.1% 4.5% 5.4%

2Q19 5.4% 4.6% 4.2% 6.9% 4.9% 5.2%

1Q19 7.0% 5.5% 3.6% 5.1% 2.5% 4.2%

4Q18 1.2% 3.6% 2.6% 3.9% 2.0% 3.0%

3Q18 8.3% 2.6% 3.8% 1.9% 1.9% 2.6%

2Q18 11.0% 3.2% 3.2% 1.7% 1.7% 2.5%

1Q18 5.9% 2.7% 4.0% 2.0% 1.9% 2.7%

4Q17 10.5% 3.1% 1.4% 4.3% 2.2% 2.8%

3Q17 9.3% 4.5% 1.7% 4.0% 0.8% 2.8%

2Q17 6.2% 4.9% 4.1% 5.6% 2.8% 4.4%

1Q17 8.4% 3.7% 1.7% 5.2% 3.6% 3.6%

4Q16 15.4% 6.6% 5.1% 5.7% 4.2% 5.4%

3Q16 12.8% 6.3% 4.5% 6.0% 3.7% 5.1%

2Q16 11.0% 4.1% 3.7% 5.0% 5.7% 4.6%

SUPERIOR SAME-STORE GROWTH

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

1Q 2016 3Q 2016 1Q 2017 3Q 2017 1Q 2018 3Q 2018 1Q 2019 Q3'19 Q1'20

NXRT AIV CPT IRT MAA PEER AVERAGE

20

CAPITAL STRUCTURE

SUMMARY OF NXRT’S CAPITAL STRUCTURE

Interest Rate Swaps – From May 13, 2016 through March 4, 2020,NXRT, through its operating partnership, NexPoint Residential TrustOperating Partnership, L.P., entered into thirteen interest rate swaptransactions (the “Swaps”); eleven with KeyBank National Associationwith a notional amount of $1.02B and two with SunTrust Bank with anotional amount of $150M. The Company entered into the Swaps to fix amajority of, and mitigate the risk associated with, the Company’sfloating rate indebtedness (without incurring substantial prepaymentpenalties or defeasance costs typically associated with fixed rateindebtedness).

• Effective dates: July 2016 – March 2020• Termination date: June 2021 – September 2026• Notional Amount: $1,167,500,000• NXRT Obligation: 1.3792% average fixed monthly rate (on

total notional amount)• Counterparty Obligation: floating rate payments based on

LIBOR• Swaps will potentially limit interest rate and duration risk

above 1.3792% 1-Month LIBOR (0.18250% as of May 29,2020)

• Maintains prepayment flexibility

SunTrust Credit Facility - On January 28, 2019, the Company, throughthe OP, entered into the $75 Million Credit Facility with SunTrust Bank.

• Full-term, interest-only facility with an initial 24-monthterm, has one 12-month extension option, and bearsinterest at a rate of one-month LIBOR plus a range from2.00% to 2.50%, depending on the Company’s leveragelevel as determined under the credit facility agreement, andis guaranteed by the Company.

On June 29, 2019, the Company, through the OP, exercised its optionunder the Accordion Feature of the Credit Facility and increased theamount from $75 million to $125 million.

• August 28, 2019: increased by another $25M to $150M• November 20, 2019: increased by another $75M to $225M

INTEREST RATE SWAPS AND SUNTRUST CREDIT FACILITY

(1) BASED ON FIRST QUARTER 2020 PUBLIC FILINGS AND EQUITY MARKET CAPS AT THE CLOSE OF TRADING JUNE 1, 2020.

• NXRT had approximately $1.38B of total indebtedness (excluding deferredfinancing costs and mark-to-market adjustments) as of March 31, 2020.

• Of the total, $70.6M (or 5.1%) was fixed rate agency financing, while theremaining $1.31B was tied to floating rate indices.

• From May 13, 2016 through March 4, 2020, the Company entered intothirteen interest rate swap contracts with a combined total notional value of$1.17 billion.

These agreements effectively replace the floating interest ratewith respect to that amount with a weighted average fixed rate of1.3792%.

• Including the effect of the Swaps, the Company had an adjusted weightedaverage interest rate of 3.00% on the total indebtedness as of March 31,2020.

AIV

APTS

AVB

BRG

CPT

EQR

ESS

IRT

MAA

NXRT (6.30.2016)

NXRT (3.31.2020)UDR

0.0%

25.0%

50.0%

75.0%

100.0%

0.0% 25.0% 50.0% 75.0% 100.0%

NET DEBT TO ENTERPRISE VALUE

FIX

ED

RA

TE

DE

BT

AS

A %

OF

TO

TA

L

OU

ST

AN

DIN

G

PEER COMPARISON: LEVERAGE & FLOATING RATE DEBT EXPOSURE (1)

Thoughtful and timely steps taken

by Management in an effort to

reduce risk while maintaining

favorable prepayment optionality

21

RECENT DISPOSITIONS

SOUTHPOINT RESERVE AT STONEY CREEK (FREDERICKSBURG, VA)

• Acquired in December 2014• $977 effective rent per occupied unit at the date acquired by

NXRT• Completed interior upgrades on 63 units, increasing effective rent

per unit $106 per month and achieving 17.1% ROI (2)

• $1,176 effective rent per occupied unit at the sale date (20.3%increase since acquisition)

• Sold in March 2020• Gross Sales Proceeds: $23.5M• Levered IRR: 22.3%• Multiple on invested capital: 2.50x

WOODBRIDGE (NASHVILLE, TN)

• Acquired in July 2014• $799 effective rent per occupied unit at the date acquired by

NXRT• Completed interior upgrades on 188 units, increasing effective

rent per unit $99 per month and achieving 21.3% ROI (2)



WILLOW GROVE (NASHVILLE, TN)

• Acquired in July 2014• $675 effective rent per occupied unit at the date acquired by

NXRT

• Completed interior upgrades on 174 units, increasing effectiverent per unit by $99 per month and achieving 26.4% ROI (2)



(1) AS OF THE CLOSE OF BUSINESS ON THE LAST DAY OF OWNERSHIP MARCH 26, 2020; SOUTHPOINT RESERVE AT STONEY CREEK WAS SOLD MARCH 30, 2020.(2) AS OF THE QUARTER ENDIED DECEMBER 31, 2019.

$600

$700

$800

$900

$1,000

$1,100

$1,200

Effective Rent(1)(in $s per occupied unit)

Willow Grove Woodbridge Southpoint Reserve

+20.3%

+32.4%

+50.9%

PORTFOLIO RETURNS

GROSS SALES PROCEEDS: $86.5M

NET CASH PROCEEDS: $43.4M

GAIN ON SALE: $39.0M

LEVERRED IRR: 34.3%

MULTIPLE ON INVESTED CAPITAL: 3.97x

22

ENVIORNMENTAL: A FOCUS ON GREEN INITIATVES

(1) AS OF MARCH 31, 2020. SOURCE: BH PROPERTY MANAGEMENT.(2) INCLUDES FIVE SOLD ASSETS.

In addition to creating returns for our investors, we prioritize conserving natural resources and passing savings onto our residents. Together with our NexPoint Real Estate Advisors affiliates, NXRT partners with industry experts to utilize the most innovative

technology to save water and energy.

NEXPOINT RESIDENTIAL TRUST’S GREEN ITIATIVES (1)(2)

Total Properties Renovated 31

Total Units Renovated 11,663

Total Bathrooms Renovated 16,326

Total Investment $4,169,993

Annual Water Savings (Gallons) 271,218,918

Annual Water Savings Per Unit 23,255

Annual Energy Savings (kWh) 14,673,216

Annual Energy Savings Per Unit 1,258

Average Property Usage Savings % 34%

Annual Cost Savings $2,017,147

Annual Cost Savings Per Unit $173

Average Property Cost Savings % 32%

Total Return on Investment (ROI) 48%

23

CASE STUDY: SILVERBROOK

(1) SOURCE: BH PROPERTY MANAGEMENT.

Silverbrook, a 642-unit apartment complex in Dallas saw a reduction in costs of $365,645 or $570 per unit per year after installing low flow faucets and showerheads. They saved 55,383 gallons per unit (or the equivalent of two large

pools).

As a result of the rehab, the property achieved a return on investment of 144%.

Silverbrook

Total Units Renovated 642

Total Bathrooms Renovated 936

Total Investment $254,784

Annual Water Savings (Gallons) 35,556,003

Annual Water Savings Per Unit 55,383

Annual Energy Savings (kWh) 539,136

Annual Energy Savings Per Unit 840

Average Property Usage Savings % 66%

Annual Cost Savings $365,645

Annual Cost Savings Per Unit $570

Average Property Cost Savings % 64%

Total Return on Investment (ROI) 144%

24

PORTFOLIO OVERVIEW: EMPLOYMENT TRENDS (1)

(1) SOURCE: BUREAU OF LABOR STATISTICS; MARCH 2020 – NON-FARM PAYROLLS NOT SEASONALLY ADJUSTED.

NASHVILLE

% Change 2.91%

National Ranking 9

No. of NXRT

units in market 1,848

PHOENIX

% Change 2.68%

National Ranking 3

No. of NXRT


DALLAS/FORT WORTH

% Change 2.31%

National Ranking 1

No. of NXRT


TAMPA

% Change 1.97%

National Ranking 10

No. of NXRT

units in market 576

SOUTH FLORIDA

% Change 0.60%

National Ranking 15

No. of NXRT


HOUSTON

% Change 1.88%

National Ranking 2

No. of NXRT


ATLANTA

% Change 1.53%

National Ranking 5

No. of NXRT


ORLANDO

% Change 1.49%

National Ranking 12

No. of NXRT


CHARLOTTE

% Change 1.33%

National Ranking 16

No. of NXRT

units in market 577

LAS VEGAS

% Change 0.29%

National Ranking 71

No. of NXRT


Job growth in nine of ten NXRT markets outpaced the national average of 0.67%,according to the Bureau of Labor Statistics March 2020 employment report.

Average job growth, on a unit weighted basis, in our markets was 1.78%. Nashvilleshowed the strongest job growth on a year over year basis, 2.91%, while Las Vegashad the lowest year over year job growth, 0.29%.

When comparing the year over year total number of jobs added by market, NXRTowns in 6 of the top 10 markets, 9 of the top 16 markets, and all 10 NXRT marketsranked within the top 71.

25

PORTFOLIO OVERVIEW

AVERAGE OCCUPANCY(1)

(1) AS OF MARCH 31, 2020.

Average monthly occupancy across our markets for the first quarter 2020ranged from 89.2% (Las Vegas) to 96.0% (Phoenix), with a portfolio average of94.2%.

AVERAGE MONTHLY RENT(1)

Average monthly rent across our markets for the first quarter 2020 ranged from$963 (Dallas-Fort Worth) to $1,438 (South Florida), with an average of $1,110.

$714

$756 $745

$770 $771 $784

$796 $803 $811 $830

$848

$880 $883

$922 $932 $948

$958 $967 $981 $985

$1,007 $1,017

$1,095 $1,103

$1,110

93.9%92.5% 92.8% 93.2% 93.7% 93.4% 93.1% 93.9% 94.5% 93.7% 93.6% 93.4%

94.6%92.8%

94.0% 93.8% 94.0% 94.2% 93.8% 94.6%93.6% 94.4% 93.6% 94.2% 94.2%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

$400

$500

$600

$700

$800

$900

$1,000

$1,100

$1,200

Ave

rag

e O

ccu

pa

ncy

Ave

rag

e M

on

thly

Re

nt

Stable Occupancy and Increasing Rent Per Unit

Average Rent Average Occupancy

CAGR (Rent) = 7.6%

26

SAME STORE PORTFOLIO: YEAR OVER YEAR AVG RENT PER UNIT

DALLAS/FORT WORTH

2020 Q1 Avg. Rent $965

2019 Q1 Avg. Rent $937

% Change 3.0%

ATLANTA

2020 Q1 Avg. Rent $1,119

2019 Q1 Avg. Rent $1,069

% Change 4.7%

TAMPA

2020 Q1 Avg. Rent $965

2019 Q1 Avg. Rent $928

% Change 3.9%

PHOENIX

2020 Q1 Avg. Rent $856

2019 Q1 Avg. Rent $785

% Change 9.0%

CHARLOTTE

2020 Q1 Avg. Rent $999

2019 Q1 Avg. Rent $947

% Change 5.5%

SOUTH FLORIDA

2020 Q1 Avg. Rent $1,233

2019 Q1 Avg. Rent $1,197

% Change 3.0%

HOUSTON

2020 Q1 Avg. Rent $1,123

2019 Q1 Avg. Rent $1,134

% Change (1.0%)

NASHVILLE

2020 Q1 Avg. Rent $985

2019 Q1 Avg. Rent $966

% Change 2.0%

ORLANDO

2020 Q1 Avg. Rent $1,170

2019 Q1 Avg. Rent $1,1140

% Change 2.7%

$856

$965 $965$985

$999

$1,119 $1,123

$1,170

$1,233

$1,035

$785

$928 $937

$966$947

$1,069

$1,134 $1,140

$1,197

$1,004

$700

$750

$800

$850

$900

$950

$1,000

$1,050

$1,100

$1,150

$1,200

$1,250

$1,300

PHOENIX TAMPA DALLAS/FORT

WORTH

NASHVILLE CHARLOTTE ATLANTA HOUSTON ORLANDO SOUTH FLORIDA NXRT SS AVERAGE

1Q'20 1Q'19

1Q’20

1Q’19

27

PORTFOLIO OVERVIEW

CHARLOTTE

2020 Q1 Same Store $999

2020 Q1 Portfolio $999

ATLANTA

2020 Q1 Same Store $1,119

2020 Q1 Portfolio $1,119

HOUSTON



SOUTH FLORIDA



ORLANDO



NASHVILLE



PHOENIX



TAMPA



DALLAS/FORT WORTH



LAS VEGAS

2020 Q1 Same Store N/A



Average monthly rent across our markets for the firstquarter 2020 ranged from $963 (Dallas-Fort Worth) to$1,438 (South Florida), with an average of $1,110.

SAME STORE AVERAGE MONTHLY RENT(1)

Same store average monthly rents across our markets forthe first quarter 2020 ranged from $856 (Phoenix) to$1,233 (South Florida), with a portfolio average of$1,035.

(1) AS OF MARCH 31, 2020.

$1,066

$965 $963

$1,023 $999

$1,184

$1,438

$1,127 $1,110

$856

$985

$1,119 $1,123

$1,170

$1,233

$1,035

$800

$850

$900

$950

$1,000

$1,050

$1,100

$1,150

$1,200

$1,250

$1,300

$1,350

$1,400

$1,450

$1,500

$1,550

$1,600PORTFOLIO SAME STORE

PORTFOLIO

SAME STORE

28

PORTFOLIO OVERVIEW

ORLANDO

2020 Q1 Same Store 94.5%

2020 Q1 Portfolio 94.1%

TAMPA



SOUTH FLORIDA



PHOENIX



HOUSTON



ATLANTA



NASHVILLE



CHARLOTTE



DALLAS/FORT WORTH



LAS VEGAS

2020 Q1 Same Store N/A


AVERAGE OCCUPANCY(1)

Average monthly occupancy across our markets for thefirst quarter 2020 ranged from 89.2% (Las Vegas) to96.0% (Phoenix), with a portfolio average of 94.5%.

SAME STORE AVERAGE OCCUPANCY(1)

Same store average occupancy across our markets for thefirst quarter 2020 ranged from 93.7% (Nashville) to96.0% (Phoenix), with a portfolio average of 94.2%.

(1) AS OF MARCH 31, 2020.

94.2%

94.1%

95.2%

95.7%

89.2%

94.2%93.7%

93.9% 94.0%94.3% 94.5%

94.8%95.4%

96.0%

94.5%

88.0%

PORTFOLIO SAME STORE PORTFOLIO

SAME STORE

29

PORTFOLIO OVERVIEW


(1) AS OF MARCH 31, 2020.

Average monthly rents across our portfolio ranged from $799 (Venue onCamelback - Phoenix) to $1,497 (Avant at Pembroke Pines – South Florida),with an average of $1,110.

SAME STORE AVERAGE MONTHLY RENT(1)

Average monthly rent across our same-store portfolio ranged from $799 (Venueon Camelback - Phoenix) to $1,295 (Parc500 – South Florida), with an averageof $1,035.

$799

$889

$899

$899

$918

$922

$923

$928

$943

$946

$974

$977

$980

$1,008

$1,011

$1,035

$1,056

$1,069

$1,125

$1,148

$1,175

$1,185

$1,246

$1,267

$1,291

$1,295

Venue on Camelback

Silverbrook

Crestmont Reserve

Arbors on Forest Ridge

Timber Creek

Venue at 8651

Versailles

Courtney Cove

Beechwood Terrace

Madera Point

Eagle Crest

Brandywine

Barrington Mill

Hollister Place

The Summit at Sabal Park

NXRT SS Average

Cornerstone

Cedar Pointe

Radbourne Lake

Old Farm Apartments

Seasons 704

Stone Creek at Old Farm

Atera

Rockledge

Sabal Palm at Lake Buena Vista

Parc500

$799

$889

$899

$899

$918

$922

$923

$928

$934

$943

$946

$974

$977

$979

$980

$1,008

$1,011

$1,056

$1,069

$1,097

$1,110

$1,118

$1,125

$1,148

$1,175

$1,182

$1,185

$1,192

$1,219

$1,246

$1,262

$1,267

$1,272

$1,291

$1,295

$1,308

$1,497

Venue on Camelback

Silverbrook

Crestmont Reserve

Arbors on Forest Ridge

Timber Creek

Venue at 8651

Versailles

Courtney Cove

Summers Landing

Beechwood Terrace

Madera Point

Eagle Crest

Brandywine

Residences at Glenview Reserve

Barrington Mill

Hollister Place

The Summit at Sabal Park

Cornerstone

Cedar Pointe

Bloom

NXRT Average

Bella Solara

Radbourne Lake

Old Farm Apartments

Seasons 704

Torreyana

Stone Creek at Old Farm

Arbors of Brentwood

Residences at West Place

Atera

The Heritage

Rockledge

Bella Vista

Sabal Palm at Lake Buena Vista

Parc500

The Enclave

Avant at Pembroke Pines

30

PORTFOLIO OVERVIEW

(1) EFFECTIVE RENT PER UNIT SHOWN ON LEFT AXIS (IN $’S), ACQUISITIONS & EXISTING PORTFOLIO SHOWN ON RIGHT AXIS (IN UNITS); DATA AS OF APRIL 30, 2020.

1 Property

314 units

$469 avg. rent

314314

2,191290

432

1,524

1,270

694

1,917

640156402

1,182

804222

78412,822 33313,155 -200

-679

-74 -576+415

+924+260-1,198

+708 -240

380 -304 +210

+874

+656 +196

+702-698

+346

+1,163 -620

37 Properties

14,104 units

$1,112 avg. rent

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

$400

$500

$600

$700

$800

$900

$1,000

$1,100

$1,200

NXRT Rental Rate Trend

Portfolio Additions Total Units NXRT Average Rent

31

VALUE-ADD RESULTS

(1) WE DO NOT PLAN TO UPGRADE 100% OF THE UNITS AT EACH OF OUR PROPERTIES.(2) INCLUSIVE OF ALL FULL AND PARTIAL INTERIOR UPGRADES COMPLETED THROUGH MARCH 31, 2020.(3) INCLUSIVE OF ALL FULL AND PARTIAL INTERIOR UPGRADES COMPLETED AND LEASED THROUGH MARCH 31, 2020.

Rehabs In Process

PROPERTY MARKET UNITS(1) UNITS COMPLETED (2) PRE-REHAB RENT POST-REHAB RENT RENT % CHANGE ROI(3) REHAB COSTS PER

UNIT (3)

ARBORS OF BRENTWOOD NASHVILLE 346 86 $1,109 $1,159 4.5% 74.0% $807

ARBORS ON FOREST RIDGE DALLAS/FORT WORTH 210 252 811 889 9.6% 30.1% 3,098

ATERA APARTMENTS DALLAS/FORT WORTH 380 198 1,130 1,275 12.8% 57.1% 3,051

AVANT AT PEMBROKE PINES SOUTH FLORIDA 1,520 25 1,434 1,658 15.6% 34.8% 7,720

BEECHWOOD TERRACE NASHVILLE 300 322 867 957 10.4% 23.6% 4,542

BELLA SOLARA LAS VEGAS 320 4 960 1,135 18.2% 39.1% 5,366

BELLA VISTA PHOENIX 248 43 1,178 1,327 12.6% 16.5% 10,792

BLOOM LAS VEGAS 528 4 N/A N/A N/A N/A N/A

BRANDYWINE I & II NASHVILLE 632 111 954 1,111 16.5% 21.0% 8,929

CEDAR POINTE NASHVILLE 210 115 983 1,119 13.8% 34.3% 4,751

CORNERSTONE ORLANDO 430 306 926 1,016 9.7% 19.8% 5,443

COURTNEY COVE TAMPA 324 158 815 918 12.6% 25.4% 4,869

CRESTMONT RESERVE DALLAS/FORT WORTH 242 105 825 932 13.0% 20.6% 6,218

CUTTER’S POINT DALLAS/FORT WORTH - 216 1,004 1,100 9.6% 26.1% 4,428

EAGLE CREST DALLAS/FORT WORTH 447 161 851 911 7.1% 37.4% 1,939

HOLLISTER PLACE HOUSTON 260 382 935 1,048 12.1% 30.7% 4,413

MADERA POINT PHOENIX 256 201 807 906 12.3% 29.8% 3,974

PARC500 SOUTH FLORIDA 217 148 1,157 1,334 15.3% 14.5% 14,648

RADBOURNE LAKE CHARLOTTE 225 298 996 1,041 4.5% 58.5% 929

RESIDENCES AT GLENVIEW RESERVE NASHVILLE 360 12 960 1,106 15.2% 17.7% 9,914

RESIDENCES AT WEST PLACE ORLANDO 342 44 1,195 1,305 9.2% 26.8% 4,944

ROCKLEDGE APARTMENTS ATLANTA 708 521 1,161 1,286 10.8% 23.4% 6,420

SABAL PALM AT LAKE BUENA VISTA ORLANDO 400 234 1,136 1,221 7.5% 171.8% 599

SEASONS 704 APARTMENTS SOUTH FLORIDA 222 157 1,035 1,134 9.6% 20.2% 5,884

SILVERBROOK DALLAS/FORT WORTH 642 659 818 885 8.2% 28.8% 2,794

SUMMERS LANDING DALLAS/FORT WORTH 196 50 955 1,014 6.2% 57.9% 1,216

THE SUMMIT AT SABAL PARK TAMPA 252 326 886 966 9.0% 22.8% 4,197

THE ENCLAVE PHOENIX 204 38 1,220 1,366 12.0% 17.9% 9,814

32

VALUE-ADD RESULTS CONTINUED

(1) WE DO NOT PLAN TO UPGRADE 100% OF THE UNITS AT EACH OF OUR PROPERTIES.(2) INCLUSIVE OF ALL FULL AND PARTIAL INTERIOR UPGRADES COMPLETED THROUGH MARCH 31, 2020.(3) INCLUSIVE OF ALL FULL AND PARTIAL INTERIOR UPGRADES COMPLETED AND LEASED THROUGH MARCH 31, 2020.

SUMMARY OF VALUE-ADD RESULTS THROUGH MARCH 31, 2020

NXRT completed interior upgrades on 412 units and leased 215 upgraded units during the first quarter of 2020, achieving a 23.6% ROI onthose upgraded units leased during the period.

From inception through March 31, 2020, 6,914 upgrades have been completed at an average cost of $4,956 per unit. Upgraded units leased through March 31, 2020 have achieved a $102, or 11.1%, average monthly rental increase per unit, which equates

to a 24.6% ROI on all upgrades completed and leased since inception.

PROPERTY MARKET UNITS(1) UNITS COMPLETED (2) PRE-REHAB RENT POST-REHAB RENT RENT % CHANGE ROI(3) REHAB COSTS PER

UNIT (3)

THE HERTIAGE PHOENIX 204 39 $1,132 $1,277 12.8% 15.2% $11,405

THE PRESERVE AT TERRELL MILL ATLANTA 752 497 785 929 18.3% 18.7% 9,252

THE VENUE ON CAMELBACK PHOENIX 415 116 661 917 38.7% 28.8% 10,667

TIMBER CREEK CHARLOTTE 352 239 890 1,003 12.7% 23.0% 5,848

TORREYANA APARTMENTS LAS VEGAS 315 4 1,215 1,340 10.3% 14.7% 10,178

VENUE AT 8651 DALLAS/FORT WORTH 333 389 841 924 9.9% 21.6% 4,579

VERSAILLES DALLAS/FORT WORTH 388 454 820 896 9.3% 22.1% 4,148

TOTAL/WTD COMPLETED/IN PROCESS 13,180 6,914 $918 $1,020 11.1% 24.6% $4,956

Rehabs Planned

PROPERTY MARKET UNITS(1) UNITS COMPLETED PRE-REHAB RENT POST-REHAB RENT RENT % CHANGE(3) ROI(3) REHAB COSTS PER

UNIT

OLD FARM HOUSTON 734 - 1,226 1,316 7.3% TBD TBD

STONE CREEK AT OLD FARM HOUSTON 190 - 1,261 1,305 3.5% TBD TBD

TOTAL/WTD AVERAGE 924 - $1,233 $1,314 6.6% TBD TBD

33

1Q 2020 FINANCIAL SUMMARY

(1) WE DEFINE “SAME STORE” PROPERTIES AS PROPERTIES THAT WERE IN OUR PORTFOLIO FOR THE PERIODS BEING COMPARED.(2) INDICATES COVERAGE RATIO OF FFO/CORE FFO/AFFO PER COMMON SHARE (DILUTED) OVER DIVIDENDS DECLARED PER COMMON SHARE DURING THE PERIOD.(3) INCLUSIVE OF ALL FULL AND PARTIAL INTERIOR UPGRADES COMPLETED THROUGH MARCH 31, 2020. CUMULATIVE RESULTS EXCLUDE REHABS COMPLETED FOR PROPERTIES SOLD TO DATE.(4) FOR MORE INFORMATION AND A RECONCILIATION OF NET DEBT, SEE PAGE 37, NON-GAAP RECONCILIATIONS: NOI & NET DEBT.

(In thousands, except for per share and unit data) Q1 2020 Q1 2019 FY 2019 FY 2018

Company Profile

Market Capitalization $627,000 $906,000 $1,136,000 $824,000

Weighted average common shares outstanding - basic 25,388 23,550 24,116 21,189

Weighted average common shares outstanding - diluted 25,851 24,044 24,593 21,667

Share Price (as of the last day of the period) $25.21 $38.34 $45.00 $35.05

Earnings Profile

Total revenues $52,582 $41,491 $181,066 $146,597

Net income (loss) attributable to common stockholders 27,955 (4,360) 99,140 (1,609)

NOI 29,985 23,587 102,591 80,175

Same Store NOI (1) 17,847 16,906 65,961 61,795

Same Store NOI Growth (%) (1) 5.6% 6.7%

Earnings Metrics Per Common Share (diluted basis) (2)

Earnings (loss) $1.08 ($0.19) $4.03 ($0.08)

FFO $0.48 $0.46 $1.66 $1.48

Core FFO $0.53 $0.46 $1.93 $1.62

AFFO $0.59 $0.53 $2.20 $1.88

Dividends declared per common share $0.313 $0.275 $1.138 $1.025

FFO Coverage 1.53x 1.66x 1.46x 1.44x

Core FFO Coverage 1.68x 1.67x 1.70x 1.58x

AFFO Coverage 1.89x 1.92x 1.94x 1.84x

Portfolio

Total Properties 37 38 40 35

Total Units 14,104 13,211 14,724 12,555

Occupancy 94.2% 93.6% 94.2% 94.6%

Average Effective Monthly Rent per Unit $1,110 $1,007 $1,103 $985

Same Store Portfolio Metrics (1)

Total Same Store Properties 25 25 25 25

Total Same Store Units 9.521 9.521 9,059 9,059

Occupancy 94.5% 93.6% 94.5% 94.8%

Average Effective Monthly Rent per Unit $1,035 $1,006 $1,038 $1,002

Value-Add Program

Completed Rehab Units 412 245 2,516 1,432

Cumulative Completed Rehab Units (3) 6,914

Average Increase to Effective Monthly Rent per Unit (Post-Rehab) $102

ROI on Post-Rehab Units 24.6%

Outstanding Debt Summary

Total Mortgage Debt $1,151,683 $924,463

Credit Facilities 225,000 52,500

Bridge Facility — —

Total Debt Outstanding $1,376,683 $976,963

Leverage Ratio (Net Debt to Enterprise Value) (4) 67% 51%

34

(In thousands, except for per share data) Q1 2020 Q1 2019

Revenues

Rental income $51,115 $40,451

Other income 1,467 1,040

Total revenues $52,582 $41,491

Expenses

Property operating expenses $11,721 $9,639

Real estate taxes and insurance 8,023 5,758

Property management fees (1) 1,550 1,240

Advisory and administrative fees (2) 1,865 1,850

Corporate general and administrative expenses 2,701 2,233

Property general and administrative expenses 1,832 1,658

Depreciation and amortization 23,338 15,398

Total expenses 51,030 37,776

Operating income before gain on sales of real estate $1,552 $3,715

Gain on sales of real estate 38,972 —

Operating income $40,524 $3,715

Interest Expense (11,662) (8,088)

Loss on extinguishment of debt and modification costs (874) —

Casualty gains 51 —

Net income (loss) 28,039 (4,373)

Net income (loss) attributable to redeemable noncontrolling interests in the Operating Partnership 84 (13)

Net income (loss) attributable to common stockholders $27,955 ($4,360)

Other comprehensive income (loss)

Unrealized gains (losses) on interest rate derivatives (50,540) (5,665)

Total comprehensive income (loss) (22,501) (10,038)

Comprehensive income (loss) attributable to redeemable noncontrolling interests in the Operating Partnership (68) (30)

Comprehensive income (loss) attributable to common stockholders ($22,433) ($10,008)

Weighted average common shares outstanding - basic 25,388 23,550

Weighted average common shares outstanding - diluted 25,851 24,044

Earnings (loss) per share – basic $1.10 ($0.19)

Earnings (loss) per share - diluted $1.08 ($0.19)

Dividends declared per common share $0.313 $0.275

CONSOLIDATED STATEMENTS OF OPERATIONS

(1) FEES INCURRED TO AN UNAFFILIATED THIRD PARTY THAT IS AN AFFILIATE OF THE NONCONTROLLING LIMITED PARTNER OF THE COMPANY’S OPERATING PARTNERSHIP.(2) FEES INCURRED TO THE COMPANY’S ADVISER.

35

(In thousands)

ASSETS Q1 2020 FY 2019

Real Estate Investments

Operating properties, net $1,726,522 $1,735,480

Real estate held for sale, net — 46,330

Total Net Operating Real Estate Investments 1,726,522 1,781,810

Cash and cash equivalents 69,540 25,671

Restricted cash 36,041 (1) 45,511

Accounts receivable 3,095 6.285

Prepaid and other assets 3,695 2,336

Fair market value of interest rate swaps — 4,376

Total Assets $1,838,893 $1,865,989

LIABILITIES AND EQUITY

Liabilities:

Mortgages payable, net $1,145,508 $1,145,371

Mortgages payable held for sale, net — 41,176

Credit facility, net 223,850 216,501

Accounts payable and other accrued liabilities 13,137 11,971

Accrued real estate taxes payable 7,119 12,206

Accrued interest payable 3,337 3,691

Security deposit liability 2,893 2,977

Prepaid rents 1,469 1,658

Fair market value of interest rate swaps 47,077 902

Total Liabilities $1,444,390 $1,436,453

Redeemable noncontrolling interests in the Operating Partnership 2,332 3,295

Equity:

Preferred stock — —

Common stock 256 251

Additional paid-in capital 378,943 359,748

Accumulated earnings less dividends 84,345 63,773

Accumulated other comprehensive income (47,922) 2,466

Common stock held in treasury at cost; 864,681 and 0 shares (23,451) —

Total Stockholders' Equity 392,171 426,241

TOTAL LIABILITIES AND EQUITY $1,838,893 $1,865,989

BALANCE SHEET

(1) INCLUDES APPROXIMATELY $15.4 MILLION RESERVED FOR VALUE-ADD UPGRADES AS OF MARCH 31,2020.

36

NON-GAAP RECONCILIATIONS: FFO, CORE FFO & AFFO

The following table reconciles our FFO, Core FFO and AFFO to our net income (loss) (the most directly comparable GAAP financial measure) for the periods shown below:

($ in thousands, except for per share data) Q1 2020 Q1 2019 FY 2019 FY 2018

RECONCILIATION OF FFO, CORE FFO AND AFFO Unaudited Unaudited Unaudited Unaudited

Net Income (loss) $28,039 ($4,373) $99,438 ($1,614)

Depreciation and amortization 23,338 15,398 69,086 47,470

Gain on sales of real estate (38,972) — (127,684) (13,742)

Adjustment for noncontrolling interests (37) (33) (122) (96)

FFO attributable to common stockholders $12,368 $10,992 $40,718 $32,018

FFO per share - diluted $0.48 $0.46 $1.66 $1.48

Loss on extinguishment of debt and modification costs 874 — 2,869 3,576

Casualty-related expenses/(recoveries) 60 35 (34) (663)

Casualty gain (loss) (51) — 3,488 —

Amortization of deferred financing costs - acquisition term notes 349 — 553 159

Adjustment for noncontrolling interests (4) — (21) (9)

Core FFO attributable to common stockholders $13,596 $11,027 $47,573 $35,081

Core FFO per share - diluted $0.53 $0.46 $1.93 $1.62

Amortization of deferred financing costs - long term debt 386 432 1,530 1,491

Equity-based compensation expense 1,300 1,235 5,130 4,198

Adjustment for noncontrolling interests (5) (5) (20) (17)

AFFO attributable to common stockholders $15,277 $12,689 $54,213 $40,753

AFFO per share - diluted $0.59 $0.53 $2.20 $1.88

Weighted average common shares outstanding - diluted 25,851 24,044 24,593 21,667

37

NON-GAAP RECONCILIATIONS: NOI & NET DEBT

(1) BASED ON GREEN STREET ADVISORS’ ‘RESIDENTIAL SECTORS’ REPORT DATED APRIL 19, 2020. FY 2020 ADJUSTED NOI DOES NOT CONSIDER ANY ADDITIONAL ACQUISITION OR DISPOSITION ACTIVITY FOR THE REMAINDER OF THE YEAR.

(2) ADJUSTMENT TO NET INCOME (LOSS) TO EXCLUDE CERTAIN PROPERTY OPERATING EXPENSES THAT ARE CASUALTY-RELATED/(RECOVERIES).(3) ADJUSTMENT TO NET INCOME (LOSS) TO EXCLUDE CERTAIN PROPERTY GENERAL AND ADMINISTRATIVE EXPENSES THAT ARE NOT REFLECTIVE OF THE CONTINUING OPERATIONS OF THE PROPERTIES OR ARE

INCURRED ON OUR BEHALF AT THE PROPERTY FOR EXPENSES SUCH AS LEGAL, PROFESSIONAL AND FRANCHISE TAX FEES.(4) ENTERPRISE VALUE IS CALCULATED AS MARKET CAPITALIZATION PLUS NET DEBT.

The following table, which has not been adjusted for the effects of noncontrolling interests, reconciles NOI to net income (loss) (the most directly comparable GAAP financials measure) for the periods shown below:

($ in thousands) FY 2020 Est (1) Q1 2020 Q4 2019 Q1 2019 FY 2019 FY 2018

RECONCILIATION OF NET INCOME (LOSS) TO NOI Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited

Net Income (loss) $5,969 $28,039 ($13,306) ($4,373) $99,438 ($1,614)

Adjustments to reconcile net income (loss) to NOI:

Advisory and administrative fees 7,500 1,865 1,887 1,850 7,500 7,474

Corporate general and administrative expenses 9,932 2,701 2,300 2,233 9,613 7,808

Casualty-related expenses/(recoveries) (2) — 60 (60) 35 (34) (663)

Casualty gains (losses) — (51) 3,488 — 3,488 —

Miscellaneous income — — (587) — (587) —

Property general and administrative expenses (3) 1,500 469 448 356 1,517 1,294

Depreciation and amortization 84,650 23,338 23,394 15,398 69,086 47,470

Interest expense 44,697 11,662 10,747 8,088 37,385 28,572

Loss on extinguishment of debt and modification costs 874 874 — — 2,869 3,576

Gain on sales of real estate — (38,972) 16 — (127,684) (13,742)

Acquisition costs — — — — — —

NOI $116,150 $29,985 $28,327 $23,587 $102,591 $80,175

($ in thousands) Q1 2020 Q1 2019

RECONCILIATION OF DEBT TO NET DEBT Unaudited Unaudited

Total mortgage debt outstanding $1,151,683 $924,463

Credit facilities 225,000 52,500

Bridge facilities — —

Total debt1,376,683 976,963

Adjustments to arrive at net debt:

Cash and cash equivalents (69,540) (20,536)

Restricted cash held for value-add upgrades (15,356) (8,863)

Net Debt $1,291,787 $947,564

Enterprise Value (4) $1,918,787 $1,853,564

Leverage Ratio 67% 51%

The following table, which has not been adjusted for the effects of noncontrolling interests, reconciles net debt to total debt outstanding as of the end of each period shown below:

38

INVESTOR RELATIONS CONTACT

Jackie [email protected](972) 419-6213

300 Crescent Court, Suite 700Dallas, TX 75201Phone: 972-628-4100Fax: 972-628-4147

CONTACT INFO

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