10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number 001-36663

NexPoint Residential Trust, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Maryland	47-1881359
(State or other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)

300 Crescent Court, Suite 700, Dallas, Texas (Address of Principal Executive Offices)	75201
	(Zip Code)

(214) 276-6300

(Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, par value $0.01 per share	NXRT	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	☒	Accelerated Filer	☐
Non-Accelerated Filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of April 28, 2022, the registrant had 25,700,190 shares of its common stock, par value $0.01 per share, outstanding.

NEXPOINT RESIDENTIAL TRUST, INC.

Form 10-Q

Quarter Ended March 31, 2022

INDEX

			Page
Cautionary Statement Regarding Forward-Looking Statements			ii
	PART I—FINANCIAL INFORMATION
Item 1.		Financial Statements
		Consolidated Balance Sheets as of March 31, 2022 (Unaudited) and December 31, 2021	1
		Consolidated Unaudited Statements of Operations and Comprehensive Income for the Three Months Ended March 31, 2022 and 2021	2
		Consolidated Unaudited Statements of Stockholders’ Equity for the Three Months Ended March 31, 2022 and 2021	3
		Consolidated Unaudited Statements of Cash Flows for the Three Months Ended March 31, 2022 and 2021	4
		Notes to Consolidated Unaudited Financial Statements	6
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
Item 3.		Quantitative and Qualitative Disclosures About Market Risk	43
Item 4.		Controls and Procedures	44
	PART II—OTHER INFORMATION
Item 1.		Legal Proceedings	45
Item 1A.		Risk Factors	45
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds	45
Item 3.		Defaults Upon Senior Securities	45
Item 4.		Mine Safety Disclosures	45
Item 5.		Other Information	45
Item 6.		Exhibits	46
Signatures			47

i

Cautionary Statement Regarding Forward-Looking Statements

This quarterly report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties. In particular, statements relating to our liquidity and capital resources, the performance of our properties and results of operations contain forward-looking statements. Furthermore, all of the statements regarding future financial performance (including market conditions and demographics) are forward-looking statements. We caution investors that any forward-looking statements presented in this quarterly report are based on management’s current beliefs and assumptions made by, and information currently available to, management. When used, the words “anticipate,” “believe,” “expect,” “intend,” “may,” “might,” “plan,” “estimate,” “project,” “should,” “will,” “would,” “result” and similar expressions that do not relate solely to historical matters are intended to identify forward-looking statements. You can also identify forward-looking statements by discussions of strategy, plans or intentions.

Forward-looking statements are subject to risks, uncertainties and assumptions and may be affected by known and unknown risks, trends, uncertainties and factors that are beyond our control. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. We caution you therefore against relying on any of these forward-looking statements.

Some of the risks and uncertainties that may cause our actual results, performance, liquidity or achievements to differ materially from those expressed or implied by forward-looking statements include, among others, the following:

• unfavorable changes in market and economic conditions in the United States and globally and in the specific markets where our properties are located;

• risks associated with the current COVID-19 pandemic, including unpredictable variants, and the future outbreak of other highly infectious or contagious diseases;

• risks associated with ownership of real estate;

• limited ability to dispose of assets because of the relative illiquidity of real estate investments;

• our multifamily properties are concentrated in certain geographic markets in the Southeastern and Southwestern United States, which makes us more susceptible to adverse developments in those markets;

• increased risks associated with our strategy of acquiring value-enhancement multifamily properties rather than more conservative investment strategies;

• failure to succeed in new markets may have adverse consequences on our performance;

• potential reforms to the Federal Home Loan Mortgage Corporation (“Freddie Mac”) and the Federal National Mortgage Association (“Fannie Mae”);

• competition could limit our ability to acquire attractive investment opportunities, which could adversely affect our profitability and impede our growth;

• competition and any increased affordability of residential homes could limit our ability to lease our apartments or increase or maintain rents;

• the relatively low residential mortgage rates may result in potential renters purchasing residences rather than leasing them, and as a result, cause a decline in our occupancy rates;

• the risk that we may fail to consummate future property acquisitions;

• failure of acquisitions to yield anticipated results;

• risks associated with increases in interest rates and our ability to issue additional debt or equity securities in the future;

• risks associated with selling apartment communities, which could limit our operational and financial flexibility;

• contingent or unknown liabilities related to properties or businesses that we have acquired or may acquire;

• lack of or insufficient amounts of insurance;

• the risk that our environmental assessments may not identify all potential environmental liabilities and our remediation actions may be insufficient;

• high costs associated with the investigation or remediation of environmental contamination, including asbestos, lead-based paint, chemical vapor, subsurface contamination and mold growth;

• high costs associated with the compliance with various accessibility, environmental, building and health and safety laws and regulations, such as the Americans with Disabilities Act of 1990 and the Fair Housing Act;

• risks associated with limited warranties we may obtain when purchasing properties;

ii

• exposure to decreases in market rents due to our short-term leases;

• risks associated with operating through joint ventures and funds;

• our dependence on information systems;

• risks associated with breaches of our data security;

• costs associated with being a public company, including compliance with securities laws;

• the risk that our business could be adversely impacted if there are deficiencies in our disclosure controls and procedures or internal control over financial reporting;

• risks associated with our substantial current indebtedness and indebtedness we may incur in the future;

• risks associated with derivatives or hedging activity;

• risks associated with representations and warranties made by the us in connection with sales of our properties may subject us to liability that could result in losses and could harm our operating results and, therefore, distributions we make to our stockholders;

• loss of key personnel of NexPoint Advisors, L.P. (our “Sponsor”), NexPoint Real Estate Advisors, L.P. (our “Adviser”) and our property manager;

• the risk that we may not replicate the historical results achieved by other entities managed or sponsored by affiliates of our Adviser, members of our Adviser’s management team or by our Sponsor or its affiliates;

• risks associated with our Adviser’s ability to terminate the Advisory Agreement (as defined below);

• our ability to change our major policies, operations and targeted investments without stockholder consent;

• the substantial fees and expenses we pay to our Adviser and its affiliates;

• risks associated with any potential internalization of our management functions;

• conflicts of interest and competing demands for time faced by our Adviser, our Sponsor and their officers and employees;

• the risk that we may compete with other entities affiliated with our Sponsor or property manager for properties and tenants;

• failure to maintain our status as a REIT;

• failure of our operating partnership to be taxable as a partnership for federal income tax purposes, possibly causing us to fail to qualify for or to maintain REIT status;

• compliance with REIT requirements, which may limit our ability to hedge our liabilities effectively and cause us to forgo otherwise attractive opportunities, liquidate certain of our investments or incur tax liabilities;

• risks associated with our ownership of interests in taxable REIT subsidiaries;

• the recognition of taxable gains from the sale of properties as a result of the inability to complete certain like-kind exchanges in accordance with Section 1031 of the Internal Revenue Code of 1986, as amended (the “Code”);

• the risk that the Internal Revenue Service may consider certain sales of properties to be prohibited transactions, resulting in a 100% penalty tax on any taxable gain;

• the ineligibility of dividends payable by REITs for the reduced tax rates available for some dividends;

• risks associated with the stock ownership restrictions of the Code for REITs and the stock ownership limit imposed by our charter;

• the ability of our board of directors to revoke our REIT qualification without stockholder approval;

• recent and potential legislative or regulatory tax changes or other actions affecting REITs;

• risks associated with the market for our common stock and the general volatility of the capital and credit markets;

• failure to generate sufficient cash flows to service our outstanding indebtedness or pay distributions at expected levels;

• risks associated with limitations of liability for and our indemnification of our directors and officers;

• the risk that legal proceedings we become involved in from time to time could adversely affect our business;

• the risk that acts of violence could decrease the value of our assets and have an adverse effect on our business and results of operations;

iii

• risks associated with the Highland Capital Management, L.P. bankruptcy, including related litigation and potential conflicts of interest; and

• any other risks included under Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission on February 18, 2022 or under Part II, Item 1A, “Risk Factors” of this Quarterly Report on Form 10-Q.

While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. They are based on estimates and assumptions only as of the date of this quarterly report. We undertake no obligation to update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes, except as required by law.

iv

NEXPOINT RESIDENTIAL TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

	March 31, 2022			December 31, 2021
	(Unaudited)
ASSETS
Operating Real Estate Investments
Land	$	375,857		$	375,857
Buildings and improvements		1,745,341			1,743,866
Intangible lease assets		1,376			2,576
Construction in progress		4,529			6,078
Furniture, fixtures and equipment		127,030			120,419
Total Gross Operating Real Estate Investments		2,254,133			2,248,796
Accumulated depreciation and amortization		(309,002	)		(287,096	)
Total Net Real Estate Investments		1,945,131			1,961,700
Cash and cash equivalents		99,538			49,450
Restricted cash		32,586			39,246
Accounts receivable, net		9,421			4,844
Prepaid and other assets		11,631			4,701
Fair market value of interest rate swaps		58,104			3,526
TOTAL ASSETS	$	2,156,411		$	2,063,467
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgages payable, net	$	1,276,240		$	1,276,285
Credit facility, net		332,979			278,215
Accounts payable and other accrued liabilities		12,539			12,590
Accrued real estate taxes payable		7,896			13,182
Accrued interest payable		2,788			2,491
Security deposit liability		2,989			2,945
Prepaid rents		1,811			1,775
Total Liabilities		1,637,242			1,587,483
Redeemable noncontrolling interests in the Operating Partnership		6,614			6,139
Stockholders' Equity:
Preferred stock, $0.01 par value: 100,000,000 shares authorized; 0 shares issued		—			—
Common stock, $0.01 par value: 500,000,000 shares authorized; 25,700,190 and 25,500,567 shares issued and outstanding, respectively		257			255
Additional paid-in capital		411,059			407,803
Accumulated earnings less dividends		44,246			59,209
Accumulated other comprehensive income		56,993			2,578
Total Stockholders' Equity		512,555			469,845
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	2,156,411		$	2,063,467

See Notes to Consolidated Financial Statements

1

NEXPOINT RESIDENTIAL TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME

(in thousands, except per share amounts)

(Unaudited)

	For the Three Months Ended March 31,
	2022			2021
Revenues
Rental income	$	59,297		$	50,340
Other income		1,489			1,456
Total revenues		60,786			51,796
Expenses
Property operating expenses		13,596			11,216
Real estate taxes and insurance		8,720			8,722
Property management fees (1)		1,757			1,485
Advisory and administrative fees (2)		1,843			1,868
Corporate general and administrative expenses		3,486			2,940
Property general and administrative expenses		2,006			1,559
Depreciation and amortization		23,718			20,758
Total expenses		55,126			48,548
Operating income		5,660			3,248
Interest expense		(10,636	)		(10,616	)
Casualty gain		128			—
Miscellaneous income		181			468
Net loss		(4,667	)		(6,900	)
Net loss attributable to redeemable noncontrolling interests in the Operating Partnership		(14	)		(21	)
Net loss attributable to common stockholders	$	(4,653	)	$	(6,879	)
Other comprehensive income
Unrealized gains on interest rate derivatives		54,579			31,342
Total comprehensive income		49,912			24,442
Comprehensive income attributable to redeemable noncontrolling interests in the Operating Partnership		150			73
Comprehensive income attributable to common stockholders	$	49,762		$	24,369
Weighted average common shares outstanding - basic		25,620			25,068
Weighted average common shares outstanding - diluted		25,620			25,068
Loss per share - basic	$	(0.18	)	$	(0.27	)
Loss per share - diluted	$	(0.18	)	$	(0.27	)

(1) Fees incurred to an unaffiliated third party that is an affiliate of the noncontrolling limited partner of the Company’s Operating Partnership (see Note 10).

(2) Fees incurred to the Adviser (see Note 11).

See Notes to Consolidated Financial Statements

2

NEXPOINT RESIDENTIAL TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(dollars in thousands)

(Unaudited)

	Preferred Stock				Common Stock				Additional			Accumulated Earnings (Loss)			Accumulated Other
	Number of Shares		Par Value		Number of Shares		Par Value		Paid-in Capital			Less Dividends			Comprehensive Income (Loss)		Total
Balances, December 31, 2021		—	$	—		25,500,567	$	255	$	407,803		$	59,209		$	2,578	$	469,845
Net loss attributable to common stockholders		—		—		—		—		—			(4,653	)		—		(4,653	)
Vesting of stock-based compensation		—		—		147,532		1		(881	)		—			—		(880	)
Issuance of common stock through at-the-market offering		—		—		52,091		1		4,137			—			—		4,138
Common stock dividends declared ($0.38 per share)		—		—		—		—		—			(9,976	)		—		(9,976	)
Other comprehensive income		—		—		—		—		—			—			54,415		54,415
Adjustment to reflect redemption value of redeemable noncontrolling interests in the Operating Partnership		—		—		—		—		—			(334	)		—		(334	)
Balances, March 31, 2022		—	$	—		25,700,190		257		411,059			44,246			56,993	$	512,555

	Preferred Stock				Common Stock				Additional			Accumulated Earnings (Loss)			Accumulated Other
	Number of Shares		Par Value		Number of Shares		Par Value		Paid-in Capital			Less Dividends			Comprehensive Income (Loss)			Total
Balances, December 31, 2020		—	$	—		25,016,957	$	250	$	376,710		$	75,321		$	(44,354	)	$	407,927
Net loss attributable to common stockholders		—		—		—		—		—			(6,879	)		—			(6,879	)
Vesting of stock-based compensation		—		—		110,184		1		363			—			—			364
Issuance of common stock through at-the-market offering		—		—		—		—		(176	)		—			—			(176	)
Common stock dividends declared ($0.34125 per share)		—		—		—		—		—			(8,776	)		—			(8,776	)
Other comprehensive income		—		—		—		—		—			—			31,248			31,248
Adjustment to reflect redemption value of redeemable noncontrolling interests in the Operating Partnership		—		—		—		—		—			(215	)		—			(215	)
Balances, March 31, 2021		—	$	—		25,127,141	$	251	$	376,897		$	59,451		$	(13,106	)	$	423,493

See Notes to Consolidated Financial Statements

3

NEXPOINT RESIDENTIAL TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

	For the Three Months Ended March 31,
	2022			2021
Cash flows from operating activities
Net loss	$	(4,667	)	$	(6,900	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		23,718			20,758
Amortization/write-off of deferred financing costs		565			571
Change in fair value on derivative instruments included in interest expense		2,384			3,663
Net cash paid on derivative settlements		(3,646	)		(3,618	)
Amortization/write-off of fair market value adjustment of assumed debt		(50	)		(51	)
Provision for bad debts, net		1,248			734
Vesting of stock-based compensation		1,877			1,608
Insurance proceeds received for business interruption		—			121
Casualty gain		94			(468	)
Changes in operating assets and liabilities, net of effects of acquisitions:
Operating assets		(6,413	)		578
Operating liabilities		(6,428	)		(3,252	)
Net cash provided by operating activities		8,682			13,744
Cash flows from investing activities
Prepaid acquisition deposits		(1,615	)		—
Insurance proceeds received from casualty losses		273			3,178
Additions to real estate investments		(9,120	)		(10,765	)
Net cash used in investing activities		(10,462	)		(7,587	)
Cash flows from financing activities
Mortgage payments		(381	)		(198	)
Credit facilities proceeds received		55,000			—
Deferred financing costs paid		(415	)		—
Interest rate cap fees paid		(10	)		—
Proceeds from the issuance of common stock through at-the-market offering, net of offering costs		4,138			(176	)
Payments for taxes related to net share settlement of stock-based compensation		(2,757	)		(1,244	)
Dividends paid to common stockholders		(10,367	)		(8,923	)
Net cash provided by (used in) financing activities		45,208			(10,541	)
Net increase (decrease) in cash, cash equivalents and restricted cash		43,428			(4,384	)
Cash, cash equivalents and restricted cash, beginning of period		88,696			57,015
Cash, cash equivalents and restricted cash, end of period	$	132,124		$	52,631

See Notes to Consolidated Financial Statements

4

NEXPOINT RESIDENTIAL TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

Supplemental Disclosure of Cash Flow Information
Interest paid	$	7,442		$	6,489
Supplemental Disclosure of Noncash Activities
Capitalized construction costs included in accounts payable and other accrued liabilities		2,846			2,237
Change in fair value on derivative instruments designated as hedges		54,579			31,342
Decrease in dividends payable upon vesting of restricted stock units		(391	)		(147	)
Write-off of assets due to casualty losses		1,904			2,028
Write-off of fully amortized in-place leases		1,200			—

See Notes to Consolidated Financial Statements

5

NEXPOINT RESIDENTIAL TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Description of Business

NexPoint Residential Trust, Inc. (the “Company”, “we”, “our”) was incorporated in Maryland on September 19, 2014, and has elected to be taxed as a real estate investment trust (“REIT”). The Company is focused on “value-add” multifamily investments primarily located in the Southeastern and Southwestern United States. Substantially all of the Company’s business is conducted through NexPoint Residential Trust Operating Partnership, L.P. (the “OP”), the Company’s operating partnership. The Company owns its properties (the “Portfolio”) through the OP and its wholly owned taxable REIT subsidiary (“TRS”). The OP owns approximately 99.9% of the Portfolio; the TRS owns approximately 0.1% of the Portfolio. The Company’s wholly owned subsidiary, NexPoint Residential Trust Operating Partnership GP, LLC (the “OP GP”), is the sole general partner of the OP. As of March 31, 2022, there were 23,819,402 common units in the OP (“OP Units”) outstanding, of which 23,746,169, or 99.7%, were owned by the Company and 73,233, or 0.3%, were owned by a noncontrolling limited partner (see Note 10).

The Company is externally managed by NexPoint Real Estate Advisors, L.P. (the “Adviser”), through an agreement dated March 16, 2015, as amended, and renewed on February 14, 2022 for a one-year term (the “Advisory Agreement”), by and among the Company, the OP and the Adviser. The Adviser conducts substantially all of the Company’s operations and provides asset management services for its real estate investments. The Company expects it will only have accounting employees while the Advisory Agreement is in effect. All of the Company’s investment decisions are made by the Adviser, subject to general oversight by the Adviser’s investment committee and the Company’s board of directors (the “Board”). The Adviser is wholly owned by NexPoint Advisors, L.P. (the “Sponsor”).

The Company’s investment objectives are to maximize the cash flow and value of properties owned, acquire properties with cash flow growth potential, provide quarterly cash distributions and achieve long-term capital appreciation for its stockholders through targeted management and a value-add program. Consistent with the Company’s policy to acquire assets for both income and capital gain, the Company intends to hold at least majority interests in its properties for long-term appreciation and to engage in the business of directly or indirectly acquiring, owning, and operating well-located multifamily properties with a value-add component in large cities and suburban submarkets of large cities primarily in the Southeastern and Southwestern United States consistent with its investment objectives. Economic and market conditions may influence the Company to hold properties for different periods of time. From time to time, the Company may sell a property if, among other deciding factors, the sale would be in the best interest of its stockholders.

The Company may allocate up to 30% of the portfolio to investments in real estate-related debt and securities with the potential for high current income or total returns. These allocations may include first and second mortgages and subordinated, bridge, mezzanine, construction and other loans, as well as debt securities related to or secured by multifamily real estate and common and preferred equity securities, which may include securities of other REITs or real estate companies.

2. Summary of Significant Accounting Policies

Basis of Accounting

The accompanying unaudited consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”). GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the dates of the unaudited consolidated financial statements and the amounts of revenues and expenses during the reporting periods. Actual amounts realized or paid could differ from those estimates. All significant intercompany accounts and transactions have been eliminated in consolidation. There have been no significant changes to the Company’s significant accounting policies during the three months ended March 31, 2022.

The accompanying unaudited consolidated financial statements have been prepared according to the rules and regulations of the SEC.  Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted according to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not misleading.

In the opinion of management, all adjustments and eliminations necessary for the fair presentation of the Company’s financial position as of March 31, 2022 and results of operations for the three months ended March 31, 2022 and 2021 have been included.  Such adjustments are normal and recurring in nature.  The unaudited information included in this quarterly report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2021 and notes thereto included in its Annual Report on Form 10-K filed with the SEC on February 18, 2022.

6

Principles of Consolidation

The Company accounts for subsidiary partnerships, joint ventures and other similar entities in which it holds an ownership interest in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810, Consolidation. The Company first evaluates whether each entity is a variable interest entity (“VIE”). Under the VIE model, the Company consolidates an entity when it has control to direct the activities of the VIE and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the voting model, the Company consolidates an entity when it controls the entity through ownership of a majority voting interest. The unaudited consolidated financial statements include the accounts of the Company and its subsidiaries, including the OP and its subsidiaries.

Revenue Recognition

The Company’s primary operations consist of rental income earned from its residents under lease agreements typically with terms of one year or less. Rental income is recognized when earned. This policy effectively results in income recognition on the straight-line method over the related terms of the leases. The Company records an allowance to reflect revenue that may not be collectable. This is recorded through a provision for bad debts which is included in rental income in the accompanying consolidated statements of operations and comprehensive income. Resident reimbursements and other income consist of charges billed to residents for utilities, carport and garage rental, and pets, and administrative, application and other fees and are recognized when earned. 

Purchase Price Allocation

Upon acquisition of a property considered to be an asset acquisition, the purchase price and related acquisition costs (“total consideration”) are allocated to land, buildings, improvements, furniture, fixtures, and equipment, and intangible lease assets in accordance with FASB ASC 805, Business Combinations. Acquisition costs are capitalized in accordance with FASB ASC 805.

The allocation of total consideration, which is determined using inputs that are classified within Level 3 of the fair value hierarchy established by FASB ASC 820, Fair Value Measurement and Disclosures (“ASC 820”) (see Note 7), is based on management’s estimate of the property’s “as-if” vacant fair value and is calculated by using all available information such as the replacement cost of such asset, appraisals, property condition reports, market data and other related information. The allocation of the total consideration to intangible lease assets represents the value associated with the in-place leases, which may include lost rent, leasing commissions, legal and other related costs, which the Company, as buyer of the property, did not have to incur to obtain the residents. If any debt is assumed in an acquisition, the difference between the fair value, which is estimated using inputs that are classified within Level 2 of the fair value hierarchy, and the face value of debt is recorded as a premium or discount and amortized as interest expense over the life of the debt assumed.

Real estate assets, including land, buildings, improvements, furniture, fixtures and equipment, and intangible lease assets are stated at historical cost less accumulated depreciation and amortization. Costs incurred in making repairs and maintaining real estate assets are expensed as incurred. Expenditures for improvements, renovations, and replacements are capitalized at cost. Real estate-related depreciation and amortization are computed on a straight-line basis over the estimated useful lives as described in the following table:

Land	Not depreciated
Buildings	30 years
Improvements	15 years
Furniture, fixtures, and equipment	3 years
Intangible lease assets	6 months

Construction in progress includes the cost of renovation projects being performed at the various properties. Once a project is complete, the historical cost of the renovation is placed into service in one of the categories above depending on the type of renovation project and is depreciated over the estimated useful lives as described in the table above.

7

Impairment

Real estate assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The key inputs into our impairment analysis include, but are not limited to, the holding period, net operating income, and capitalization rates. In such cases, the Company will evaluate the recoverability of such real estate assets based on estimated future cash flows and the estimated liquidation value of such real estate assets, and provide for impairment if such undiscounted cash flows are insufficient to recover the carrying amount of the real estate asset. If impaired, the real estate asset will be written down to its estimated fair value. The Company’s impairment analysis identifies and evaluates events or changes in circumstances that indicate the carrying amount of a real estate investment may not be recoverable, including determining the period the Company will hold the rental property, net operating income, and the estimated capitalization rate for each respective real estate investment.

As of March 31, 2022, the Company has not recorded any impairment on its real estate assets.  However, we continue to monitor the impact of COVID-19 (see “–Coronavirus (“COVID-19”)” for additional information, below).

Held for Sale

The Company periodically classifies real estate assets as held for sale when certain criteria are met, in accordance with GAAP. At that time, the Company presents the net real estate assets and the net debt associated with the real estate held for sale separately in its consolidated balance sheet, and the Company ceases recording depreciation and amortization expense related to that property. Real estate held for sale is reported at the lower of its carrying amount or its estimated fair value less estimated costs to sell. As of March 31, 2022, there are no properties held for sale.      

Income Taxes

The Company has elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), and expects to continue to qualify as a REIT. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement to distribute annually at least 90% of its “REIT taxable income,” as defined by the Code, to its stockholders. As a REIT, the Company will be subject to federal income tax on its undistributed REIT taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions it pays with respect to any calendar year are less than the sum of (1) 85% of its ordinary income, (2) 95% of its capital gain net income and (3) 100% of its undistributed income from prior years. The Company intends to operate in such a manner so as to qualify as a REIT, but no assurance can be given that the Company will operate in a manner so as to qualify as a REIT. Taxable income from certain non-REIT activities is managed through a TRS and is subject to applicable federal, state, and local income and margin taxes. The Company had no significant taxes associated with its TRS for the three months ended March 31, 2022 and 2021.

If the Company fails to meet these requirements, it could be subject to federal income tax on all of the Company’s taxable income at regular corporate rates for that year. The Company would not be able to deduct distributions paid to stockholders in any year in which it fails to qualify as a REIT. Additionally, the Company will also be disqualified from electing to be taxed as a REIT for the four taxable years following the year during which qualification was lost unless the Company is entitled to relief under specific statutory provisions. As of March 31, 2022, the Company believes it is in compliance with all applicable REIT requirements.

The Company evaluates the accounting and disclosure of tax positions taken or expected to be taken in the course of preparing the Company’s tax returns to determine whether the tax positions are “more-likely-than-not” (greater than 50 percent probability) of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. The Company’s management is required to analyze all open tax years, as defined by the statute of limitations, for all major jurisdictions, which include federal and certain states. The Company has no examinations in progress and none are expected at this time.

The Company recognizes its tax positions and evaluates them using a two-step process. First, the Company determines whether a tax position is more likely than not to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Second, the Company will determine the amount of benefit to recognize and record the amount that is more likely than not to be realized upon ultimate settlement.

The Company had no material unrecognized tax benefit or expense, accrued interest or penalties as of March 31, 2022. The Company and its subsidiaries are subject to federal income tax as well as income tax of various state and local jurisdictions. The 2021, 2020 and 2019 tax years remain open to examination by tax jurisdictions to which the Company and its subsidiaries are subject. When applicable, the Company recognizes interest and/or penalties related to uncertain tax positions on its consolidated statements of operations and comprehensive income.

8

Recent Accounting Pronouncements

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During the first quarter of 2022, the Company transitioned a portion its debt to one-month term SOFR (“Term SOFR”). The Company has taken the ASC 848 elections needed to allow for the hedged forecasted transactions to transition while not discontinuing the associated hedge accounting designations. Application of these hedged accounting expedients preserves the presentation of derivatives consistent with past presentation.  The Company will continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

Coronavirus (“COVID-19”)

As a result of the COVID-19 pandemic, the Company may experience difficulties collecting monthly rent on time, leasing additional apartment units and/or renewing leases with existing tenants, selling or purchasing properties and accessing debt and equity capital on attractive terms, or at all. To date, the Company has not been materially impacted by the COVID-19 pandemic and will continue to monitor the impact of the COVID-19 pandemic on all aspects of its business. For additional information regarding the risks to the Company related to the COVID-19 pandemic, or any other future pandemic. See “Item 1A. Risk factors” within “Part I” of our annual report on Form 10-K, filed with the U.S. Securities and Exchange Commission on February 18, 2022, for additional discussion of the risks posed by the COVID-19 pandemic.

3. Investments in Subsidiaries

The Company conducts its operations through the OP, which owns properties through single asset limited liability companies that are special purpose entities (“SPEs”). The Company consolidates the SPEs that it controls as well as any VIEs where it is the primary beneficiary.  The Company controls and consolidates the OP as a VIE. In connection with its indirect equity investments in the properties acquired, the Company, through the OP and the TRS, directly or indirectly holds 100% of the membership interests in SPEs that directly own the properties. All of the properties the SPEs own are consolidated in the Company’s consolidated financial statements. The assets of each entity can only be used to settle obligations of that particular entity, and the creditors of each entity have no recourse to the assets of other entities or the Company.

Additionally, the Company has in the past and may in the future enter into purchase and sale transactions structured as reverse like-kind exchanges (“1031 Exchanges”) under Section 1031 of the Code. For a reverse 1031 Exchange in which the Company purchases a new property prior to selling the property to be matched in the like-kind exchange (the Company refers to the new property being acquired in the 1031 Exchange prior to the sale of the related property as a “Parked Asset”), legal title to the Parked Asset is held by an Exchange Accommodation Titleholder (“EAT”) engaged to execute the 1031 Exchange until the sale transaction and the 1031 Exchange are completed. The Company, through a wholly owned subsidiary, enters into a master lease agreement with the EAT whereby the EAT leases the acquired property and all other rights acquired in connection with the acquisition to the Company. The term of the master lease agreement is the earlier of the completion of the reverse 1031 Exchange or 180 days from the date that the property was acquired. The EAT is classified as a VIE as it does not have sufficient equity investment at risk to finance its activities without additional subordinated financial support. The Company consolidates the EAT as its primary beneficiary because it has the ability to control the activities that most significantly impact the EAT’s economic performance and the Company retains all of the legal and economic benefits and obligations related to the Parked Assets prior to completion of the 1031 Exchange. As such, the Parked Assets are included in the Company’s consolidated financial statements as VIEs until legal title and control is transferred to the Company upon either completion of the 1031 Exchange or termination of the master lease agreement, at which time they will be consolidated as wholly owned subsidiaries.

9

As of March 31, 2022, the Company, through the OP and the wholly owned TRS, owned 39 properties through SPEs. The following table represents the Company’s ownership in each property by virtue of its 100% ownership of the SPEs that directly own the title to each property as of March 31, 2022 and December 31, 2021:

				Effective Ownership Percentage at
Property Name		Location	Year Acquired	March 31, 2022			December 31, 2021
Arbors on Forest Ridge		Bedford, Texas	2014		100	%		100	%
Cutter's Point		Richardson, Texas	2014		100	%		100	%
Silverbrook		Grand Prairie, Texas	2014		100	%		100	%
The Summit at Sabal Park		Tampa, Florida	2014		100	%		100	%
Courtney Cove		Tampa, Florida	2014		100	%		100	%
Radbourne Lake		Charlotte, North Carolina	2014		100	%		100	%
Timber Creek		Charlotte, North Carolina	2014		100	%		100	%
Sabal Palm at Lake Buena Vista		Orlando, Florida	2014		100	%		100	%
Cornerstone		Orlando, Florida	2015		100	%		100	%
The Preserve at Terrell Mill		Marietta, Georgia	2015		100	%		100	%
Versailles		Dallas, Texas	2015		100	%		100	%
Seasons 704 Apartments		West Palm Beach, Florida	2015		100	%		100	%
Madera Point		Mesa, Arizona	2015		100	%		100	%
Venue at 8651		Fort Worth, Texas	2015		100	%		100	%
Parc500		West Palm Beach, Florida	2016		100	%		100	%
The Venue on Camelback		Phoenix, Arizona	2016		100	%		100	%
Old Farm		Houston, Texas	2016		100	%		100	%
Stone Creek at Old Farm		Houston, Texas	2016		100	%		100	%
Hollister Place		Houston, Texas	2017		100	%		100	%
Rockledge Apartments		Marietta, Georgia	2017		100	%		100	%
Atera Apartments		Dallas, Texas	2017		100	%		100	%
Crestmont Reserve		Dallas, Texas	2018		100	%		100	%
Brandywine I & II		Nashville, Tennessee	2018		100	%		100	%
Bella Vista		Phoenix, Arizona	2019		100	%		100	%
The Enclave		Tempe, Arizona	2019		100	%		100	%
The Heritage		Phoenix, Arizona	2019		100	%		100	%
Summers Landing		Fort Worth, Texas	2019		100	%		100	%
Residences at Glenview Reserve		Nashville, Tennessee	2019		100	%		100	%
Residences at West Place		Orlando, Florida	2019		100	%		100	%
Avant at Pembroke Pines		Pembroke Pines, Florida	2019		100	%		100	%
Arbors of Brentwood		Nashville, Tennessee	2019		100	%		100	%
Torreyana Apartments		Las Vegas, Nevada	2019		100	%		100	%
Bloom		Las Vegas, Nevada	2019		100	%		100	%
Bella Solara		Las Vegas, Nevada	2019		100	%		100	%
Fairways at San Marcos		Chandler, AZ	2020		100	%		100	%
The Verandas at Lake Norman	(1)	Charlotte, North Carolina	2021		100	%		100	%
Creekside at Matthews	(1)	Charlotte, North Carolina	2021		100	%		100	%
Six Forks Station		Raleigh, North Carolina	2021		100	%		100	%
High House at Cary	(2)	Cary, North Carolina	2021		100	%		100	%

(1) The EAT that directly owned The Verandas at Lake Norman and Creekside at Matthews was consolidated as a VIE at June 30, 2021 giving the Company an effective 100% ownership interest.  The master lease agreement with the EAT that directly owned these properties terminated on December 28, 2021, at which time legal title and control transferred to the Company. Upon the transfer of title, the EAT that directly owned these properties was no longer considered a VIE.

(2) Formerly known as Hudson High House.

10

4. Real Estate Investments Statistics

As of March 31, 2022, the Company was invested in a total of 39 multifamily properties, as listed below:

						Average Effective Monthly Rent Per Unit (1) as of				% Occupied (2) as of
Property Name	Rentable Square Footage (in thousands)		Number of Units (3)		Date Acquired	March 31, 2022		December 31, 2021		March 31, 2022			December 31, 2021
Arbors on Forest Ridge		155		210	1/31/2014	$	1,040	$	1,021		94.8	%		96.2	%
Cutter's Point		198		196	1/31/2014		1,261		1,219		95.4	%		95.4	%
Silverbrook		526		642	1/31/2014		1,068		1,043		94.2	%		94.1	%
The Summit at Sabal Park		205		252	8/20/2014		1,253		1,198		94.4	%		96.0	%
Courtney Cove		225		324	8/20/2014		1,187		1,132		93.5	%		93.8	%
Radbourne Lake		247		225	9/30/2014		1,293		1,227		93.3	%		94.2	%
Timber Creek		248		352	9/30/2014		1,058		1,032		96.4	%		96.1	%
Sabal Palm at Lake Buena Vista		371		400	11/5/2014		1,453		1,377		95.8	%		97.8	%
Cornerstone		318		430	1/15/2015		1,183		1,152		95.6	%		95.6	%
The Preserve at Terrell Mill		692		752	2/6/2015		1,182		1,156		94.4	%		90.9	%
Versailles		301		388	2/26/2015		1,166		1,024		88.1	%		96.4	%
Seasons 704 Apartments		217		222	4/15/2015		1,502		1,410		94.1	%		96.8	%
Madera Point		193		256	8/5/2015		1,190		1,140		96.1	%		94.5	%
Venue at 8651		289		333	10/30/2015		1,033		1,006		95.4	%		94.5	%
Parc500		266		217	7/27/2016		1,609		1,543		94.5	%		96.3	%
The Venue on Camelback		256		415	10/11/2016		960		915		94.9	%		92.3	%
Old Farm		697		734	12/29/2016		1,218		1,207		94.7	%		93.9	%
Stone Creek at Old Farm		186		190	12/29/2016		1,268		1,248		96.3	%		96.8	%
Hollister Place		246		260	2/1/2017		1,105		1,065		89.2	%		92.5	%
Rockledge Apartments		802		708	6/30/2017		1,446		1,408		94.9	%		93.9	%
Atera Apartments		334		380	10/25/2017		1,352		1,310		95.0	%		93.9	%
Crestmont Reserve		199		242	9/26/2018		1,052		985		93.0	%		95.5	%
Brandywine I & II		414		632	9/26/2018		1,080		1,031		95.1	%		95.6	%
Bella Vista		243		248	1/28/2019		1,543		1,515		96.8	%		96.0	%
The Enclave		194		204	1/28/2019		1,603		1,507		95.1	%		96.6	%
The Heritage		199		204	1/28/2019		1,514		1,432		91.7	%		95.6	%
Summers Landing		139		196	6/7/2019		1,090		1,033		96.4	%		93.9	%
Residences at Glenview Reserve		344		360	7/17/2019		1,125		1,074		94.7	%		95.6	%
Residences at West Place		345		342	7/17/2019		1,420		1,345		94.2	%		93.0	%
Avant at Pembroke Pines		1,442		1,520	8/30/2019		1,772		1,695		95.1	%		93.9	%
Arbors of Brentwood		325		346	9/10/2019		1,344		1,284		94.8	%		95.1	%
Torreyana Apartments		309		316	11/22/2019		1,419		1,365		94.6	%		93.7	%
Bloom		498		528	11/22/2019		1,263		1,238		91.1	%		89.2	%
Bella Solara		271		320	11/22/2019		1,343		1,309		91.9	%		91.3	%
Fairways at San Marcos		340		352	11/2/2020		1,476		1,425		96.3	%		96.3	%
The Verandas at Lake Norman		241		264	6/30/2021		1,258		1,215		93.2	%		93.2	%
Creekside at Matthews		263		240	6/30/2021		1,393		1,350		91.7	%		94.2	%
Six Forks Station		360		323	9/10/2021		1,246		1,228		91.2	%		95.4	%
High House at Cary		293		302	12/7/2021		1,372		1,361		93.4	%		94.7	%
		13,391		14,825

(1) Average effective monthly rent per unit is equal to the average of the contractual rent for commenced leases as of March 31, 2022 and December 31, 2021, respectively, minus any tenant concessions over the term of the lease, divided by the number of units under commenced leases as of March 31, 2022 and December 31, 2021, respectively.

(2) Percent occupied is calculated as the number of units occupied as of March 31, 2022 and December 31, 2021, divided by the total number of units, expressed as a percentage.

(3) Includes 49 down units due to casualty events as of March 31, 2022 (see Note 5).

11

5. Real Estate Investments

As of March 31, 2022, the major components of the Company’s investments in multifamily properties were as follows (in thousands):

Operating Properties	Land		Buildings and Improvements			Intangible Lease Assets			Construction in Progress		Furniture, Fixtures and Equipment			Totals
Arbors on Forest Ridge	$	2,330	$	11,760		$	—		$	1	$	1,865		$	15,956
Cutter's Point		3,330		13,088			—			1		7,393			23,812
Silverbrook		4,860		25,691			—			196		5,690			36,437
The Summit at Sabal Park		5,770		13,885			—			—		2,048			21,703
Courtney Cove		5,880		14,345			—			17		2,548			22,790
Radbourne Lake		2,440		22,848			—			—		2,642			27,930
Timber Creek		11,260		13,334			—			380		3,931			28,905
Sabal Palm at Lake Buena Vista		7,580		42,461			—			10		2,874			52,925
Cornerstone		1,500		30,915			—			21		3,833			36,269
The Preserve at Terrell Mill		10,170		53,148			—			—		9,414			72,732
Versailles		6,720		21,953			—			2		4,155			32,830
Seasons 704 Apartments		7,480		14,725			—			—		2,262			24,467
Madera Point		4,920		18,155			—			—		2,698			25,773
Venue at 8651		2,350		17,548			—			322		3,914			24,134
Parc500		3,860		21,193			—			5		4,228			29,286
The Venue on Camelback		8,340		38,513			—			141		3,450			50,444
Old Farm		11,078		71,070			—			174		4,031			86,353
Stone Creek at Old Farm		3,493		19,718			—			2		936			24,149
Hollister Place		2,782		21,202			—			1,468		2,793			28,245
Rockledge Apartments		17,451		97,417			—			—		6,405			121,273
Atera Apartments		22,371		38,691			—			7		2,545			63,614
Crestmont Reserve		4,124		21,068			—			—		1,558			26,750
Brandywine I & II		6,237		73,769			—			—		5,385			85,391
Bella Vista		10,942		37,310			—			6		2,865			51,123
The Enclave		11,046		30,515			—			—		2,500			44,061
The Heritage		6,835		35,131			—			26		2,562			44,554
Summers Landing		1,798		18,447			—			1		821			21,067
Residences at Glenview Reserve		3,367		42,339			—			—		2,602			48,308
Residences at West Place		3,345		52,369			—			—		1,855			57,569
Avant at Pembroke Pines		48,434		276,632			—			1,056		12,425			338,547
Arbors of Brentwood		6,346		56,063			—			—		2,414			64,823
Torreyana Apartments		23,824		43,771			—			3		1,533			69,131
Bloom		23,805		82,595			—			19		3,007			109,426
Bella Solara		12,605		53,440			—			22		2,068			68,135
Fairways at San Marcos		10,993		72,922			—			297		2,005			86,217
The Verandas at Lake Norman		9,510		52,800			—			115		857			63,282
Creekside at Matthews		11,515		45,337			—			—		1,046			57,898
Six Forks Station		11,357		61,517			—			218		1,045			74,137
High House at Cary		23,809		67,656			1,376			19		827			93,687
		375,857		1,745,341			1,376			4,529		127,030			2,254,133
Accumulated depreciation and amortization		—		(218,292	)		(917	)		—		(89,793	)		(309,002	)
Total Operating Properties	$	375,857	$	1,527,049		$	459		$	4,529	$	37,237		$	1,945,131

12

As of December 31, 2021, the major components of the Company’s investments in multifamily properties were as follows (in thousands):

Operating Properties	Land		Buildings and Improvements			Intangible Lease Assets			Construction in Progress		Furniture, Fixtures and Equipment			Totals
Arbors on Forest Ridge	$	2,330	$	11,755		$	—		$	—	$	1,821		$	15,906
Cutter's Point		3,330		13,091			—			—		7,379			23,800
Silverbrook		4,860		27,495			—			—		5,566			37,921
The Summit at Sabal Park		5,770		13,882			—			—		1,978			21,630
Courtney Cove		5,880		14,350			—			—		2,444			22,674
Radbourne Lake		2,440		22,744			—			64		2,455			27,703
Timber Creek		11,260		13,310			—			239		3,827			28,636
Sabal Palm at Lake Buena Vista		7,580		42,456			—			2		2,758			52,796
Cornerstone		1,500		30,901			—			21		3,722			36,144
The Preserve at Terrell Mill		10,170		53,080			—			—		8,997			72,247
Versailles		6,720		21,887			—			—		4,075			32,682
Seasons 704 Apartments		7,480		14,644			—			—		2,078			24,202
Madera Point		4,920		18,090			—			48		2,612			25,670
Venue at 8651		2,350		17,495			—			334		3,843			24,022
Parc500		3,860		21,172			—			—		4,147			29,179
The Venue on Camelback		8,340		38,328			—			306		3,248			50,222
Old Farm		11,078		70,993			—			99		3,902			86,072
Stone Creek at Old Farm		3,493		19,714			—			2		899			24,108
Hollister Place		2,782		21,196			—			1,308		2,739			28,025
Rockledge Apartments		17,451		97,374			—			—		5,968			120,793
Atera Apartments		22,371		36,857			—			1,824		2,384			63,436
Crestmont Reserve		4,124		21,067			—			—		1,515			26,706
Brandywine I & II		6,237		73,737			—			—		5,160			85,134
Bella Vista		10,942		37,193			—			51		2,687			50,873
The Enclave		11,046		30,469			—			11		2,403			43,929
The Heritage		6,835		35,011			—			68		2,386			44,300
Summers Landing		1,798		18,433			—			1		790			21,022
Residences at Glenview Reserve		3,367		42,306			—			—		2,366			48,039
Residences at West Place		3,345		52,310			—			—		1,591			57,246
Avant at Pembroke Pines		48,434		275,968			—			1,414		11,611			337,427
Arbors of Brentwood		6,346		56,040			—			—		2,235			64,621
Torreyana Apartments		23,824		43,700			—			25		1,371			68,920
Bloom		23,805		82,545			—			16		2,697			109,063
Bella Solara		12,605		53,415			—			24		1,854			67,898
Fairways at San Marcos		10,993		72,920			—			2		1,989			85,904
The Verandas at Lake Norman		9,510		52,884			—			6		650			63,050
Creekside at Matthews		11,515		45,271			—			18		756			57,560
Six Forks Station		11,357		62,129			1,200			195		748			75,629
High House at Cary		23,809		67,654			1,376			—		768			93,607
		375,857		1,743,866			2,576			6,078		120,419			2,248,796
Accumulated depreciation and amortization		—		(203,125	)		(1,029	)		—		(82,942	)		(287,096	)
Total Operating Properties	$	375,857	$	1,540,741		$	1,547		$	6,078	$	37,477		$	1,961,700

Depreciation expense was $22.6 million and $19.9 million for the three months ended March 31, 2022 and 2021, respectively.

Amortization expense related to the Company’s intangible lease assets was $1.1 million and $0.8 million for the three months ended March 31, 2022 and 2021, respectively. Amortization expense related to the Company’s intangible lease assets for all acquisitions completed through March 31, 2022 is expected to be $0.5 million for the remainder of the year ended December 31, 2022. Due to the six-month useful life attributable to intangible lease assets, the value of intangible lease assets on any acquisition prior to September 30, 2021 has been fully amortized and the assets and related accumulated amortization have been written off as of March 31, 2022.

Acquisitions

There were no acquisitions of real estate during the three months ended March 31, 2022 and 2021.

Dispositions

There were no dispositions of real estate during the three months ended March 31, 2022 and 2021.

13

Casualty Losses

As of March 31, 2022, seven of the Company’s properties, Silverbrook, Venue at 8651, Bloom, Old Farm, Timber Creek, The Preserve at Terrell Mill and Six Forks, suffered significant property damages as a result of fires and flooding. As of March 31, 2022, 49 units were excluded from the Portfolio’s total unit count and all same store pools due to reconstruction. Business interruption proceeds for lost rent are included in miscellaneous income in the accompanying consolidated statements of operations and comprehensive income in relation to these events.

6. Debt

Mortgage Debt

The following table contains summary information concerning the mortgage debt of the Company as of March 31, 2022 (dollars in thousands):

Operating Properties		Type	Term (months)		Outstanding Principal (1)				Interest Rate (2)	Maturity Date
Arbors on Forest Ridge	(3)	Floating		84	$	13,130			2.13%	7/1/2024
Cutter's Point	(3)	Floating		84		16,640			2.13%	7/1/2024
Silverbrook	(3)	Floating		84		30,590			2.13%	7/1/2024
The Summit at Sabal Park	(3)	Floating		84		13,560			2.07%	7/1/2024
Courtney Cove	(3)	Floating		84		13,680			2.07%	7/1/2024
The Preserve at Terrell Mill	(3)	Floating		84		42,480			2.07%	7/1/2024
Versailles	(3)	Floating		84		23,880			2.07%	7/1/2024
Seasons 704 Apartments	(3)	Floating		84		17,460			2.07%	7/1/2024
Madera Point	(3)	Floating		84		15,150			2.07%	7/1/2024
Venue at 8651	(3)	Floating		84		13,734			2.23%	7/1/2024
The Venue on Camelback	(3)	Floating		84		28,093			2.13%	7/1/2024
Old Farm	(3)	Floating		84		52,886			2.13%	7/1/2024
Stone Creek at Old Farm	(3)	Floating		84		15,274			2.13%	7/1/2024
Timber Creek	(3)	Floating		84		24,100			1.71%	10/1/2025
Radbourne Lake	(3)	Floating		84		20,000			1.74%	10/1/2025
Sabal Palm at Lake Buena Vista	(3)	Floating		84		42,100			1.75%	9/1/2025
Cornerstone	(4)	Fixed		120		20,672			4.24%	3/1/2023
Parc500	(5)	Fixed		120		14,590			4.49%	8/1/2025
Hollister Place	(3)	Floating		84		14,811			1.79%	10/1/2025
Rockledge Apartments	(3)	Floating		84		68,100			2.02%	7/1/2024
Atera Apartments	(3)	Floating		84		29,500			1.93%	11/1/2024
Crestmont Reserve	(3)	Floating		84		12,061			1.63%	10/1/2025
Brandywine I & II	(3)	Floating		84		43,835			1.63%	10/1/2025
Bella Vista	(6)	Floating		84		29,040			1.77%	2/1/2026
The Enclave	(6)	Floating		84		25,322			1.77%	2/1/2026
The Heritage	(6)	Floating		84		24,625			1.77%	2/1/2026
Summers Landing	(7)	Floating		84		10,109			1.63%	10/1/2025
Residences at Glenview Reserve	(8)	Floating		84		26,270			1.89%	10/1/2025
Residences at West Place	(8)	Fixed		120		33,817			4.24%	10/1/2028
Avant at Pembroke Pines	(3)	Floating		84		177,100			1.88%	9/1/2026
Arbors of Brentwood	(3)	Floating		84		34,237			1.88%	10/1/2026
Torreyana Apartments	(6)	Floating		84		37,400			2.15%	12/1/2026
Bloom	(6)	Floating		84		58,850			2.15%	12/1/2026
Bella Solara	(6)	Floating		84		36,575			2.15%	12/1/2026
Fairways at San Marcos	(6)	Floating		84		46,464			2.29%	12/1/2027
The Verandas at Lake Norman	(9)	Floating		84		34,925			2.01%	7/1/2028
Creekside at Matthews	(9)	Floating		84		31,900			2.01%	7/1/2028
Six Forks Station	(10)	Floating		120		41,180			1.87%	10/1/2031
High House at Cary	(9)	Floating		84		46,625			2.17%	1/1/2029
					$	1,280,765
Fair market value adjustment						1,009		(11)
Deferred financing costs, net of accumulated amortization of $5,433						(5,534	)
					$	1,276,240

(1) Mortgage debt that is non-recourse to the Company and encumbers the multifamily properties.

(2) Interest rate is based on a reference rate plus an applicable margin, except for fixed rate mortgage debt. References rates used in our portfolio include one-month LIBOR and 30-Day Average Secured Overnight Financing Rate (“SOFR”). As of March 31, 2022, one-month LIBOR was 0.452% and SOFR was 0.15934%.

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(3) Loan can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%. Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(4) Debt in the amount of $18.0 million was assumed upon acquisition of this property and recorded at approximated fair value. The assumed debt carries a 4.09% fixed rate, was originally issued in March 2013, and had a term of 120 months with an initial 24 months of interest only. At the time of acquisition, the principal balance of the first mortgage remained unchanged and had a remaining term of 98 months with 2 months of interest only. The first mortgage is pre-payable and subject to yield maintenance from the 13^th month through August 31, 2022 and is pre-payable at par starting on September 1, 2022 until maturity. Concurrently with the acquisition of the property, the Company placed a supplemental second mortgage on the property with a principal amount of approximately $5.8 million, a fixed rate of 4.70%, and with a maturity date that is the same time as the first mortgage. The supplemental second mortgage is pre-payable and subject to yield maintenance from the date of issuance through August 31, 2022 and is pre-payable at par starting on September 1, 2022 until maturity. As of March 31, 2022, the total indebtedness secured by the property had a blended interest rate of 4.24%.

(5) Debt was assumed upon acquisition of this property and recorded at approximated fair value. The loan is open to pre-payment in the last four months of the term.

(6) Loan can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%.  Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(7) Debt was assumed upon acquisition of this property and recorded at approximated fair value.  It can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%. Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(8) Debt was assumed upon acquisition of this property and recorded at approximated fair value. The loan can be prepaid at the greater of par plus 1.00% of the unpaid principal balance or the product obtained by multiplying the present value of the principal being prepaid by the excess of the monthly fixed interest rate of the loan over a daily discount rate. The loan is open to pre-payment in the last three months of the term.  

(9) Loan can be pre-paid in the first 24 months of the term in certain circumstances at par plus 5.00%.  Starting in the 25th month of the term through the 36th month of the term, the loan can be pre-paid at par plus 2% of the unpaid principal balance. Starting in the 37th month of the term, the loan can be pre-paid at par plus 1% of the unpaid principal balance. The loan is open to pre-payment in the last three months of the term.

(10) Loan can be pre-paid in the first 24 months of the term in certain circumstances at par plus 5.00%. Starting in the 25th month of the term through the 116th of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last four months of the term.

(11) The Company reflected a valuation adjustment on its fixed rate debt for Parc500 and Residences at West Place to adjust it to fair market value on their respective dates of acquisition for the difference between the fair value and the assumed principal amount of debt. The difference is amortized into interest expense over the remaining terms of the mortgages.

The weighted average interest rate of the Company’s mortgage indebtedness was 2.10% as of March 31, 2022 and 1.81% as of December 31, 2021. The increase between the periods is primarily related to an increase in one-month LIBOR of approximately 35 basis points to 0.452% as of March 31, 2022 from 0.10125% as of December 31, 2021. As of March 31, 2022, the adjusted weighted average interest rate of the Company’s mortgage indebtedness was 2.95%. For purposes of calculating the adjusted weighted average interest rate of the outstanding mortgage indebtedness, the Company has included the weighted average fixed rate of 1.2128% for one-month LIBOR on its combined $1.4 billion notional amount of interest rate swap agreements, which effectively fix the interest rate on $1.4 billion of the Company’s floating rate mortgage debt (see Note 7).

Each of the Company’s mortgages is a non-recourse obligation subject to customary provisions. The loan agreements contain customary events of default, including defaults in the payment of principal or interest, defaults in compliance with the covenants contained in the documents evidencing the loan, defaults in payments under any other security instrument covering any part of the property, whether junior or senior to the loan, and bankruptcy or other insolvency events. As of March 31, 2022, the Company believes it is in compliance with all provisions. 

Credit Facility

The following table contains summary information concerning the Company’s credit facility as of March 31, 2022 (dollars in thousands):

	Type	Term (months)		Outstanding Principal			Interest Rate (1)	Maturity Date
Corporate Credit Facility	Floating		36	$	335,000		2.80%	6/30/2024
Deferred financing costs, net of accumulated amortization of $461					(2,021	)
				$	332,979

(1) Interest rate is based on Term SOFR plus an applicable margin.  Term SOFR as of March 31, 2022 was 0.3024%.

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On March 25, 2022, the Company entered into a loan modification agreement by and among the Company, the OP, Truist Bank and the Lenders party thereto, which modified the Company’s existing credit facility, dated as of June 30, 2021 (as modified, amended and supplemented, the “Corporate Credit Facility”). As of March 31, 2022, there was $350.0 million available for borrowing under the Corporate Credit Facility. Subject to conditions provided in the Corporate Credit Facility, the commitments under Corporate Credit Facility may be increased up to an additional $150.0 million if the lenders agree to increase their commitments or if the lenders agree for the increase to be funded by any additional lender proposed by the Company, through the OP. The Corporate Credit Facility will mature on June 30, 2024 with respect to the revolving commitments, unless the Company exercises its option to voluntarily and permanently reduce all of the revolving commitments before the maturity date or elects to exercise its right and option to extend the facility with respect to the revolving commitments for a single one-year term. As of March 31, 2022, there was $335.0 million in aggregate principal outstanding under the Corporate Credit Facility.

Advances under the Corporate Credit Facility accrue interest at a per annum rate equal to, at the Company’s election, either Term SOFR plus a margin of 1.90% to 2.40%, depending on the Company’s total leverage ratio and a benchmark replacement adjustment of 0.1%, or a base rate determined according to the highest of (a) the prime rate, (b) the federal funds rate plus 0.50%, (c) Term SOFR plus 1.0% or (d) 0.0% plus a margin of 0.90% to 1.40%, depending on the Company’s total leverage ratio. An unused commitment fee at a rate of 0.15% or 0.25%, depending on the outstanding aggregate revolving commitments, applies to unutilized borrowing capacity under the Corporate Credit Facility. Amounts owing under the Corporate Credit Facility may be prepaid at any time without premium or penalty. The Corporate Credit Facility is guaranteed by the Company and the obligations under the Corporate Credit Facility are, subject to some exceptions, secured by a continuing security interest in substantially all of the assets of the Company. The Company is in compliance with all of the covenants required in its Corporate Credit Facility.

Deferred Financing Costs

The Company defers costs incurred in obtaining financing and amortizes the costs over the terms of the related loans using the straight-line method, which approximates the effective interest method. Deferred financing costs, net of amortization, are recorded as a reduction from the related debt on the Company’s consolidated balance sheets. Upon repayment of or in conjunction with a material change in the terms of the underlying debt agreement, any unamortized costs are charged to loss on extinguishment of debt and modification costs (see “Loss on Extinguishment of Debt and Modification Costs” below). For the three months ended March 31, 2022 and 2021, amortization of deferred financing costs of approximately $0.6 million and $0.6 million, respectively, is included in interest expense on the consolidated statements of operations and comprehensive income.

Loss on Extinguishment of Debt and Modification Costs

Loss on extinguishment of debt and modification costs includes prepayment penalties and defeasance costs incurred on the early repayment of debt, costs incurred in a debt modification that are not capitalized as deferred financing costs and other costs incurred in a debt extinguishment.

Schedule of Debt Maturities

The aggregate scheduled maturities, including amortizing principal payments, of total debt for the next five calendar years subsequent to March 31, 2022 are as follows (in thousands):

	Operating Properties		Credit Facility		Total
2022	$	1,040	$	—	$	1,040
2023		21,047		—		21,047
2024		394,956		335,000		729,956
2025		205,662		—		205,662
2026		423,149		—		423,149
Thereafter		234,911		—		234,911
Total	$	1,280,765	$	335,000	$	1,615,765

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7. Fair Value of Derivatives and Financial Instruments

Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy):

• Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access.

• Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates and yield curves that are observable at commonly quoted intervals.

• Level 3 inputs are the unobservable inputs for the asset or liability, which are typically based on an entity’s own assumption, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on input from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company utilizes independent third parties to perform the allocation of value analysis for each property acquisition and to perform the market valuations on its derivative financial instruments and has established policies, as described above, processes and procedures intended to ensure that the valuation methodologies for investments and derivative financial instruments are fair and consistent as of the measurement date.

Derivative Financial Instruments and Hedging Activities

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company may enter into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash payments principally related to the Company’s borrowings. In order to minimize counterparty credit risk, the Company enters into and expects to enter into hedging arrangements only with major financial institutions that have high credit ratings.

The Company utilizes an independent third party to perform the market valuations on its derivative financial instruments. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. The fair values of interest rate caps are determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates rise above the strike rate of the caps. The variable interest rates used in the calculation of projected receipts on the cap are based on an expectation of future interest rates derived from observable market interest rate curves and volatilities. To comply with the provisions of ASC 820, the Company incorporates credit valuation adjustments to appropriately reflect both the Company’s own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of the Company’s derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with the Company’s derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties. The Company has determined that the significance of the impact of the credit valuation adjustments made to its derivative contracts, which determination was based on the fair value of each individual contract, was not significant to the overall valuation. As a result, all of the Company’s derivatives held as of March 31, 2022 and December 31, 2021 were classified as Level 2 of the fair value hierarchy.

17

The Company’s main objective in using interest rate derivatives is to add stability to interest expense related to floating rate debt. To accomplish this objective, the Company primarily uses interest rate swaps and caps as part of its interest rate risk management strategy. Interest rate swaps involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. The interest rate swaps have terms ranging from four to five years. Interest rate caps involve the receipt of variable-rate amounts from a counterparty if interest rates rise above the strike rate on the contract in exchange for an up-front premium. The interest rate caps have terms ranging from three to four years. During the three months ended March 31, 2022 and 2021, interest rate cap derivatives were used to hedge the variable cash flows associated with a portion of the Company’s floating rate debt. The interest rate cap agreements the Company has entered into effectively cap one-month LIBOR on $458.8 million of the Company’s floating rate mortgage indebtedness at a weighted average rate of 4.79% as of March 31, 2022.

In order to fix a portion of, and mitigate the risk associated with, the Company’s floating rate indebtedness (without incurring substantial prepayment penalties or defeasance costs typically associated with fixed rate indebtedness when repaid early or refinanced), the Company, through the OP, has entered into nine interest rate swap transactions with KeyBank National Association (“KeyBank”) and four with Truist Bank with a combined notional amount of $1.4 billion. The interest rate swaps the Company has entered into effectively replace the floating interest rate with respect to that amount with a weighted average fixed rate of 1.2128%. The Company has designated these interest rate swaps as cash flow hedges of interest rate risk.

As of March 31, 2022, the Company had the following outstanding interest rate swaps that were designated as cash flow hedges of interest rate risk (dollars in thousands):

Effective Date	Termination Date	Counterparty	Notional Amount		Fixed Rate (1)
April 1, 2017	April 1, 2022	KeyBank	$	100,000		1.9570	%
May 1, 2017	April 1, 2022	KeyBank		50,000		1.9610	%
July 1, 2017	July 1, 2022	KeyBank		100,000		1.7820	%
June 1, 2019	June 1, 2024	KeyBank		50,000		2.0020	%
June 1, 2019	June 1, 2024	Truist		50,000		2.0020	%
September 1, 2019	September 1, 2026	KeyBank		100,000		1.4620	%
September 1, 2019	September 1, 2026	KeyBank		125,000		1.3020	%
January 3, 2020	September 1, 2026	KeyBank		92,500		1.6090	%
March 4, 2020	June 1, 2026	Truist		100,000		0.8200	%
June 1, 2021	September 1, 2026	KeyBank		200,000		0.8450	%
June 1, 2021	September 1, 2026	KeyBank		200,000		0.9530	%
March 1, 2022	March 1, 2025	Truist		145,000		0.5730	%
March 1, 2022	March 1, 2025	Truist		105,000		0.6140	%
			$	1,417,500		1.2128	%	(2)

(1) The floating rate option for the interest rate swaps is one-month LIBOR. As of March 31, 2022, one-month LIBOR was 0.452%.

(2) Represents the weighted average fixed rate of the interest rate swaps.

As of March 31, 2022, the Company had the following outstanding interest rate swaps that were designated as cash flow hedges of interest rate risk with future effective dates (dollars in thousands):

Effective Date	Termination Date	Counterparty	Notional Amount		Fixed Rate (1)
September 1, 2026	January 1, 2027	KeyBank	$	92,500		1.7980	%

(1) The floating rate option for the interest rate swaps is one-month LIBOR. As of March 31, 2022, one-month LIBOR was 0.452%.

(2) Represents the weighted average fixed rate of the interest rate swaps.

Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to interest rate movements but either do not meet the strict requirements to apply hedge accounting in accordance with FASB ASC 815, Derivatives and Hedging, or the Company has elected not to designate such derivatives as hedges. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in net income (loss) as interest expense.

As of March 31, 2022 and 2021, the Company had the following outstanding derivatives that were not designated as hedges in qualifying hedging relationships (dollars in thousands):

As of March 31,	Number of Instruments		Notional Amount
2022		15	$	458,846
2021		15	$	379,406

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The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated balance sheets as of March 31, 2022 and December 31, 2021 (in thousands):

		Asset Derivatives				Liability Derivatives
	Balance Sheet Location	March 31, 2022		December 31, 2021		March 31, 2022		December 31, 2021
Derivatives designated as hedging instruments:
Interest rate swaps	Fair market value of interest rate swaps	$	58,350	$	11,045	$	246	$	7,519
Derivatives not designated as hedging instruments:
Interest rate caps	Prepaid and other assets		1,453		263		—		—
Total		$	59,803	$	11,308	$	246	$	7,519

The tables below present the effect of the Company’s derivative financial instruments on the consolidated statements of operations and comprehensive income for the three months ended March 31, 2022 and 2021 (in thousands):

	Amount of gain (loss) recognized in OCI				Location of gain (loss) reclassified from accumulated	Amount of gain (loss) reclassified from OCI into income
	2022		2021		OCI into income	2022			2021
Derivatives designated as hedging instruments:
For the three months ended March 31,
Interest rate products	$	51,017	$	27,679	Interest expense	$	(3,562	)	$	(3,663	)

	Location of gain (loss)	Amount of gain (loss) recognized in income
	recognized in income	2022		2021
Derivatives not designated as hedging instruments:
For the three months ended March 31,
Interest rate products	Interest expense	$	1,184	$	12

Other Financial Instruments Carried at Fair Value

Redeemable noncontrolling interests in the OP have a redemption feature and are marked to their redemption value if such value exceeds the carrying value of the redeemable noncontrolling interests in the OP (see Note 10). The redemption value is based on the fair value of the Company’s common stock at the redemption date, and therefore, is calculated based on the fair value of the Company’s common stock at the balance sheet date. Since the valuation is based on observable inputs such as quoted prices for similar instruments in active markets, redeemable noncontrolling interests in the OP are classified as Level 2 if they are adjusted to their redemption value.

Financial Instruments Not Carried at Fair Value

At March 31, 2022 and December 31, 2021, the fair values of cash and cash equivalents, restricted cash, accounts receivable, prepaid and other assets, excluding interest rate caps, accounts payable and other accrued liabilities, accrued real estate taxes payable, accrued interest payable, security deposits and prepaid rent approximated their carrying values because of the short term nature of these instruments. The estimated fair values of other financial instruments were determined by the Company using available market information and appropriate valuation methodologies. Considerable judgment is necessary to interpret market data and develop estimated fair values. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company would realize on the disposition of the financial instruments. The use of different market assumptions or estimation methodologies may have a material effect on the estimated fair value amounts.

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Long-term indebtedness is carried at amounts that reasonably approximate their fair value. In calculating the fair value of its long-term indebtedness, the Company used interest rate and spread assumptions that reflect current credit worthiness and market conditions available for the issuance of long-term debt with similar terms and remaining maturities. These financial instruments utilize Level 2 inputs.

The table below presents the carrying value and estimated fair value of our debt at March 31, 2022 and December 31, 2021 (in thousands):

	March 31, 2022				December 31, 2021
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Fixed rate debt	$	69,079	$	68,962	$	69,285	$	71,141
Floating rate debt (1)	$	1,546,686	$	1,635,044	$	1,491,861	$	1,525,298

(1) Includes balances outstanding under our Corporate Credit Facility.

Real estate assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In such cases, the Company will evaluate the recoverability of such real estate assets based on estimated future cash flows and the estimated liquidation value of such real estate assets, and provide for impairment if such undiscounted cash flows are insufficient to recover the carrying amount of the real estate asset. If impaired, the real estate asset will be written down to its estimated fair value. There can be no assurance that the estimates discussed herein, using Level 3 inputs, are indicative of the amounts the Company could realize on disposition of the real estate asset. For the three months ended March 31, 2022 and 2021, the Company did not record any impairment charges related to real estate assets.

8. Stockholders’ Equity

Common Stock

During the three months ended March 31, 2022, the Company issued 147,532 shares of common stock pursuant to its long-term incentive plan (see “Long Term Incentive Plan” below) and 52,091 pursuant to its at-the-market offering (see “At-the-Market Offering” below).

As of March 31, 2022, the Company had 25,700,190 shares of common stock, par value $0.01 per share, issued and outstanding.

Share Repurchase Program

On June 15, 2016, the Board authorized the Company to repurchase up to $30.0 million of its common stock, par value $0.01 per share, during a two-year period that was set to expire on June 15, 2018 (the “Share Repurchase Program”). On April 30, 2018, the Board increased the Share Repurchase Program from $30.0 million to up to $40.0 million and extended it by an additional two years to June 15, 2020. On March 13, 2020, the Board further increased the Share Repurchase Program from $40.0 million to up to $100.0 million and extended it to March 12, 2023.  The Company may utilize various methods to affect the repurchases, and the timing and extent of the repurchases will depend upon several factors, including market and business conditions, regulatory requirements and other corporate considerations, including whether the Company’s common stock is trading at a significant discount to net asset value per share. Repurchases under this program may be discontinued at any time.

During the three months ended March 31, 2022 and 2021, the Company did not repurchase any shares of its common stock. Since the inception of the Share Repurchase Program through March 31, 2022, the Company had repurchased 2,382,155 shares of its common stock, par value $0.01 per share, at a total cost of approximately $61.2 million, or $25.70 per share.

Treasury Shares

From time to time, in accordance with the Company’s Share Repurchase Program, the Company may repurchase shares of its common stock in the open market. Until any such shares are retired, the cost of the shares is included in common stock held in treasury at cost on the consolidated balance sheet. The number of shares of common stock classified as treasury shares reduces the number of shares of the Company’s common stock outstanding and, accordingly, are considered in the weighted average number of shares outstanding during the period. During the three months ended March 31, 2022 and 2021, the Company retired no shares of its common stock held in treasury. As of March 31, 2022, the Company did not have any shares of common stock held in treasury.

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Long Term Incentive Plan

On June 15, 2016, the Company’s stockholders approved a long-term incentive plan (the “2016 LTIP”) and the Company filed a registration statement on Form S-8 registering 2,100,000 shares of common stock, par value $0.01 per share, which the Company may issue pursuant to the 2016 LTIP. The 2016 LTIP authorizes the compensation committee of the Board to provide equity-based compensation in the form of stock options, appreciation rights, restricted shares, restricted stock units, performance shares, performance units and certain other awards denominated or payable in, or otherwise based on, the Company’s common stock or factors that may influence the value of the Company’s common stock, plus cash incentive awards, for the purpose of providing the Company’s directors, officers and other key employees (and those of the Adviser and the Company’s subsidiaries), the Company’s non-employee directors, and potentially certain non-employees who perform employee-type functions, incentives and rewards for performance.

Restricted Stock Units.

Under the 2016 LTIP, restricted stock units may be granted to the Company’s directors, officers and other key employees (and those of the Adviser and the Company’s subsidiaries) and typically vest over a three to five-year period for officers, employees and certain key employees of the Adviser and annually for directors. Beginning on the date of grant, restricted stock units earn dividends that are payable in cash on the vesting date. On February 21, 2019, pursuant to the 2016 LTIP, the Company granted 186,662 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. On February 20, 2020, pursuant to the 2016 LTIP, the Company granted 168,183 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. On May 11, 2020, pursuant to the 2016 LTIP, the Company granted 116,852 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. On February 18, 2021, pursuant to the 2016 LTIP, the Company granted 204,663 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. On February 17, 2022, pursuant to the 2016 LTIP, the Company granted 142,159 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. The following table includes the number of restricted stock units granted, vested, forfeited and outstanding as of March 31, 2022:

	2022
	Number of Units				Weighted Average Grant Date Fair Value
Outstanding January 1,		589,283			$	39.17
Granted		142,159				83.88
Vested		(180,497	)	(1)		35.87
Outstanding March 31,		550,945			$	51.79

(1) Certain key employees of the Adviser elected to net the taxes owed upon vesting against the shares issued resulting in 147,532 shares being issued as shown on the Consolidated Statement of Stockholders’ Equity.

The following table contains information regarding the vesting of restricted stock units under the 2016 LTIP for the next five calendar years subsequent to March 31, 2022:

	Shares Vesting
	February			May		Total
2022		—	(1)		22,022		22,022
2023		139,095			22,019		161,114
2024		132,699			22,017		154,716
2025		97,811			22,017		119,828
2026		66,114			—		66,114
2027		27,151			—		27,151
Total		462,870			88,075		550,945

(1) Shares vested prior to March 31, 2022.

As of March 31, 2022, the Company had issued 839,788 shares of common stock under the 2016 LTIP. For the three months ended March 31, 2022 and 2021, the Company recognized approximately $1.9 million and $1.6 million, respectively, of equity-based compensation expense related to grants of restricted stock units.  As of March 31, 2022, the Company had recognized a liability of approximately $1.2 million related to dividends earned on restricted stock units that are payable in cash upon vesting.

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At-the-Market Offering

On March 4, 2020, the Company, the OP and the Adviser entered into separate equity distribution agreements with each of Jefferies LLC (“Jefferies”), Raymond James & Associates, Inc. (“Raymond James”), KeyBanc Capital Markets Inc. (“KeyBanc”) and Truist Securities (f/k/a SunTrust Robinson Humphrey, Inc., “SunTrust,” and together with Jefferies, Raymond James and KeyBanc, the “ATM Sales Agents”), pursuant to which the Company may issue and sell from time to time shares of the Company’s common stock, par value $0.01 per share, having an aggregate sales price of up to $225,000,000 (the “2020 ATM Program”).  Sales of shares of common stock, if any, may be made in transactions that are deemed to be “at the market” offerings, as defined in Rule 415 under the Securities Act, including, without limitation, sales made by means of ordinary brokers’ transactions on the New York Stock Exchange, to or through a market maker at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices based on prevailing market prices.  In addition to the issuance and sale of shares of common stock, the Company may enter into forward sale agreements with each of Jefferies, KeyBanc and Raymond James, or their respective affiliates, through the 2020 ATM Program.  During the three months ended March 31, 2022, the Company issued 52,091 shares of common stock at an average price of $83.16 per share for gross proceeds of $4.3 million under the ATM Program. The Company paid approximately $0.1 million in fees to the 2020 ATM Sales Agents with respect to such sales and incurred other issuance costs of approximately $0.1 million, both of which were netted against the gross proceeds and recorded in additional paid in capital. The following table contains summary information of the 2020 ATM Program since its inception:

Gross proceeds	$	62,310,967
Common shares issued		1,120,910
Gross average sale price per share	$	55.59
Sales commissions	$	934,665
Offering costs		1,184,340
Net proceeds		60,191,962
Average price per share, net	$	53.70

9. Earnings (Loss) Per Share

Basic earnings (loss) per share is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of shares of the Company’s common stock outstanding, which excludes any unvested restricted stock units issued pursuant to the 2016 LTIP. Diluted earnings (loss) per share is computed by adjusting basic earnings (loss) per share for the dilutive effect of the assumed vesting of restricted stock units. During periods of net loss, the assumed vesting of restricted stock units is anti-dilutive and is not included in the calculation of earnings (loss) per share.

The effect of the conversion of OP Units held by noncontrolling limited partners is not reflected in the computation of basic and diluted loss per share, as they are exchangeable for common stock on a one-for-one basis. The loss allocable to such units is allocated on this same basis and reflected as net loss attributable to redeemable noncontrolling interests in the OP in the accompanying consolidated statements of operations and comprehensive income. As such, the assumed conversion of these units would have no net impact on the determination of diluted loss per share. See Note 10 for additional information.

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The following table sets forth the computation of basic and diluted loss per share for the periods presented (in thousands, except per share amounts):

		For the Three Months Ended March 31,
		2022			2021
Numerator for loss per share:
Net loss		$	(4,667	)	$	(6,900	)
Net loss attributable to redeemable noncontrolling interests in the Operating Partnership			(14	)		(21	)
Net loss attributable to common stockholders		$	(4,653	)	$	(6,879	)
Denominator for loss per share:
Weighted average common shares outstanding			25,620			25,068
Denominator for basic loss per share			25,620			25,068
Weighted average unvested restricted stock units			573			582
Denominator for diluted earnings per share	(1)		25,620			25,068
Loss per weighted average common share:
Basic		$	(0.18	)	$	(0.27	)
Diluted		$	(0.18	)	$	(0.27	)

(1) If the Company sustains a net loss for the period presented, unvested restricted stock units are not included in the diluted earnings per share calculation.

10. Noncontrolling Interests

Redeemable Noncontrolling Interests in the OP

Interests in the OP held by limited partners are represented by OP Units. Net income (loss) is allocated to holders of OP Units based upon net income (loss) attributable to common stockholders and the weighted average number of OP Units outstanding to total common shares plus OP Units outstanding during the period. Capital contributions, distributions, and profits and losses are allocated to OP Units in accordance with the terms of the partnership agreement of the OP. Each time the OP distributes cash to the Company, outside limited partners of the OP receive their pro-rata share of the distribution. Redeemable noncontrolling interests in the OP have a redemption feature and are marked to their redemption value if such value exceeds the carrying value of the redeemable noncontrolling interests in the OP.

On June 30, 2017, the Company and the OP entered into a contribution agreement with BH Equities, LLC and its affiliates (collectively, “BH Equity”), whereby the Company purchased 100% of the joint venture interests in the Portfolio owned by BH Equity, representing approximately 8.4% ownership in the Portfolio (the “BH Buyout”), for total consideration of approximately $51.7 million (the “Purchase Amount”). The Purchase Amount consisted of approximately $49.7 million in cash that was paid on June 30, 2017 and 73,233 OP Units (initially valued at $2.0 million) that were issued on August 1, 2017. The number of OP Units issued was calculated by dividing $2.0 million by the midpoint of the range of the Company’s net asset value as publicly disclosed in connection with the Company’s release of its second quarter of 2017 earnings results, which was $27.31 per share.

In connection with the issuance of OP Units to BH Equity on August 1, 2017, the Company and the OP amended the partnership agreement of the OP (the “Amendment”). Pursuant to the Amendment, limited partners holding OP Units have the right to cause the OP to redeem their units at a redemption price equal to and in the form of the Cash Amount (as defined in the partnership agreement of the OP), provided that such OP Units have been outstanding for at least one year. The Company, through the OP GP, as the general partner of the OP may, in its sole discretion, purchase the OP Units by paying to the limited partner either the Cash Amount or the REIT Share Amount (one share of common stock of the Company for each OP Unit), as defined in the partnership agreement of the OP. Notwithstanding the foregoing, a limited partner will not be entitled to exercise its redemption right to the extent the issuance of the Company’s common stock to the redeeming limited partner would (1) be prohibited, as determined in the Company’s sole discretion, under the Company’s charter or (2) cause the acquisition of common stock by such redeeming limited partner to be “integrated” with any other distribution of the Company’s common stock for purposes of complying with the Securities Act. Accordingly, the Company records the OP Units held by noncontrolling limited partners outside of permanent equity and reports the OP Units at the greater of their carrying value or their redemption value using the Company’s stock price at each balance sheet date.

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The following table sets forth the redeemable noncontrolling interests in the OP for the three months ended March 31, 2022 (in thousands):

Redeemable noncontrolling interests in the OP, December 31, 2021	$	6,139
Net loss attributable to redeemable noncontrolling interests in the OP		(14	)
Other comprehensive income attributable to redeemable noncontrolling interests in the OP		164
Contributions from redeemable noncontrolling interests in the OP		—
Distributions to redeemable noncontrolling interests in the OP		(9	)
Adjustment to reflect redemption value of redeemable noncontrolling interests in the OP		334
Redeemable noncontrolling interests in the OP, March 31, 2022	$	6,614

Noncontrolling Interests

Noncontrolling interests have in the past and may in the future be comprised of joint venture partners’ interests in joint ventures the Company consolidates. When applicable, the Company reports its joint venture partners’ interests in its consolidated joint ventures and other subsidiary interests held by third parties as noncontrolling interests. The Company records these noncontrolling interests at their initial fair value, adjusting the basis prospectively for their share of the respective consolidated investment’s net income or loss, equity contributions, return of capital, and distributions. Generally, these noncontrolling interests are not redeemable by the equity holders and are presented as part of permanent equity. Income and losses are allocated to the noncontrolling interest holder based on its economic ownership percentage

Fees and Reimbursements to BH and its Affiliates

The Company has entered into management agreements with BH Management Services, LLC (“BH”), the Company’s property manager and an independently owned third party, who manages the Company’s properties and supervises the implementation of the Company’s value-add program. BH is an affiliate of BH Equity, who was a noncontrolling interest member of the Company’s joint ventures prior to the BH Buyout on June 30, 2017. Through BH Equity’s noncontrolling interests in such joint ventures, BH Equity was deemed to be a related party. With the completion of the BH Buyout, BH Equity is no longer deemed to be a related party. BH Equity became a noncontrolling limited partner of the OP upon execution of the Amendment. BH and its affiliates do not have common ownership in any joint venture with the Adviser; there is also no common ownership between BH and its affiliates and the Adviser.

The property management fee paid to BH is approximately 3% of the monthly gross income from each property managed. Currently, BH manages all of the Company’s properties. Additionally, the Company may pay BH certain other fees, including: (1) a fee of $15-25 per unit for the one-time setup and inspection of properties, (2) a construction supervision fee of 5-6% of total project costs, which is capitalized, (3) acquisition fees and due diligence costs reimbursements, and (4) other owner approved fees at $55 per hour. BH also acts as a paymaster for the properties and is reimbursed at cost for various operating expenses it pays on behalf of the properties. The following is a summary of fees that the properties incurred to BH and its affiliates, as well as reimbursements paid to BH from the properties for various operating expenses, for the three months ended March 31, 2022 and 2021 (in thousands):

		For the Three Months Ended March 31,
		2022		2021
Fees incurred
Property management fees	(1)	$	1,750	$	1,479
Construction supervision fees	(2)		325		254
Design fees	(2)		—		54
Aerwave fees	(3)		124		—
Reimbursements
Payroll and benefits	(3)		5,164		4,238
Other reimbursements	(4)		1,028		825

(1) Included in property management fees on the consolidated statements of operations and comprehensive income.

(2) Capitalized on the consolidated balance sheets and reflected in buildings and improvements.

(3) Included in property operating expenses on the consolidated statements of operations and comprehensive income.

(4) Includes property operating expenses such as repairs and maintenance costs and certain property general and administrative expenses, which are included on the consolidated statements of operations and comprehensive income.

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11. Related Party Transactions

Advisory and Administrative Fee

In accordance with the Advisory Agreement, the Company pays the Adviser an advisory fee equal to 1.00% of the Average Real Estate Assets (as defined below). The duties performed by the Company’s Adviser under the terms of the Advisory Agreement include, but are not limited to: providing daily management for the Company, selecting and working with third party service providers, managing the Company’s properties or overseeing the third party property manager, formulating an investment strategy for the Company and selecting suitable properties and investments, managing the Company’s outstanding debt and its interest rate exposure through derivative instruments, determining when to sell assets, and managing the value-add program or overseeing a third party vendor that implements the value-add program. “Average Real Estate Assets” means the average of the aggregate book value of Real Estate Assets before reserves for depreciation or other non-cash reserves, computed by taking the average of the book value of real estate assets at the end of each month (1) for which any fee under the Advisory Agreement is calculated or (2) during the year for which any expense reimbursement under the Advisory Agreement is calculated. “Real Estate Assets” is defined broadly in the Advisory Agreement to include, among other things, investments in real estate-related securities and mortgages and reserves for capital expenditures (the value-add program). The advisory fee is payable monthly in arrears in cash, unless the Adviser elects, in its sole discretion, to receive all or a portion of the advisory fee in shares of common stock, subject to certain limitations.

In accordance with the Advisory Agreement, the Company also pays the Adviser an administrative fee equal to 0.20% of the Average Real Estate Assets. The administrative fee is payable monthly in arrears in cash, unless the Adviser elects, in its sole discretion, to receive all or a portion of the administrative fee in shares of common stock, subject to certain limitations.

The advisory and administrative fees paid to the Adviser on the Contributed Assets (as defined in the Advisory Agreement) are subject to an annual cap of approximately $5.4 million (the “Contributed Assets Cap”) (see “Expense Cap” below).

Pursuant to the terms of the Advisory Agreement, the Company will reimburse the Adviser for all documented Operating Expenses and Offering Expenses it incurs on behalf of the Company. “Operating Expenses” include legal, accounting, financial and due diligence services performed by the Adviser that outside professionals or outside consultants would otherwise perform, the Company’s pro rata share of rent, telephone, utilities, office furniture, equipment, machinery and other office, internal and overhead expenses of the Adviser required for the Company’s operations, and compensation expenses under the 2016 LTIP. Operating Expenses do not include expenses for the advisory and administrative services described in the Advisory Agreement. Certain Operating Expenses, such as the Company’s ratable share of rent, telephone, utilities, office furniture, equipment, machinery and other office, internal and overhead expenses incurred by the Adviser or its affiliates that relate to the operations of the Company, may be billed monthly to the Company under a shared services agreement. “Offering Expenses” include all expenses (other than underwriters’ discounts) in connection with an offering, including, without limitation, legal, accounting, printing, mailing and filing fees and other documented offering expenses. For the three months ended March 31, 2022 and 2021, the Adviser did not bill any Operating Expenses or Offering Expenses to the Company and any such expenses the Adviser incurred during the periods are considered to be permanently waived.

Expense Cap

Pursuant to the terms of the Advisory Agreement, expenses paid or incurred by the Company for operating expenses and advisory and administrative fees payable to the Adviser and Operating Expenses will not exceed 1.5% of Average Real Estate Assets per calendar year (or part thereof that the Advisory Agreement is in effect (the “Expense Cap”)). The Expense Cap does not limit the reimbursement of expenses related to Offering Expenses. The Expense Cap also does not apply to legal, accounting, financial, due diligence and other service fees incurred in connection with mergers and acquisitions, extraordinary litigation or other events outside the Company’s ordinary course of business or any out-of-pocket acquisitions or due diligence expenses incurred in connection with the acquisition or disposition of real estate assets. Also, advisory and administrative fees are further limited on Contributed Assets to approximately $5.4 million in any calendar year. Contributed Assets refers to all Real Estate Assets contributed to the Company as part of its spin-off. The Contributed Assets Cap is not reduced for dispositions of such assets subsequent to its spin-off. Advisory and administrative fees on New Assets are not subject to the above limitation and are based on an annual rate of 1.2% on Average Real Estate Assets, but are subject to the Expense Cap. New Assets are all Real Estate Assets that are not Contributed Assets.

For the three months ended March 31, 2022 and 2021, the Company incurred advisory and administrative fees of $1.8 million and $1.9 million, respectively.  

For the three months ended March 31, 2022 and 2021, the Adviser elected to voluntarily waive the advisory and administrative fees of approximately $4.9 million and $4.0 million, respectively. The advisory and administrative fees waived by the Adviser are considered to be permanently waived for the periods.  The Adviser is not contractually obligated to waive fees on New Assets in the future and may cease waiving fees on New Assets at its discretion.

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Other Related Party Transactions

The Company has in the past, and may in the future, utilize the services of affiliated parties. For the three months ended March 31, 2022 and 2021, the Company did not pay any fees to NexBank Title, Inc. (“NexBank Title”). NexBank Title is an affiliate of the Adviser through common beneficial ownership. NexBank Title provides title insurance and work related to providing title insurance on properties related to acquisitions, dispositions and refinancing transactions. These amounts are either capitalized as real estate assets or deferred financing costs, expensed as loss on extinguishment of debt and modification costs, or expensed as selling costs when determining gain (loss) on sales of real estate, depending on the appropriate accounting as determined for each specific transaction. The Company holds multiple operating accounts at NexBank Capital, Inc. (“NexBank”), an affiliate of the Adviser through common beneficial ownership.

On July 30, 2021, three of our property-owning subsidiaries entered into agreements with NLMF Holdco, LLC, an entity under common control with our Adviser and in which we own a 10% equity interest. As of March 31, 2022, the Company has funded approximately $0.3 million to NLMF Holdco, LLC which is included in prepaid and other assets on the consolidated balance sheet of the Company. For the three months ended March 31, 2022, the Company incurred expenses of $0.1 million for fiber internet service which is included in property operating expenses on the consolidated statement of operations and comprehensive loss.  Additionally, on July 30, 2021, we entered into agreements with NLMF Leaseco, LLC, which is controlled by Matt McGraner, one of our officers. We expect that these actions will provide faster, more reliable and lower cost internet to our residents.

12. Commitments and Contingencies

Commitments

In the normal course of business, the Company enters into various rehabilitation construction related purchase commitments with parties that provide these goods and services. In the event the Company were to terminate rehabilitation construction services prior to the completion of projects, the Company could potentially be committed to satisfy outstanding or uncompleted purchase orders with such parties. As of March 31, 2022, management does not anticipate any material deviations from schedule or budget related to rehabilitation projects currently in process.

The Company’s agreement with NLMF Holdco, LLC may result in additional funding requirements to cover future project costs. The maximum exposure of potential commitments is expected to be no more than $4.0 million. As of March 31, 2022, the Company has funded approximately $0.3 million to NLMF Holdco, LLC which is included in prepaid and other assets on the consolidated balance sheet of the Company.

Contingencies

In the normal course of business, the Company is subject to claims, lawsuits, and legal proceedings. While it is not possible to ascertain the ultimate outcome of all such matters, management believes that the aggregate amount of such liabilities, if any, in excess of amounts provided or covered by insurance, will not have a material adverse effect on the consolidated balance sheets or consolidated statements of operations and comprehensive income of the Company. The Company is not involved in any material litigation nor, to management’s knowledge, is any material litigation currently threatened against the Company or its properties or subsidiaries.

Environmental liabilities could have a material adverse effect on the Company’s business, assets, cash flows or results of operations. As of March 31, 2022, the Company was not aware of any environmental liabilities. There can be no assurance that material environmental liabilities do not exist.

Self-Insurance Program

On March 1, 2021, the Adviser entered into a self-insurance policy resulting in an aggregate amount of $2,468,750 (the “2021 Aggregate Amount”) which is allocated across properties managed by the Adviser with approximately $1.6 million being allocated to the Company. As of December 31, 2021, all of the $1.6 million of the 2021 Aggregate Amount allocated to the Company has been prepaid. Under ASC 450-20 “Loss Contingencies”, the Company does not reserve for the 2021 Aggregate Amount or any portion thereof until a claim is made and the amount of the claim and the timing of payment on the claim can be reasonably estimated.  For the period from March 1, 2021 to February 28, 2022, the Company incurred claims related to its entire allocated 2021 Aggregate Amount at Old Farm and Silverbrook.

On March 1, 2022, the Adviser entered into a new policy resulting in a new aggregate amount of $2,497,500 (the “2022 Aggregate Amount”) which is allocated across properties managed by the Adviser with approximately $1.8 million being allocated to the Company. Under ASC 450-20 “Loss Contingencies”, the Company does not reserve for the 2021 Aggregate Amount or any portion thereof until a claim is made and the amount of the claim and the timing of payment on the claim can be reasonably estimated.  For the period from March 1, 2022 to March 31, 2022, the Company incurred $0.6 million in claims related to a fire at Six Forks Station under the 2022 Aggregate Amount.

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13. Subsequent Events

Dividends Declared

On April 25, 2022, the Company’s Board declared a quarterly dividend of $0.38 per share, payable on June 30, 2022 to stockholders of record on June 15, 2022.

Acquisitions

On April 1, 2022, the Company acquired The Adair and Estates on Maryland, from investors in a Delaware Statutory Trust managed by an entity affiliated with the Adviser, for total consideration of $143.4 million (the “Purchase Price”), as detailed in the table below (dollars in thousands). The Purchase Price consisted of 26,558 OP Units (valued at $2.6 million) that were issued on April 1, 2022 and approximately $71.1 million in cash. The number of OP Units issued was calculated by dividing $2.6 million by the midpoint of the range of the Company’s net asset value as publicly disclosed in connection with the Company’s release of its fourth quarter of 2021 earnings results, which was $98.30 per share. The Company’s Audit Committee approved the acquisitions. These transactions were initially disclosed in our Form 10-K.

Property Name	Location	Purchase Price		Mortgage Debt		# Units		Effective Ownership
The Adair	Sandy Springs, GA	$	65,500	$	35,115		232		100	%
Estates on Maryland	Phoenix, AZ		77,900		43,157		330		100	%
		$	143,400	$	78,272		562

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following is a discussion and analysis of our financial condition and our historical results of operations. The following should be read in conjunction with our financial statements and accompanying notes included herein and with our annual report on Form 10-K for the year ended December 31, 2021 (our “Annual Report”), filed with the Securities and Exchange Commission (the “SEC”) on February 18, 2022. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those projected, forecasted, or expected in these forward-looking statements as a result of various factors, including, but not limited to, those discussed below and elsewhere in this quarterly report. See “Cautionary Statement Regarding Forward-Looking Statements” in this report, and “Risk Factors” in Part I, Item 1A, “Risk Factors” of our Annual Report.

Overview

As of March 31, 2022, our Portfolio consisted of 39 multifamily properties primarily located in the Southeastern and Southwestern United States encompassing 14,825 units of apartment space that was approximately 94.2% leased with a weighted average monthly effective rent per occupied apartment unit of $1,310. Substantially all of our business is conducted through the OP. We own the Portfolio through the OP and our TRS. The OP owns approximately 99.9% of the Portfolio; our TRS owns approximately 0.1% of the Portfolio. The OP GP is the sole general partner of the OP. As of March 31, 2022, there were 23,819,402 OP Units outstanding, of which 23,746,169, or 99.7%, were owned by us and 73,233, or 0.3%, were owned by an unaffiliated limited partner (see Note 10 to our consolidated financial statements).

We are primarily focused on directly or indirectly acquiring, owning, and operating well-located multifamily properties with a value-add component in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. We generate revenue primarily by leasing our multifamily properties. We intend to employ targeted management and a value-add program at a majority of our properties in an attempt to improve rental rates and the net operating income (“NOI”) at our properties and achieve long-term capital appreciation for our stockholders. We are externally managed by the Adviser through the Advisory Agreement, by and among the OP, the Adviser and us. The Advisory Agreement was renewed on February 14, 2022 for a one-year term. The Adviser is wholly owned by NexPoint Advisors, L.P.

On March 4, 2020, the Company, the OP and the Adviser entered into separate equity distribution agreements with each of Jefferies LLC (“Jefferies”), Raymond James & Associates, Inc. (“Raymond James”), KeyBanc Capital Markets Inc. (“KeyBanc”) and Truist Securities (f/k/a SunTrust Robinson Humphrey, Inc., “SunTrust,” and together with Jefferies, Raymond James and KeyBanc, the “ATM Sales Agents”), pursuant to which the Company may issue and sell from time to time shares of the Company’s common stock, par value $0.01 per share, having an aggregate sales price of up to $225,000,000 (the “2020 ATM Program”).  Sales of shares of common stock, if any, may be made in transactions that are deemed to be “at the market” offerings, as defined in Rule 415 under the Securities Act, including, without limitation, sales made by means of ordinary brokers’ transactions on the New York Stock Exchange, to or through a market maker at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices based on prevailing market prices.  In addition to the issuance and sale of shares of common stock, the Company may enter into forward sale agreements with each of Jefferies, KeyBanc and Raymond James, or their respective affiliates, through the 2020 ATM Program.  During the three months ended March 31, 2022, the Company issued 52,091 shares of common stock at an average price of $83.16 per share for gross proceeds of $4.3 million under the 2020 ATM Program. The Company paid approximately $0.1 million in fees to the ATM Sales Agents with respect to such sales and incurred other issuance costs of approximately $0.1 million, both of which were netted against the gross proceeds and recorded in additional paid in capital (see Note 8 to our consolidated financial statements).

We have elected to be taxed as a REIT under Sections 856 through 860 of the Code, and expect to continue to qualify as a REIT. To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute at least 90% of our REIT taxable income to our stockholders. As a REIT, we will be subject to federal income tax on our undistributed REIT taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than the sum of (1) 85% of our ordinary income, (2) 95% of our capital gain net income and (3) 100% of our undistributed income from prior years. We believe we qualify for taxation as a REIT under the Code, and we intend to continue to operate in such a manner, but no assurance can be given that we will operate in a manner so as to qualify as a REIT. Taxable income from certain non-REIT activities is managed through a TRS and is subject to applicable federal, state, and local income and margin taxes. We had no significant taxes associated with our TRS for the three months ended March 31, 2022 and 2021.

On October 15, 2021, a lawsuit was filed by a trust set up in connection with the Highland bankruptcy in the United States Bankruptcy Court for the Northern District of Texas. The lawsuit makes claims against a number of entities, including our Sponsor and James Dondero. The lawsuit does not include claims related to our business or our assets or operations. Our Sponsor and Mr. Dondero have informed us they believe the lawsuit has no merit and they intend to vigorously defend against the claims. We do not expect the lawsuit will have a material effect on our business, results of operations or financial condition.

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Components of Our Revenues and Expenses

Revenues

Rental income. Our earnings are primarily attributable to the rental revenue from our multifamily properties. We anticipate that the leases we enter into for our multifamily properties will typically be for one year or less on average. Also included are utility reimbursements, late fees, pet fees, and other rental fees charged to tenants.

Other income. Other income includes ancillary income earned from tenants such as non-refundable fees, application fees, laundry fees, cable TV income, and other miscellaneous fees charged to tenants.

Expenses

Property operating expenses. Property operating expenses include property maintenance costs, salary and employee benefit costs, utilities, casualty-related expenses and recoveries and other property operating costs.

Real estate taxes and insurance. Real estate taxes include the property taxes assessed by local and state authorities depending on the location of each property. Insurance includes the cost of commercial, general liability, and other needed insurance for each property.

Property management fees. Property management fees include fees paid to BH, our property manager, or other third party management companies for managing each property (see Note 10 to our consolidated financial statements).

Advisory and administrative fees. Advisory and administrative fees include the fees paid to our Adviser pursuant to the Advisory Agreement (see Note 11 to our consolidated financial statements).

Corporate general and administrative expenses. Corporate general and administrative expenses include, but are not limited to, audit fees, legal fees, listing fees, board of director fees, equity-based compensation expense, investor relations costs and payments of reimbursements to our Adviser for operating expenses. Corporate general and administrative expenses and the advisory and administrative fees paid to our Adviser (including advisory and administrative fees on properties defined in the Advisory Agreement as New Assets) will not exceed 1.5% of Average Real Estate Assets per calendar year (or part thereof that the Advisory Agreement is in effect), calculated in accordance with the Advisory Agreement, or the Expense Cap. The Expense Cap does not limit the reimbursement by us of expenses related to securities offerings paid by our Adviser. The Expense Cap also does not apply to legal, accounting, financial, due diligence, and other service fees incurred in connection with mergers and acquisitions, extraordinary litigation, or other events outside our ordinary course of business or any out-of-pocket acquisition or due diligence expenses incurred in connection with the acquisition or disposition of real estate assets.  Additionally, in the sole discretion of the Adviser, the Adviser may elect to waive certain advisory and administrative fees otherwise due.  If advisory and administrative fees are waived in a period, the waived fees for that period are considered to be waived permanently and the Adviser may not be reimbursed in the future.

Property general and administrative expenses. Property general and administrative expenses include the costs of marketing, professional fees, general office supplies, and other administrative related costs of each property.

Depreciation and amortization. Depreciation and amortization costs primarily include depreciation of our multifamily properties and amortization of acquired in-place leases.

Other Income and Expense

Interest expense. Interest expense primarily includes the cost of interest expense on debt, the amortization of deferred financing costs and the related impact of interest rate derivatives used to manage our interest rate risk.

Loss on extinguishment of debt and modification costs. Loss on extinguishment of debt and modification costs includes prepayment penalties and defeasance costs, the write-off of unamortized deferred financing costs and fair market value adjustments of assumed debt related to the early repayment of debt, costs incurred in a debt modification that are not capitalized as deferred financing costs and other costs incurred in a debt extinguishment.

Casualty losses. Casualty losses include expenses resulting from damages from an unexpected and unusual event such as a natural disaster. Expenses can include additional payments on insurance premiums, impairment recognized on a property, and other abnormal expenses arising from the related event.  

Miscellaneous income. Miscellaneous income includes proceeds received from insurance for business interruption involving the loss of rental income at a property that has temporarily suspended operations due to an unexpected and unusual event.

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Gain on sales of real estate. Gain on sales of real estate includes the gain recognized upon sales of properties. Gain on sales of real estate is calculated by deducting the carrying value of the real estate and costs incurred to sell the properties from the sales prices of the properties.

Results of Operations for the Three Months Ended March 31, 2022 and 2021

The following table sets forth a summary of our operating results for the three months ended March 31, 2022 and 2021 (in thousands):

	For the Three Months Ended March 31,
	2022			2021			$ Change
Total revenues	$	60,786		$	51,796		$	8,990
Total expenses		(55,126	)		(48,548	)		(6,578	)
Operating income		5,660			3,248			2,412
Interest expense		(10,636	)		(10,616	)		(20	)
Casualty gain		128			—			128
Miscellaneous income		181			468			(287	)
Net loss		(4,667	)		(6,900	)		2,233
Net loss attributable to redeemable noncontrolling interests in the Operating Partnership		(14	)		(21	)		7
Net loss attributable to common stockholders	$	(4,653	)	$	(6,879	)	$	2,226

The change in our net loss for the three months ended March 31, 2022 as compared to the net loss for the three months ended March 31, 2021 primarily relates to an increase in total revenues, and was partially offset by an increase in total expenses and decrease in miscellaneous income. The change in our net loss between the periods was also due to our acquisition and disposition activity in 2021 and the timing of the transactions (we purchased two properties in the second quarter of 2021, one property in the third quarter of 2021, one property in the fourth quarter of 2021, and disposed of two properties in the fourth quarter of 2021).

Revenues

Rental income. Rental income was $59.3 million for the three months ended March 31, 2022 compared to $50.3 million for the three months ended March 31, 2021, which was an increase of approximately $9.0 million. The increase between the periods was primarily due to a 15.9% increase in the weighted average monthly effective rent per occupied apartment unit in our Portfolio to $1,310 as of March 31, 2022 from $1,130 as of March 31, 2021.  The increase in effective rent was primarily driven by the value-add program that we have implemented and organic growth in rents in the markets where our properties are located.

Other income. Other income was $1.5 million for the three months ended March 31, 2022 compared to $1.5 million for the three months ended March 31, 2021.

Expenses

Property operating expenses. Property operating expenses were $13.6 million for the three months ended March 31, 2022 compared to $11.2 million for the three months ended March 31, 2021, which was an increase of approximately $2.4 million. The increase between the periods was primarily due to our acquisition and disposition activity in 2021 and the timing of the transactions, as described above. The increase between the periods was primarily due to a $0.7 million, or 14.7%, increase in payroll costs, and a $0.2 million increase in water and sewer fees.

Real estate taxes and insurance. Real estate taxes and insurance costs were $8.7 million for the three months ended March 31, 2022 compared to $8.7 million for the three months ended March 31, 2021. Property taxes incurred in the first year of ownership may be significantly less than subsequent years since the purchase price of the property may trigger a significant increase in assessed value by the taxing authority in subsequent years, increasing the cost of real estate taxes.

Property management fees. Property management fees were $1.8 million for the three months ended March 31, 2022 compared to $1.5 million for the three months ended March 31, 2021, which was an increase of approximately $0.3 million. The increase between the periods was primarily due to an increase in total revenues, which the fee is primarily based on.

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Advisory and administrative fees. Advisory and administrative fees were $1.8 million for the three months ended March 31, 2022 and $1.9 million for the three months ended March 31, 2021, which was a decrease of approximately $0.1 million. For the three months ended March 31, 2022 and 2021, our Adviser elected to voluntarily waive the advisory and administrative fees of approximately $4.9 million and $4.0 million and are considered to be permanently waived. Our Adviser is not contractually obligated to waive fees on New Assets in the future and may cease waiving fees on New Assets at its discretion. Advisory and administrative fees may increase in future periods as we acquire additional properties, which will be classified as New Assets.

Corporate general and administrative expenses. Corporate general and administrative expenses were $3.5 million for the three months ended March 31, 2022 compared to $2.9 million for the three months ended March 31, 2021, which was an increase of approximately $0.6 million. The increase between the periods was primarily due to increases in stock compensation expense of $0.3 million and professional fees of $0.2 million.

Property general and administrative expenses. Property general and administrative expenses were $2.0 million for the three months ended March 31, 2022 compared to $1.6 million for the three months ended March 31, 2021, which was an increase of approximately $0.4 million. The increase between the periods was primarily due to our acquisition and disposition activity in 2021 and the timing of the transactions, as described above. The increase between the periods was also due to increases in centralized marketing services and revenue software management of $0.1 million.

Depreciation and amortization. Depreciation and amortization costs were $23.7 million for the three months ended March 31, 2022 compared to $20.8 million for the three months ended March 31, 2021, which was an increase of approximately $2.9 million. The increase between the periods was primarily due to an increase of $2.7 million in depreciation expense, primarily due to our acquisition activity in 2021 and the timing of the transactions, as described above. The increase between the periods was also due to the amortization of intangible lease assets of $1.1 million related to two properties for the three months ended March 31, 2022 compared to $0.8 million related to one property for the three months ended March 31, 2021, which was an increase of approximately $0.3 million. The amortization of intangible lease assets over a six-month period from the date of acquisition is expected to increase the amortization expense during the year of acquisition for each property.

Other Income and Expense

Interest expense. Interest expense was $10.6 million for the three months ended March 31, 2022 compared to $10.6 million for the three months ended March 31, 2021. There was an increase in interest on debt of approximately $1.3 million and a mark-to-market gain on interest rate cap derivatives of $1.2 million. The gain on interest rate cap derivatives is due to an increase in fair value of the caps held primarily by Fairways at San Marcos, The Verandas at Lake Norman, Creekside at Matthews, Six Forks Station and High House at Cary. The following table details the various costs included in interest expense for the three months ended March 31, 2022 and 2021 (in thousands):

	For the Three Months Ended March 31,
	2022			2021			$ Change
Interest on debt	$	7,689		$	6,404		$	1,285
Amortization of deferred financing costs		565			561			4
Interest rate swaps		3,562			3,663			(101	)
Interest rate caps mark-to-market gain		(1,180	)		(12	)		(1,168	)
Total	$	10,636		$	10,616		$	20

Non-GAAP Measurements

Net Operating Income and Same Store Net Operating Income

NOI is a non-GAAP financial measure of performance. NOI is used by investors and our management to evaluate and compare the performance of our properties to other comparable properties, to determine trends in earnings and to compute the fair value of our properties as NOI is calculated by adjusting net income (loss) to add back (1) interest expense (2) advisory and administrative fees, (3) 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 (loss) computed in accordance with GAAP, (4) corporate general and administrative expenses, (5) other gains and losses that are specific to us including loss on extinguishment of debt and modification costs, (6) casualty-related expenses/(recoveries) and casualty gains (losses), (7) pandemic expenses that are not reflective of continuing operations of the properties 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, centralized leasing service and franchise tax fees.

The cost of funds is eliminated from net income (loss) because it is specific to our particular financing capabilities and constraints. The cost of funds is also eliminated because it is dependent on historical interest rates and other costs of capital as well as past decisions made by us regarding the appropriate mix of capital, which may have changed or may change in the future. Corporate general and administrative expenses and non-operating fees to affiliates are eliminated because they do not reflect continuing operating costs of the property owner. Depreciation and amortization expenses as well as gains or losses from the sale of operating

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real estate assets are eliminated because they may not accurately represent the actual change in value in our multifamily properties that result from use of the properties or changes in market conditions. While certain aspects of real property do decline in value over time in a manner that is reasonably captured by depreciation and amortization, the value of the properties as a whole have historically increased or decreased as a result of changes in overall economic conditions instead of from actual use of the property or the passage of time. Gains and losses from the sale of real property vary from property to property and are affected by market conditions at the time of sale, which will usually change from period to period. Casualty-related expenses and recoveries are excluded because they do not reflect continuing operating costs of the property owner. Entity level general and administrative expenses incurred at the properties are eliminated as they are specific to the way in which we have chosen to hold our properties and are the result of our ownership structuring. Also, expenses that are incurred upon acquisition of a property do not reflect continuing operating costs of the property owner. These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly timed purchases or sales. We believe that eliminating these items from net income (loss) is useful because the resulting measure captures the actual ongoing revenue generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs.

However, the usefulness of NOI is limited because it excludes corporate general and administrative expenses, interest expense, loss on extinguishment of debt and modification costs, certain fees to affiliates such as advisory and administrative fees, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as determined under GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs. NOI may fail to capture significant trends in these components of net income, which further limits its usefulness.

NOI is a measure of the operating performance of our properties but does not measure our performance as a whole. NOI is therefore not a substitute for net income (loss) as computed in accordance with GAAP. This measure should be analyzed in conjunction with net income (loss) computed in accordance with GAAP and discussions elsewhere in “—Results of Operations” regarding the components of net income (loss) that are eliminated in the calculation of NOI. Other companies may use different methods for calculating NOI or similarly entitled measures and, accordingly, our NOI may not be comparable to similarly entitled measures reported by other companies that do not define the measure exactly as we do.

We define “Same Store NOI” as NOI for our properties that are comparable between periods. We view Same Store NOI as an important measure of the operating performance of our properties because it allows us to compare operating results of properties owned for the entirety of the current and comparable periods and therefore eliminates variations caused by acquisitions or dispositions during the periods.

NOI and Same Store NOI for the Three Months Ended March 31, 2022 and 2021

The following table, which has not been adjusted for the effects of noncontrolling interests, reconciles our NOI and our Same Store NOI for the three months ended March 31, 2022 and 2021 to net loss, the most directly comparable GAAP financial measure (in thousands):

		For the Three Months Ended March 31,
		2022			2021
Net loss		$	(4,667	)	$	(6,900	)
Adjustments to reconcile net loss to NOI:
Advisory and administrative fees			1,843			1,868
Corporate general and administrative expenses			3,486			2,940
Casualty-related expenses	(1)		1,047			42
Casualty gains			(128	)		—
Pandemic expense	(2)		3			24
Property general and administrative expenses	(3)		627			376
Depreciation and amortization			23,718			20,758
Interest expense			10,636			10,616
NOI		$	36,565		$	29,724
Less Non-Same Store
Revenues			(5,283	)		(1,919	)
Operating expenses			1,876			1,031
Operating income			(3	)		(341	)
Same Store NOI		$	33,155		$	28,495

(1) Adjustment to net loss to exclude certain property operating expenses that are casualty-related expenses.

(2) Represents additional cleaning, disinfecting and other costs incurred at the properties related to COVID-19.

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(3) Adjustment to net 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, centralized leasing service and franchise tax fees.

Net Operating Income for Our Same Store and Non-Same Store Properties for the Three Months Ended March 31, 2022 and 2021

There are 34 properties encompassing 13,456 units of apartment space in our same store pool for the three months ended March 31, 2022 and 2021 (our “Same Store” properties). Our Same Store properties exclude the following five properties in our Portfolio as of March 31, 2022: The Verandas at Lake Norman, Creekside at Matthews, Six Forks Station, Hudson High House and Cutter’s Point as well as the 49 units that are currently down (see Note 5).

The following table reflects the revenues, property operating expenses and NOI for the three months ended March 31, 2022 and 2021 for our Same Store and Non-Same Store properties (dollars in thousands):

	For the Three Months Ended March 31,
	2022		2021		$ Change			% Change
Revenues
Same Store
Rental income	$	54,121	$	48,434	$	5,687			11.7	%
Other income		1,382		1,443		(61	)		-4.2	%
Same Store revenues		55,503		49,877		5,626			11.3	%
Non-Same Store
Rental income		5,176		1,906		3,270			171.6	%
Other income		107		13		94			723.1	%
Non-Same Store revenues		5,283		1,919		3,364			175.3	%
Total revenues		60,786		51,796		8,990			17.4	%
Operating expenses
Same Store
Property operating expenses (1)		11,569		10,565		1,004			9.5	%
Real estate taxes and insurance		8,110		8,407		(297	)		-3.5	%
Property management fees (2)		1,605		1,423		182			12.8	%
Property general and administrative expenses (3)		1,242		1,115		127			11.4	%
Same Store operating expenses		22,526		21,510		1,016			4.7	%
Non-Same Store
Property operating expenses (4)		977		585		392			67.0	%
Real estate taxes and insurance		610		315		295			93.7	%
Property management fees (2)		152		62		90			145.2	%
Property general and administrative expenses (5)		137		69		68			98.6	%
Non-Same Store operating expenses		1,876		1,031		845			82.0	%
Total operating expenses		24,402		22,541		1,861			8.3	%
Operating income
Same Store
Miscellaneous income		178		128		50			39.1	%
Non-Same Store
Miscellaneous income		3		341		(338	)	N/M
Total operating income		181		469		(288	)	N/M
NOI
Same Store		33,155		28,495		4,660			16.4	%
Non-Same Store		3,410		1,229		2,181			177.5	%
Total NOI	$	36,565	$	29,724	$	6,841			23.0	%

(1) For the three months ended March 31, 2022 and 2021, excludes approximately $(1,676,000) and $58,000, respectively, of casualty-related expenses/(recoveries).

(2) Fees incurred to an unaffiliated third party that is an affiliate of the noncontrolling limited partner of the OP.

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(3) For the three months ended March 31, 2022 and 2021, excludes approximately $609,000 and $322,000, respectively, of 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, centralized leasing service and franchise tax fees.

(4) For the three months ended March 31, 2022 and 2021, excludes approximately $117,000 and $8,000, respectively, of casualty-related expenses.  

(5) For the three months ended March 31, 2022 and 2021, excludes approximately $18,000 and $54,000, respectively, of 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, centralized leasing service and franchise tax fees.

See reconciliation of net loss to NOI above under “NOI and Same Store NOI for the Three Months Ended March 31, 2022 and 2021.”

Same Store Results of Operations for the Three Months Ended March 31, 2022 and 2021

As of March 31, 2022, our Same Store properties were approximately 94.4% leased with a weighted average monthly effective rent per occupied apartment unit of $1,310. As of March 31, 2021, our Same Store properties were approximately 95.3% leased with a weighted average monthly effective rent per occupied apartment unit of $1,135. For our Same Store properties, we recorded the following operating results for the three months ended March 31, 2022 as compared to the three months ended March 31, 2021:

Revenues

Rental income. Rental income was $54.1 million for the three months ended March 31, 2022 compared to $48.4 million for the three months ended March 31, 2021, which was an increase of approximately $5.7 million, or 11.7%. The majority of the increase is related to a 15.4% increase in the weighted average monthly effective rent per occupied apartment unit to $1,310 as of March 31, 2022 from $1,135 as of March 31, 2021, partially offset by a 0.9% decrease in occupancy.

Other income. Other income was $1.4 million for the three months ended March 31, 2022 compared to $1.4 million for the three months ended March 31, 2021.

Expenses

Property operating expenses. Property operating expenses were $11.6 million for the three months ended March 31, 2022 compared to $10.6 million for the three months ended March 31, 2021, which was an increase of approximately $1.0 million, or 9.5%. The majority of the increase is related to a $0.4 million, or 10.2%, increase in repair and maintenance costs and an increase in payroll of $0.3 million, or 7.1%.

Real estate taxes and insurance. Real estate taxes and insurance costs were $8.1 million for the three months ended March 31, 2022 compared to $8.4 million for the three months ended March 31, 2021, which was a decrease of approximately $0.3 million, or 3.5%. The majority of the decrease is related to an increase in property tax refunds of approximately $0.3 million.

Property management fees. Property management fees were $1.6 million for the three months ended March 31, 2022 compared to $1.4 million for the three months ended March 31, 2021, which was an increase of approximately $0.2 million, or 12.8%. The majority of the increase is related to a $5.7 million, or 11.7%, increase in rental income, which the fee is primarily based on.

Property general and administrative expenses. Property general and administrative expenses were $1.2 million for the three months ended March 31, 2022 compared to $1.1 million for the three months ended March 31, 2021, which was an increase of approximately $0.1 million, or 11.4%. The majority of the increase is related to an increase in eviction fees of approximately $0.1 million.

FFO, Core FFO and AFFO

We believe that net income (loss), as defined by GAAP, is the most appropriate earnings measure. We also believe that funds from operations (“FFO”), as defined by the National Association of Real Estate Investment Trusts (“NAREIT”), core funds from operations (“Core FFO”) and adjusted funds from operations (“AFFO”) are important non-GAAP supplemental measures of operating performance for a REIT.

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Since the historical cost accounting convention used for real estate assets requires depreciation except on land, such accounting presentation implies that the value of real estate assets diminishes predictably over time. However, since real estate values have historically risen or fallen with market and other conditions, presentations of operating results for a REIT that use historical cost accounting for depreciation could be less informative. Thus, NAREIT created FFO as a supplemental measure of operating performance for REITs that excludes historical cost depreciation and amortization, among other items, from net income (loss), as defined by GAAP. FFO is defined by NAREIT as net income (loss) computed in accordance with GAAP, excluding gains or losses from real estate dispositions, plus real estate depreciation and amortization and impairment charges. We compute FFO attributable to common stockholders 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 the OP and 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 acquisition expenses, losses on extinguishment of debt and modification costs (including prepayment penalties and defeasance costs incurred on the early repayment of debt, the write-off of unamortized deferred financing costs and fair market value adjustments of assumed debt related to the early repayment of debt, costs incurred in a debt modification that are not capitalized as deferred financing costs and other costs incurred in a debt extinguishment), casualty-related expenses and recoveries and gains or losses, pandemic expenses, the amortization of deferred financing costs incurred in connection with obtaining short-term debt financing, and the noncontrolling interests (as described above) related to these items. We believe Core FFO is useful to investors as a supplemental gauge of our operating performance and is useful in comparing our operating performance with other REITs that are not as involved in the aforementioned activities.

AFFO makes certain adjustments to Core FFO in order to arrive at a more refined measure of the operating performance of our Portfolio. 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 (as described above) related to these items. We believe AFFO is useful to investors as a supplemental gauge of our operating performance and is useful in comparing our operating performance with other REITs that are not as involved in the aforementioned activities.

The effect of the conversion of OP Units held by noncontrolling limited partners is not reflected in the computation of basic and diluted FFO, Core FFO and AFFO per share, as they are exchangeable for common stock on a one-for-one basis. The FFO, Core FFO and AFFO allocable to such units is allocated on this same basis and reflected in the adjustments for noncontrolling interests in the table below. As such, the assumed conversion of these units would have no net impact on the determination of diluted FFO, Core FFO and AFFO per share. See Note 9 to our consolidated financial statements for additional information.

We believe that the use of FFO, Core FFO and AFFO, combined with the required GAAP presentations, improves the understanding of operating results of REITs among investors and makes comparisons of operating results among such companies more meaningful. While FFO, Core FFO and AFFO are relevant and widely used measures of operating performance of REITs, they do not represent cash flows from operations or net income (loss) as defined by GAAP and should not be considered as an alternative or substitute to those measures in evaluating our liquidity or operating performance. FFO, Core FFO and AFFO do not purport to be indicative of cash available to fund our future cash requirements. Further, our computation of FFO, Core FFO and AFFO may not be comparable to FFO, Core FFO and AFFO reported by other REITs that do not define FFO in accordance with the current NAREIT definition or that interpret the current NAREIT definition or define Core FFO or AFFO differently than we do.

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The following table reconciles our calculations of FFO, Core FFO and AFFO to net loss, the most directly comparable GAAP financial measure, for the three months ended March 31, 2022 and 2021 (in thousands, except per share amounts):

		For the Three Months Ended March 31,
		2022			2021			% Change
Net loss		$	(4,667	)	$	(6,900	)		32.4	%
Depreciation and amortization			23,718			20,758			14.3	%
Adjustment for noncontrolling interests			(57	)		(41	)		39.0	%
FFO attributable to common stockholders			18,994			13,817			37.5	%
FFO per share - basic		$	0.74		$	0.55			34.5	%
FFO per share - diluted		$	0.74		$	0.55			34.5	%
Casualty-related expenses			1,047			42		N/M
Casualty gain			(128	)		—			0.0	%
Pandemic expense	(1)		3			24		N/M
Amortization of deferred financing costs - acquisition term notes			179			209			(14.4	)%
Adjustment for noncontrolling interests			(4	)		(1	)	N/M
Core FFO attributable to common stockholders			20,091			14,091			42.6	%
Core FFO per share - basic		$	0.78		$	0.56			39.5	%
Core FFO per share - diluted		$	0.78		$	0.56			39.5	%
Amortization of deferred financing costs - long term debt			386			352			9.7	%
Equity-based compensation expense			1,876			1,608			16.7	%
Adjustment for noncontrolling interests			(7	)		(6	)		16.7	%
AFFO attributable to common stockholders			22,346			16,045			39.3	%
AFFO per share - basic		$	0.87		$	0.64			36.3	%
AFFO per share - diluted		$	0.87		$	0.64			36.3	%
Weighted average common shares outstanding - basic			25,620			25,068			2.2	%
Weighted average common shares outstanding - diluted			25,620			25,068			2.2	%
Dividends declared per common share		$	0.380		$	0.341			11.4	%
FFO Coverage - diluted	(2)	1.95x			1.62x				20.8	%
Core FFO Coverage - diluted	(2)	2.06x			1.65x				25.3	%
AFFO Coverage - diluted	(2)	2.30x			1.88x				22.4	%

(1) Represents additional cleaning, disinfecting and other costs incurred at the properties related to COVID-19.

(2) Indicates coverage ratio of FFO/Core FFO/AFFO per common share (diluted) over dividends declared per common share during the period.

The three months ended March 31, 2022 as compared to the three months ended March 31, 2021

FFO was $19.0 million for the three months ended March 31, 2022 compared to $13.8 million for the three months ended March 31, 2021, which was an increase of approximately $5.2 million. The change in our FFO between the periods primarily relates to an increase in total revenues of $9.0 million, partially offset by increases in total property operating expenses of $2.4 million, corporate general and administrative expenses of $0.6 million, and adjustments for amounts attributable to noncontrolling interests.

Core FFO was $20.1 million for the three months ended March 31, 2022 compared to $14.1 million for the three months ended March 31, 2021, which was an increase of approximately $6.0 million. The change in our Core FFO between the periods primarily relates to an increase in FFO and an increase in casualty-related expenses of approximately $1.0 million, partially offset by an increase in casualty gain of $0.1 million.

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AFFO was $22.3 million for the three months ended March 31, 2022 compared to $16.0 million for the three months ended March 31, 2021, which was an increase of approximately $6.3 million. The change in our AFFO between the periods primarily relates to increases in Core FFO and equity-based compensation expense of $0.3 million.

Liquidity and Capital Resources

Our short-term liquidity requirements consist primarily of funds necessary to pay for debt maturities, operating expenses and other expenditures directly associated with our multifamily properties, including:

• capital expenditures to continue our value-add program and to improve the quality and performance of our multifamily properties;

• interest expense and scheduled principal payments on outstanding indebtedness (see “—Obligations and Commitments” below);

• recurring maintenance necessary to maintain our multifamily properties;

• distributions necessary to qualify for taxation as a REIT;

• acquisition of additional properties;

• advisory and administrative fees payable to our Adviser;

• general and administrative expenses;

• reimbursements to our Adviser; and

• property management fees payable to BH.

We expect to meet our short-term liquidity requirements generally through net cash provided by operations and existing cash balances and any unused capacity on the Corporate Credit Facility. As of March 31, 2022, we had approximately $14.1 million of renovation value-add reserves for our planned capital expenditures to implement our value-add program. Renovation value-add reserves are not required to be held in escrow by a third party. We may reallocate these funds, at our discretion, to pursue other investment opportunities or meet our short-term liquidity requirements.

Our long-term liquidity requirements consist primarily of funds necessary to pay for the costs of acquiring additional multifamily properties, renovations and other capital expenditures to improve our multifamily properties and scheduled debt payments and distributions. We expect to meet our long-term liquidity requirements through various sources of capital, which may include a revolving credit facility and future debt or equity issuances, existing working capital, net cash provided by operations, long-term mortgage indebtedness and other secured and unsecured borrowings, and property dispositions. However, there are a number of factors that may have a material adverse effect on our ability to access these capital sources, including the state of overall equity and credit markets, our degree of leverage, our unencumbered asset base and borrowing restrictions imposed by lenders (including as a result of any failure to comply with financial covenants in our existing and future indebtedness), general market conditions for REITs, our operating performance and liquidity, market perceptions about us and restrictions on sales of properties under the Code. The Company continues to monitor the impact on COVID-19 and its impact on future rent collections, valuation of real estate investments, impact on cash flow and ability to refinance or repay debt. The success of our business strategy will depend, in part, on our ability to access these various capital sources.

In addition to our value-add program, our multifamily properties will require periodic capital expenditures and renovation to remain competitive. Also, acquisitions, redevelopments, or expansions of our multifamily properties will require significant capital outlays. Long-term, we may not be able to fund such capital improvements solely from net cash provided by operations because we must distribute annually at least 90% of our REIT taxable income, determined without regard to the deductions for dividends paid and excluding net capital gains, to qualify and maintain our qualification as a REIT, and we are subject to tax on any retained income and gains. As a result, our ability to fund capital expenditures, acquisitions, or redevelopment through retained earnings long-term is limited. Consequently, we expect to rely heavily upon the availability of debt or equity capital for these purposes. If we are unable to obtain the necessary capital on favorable terms, or at all, our financial condition, liquidity, results of operations, and prospects could be materially and adversely affected.

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On March 4, 2020, the Company, the OP and the Adviser entered into separate equity distribution agreements with each of the ATM Sales Agents, pursuant to which the Company may issue and sell from time to time shares of the Company’s common stock, par value $0.01 per share, having an aggregate sales price of up to $225,000,000 (the “2020 ATM Program”).  Sales of shares of common stock, if any, may be made in transactions that are deemed to be “at the market” offerings, as defined in Rule 415 under the Securities Act, including, without limitation, sales made by means of ordinary brokers’ transactions on the New York Stock Exchange, to or through a market maker at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices based on prevailing market prices.  In addition to the issuance and sale of shares of common stock, the Company may enter into forward sale agreements with each of Jefferies, KeyBanc and Raymond James, or their respective affiliates, through the ATM Program.  During the three months ended March 31, 2022, the Company issued 52,091 shares of common stock at an average price of $83.16 per share for gross proceeds of $4.3 million under the ATM Program. The Company paid approximately $0.1 million in fees to the 2020 ATM Sales Agents with respect to such sales and incurred other issuance costs of approximately $0.1 million, both of which were netted against the gross proceeds and recorded in additional paid in capital (see Note 8 to our consolidated financial statements).

We believe that our available cash, expected operating cash flows, and potential debt or equity financings will provide sufficient funds for our operations, anticipated scheduled debt service payments and dividend requirements for the twelve-month period following March 31, 2022.

Cash Flows

The following table presents selected data from our consolidated statements of cash flows for the three months ended March 31, 2022 and 2021 (in thousands):

	For the Three Months Ended March 31,
	2022			2021
Net cash provided by operating activities	$	8,682		$	13,744
Net cash used in investing activities		(10,462	)		(7,587	)
Net cash provided by (used in) financing activities		45,208			(10,541	)
Net increase (decrease) in cash, cash equivalents and restricted cash		43,428			(4,384	)
Cash, cash equivalents and restricted cash, beginning of period		88,696			57,015
Cash, cash equivalents and restricted cash, end of period	$	132,124		$	52,631

Cash flows from operating activities. During the three months ended March 31, 2022, net cash provided by operating activities was $8.7 million compared to net cash provided by operating activities of $13.7 million for the three months ended March 31, 2021. The change in cash flows from operating activities was mainly due to our acquisition and disposition activity in 2021 and the timing of the transactions, as described above.

Cash flows from investing activities. During the three months ended March 31, 2022, net cash used in investing activities was $10.5 million compared to net cash used in investing activities of $7.6 million for the three months ended March 31, 2021. The change in cash flows from investing activities was mainly due to a decrease in insurance proceeds received from casualty losses and our acquisition and disposition activity in 2021 and the timing of the transactions, as described above.

Cash flows from financing activities. During the three months ended March 31, 2022, net cash provided by financing activities was $45.2 million compared to net cash used in financing activities of $10.5 million for the three months ended March 31, 2021. The change in cash flows from financing activities was mainly due to a net increase in debt of approximately $54.8 million and an increase in proceeds from the issuance of common stock through the 2020 ATM Program of approximately $4.3 million (net of Sales Agents fees and other legal fees). These were partially offset by an increase in common stock dividends paid of approximately $1.4 million.  

Debt, Derivatives and Hedging Activity

Mortgage Debt

As of March 31, 2022, our subsidiaries had aggregate mortgage debt outstanding to third parties of approximately $1.3 billion at a weighted average interest rate of 2.10% and an adjusted weighted average interest rate of 2.95%. For purposes of calculating the adjusted weighted average interest rate of our mortgage debt outstanding, we have included the weighted average fixed rate of 1.2128% for one-month LIBOR on our combined $1.4 billion notional amount of interest rate swap agreements, which effectively fixes the interest rate on $1.4 billion of our floating rate debt. See Notes 6 and 7 to our consolidated financial statements for additional information.

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We have entered into and expect to continue to enter into interest rate swap and cap agreements with various third parties to fix or cap the floating interest rates on a majority of our floating rate mortgage debt outstanding. The interest rate swap agreements generally have a term of four to five years and effectively establish a fixed interest rate on debt on the underlying notional amounts. The interest rate swap agreements involve the receipt of variable-rate amounts from a counterparty in exchange for us making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. As of March 31, 2022, interest rate swap agreements effectively covered 100% of our $1.2 billion of floating rate mortgage debt outstanding and 61.4% of our $335.0 million floating rate Credit Facility.

The interest rate cap agreements generally have a term of three to four years, cover the outstanding principal amount of the underlying debt and are generally required by our lenders. Under the interest rate cap agreements, we pay a fixed fee in exchange for the counterparty to pay any interest above a maximum rate. As of March 31, 2022, interest rate cap agreements covered $458.8 million of our $1.2 billion of floating rate mortgage debt outstanding. These interest rate cap agreements effectively cap one-month LIBOR on $458.8 million of our floating rate mortgage debt at a weighted average rate of 4.79%.

We intend to invest in additional multifamily properties as suitable opportunities arise and adequate sources of equity and debt financing are available. We expect that future investments in properties, including any improvements or renovations of current or newly acquired properties, will depend on and will be financed by, in whole or in part, our existing cash, future borrowings and the proceeds from additional issuances of common stock or other securities or property dispositions.

Although we expect to be subject to restrictions on our ability to incur indebtedness, we expect that we will be able to refinance existing indebtedness or incur additional indebtedness for acquisitions or other purposes, if needed. However, there can be no assurance that we will be able to refinance our indebtedness, incur additional indebtedness or access additional sources of capital, such as by issuing common stock or other debt or equity securities, on terms that are acceptable to us or at all.

Furthermore, following the completion of our value-add and capital expenditures programs and depending on the interest rate environment at the applicable time, we may seek to refinance our floating rate debt into longer-term fixed rate debt at lower leverage levels.

Corporate Credit Facility

On March 25, 2022, the Company entered into a loan modification agreement by and among the Company, the OP, Truist Bank and the Lenders party thereto, which modified the Company’s existing credit agreement, dated as of June 30, 2021 (as amended and supplemented, the “Corporate Credit Facility”). As of March 31, 2022, there was $350.0 million available for borrowing under the Corporate Credit Facility. Subject to conditions provided in the Corporate Credit Facility, the commitments under Corporate Credit Facility may be increased up to an additional $150.0 million if the lenders agree to increase their commitments or if the lenders agree for the increase to be funded by any additional lender proposed by the Company, through the OP. The Corporate Credit Facility will mature on June 30, 2024 with respect to the revolving commitments, unless the Company exercises its option to voluntarily and permanently reduce all of the revolving commitments before the maturity date or elects to exercise its right and option to extend the facility with respect to the revolving commitments for a single one-year term. As of March 31, 2022, there was $335.0 million in aggregate principal outstanding under the Corporate Credit Facility.

The Corporate Credit Facility is a non-recourse obligation and contains customary events of default, including defaults in the payment of principal or interest, defaults in compliance with the covenants contained in the document evidencing the loan, defaults in payments under any other security instrument, and bankruptcy or other insolvency events. As of March 31, 2022, the Company believes it is compliant with all provisions. For additional information regarding our Corporate Credit Facility, see Note 6.

Interest Rate Swap Agreements

In order to fix a portion of, and mitigate the risk associated with, our floating rate indebtedness (without incurring substantial prepayment penalties or defeasance costs typically associated with fixed rate indebtedness when repaid early or refinanced), we, through the OP, have entered into 11 interest rate swap transactions with KeyBank and two with SunTrust Bank (collectively the “Counterparties”) with a combined notional amount of $1.4 billion. As of March 31, 2022, the interest rate swaps we have entered into effectively replace the floating interest rate (one-month LIBOR) with respect to $1.4 billion of our floating rate debt outstanding with a weighted average fixed rate of 1.2128%. During the term of these interest rate swap agreements, we are required to make monthly fixed rate payments of 1.2128%, on a weighted average basis, on the notional amounts, while the Counterparties are obligated to make monthly floating rate payments based on one-month LIBOR to us referencing the same notional amounts. For purposes of hedge accounting under FASB ASC 815, Derivatives and Hedging, we have designated these interest rate swaps as cash flow hedges of interest rate risk. See Notes 6 and 7 to our consolidated financial statements for additional information.

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The following table contains summary information regarding our outstanding interest rate swaps (dollars in thousands):

Effective Date	Termination Date	Counterparty	Notional Amount		Fixed Rate (1)
April 1, 2017	April 1, 2022	KeyBank	$	100,000		1.9570	%
May 1, 2017	April 1, 2022	KeyBank		50,000		1.9610	%
July 1, 2017	July 1, 2022	KeyBank		100,000		1.7820	%
June 1, 2019	June 1, 2024	KeyBank		50,000		2.0020	%
June 1, 2019	June 1, 2024	Truist		50,000		2.0020	%
September 1, 2019	September 1, 2026	KeyBank		100,000		1.4620	%
September 1, 2019	September 1, 2026	KeyBank		125,000		1.3020	%
January 3, 2020	September 1, 2026	KeyBank		92,500		1.6090	%
March 4, 2020	June 1, 2026	Truist		100,000		0.8200	%
June 1, 2021	September 1, 2026	KeyBank		200,000		0.8450	%
June 1, 2021	September 1, 2026	KeyBank		200,000		0.9530	%
March 1, 2022	March 1, 2025	Truist		145,000		0.5730	%
March 1, 2022	March 1, 2025	Truist		105,000		0.6140	%
			$	1,417,500		1.2128	%	(2)

(1) The floating rate option for the interest rate swaps is one-month LIBOR. As of March 31, 2022, one-month LIBOR was 0.452%.

(2) Represents the weighted average fixed rate of the interest rate swaps.

Obligations and Commitments

The following table summarizes our contractual obligations and commitments as of March 31, 2022 for the next five calendar years subsequent to March 31, 2022. We used one-month LIBOR as of March 31, 2022 to calculate interest expense due by period on our floating rate debt and net interest expense due by period on our interest rate swaps.

		Payments Due by Period (in thousands)
		Total		2022		2023		2024		2025		2026		Thereafter
Operating Properties Mortgage Debt
Principal payments		$	1,280,765	$	1,040	$	21,047	$	394,956	$	205,662	$	423,149	$	234,911
Interest expense	(1)		120,478		27,846		26,532		22,440		16,861		11,213		15,586
Total		$	1,401,243	$	28,886	$	47,579	$	417,396	$	222,523	$	434,362	$	250,497
Credit Facility
Principal payments		$	335,000	$	—	$	—	$	335,000	$	—	$	—	$	—
Interest expense			21,493		7,216		9,544		4,733		—		—		—
Total		$	356,493	$	7,216	$	9,544	$	339,733	$	—	$	—	$	—
Total contractual obligations and commitments		$	1,757,736	$	36,102	$	57,123	$	757,129	$	222,523	$	434,362	$	250,497

(1) Interest expense obligations includes the impact of expected settlements on interest rate swaps which have been entered into in order to fix the interest rate on the hedged portion of our floating rate debt obligations. As of March 31, 2022, we had entered into thirteen interest rate swap transactions with a combined notional amount of $1.4 billion. We have allocated the total impact of expected settlements on the $1.4 billion notional amount of interest rate swaps to ‘Operating Properties Mortgage Debt.’ We used one-month LIBOR as of March 31, 2022 to determine our expected settlements through the terms of the interest rate swaps.

Corporate Credit Facility

The Corporate Credit Facility will mature on June 30, 2024 with respect to the revolving commitments, unless the Company exercises its option to voluntarily and permanently reduce all of the revolving commitments before the maturity date or elects to exercise its right and option to extend the facility with respect to the revolving commitments for a single one-year term.

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Advisory Agreement

Our Advisory Agreement requires that we pay our Adviser an annual advisory and administrative fee of 1.2%. The advisory and administrative fees paid to the Adviser on the Contributed Assets (as defined in the Advisory Agreement) are subject to an annual cap of approximately $5.4 million. For the three months ended March 31, 2022 and 2021, the Company incurred advisory and administrative fees of $1.8 million and $1.9 million, respectively.

NLMF Holdco, LLC

The Company’s agreement with NLMF Holdco, LLC may result in additional funding requirements to cover future project costs. The maximum exposure of potential commitments is expected to be no more than $4.0 million. We expect that these actions will provide faster, more reliable and lower cost internet to our residents. We expect to roll out this service to our other properties in the future. As of March 31, 2022, the Company has funded approximately $0.3 million to NLMF Holdco, LLC which is included in prepaid and other assets on the consolidated balance sheet of the Company. For the three months ended March 31, 2022, the Company incurred expenses of $0.1 million for fiber internet service which is included in property operating expenses on the consolidated statement of operations and comprehensive income.

Capital Expenditures and Value-Add Program

We anticipate incurring average annual repairs and maintenance expense of $575 to $725 per apartment unit in connection with the ongoing operations of our business. These expenditures are expensed as incurred. In addition, we reserve, on average, approximately $250 to $350 per apartment unit for non-recurring capital expenditures and/or lender required replacement reserves. When incurred, these expenditures are either capitalized or expensed, in accordance with GAAP, depending on the type of the expenditure. Although we will continuously monitor the adequacy of this average, we believe these figures to be sufficient to maintain the properties at a high level in the markets in which we operate. A majority of the properties in our Portfolio were underwritten and acquired with the premise that we would invest $4,000 to $10,000 per unit in the first 36 months of ownership, in an effort to add value to the asset’s exterior and interiors. In many cases, we reserve cash at the closing of each acquisition to fund these planned capital expenditures and value-add improvements. As of March 31, 2022, we had approximately $14.1 million of renovation value-add reserves for our planned capital expenditures and other expenses to implement our value-add program, which will complete approximately 924 planned interior rehabs. The following table sets forth a summary of our capital expenditures related to our value-add program for the   (in thousands):

		For the Three Months Ended March 31,
Rehab Expenditures		2022		2021
Interior	(1)	$	4,714	$	2,332
Exterior and common area			917		2,960
Total rehab expenditures		$	5,631	$	5,292

(1) Includes total capital expenditures during the period on completed and in-progress interior rehabs. For the three months ended March 31, 2022 and 2021, we completed full and partial interior rehabs on 531 and 285 units, respectively.  

Income Taxes

We anticipate that we will continue to qualify to be taxed as a REIT for U.S. federal income tax purposes, and we intend to continue to be organized and to operate in a manner that will permit us to qualify as a REIT. To qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our annual REIT taxable income to stockholders. As a REIT, we will be subject to federal income tax on our undistributed REIT taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than the sum of (1) 85% of our ordinary income, (2) 95% of our capital gain net income and (3) 100% of our undistributed income from prior years. Taxable income from certain non-REIT activities is managed through a TRS and is subject to applicable federal, state, and local income and margin taxes. We had no significant taxes associated with our TRS for the three months ended March 31, 2022 and 2021.

If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income tax on our taxable income at regular corporate income tax rates, and dividends paid to our stockholders would not be deductible by us in computing taxable income. Any resulting corporate liability could be substantial and could materially and adversely affect our net income and net cash available for distribution to stockholders. Unless we were entitled to relief under certain Code provisions, we also would be disqualified from re-electing to be taxed as a REIT for the four taxable years following the year in which we failed to qualify to be taxed as a REIT.

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We evaluate the accounting and disclosure of tax positions taken or expected to be taken in the course of preparing our tax returns to determine whether the tax positions are “more-likely-than-not” (greater than 50 percent probability) of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Our management is required to analyze all open tax years, as defined by the statute of limitations, for all major jurisdictions, which include federal and certain states. We have no examinations in progress and none are expected at this time.

We recognize our tax positions and evaluate them using a two-step process. First, we determine whether a tax position is more likely than not to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Second, we will determine the amount of benefit to recognize and record the amount that is more likely than not to be realized upon ultimate settlement.

We had no material unrecognized tax benefit or expense, accrued interest or penalties as of March 31, 2022. We and our subsidiaries are subject to federal income tax as well as income tax of various state and local jurisdictions. The 2021, 2020 and 2019 tax years remain open to examination by tax jurisdictions to which our subsidiaries and we are subject. When applicable, we recognize interest and/or penalties related to uncertain tax positions on our consolidated statements of operations and comprehensive income.

Dividends

We intend to make regular quarterly dividend payments to holders of our common stock. U.S. federal income tax law generally requires that a REIT distribute annually at least 90% of its REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains. As a REIT, we will be subject to federal income tax on our undistributed REIT taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than the sum of (1) 85% of our ordinary income, (2) 95% of our capital gain net income and (3) 100% of our undistributed income from prior years. We intend to make regular quarterly dividend payments of all or substantially all of our taxable income to holders of our common stock out of assets legally available for this purpose, if and to the extent authorized by our Board. Before we make any dividend payments, whether for U.S. federal income tax purposes or otherwise, we must first meet both our operating requirements and debt service on our debt payable. If our cash available for distribution is less than our taxable income, we could be required to sell assets, borrow funds or raise additional capital to make cash dividends or we may make a portion of the required dividend in the form of a taxable distribution of stock or debt securities.

We will make dividend payments based on our estimate of taxable earnings per share of common stock, but not earnings calculated pursuant to GAAP. Our dividends and taxable income and GAAP earnings will typically differ due to items such as depreciation and amortization, fair value adjustments, differences in premium amortization and discount accretion, and non-deductible general and administrative expenses. Our quarterly dividends per share may be substantially different than our quarterly taxable earnings and GAAP earnings per share. Our Board declared our second quarterly dividend of 2022 of $0.38 per share on February 14, 2022, which was paid on March 31, 2022 and funded out of cash flows from operations.

Off-Balance Sheet Arrangements

As of March 31, 2022 and December 31, 2021, we had no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Critical Accounting Policies and Estimates

Management’s discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires our management to make judgments, assumptions and estimates that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate these judgments, assumptions and estimates for changes that would affect the reported amounts. These estimates are based on management’s historical industry experience and on various other judgments and assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these judgments, assumptions and estimates. Below is a discussion of the accounting policies that we consider critical to understanding our financial condition or results of operations where there is uncertainty or where significant judgment is required. A discussion of recent accounting pronouncements and our significant accounting policies, including further discussion of the accounting policies described below, can be found in Note 2 “Summary of Significant Accounting Policies” to our consolidated financial statements included in this quarterly report.

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Purchase Price Allocation

Upon acquisition of a property considered to be an asset acquisition, the purchase price and related acquisition costs (“total consideration”) are allocated to land, buildings, improvements, furniture, fixtures, and equipment, and intangible lease assets based on relative fair value in accordance with FASB ASC 805, Business Combinations. Acquisition costs are capitalized in accordance with FASB ASC 805.

The allocation of total consideration, which is determined using inputs that are classified within Level 3 of the fair value hierarchy established by FASB ASC 820, Fair Value Measurement and Disclosures (see Note 7 to our consolidated financial statements), is based on management’s estimate of the property’s “as-if” vacant fair value and is calculated by using all available information such as the replacement cost of such asset, appraisals, property condition reports, market data and other related information. If any debt is assumed in an acquisition, the difference between the fair value, which is estimated using inputs that are classified within Level 2 of the fair value hierarchy, and the face value of debt is recorded as a premium or discount and amortized as interest expense over the life of the debt assumed.

Impairment

Real estate assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The key inputs into our impairment analysis include, but are not limited to, the holding period, net operating income, and capitalization rates. In such cases, we will evaluate the recoverability of such real estate assets based on estimated future cash flows and the estimated liquidation value of such real estate assets, and provide for impairment if such undiscounted cash flows are insufficient to recover the carrying amount of the real estate asset. If impaired, the real estate asset will be written down to its estimated fair value. The Company’s impairment analysis identifies and evaluates events or changes in circumstances that indicate the carrying amount of a real estate investment may not be recoverable, including determining the period the Company will hold the rental property, net operating income, and the estimated capitalization rate for each respective real estate investment.

Inflation

The real estate market has not been affected significantly by inflation in the past several years due to increases in rents nationwide. The majority of our lease terms are for a period of one year or less and reset to market if renewed. The majority of our leases also contain protection provisions applicable to reimbursement billings for utilities. Due to the short-term nature of our leases, we do not believe our results will be materially affected.

Inflation may also affect the overall cost of debt, as the implied cost of capital increases. Currently, interest rates are less than historical averages. However, the Federal Reserve, in response to or in anticipation of continued inflation concerns, could continue to raise interest rates. We intend to mitigate these risks through long-term fixed interest rate loans and interest rate hedges, which to date have included interest rate cap and interest rate swap agreements.

REIT Tax Election

We have elected to be taxed as a REIT under Sections 856 through 860 of the Code and expect to continue to qualify as a REIT. To qualify as a REIT, we must meet a number of organizational and operational requirements, including a requirement that we distribute at least 90% of our “REIT taxable income,” as defined by the Code, to our stockholders. Taxable income from certain non-REIT activities is managed through a TRS and is subject to applicable federal, state, and local income and margin taxes. We had no significant taxes associated with our TRS for the three months ended March 31, 2022 and 2021. We believe we qualify for taxation as a REIT under the Code, and we intend to continue to operate in such a manner, but no assurance can be given that we will operate in a manner so as to qualify as a REIT.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market risk is the adverse effect on the value of assets and liabilities that results from a change in market conditions. Our primary market risk exposure is interest rate risk with respect to our indebtedness and counterparty credit risk with respect to our interest rate derivatives. In order to minimize counterparty credit risk, we enter into and expect to enter into hedging arrangements only with major financial institutions that have high credit ratings. As of March 31, 2022, we had total indebtedness of $1.6 billion at a weighted average interest rate of 2.25%, of which $1.5 billion was debt with a floating interest rate. As of March 31, 2022, interest rate swap agreements effectively covered 100% of our $1.2 billion of floating rate mortgage debt outstanding and 61.4% of our $335.0 million floating rate Credit Facility. For purposes of calculating the adjusted weighted average interest rate of the total indebtedness, we have included the weighted average fixed rate of 1.2128% for one-month LIBOR on the $1.4 billion notional amount of interest rate swap agreements that we have entered into as of March 31, 2022.

43

An increase in interest rates could make the financing of any acquisition by us more costly. Rising interest rates could also limit our ability to refinance our debt when it matures or cause us to pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness. We may manage, or hedge, interest rate risks related to our borrowings by means of interest rate cap and interest rate swap agreements. As of March 31, 2022, the interest rate cap agreements we have entered into effectively cap one-month LIBOR on $458.8 million of our floating rate mortgage debt at a weighted average rate of 4.79% for the term of the agreements, which is generally three to four years. We also expect to manage our exposure to interest rate risk by maintaining a mix of fixed and floating rates for our indebtedness.

In order to fix a portion of, and mitigate the risk associated with, our floating rate indebtedness (without incurring substantial prepayment penalties or defeasance costs typically associated with fixed rate indebtedness when repaid early or refinanced), we, through the OP, have entered into thirteen interest rate swap transactions with the Counterparties with a combined notional amount of $1.4 billion. The interest rate swaps we have entered into effectively replace the floating interest rate (one-month LIBOR) with respect to that amount with a weighted average fixed rate of 1.2128%. During the term of these interest rate swap agreements, we are required to make monthly fixed rate payments of 1.2128%, on a weighted average basis, on the notional amounts, while the Counterparties are obligated to make monthly floating rate payments based on one-month LIBOR to us referencing the same notional amounts. We have designated these interest rate swaps as cash flow hedges of interest rate risk.

Until our interest rates reach the caps provided by our interest rate cap agreements, each quarter point change in LIBOR would result in an approximate increase to annual interest expense costs on our floating rate indebtedness, reduced by any payments due from the Counterparties under the terms of the interest rate swap agreements we had entered into as of March 31, 2022, of the amounts illustrated in the table below for our indebtedness as of March 31, 2022 (dollars in thousands):

Change in Interest Rates	Annual Increase to Interest Expense
0.25%	$	320
0.50%		640
0.75%		960
1.00%		1,280

There is no assurance that we would realize such expense as such changes in interest rates could alter our liability positions or strategies in response to such changes.

We may also be exposed to credit risk in the derivative financial instruments we use. Credit risk is the failure of the Counterparties to perform under the terms of the derivative financial instruments. If the fair value of a derivative financial instrument is positive, the Counterparties will owe us, which creates credit risk for us. If the fair value of a derivative financial instrument is negative, we will owe the Counterparties and, therefore, do not have credit risk. We seek to minimize the credit risk in derivative financial instruments by entering into transactions with major financial institutions that have high credit ratings.

In July 2017, the Financial Conduct Authority (the authority that regulates LIBOR) announced it intends to stop compelling banks to submit rates for the calculation of LIBOR after 2021. The Alternative Reference Rates Committee (“ARRC”) has proposed that the Secured Overnight Financing Rate (“SOFR”) is the rate that represents best practice as the alternative to USD-LIBOR for use in derivatives and other financial contracts that are currently indexed to USD-LIBOR. ARRC has proposed a paced market transition plan to SOFR from USD-LIBOR and organizations are currently working on industry wide and company specific transition plans as it relates to derivatives and cash markets exposed to USD-LIBOR. We have material contracts that are indexed to USD-LIBOR and are monitoring this activity and evaluating the related risks.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15(b) and Rule 15d-15(b) under the Exchange Act, our management, including our President and Chief Financial Officer, evaluated, as of March 31, 2022, the effectiveness of our disclosure controls and procedures as defined in Exchange Act Rule 13a-15(e) and Rule 15d-15(e). Based on that evaluation, our President and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of March 31, 2022, to provide reasonable assurance that information required to be disclosed by us in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Exchange Act and is accumulated and communicated to management, including the President and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures.

We believe, however, that a controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the controls systems are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud or error, if any, within a company have been detected.

Changes in Internal Control over Financial Reporting

There has been no change in internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended March 31, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

44

PART II—OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we are party to legal proceedings that arise in the ordinary course of our business. Management is not aware of any legal proceedings of which the outcome is reasonably likely to have a material adverse effect on our results of operations or financial condition, nor are we aware of any such legal proceedings contemplated by government agencies.

Item 1A. Risk Factors

There have been no material changes to the risk factors previously disclosed under Part I, Item 1A, “Risk Factors” in our Annual Report, filed with the SEC on February 18, 2022:

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Repurchase of Shares

On June 15, 2016, we announced that our Board authorized us to repurchase an indeterminate number of shares of our common stock at an aggregate market value of up to $30.0 million during a two-year period that was set to expire on June 15, 2018 (the “Share Repurchase Program”).  On April 30, 2018, our Board increased the Share Repurchase Program from $30.0 million to up to $40.0 million and extended it by an additional two years to June 15, 2020. On March 13, 2020, the Board increased the Share Repurchase Program from $40.0 million to up to $100.0 million and extended it to March 12, 2023. During the three months ended March 31, 2022, the Company repurchased no shares of its common stock. Since the inception of the Share Repurchase Program through March 31, 2022, the Company had repurchased 2,382,155 shares of its common stock, par value $0.01 per share, at a total cost of approximately $61.2 million, or $25.70 per share as shown in the table below:

Period	Total Number of Shares Purchased		Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value of Shares that may yet be Purchased under the Plans or Programs (in millions)
Beginning Total		2,382,155	$	25.70		2,382,155	$	38.8
January 1 – January 31		—		—		—		38.8
February 1 – February 28		—		—		—		38.8
March 1 – March 31		—		—		—		38.8
Total as of March 31, 2022		2,382,155	$	25.70		2,382,155	$	38.8

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

45

Item 6. Exhibits

EXHIBIT INDEX

Exhibit Number	Description
10.1	March 2022 Modification of Loan Documents, dated March 25, 2022, by and among NexPoint Residential Trust Operating Partnership, L.P., NexPoint Residential Trust, Inc., Truist Bank and the pledgors and lenders party to thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on March 29, 2022).
10.2*	September 2021 Modification of Loan Documents, dated September 9, 2021, by and among NexPoint Residential Trust Operating Partnership, L.P., NexPoint Residential Trust, Inc., Truist Bank and the pledgors and lenders party to thereto.
31.1*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1+	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002
101.INS*	Inline XBRL Instance Document (The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document)
101.SCH*	Inline XBRL Taxonomy Extension Schema
101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB*	Inline XBRL Taxonomy Extension Label Linkbase
101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase
104*	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Filed herewith.

+ Furnished herewith.

46

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

NEXPOINT RESIDENTIAL TRUST, INC.

Signature	Title	Date
/s/ Jim Dondero	President and Director	April 28, 2022
Jim Dondero	(Principal Executive Officer)
/s/ Brian Mitts	Chief Financial Officer and Director	April 28, 2022
Brian Mitts	(Principal Financial Officer and Principal Accounting Officer)

47

EX-10.2

Exhibit 10.2

SEPTEMBER 2021 MODIFICATION OF LOAN DOCUMENTS

THIS SEPTEMBER 2021 MODIFICATION OF LOAN DOCUMENTS (this “Agreement” or “Modification”) is made effective as of September 9, 2021 (the “Effective Date”), by and among NEXPOINT RESIDENTIAL TRUST OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the "Borrower"), NEXPOINT RESIDENTIAL TRUST, INC., a Maryland corporation (the "Guarantor"), each of the undersigned in their capacities as “Pledgors” under any one or more of the Pledge Agreement, the Economic Interest Pledge Agreement, and the Equity Proceeds Pledge Agreement (each, as defined in the Credit Agreement referenced below), TRUIST BANK, a North Carolina banking corporation, as administrative agent (in such capacity, and together with any successor Administrative Agent under the Credit Agreement (as hereinafter defined), the “Administrative Agent”), and the Lenders party to the Credit Agreement as of the date hereof (provided, that such Lenders shall include KeyBank National Association in its capacity as the sole Second Supplemental Lender being added to the Credit Agreement pursuant to the terms hereof).

RECITALS:

A.Reference is hereby made to that certain Amended and Restated Revolving Credit Agreement dated as of June 30, 2021 by and among Borrower, Administrative Agent, and the Lenders party thereto (as the same may have been amended, restated, supplemented, or otherwise modified prior to the date hereof and as modified hereby, the “Credit Agreement”) pursuant to which the Lenders have previously extended financing to the Borrower in the form of the Revolving Loans and Supplemental Loans referenced therein. Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Credit Agreement.  

B.Guarantor has guaranteed the obligations of Borrower under and in connection with the Credit Agreement pursuant to the terms of that certain Amended and Restated Guaranty Agreement dated as of June 30, 2021 (as the same may have been amended, restated, supplemented, or otherwise modified prior to the date hereof and as modified hereby, the “Guaranty”).

C.The Borrower’s obligations under the Credit Agreement have been further secured by the Pledge Agreement, the Economic Interest Pledge Agreement, and the Equity Proceeds Pledge Agreement, each as referenced in the Credit Agreement, and executed and delivered by the respective Pledgors.

D.Borrower, Guarantor, Pledgors, Administrative Agent, and the Lenders wish to modify certain terms and provisions of the Loan Documents as set forth or required herein for the purposes of, among other things, providing for an additional tranche of term loan indebtedness under the Credit Agreement to be funded as of the date hereof in an amount equal to $35,000,000.00 and subject to the terms and conditions referenced herein. The Administrative Agent and Lenders are willing to agree to such modifications subject to the satisfaction of certain conditions precedent as set forth herein and subject to Borrower, Guarantor, and Pledgors making the representations and assurances hereinafter set forth.

NOW, THEREFORE, in consideration of the recitals, the mutual representations and covenants contained in this Modification and other good consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower, Guarantor (as applicable), Pledgors (as applicable), Administrative Agent, and the Lenders do hereby agree as follows:

1.Recitals; Terms.  The Recitals set forth above are true and correct and are made a part hereof.  Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Credit Agreement.

2.Credit Agreement.  The Credit Agreement is hereby modified to reflect the revisions thereto reflected in the redlined iteration thereof attached hereto as Exhibit A, such that the Credit Agreement, as modified hereby, shall be as set forth on Exhibit B attached hereto.

3.Loan Documents Generally.  Each of the Loan Documents is hereby further amended in the following respects (to the extent the amendments set forth above have not already addressed such matters):

(a)Each reference contained in the Loan Documents to such Loan Document or any other Loan Document (as applicable), is hereby deemed to be a reference to each such document as amended and modified by this Modification (as applicable).

(b)This Modification shall be deemed to be included as a “Loan Document” in any and all references to the “Loan Documents” contained in any of the Loan Documents existing as of the date hereof or which are executed following the date hereof.  

4.Conditions Precedent.  The effectiveness of the proposed modification of the Loan Documents set forth herein is conditioned upon the Administrative Agent’s receipt of the following documents, materials, confirmations and/or payments, each of which shall be in a form and substance satisfactory to the Administrative Agent:

(a)two (2) duly executed original counterparts from Borrower, Guarantor, each Pledgor, each Lender, and Administrative Agent of this Modification (together with all required acknowledgements by such parties);

(b)payment by Borrower of (i) a work fee to Administrative Agent for the account of each Lender in an amount equal to 5 basis points multiplied by the total Commitment of each respective Lender; (ii) all outstanding fees and expenses of the Administrative Agent and the Administrative Agent’s counsel incurred in connection with the preparation, review, execution and delivery of this Modification, the documents executed in connection herewith, all other amendments, restatements, supplements or negotiations related to the Loan Documents or the Loans; (iii) all other fees, expenses or other amounts payable by Borrower related to the Credit Agreement and/or the Loan Documents which are due and payable on the date hereof pursuant to the terms of any Loan Document; and (iv) fees/costs related to Second Supplemental Commitment;

(c)a certificate of “no change” from each of the Borrower and Guarantor certifying that such entity’s: (i) certificate of existence/good standing; and (ii) organizational documents have not been amended since the date of the closing of the Credit Agreement;

(d)a current Certificate of Existence/Good Standing for each of the Borrower and the Guarantor issued by the jurisdiction in which such entity is organized and, with respect to the Borrower, a certified copy of a currently-effective authorization to transact business in each applicable state in which such authorization is required for the ownership and operation of the properties secured by the Security Instrument;

(e)resolutions from each of the Borrower, the Guarantor, and each Pledgor authorizing and approving the modification of the Loan Documents and the other matters set forth herein;

(f)a legal opinion from counsel to the Borrower, Guarantor, and each Pledgor opining to the due authorization, execution, and effectiveness of this Modification; and

(g)such other and further items, information or materials as the Administrative Agent shall reasonably require.

5.Representations, Warranties and Acknowledgments of Borrower.  As an inducement to the Administrative Agent and Lenders to enter into this Agreement, Borrower represents, warrants, covenants and acknowledges as follows (it being acknowledged by all parties that each such representation, warranty, covenant and acknowledgment relates to material matters upon which Administrative Agent and Lenders have relied):

(a)Title to all collateral (including all real and personal property) in which Administrative Agent was given a lien or security interest pursuant to the Loan Documents is vested in Borrower or the applicable Pledgor subject only to those matters specifically approved in writing by Administrative Agent or expressly permitted in the applicable Loan Document(s).  No additional lien interests have been granted by Borrower or any Pledgor for any such collateral since the execution of the original Loan Documents.

(b)There are no defenses, offsets or counterclaims or other claims, legal or equitable, available to Borrower, the Guarantor, any Pledgor, or any other person or entity with respect to this Modification, the Loan Documents, or any other instrument, document and/or agreement described herein or therein, as modified and amended hereby, or with respect to the obligation of the Borrower to repay the Loans or other Obligations, as the case may be.

(c)Each of Borrower, Guarantor, and each Pledgor is a duly organized and validly existing entity under and with respect to the laws of its state of organization. Each of Borrower, Guarantor, and each Pledgor has the right and power and has obtained all authorizations necessary to execute and deliver this Modification and all other documents required to be delivered as conditions precedent to the effectiveness hereof and to perform their respective obligations hereunder and under the other Loan Documents (as applicable) in accordance with their respective terms. This Modification has been duly executed and delivered by a duly authorized officer of Borrower, Guarantor, and each Pledgor.  This Modification and each of the other Loan Documents (in each case as amended hereby, if applicable), is a legal, valid and binding obligation of Borrower, the Guarantor, and each Pledgor (in each case, to the extent they are a party thereto), enforceable against the Borrower, Guarantor, and/or each Pledgor (as applicable) in accordance with their respective terms, except as the same may be limited by bankruptcy, insolvency, and other similar laws affecting the rights of creditors generally and the availability of equitable remedies for the enforcement of certain obligations contained herein or therein may be limited by equitable principles generally.

(d)There are no actions, suits or proceedings pending or threatened against or affecting Borrower, Guarantor, and/or any Pledgor which, if adversely determined, could affect Borrower’s, Guarantor’s, or any such Pledgor’s ability to perform its obligations under the Loan Documents or challenge the validity of or enforceability of, or ability of Borrower, Guarantor, and/or any such Pledgor to fulfill each of its obligations under this Modification, any of the other Loan Documents, or any of the other instruments, documents or agreements described herein, as modified and amended hereby, or the priority of any lien thereof, in any court, at law or in equity, or before any administrative agencies or other governmental authority.

(e)Borrower further represents and warrants that the ownership structure of each of the Borrower, the Guarantor, and each of the Pledgors has not been changed and each of Borrower’s, Guarantor’s, and each Pledgor’s organizational documents have not been modified or amended, in each case since the initial closing of the Credit Agreement, or have not been so changed or amended except to the extent of such amendments as have been provided to Administrative Agent in writing.

(f)Following the execution and delivery of this Modification, no Event of Default or Default exists under the Loan Documents as of the date hereof and, as of the date hereof, all of the covenants, representations and warranties made by the Borrower, Guarantor, and each Pledgor and contained in any of the Loan Documents are true and correct as of the date of this Modification (except to the extent any such representations or warranties expressly refer to an earlier date).

6.Reaffirmation of Collateral Document Obligations; Receipt of Modification.  The Borrower, Guarantor, and each Pledgor each hereby acknowledges receipt of a copy of this Modification and agrees that (a) each of the Collateral Documents shall continue in full force and effect in favor of the Administrative Agent and for the benefit of the Secured Parties with respect to the obligations guaranteed or secured thereby (as modified hereby), and (b) each of the Collateral Documents, as modified hereby, is hereby ratified and confirmed in all respects.  

7.Future Delivery and Execution of Documents.  Each of Borrower, Guarantor, and/or each Pledgor (as applicable) will execute such additional documents as are reasonably requested by the Administrative Agent to reflect the terms and conditions of this Modification, and will cause to be delivered such additional certificates, legal opinions and other documents as are reasonably required by the Administrative Agent.

8.Release.  In consideration of the modifications set forth in this Modification, Borrower, Guarantor, and each Pledgor each hereby releases and holds harmless the Administrative Agent and each of the Lenders and their respective officers, employees and agents, from and against any claim, action, suit, demand, cost, expense or liability of any kind relating to the making of the extension of credit under the Credit Agreement, the administration of same or any business communications and dealings between or among the Borrower and/or Guarantor (or either of them), on one hand, and the Administrative Agent and any Lender, on the other, concerning the Credit Agreement, the extensions of credit thereunder, or any of the Loan Documents and arising on or prior to the date hereof.

9.Defaults Under the Credit Agreement.  The failure of Borrower, Guarantor, and/or any Pledgor to perform any of their respective obligations under this Modification or any of the other Loan Documents (following any applicable notice and cure periods) or the falsity of any representation or warranty made herein or the failure of Borrower, Guarantor, and/or Pledgors to advise Administrative Agent that a representation or warranty made herein is no longer true shall, at the option of the Administrative Agent and Lenders, after expiration of any applicable cure period, constitute an Event of Default under the Credit Agreement.

10.Effectiveness.  The Loan Documents and the terms and provisions thereof, as modified and amended hereby, and the liens and security interests created thereby shall constitute and remain in full force and effect as of the execution thereof.  All of the terms of the Loan Documents, except to the extent modified herein or amended and restated in connection herewith, shall remain in full force and effect.  The amendments contained herein shall be deemed to have prospective application only, unless otherwise specifically stated herein. Section headings in this Modification are included herein for convenience of reference only and shall not constitute a part of this Modification for any other purpose.

11.Savings Clause.  If any provision of any of this Modification or of any Loan Document, as amended hereby, is determined to be illegal, invalid or unenforceable, such provision shall be fully severable and the remaining provisions shall remain in full force and effect and shall be construed without giving effect to the illegal, invalid or unenforceable provisions.

12.No Novation.  Borrower, Guarantor, and each Pledgor each intend for the amendments to the Loan Documents to evidence an amendment to the terms of the existing indebtedness or obligations of Borrower, Guarantor, and/or Pledgors (as and to the extent applicable) to the Administrative Agent and Lenders and do not intend for such amendments to constitute a novation in any manner whatsoever.  

13.Counterparts.This Modification may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument.  It shall not be necessary in making proof of this Modification to produce or account for more than one such counterpart for each of the parties hereto.  Delivery by facsimile or PDF by any of the parties hereto of an executed counterpart of this Modification shall be as effective as an original executed counterpart hereof and shall be deemed a representation that an original executed counterpart hereof will be delivered. Each counterpart hereof shall be deemed to be an original and shall be binding upon all parties, their successors and assigns.

14.Fees and Expenses.  The Borrower hereby agrees that all fees, expenses and costs incurred by the Administrative Agent or its counsel in reviewing, negotiating, preparing and granting the amendment set forth herein shall, to the extent not paid or invoiced as of the date hereof, be paid by it upon demand as fees, costs and expenses incurred in connection with the Credit Agreement.

15.Amendments; Use of Terms.  This Modification may not be supplemented, changed, waived, discharged, terminated, modified or amended except in written form executed by all parties hereto.  Wherever in this Modification any word or combination of words (including defined terms) connotes number or gender, such word or combination of words shall be deemed of such number (singular or plural) and such gender (masculine, neuter or feminine) as the context and circumstances may require.  This Modification shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, personal and legal representatives, successors and assigns.

16.Final Agreement.  This Modification represents the final agreement between the parties and supersedes all previous negotiations, discussions and agreements, contemporaneous or subsequent, between the parties, and no parol evidence of any prior or other agreement shall be permitted to contradict or vary their terms.  There are no promises, terms, conditions or obligations other than those contained in this Modification.  There are no unwritten oral agreements between the parties.

17.Binding Effect.  This Modification shall become effective as of the date set forth above upon satisfaction or waiver of all of the conditions set forth in Section 4 hereof and execution and delivery of this Modification by the Borrower, Guarantor, Pledgors, Administrative Agent, and the Lenders.  Thereafter this Modification shall be binding upon and inure to the benefit of the parties hereto, and their respective successors and assigns.

18.Governing Law and Jurisdiction.  This Modification and all matters relating thereto shall be governed by and construed and interpreted in accordance with the laws of the State of New York.

IN WITNESS WHEREOF, Borrower, Guarantor, Pledgors, Administrative Agent, and the Lenders have executed this Modification under seal on the date first above written.

BORROWER/PLEDGOR:
NEXPOINT RESIDENTIAL TRUST OPERATING PARTNERSHIP, L.P., a Delaware limited partnership
By:	NEXPOINT RESIDENTIAL TRUST, OPERATING PARTNERSHIP GP, LLC, a Delaware limited liability company, its General Partner
By:	NEXPOINT RESIDENTIAL TRUST, INC., a Maryland corporation, its Sole Member
By:	/s/ Matt McGraner
Name:	Matt McGraner
Title:	Executive Vice President and Chief Investment Officer

GUARANTOR/PLEDGOR:
NEXPOINT RESIDENTIAL TRUST, INC., a Maryland corporation
By:	/s/ Matt McGraner
Name:	Matt McGraner
Title:	Executive Vice President and Chief Investment Officer

ADDITIONAL PLEDGORS:

FRBH C-1 Residential, LLC

FRBH Nashville Residential, LLC

FRBH JAX-TPA, LLC

HRT Timber Creek, LLC

NXRT Radbourne Lake, LLC

NXRT Sabal Palms, LLC

NXRTBH Cornerstone, LLC

NXRTBH Barrington Mill, LLC

NXRTBH North Dallas 3, LLC

NXRT Bayberry, LLC

NXRTBH AZ2, LLC

NXRT Vanderbilt, LLC

BH Willowdale Manager, LLC

FRBH Regatta Bay, LLC

NXRTBH McMillan, LLC

Freedom Miramar Apartments, LLC

HRTBH North Atlanta, LLC

NXRT Crestmont, LLC

NXRT Brandywine LP, LLC

NXRT PHX 3, LLC

NXRT Summers Landing GP, LLC

NXRT Glenview, LLC

NXRT West Place, LLC

NXRT Pembroke Owner, LLC

NXRT Brentwood Owner, LLC

NexPoint Residential Trust Operating Partnership, L.P.

By:	/s/ Matt McGraner
Name:	Matt McGraner
Title:	Authorized Signatory

ADMINISTRATIVE AGENT:
TRUIST BANK, as Administrative Agent,
By:	/s/ Ryan Almond
Name:	Ryan Almond
Title:	Director

LENDERS:
TRUIST BANK, as a Revolving Lender and as a Supplemental Lender
By:	/s/ Ryan Almond
Name:	Christopher T. Neil
Title:	Senior Banker

KEYBANK NATIONAL ASSOCIATION, as a Revolving Lender, as a Supplemental Lender, and as the sole Second Supplemental Lender
By:	/s/ Christopher Neil
Name:	Christopher T. Neil
Title:	Senior Banker

CITIZENS BANK, N.A., as a Revolving Lender
By:	/s/ Thomas Shannon
Name:	Thomas Shannon
Title:	Officer

RAYMOND JAMES BANK, N.A., as a Revolving Lender
By:	/s/ Ted Long
Name:	Ted Long
Title:	Senior Vice President

SYNOVUS BANK, as a Revolving Lender
By:	/s/ Tejas Patel
Name:	Tejas Patel
Title:	Senior Manager

EXHIBIT A

REDLINED CREDIT AGREEMENT

CUSIP # 65342UAC7

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

dated as of June 30, 2021

among

NEXPOINT RESIDENTIAL TRUST OPERATING PARTNERSHIP, L.P., as Borrower

THE LENDERS FROM TIME TO TIME PARTY HERETO

and

TRUIST BANK,

as Administrative Agent

KEYBANK NATIONAL ASSOCIATION and CITIZENS BANK, N.A.,
as Documentation Agents

TRUIST SECURITIES, INC.

as Lead Arranger and Book Runner

116430174v7

118937410v3

TABLE OF CONTENTS

Page

ARTICLE I
DEFINITIONS; CONSTRUCTION			1
	Section 1.1.	Definitions	1
	Section 1.2.	Classifications of Loans and Borrowings	28
	Section 1.3.	Accounting Terms and Determination	28
	Section 1.4.	Terms Generally	29
	Section 1.5.	Divisions	29
	Section 1.6.	LIBOR	29
ARTICLE II
AMOUNT AND TERMS OF THE COMMITMENTS			30
	Section 2.1.	Establishment of Revolving Credit Facility	30
	Section 2.2.	Revolving Loans	30
	Section 2.3.	Establishment of Supplemental and Second Supplemental Credit Facility Facilities	30
	Section 2.4.	Supplemental Loans and Second Supplemental Loans	30
	Section 2.5.	Procedure for Borrowings	30
	Section 2.6.	Funding of Borrowings	31
	Section 2.7.	Interest Elections	31
	Section 2.8.	Optional Reduction and Termination of Commitments	32
	Section 2.9.	Repayment of Loans	33
	Section 2.10.	Evidence of Indebtedness	33
	Section 2.11.	Optional Prepayments	33
	Section 2.12.	Mandatory Prepayments	34
	Section 2.13.	Interest on Loans	35
	Section 2.14.	Fees	36
	Section 2.15.	Computation of Interest and Fees	36
	Section 2.16.	Inability to Determine Interest Rates	36
	Section 2.17.	Illegality	38
	Section 2.18.	Increased Costs	38
	Section 2.19.	Funding Indemnity	39
	Section 2.20.	Taxes	40
	Section 2.21.	Payments Generally; Pro Rata Treatment; Sharing of Set-offs	43
	Section 2.22.	Extension of Maturity Date	44
	Section 2.23.	Increase of Revolving Commitments; Additional Lenders	44
	Section 2.24.	Mitigation of Obligations	46
	Section 2.25.	Replacement of Lenders	46
	Section 2.26.	Defaulting Lenders	47
ARTICLE III
CONDITIONS PRECEDENT TO LOANS			48
	Section 3.1.	Conditions to Effectiveness	48
	Section 3.2.	Conditions to Each Credit Event	50
	Section 3.3.	Delivery of Documents	50
ARTICLE IV
REPRESENTATIONS AND WARRANTIES			51
	Section 4.1.	Existence; Power	51
	Section 4.2.	Organizational Power; Authorization	51
	Section 4.3.	Governmental Approvals; No Conflicts	51
	Section 4.4.	Financial Condition; No Material Adverse Change	51
	Section 4.5.	Properties	51

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	Section 4.6.	Intellectual Property	52
	Section 4.7.	Litigation and Environmental Matters	52
	Section 4.8.	Compliance with Laws and Agreements	53
	Section 4.9.	Investment Company Act.	53
	Section 4.10.	Taxes	54
	Section 4.11.	ERISA	54
	Section 4.12.	Disclosure	54
	Section 4.13.	Solvency	54
	Section 4.14.	Margin Regulations	54
	Section 4.15.	Subsidiaries; REIT Qualification	54
	Section 4.16.	Labor Relations	55
	Section 4.17.	Sanctions and Anti-Corruption Laws	55
	Section 4.18.	Affected Financial Institutions	55
ARTICLE V
AFFIRMATIVE COVENANTS			56
	Section 5.1.	Financial Statements and Other Information	56
	Section 5.2.	Financial Tests	57
	Section 5.3.	Notices of Material Events	57
	Section 5.4.	Existence; Conduct of Business	58
	Section 5.5.	Payment of Obligations	58
	Section 5.6.	Maintenance of Properties; Insurance	58
	Section 5.7.	Books and Records	58
	Section 5.8.	Compliance with Laws.	59
	Section 5.9.	Use of Proceeds	59
	Section 5.10.	Fiscal Year	59
	Section 5.11.	Environmental Matters	59
	Section 5.12.	Collateral Requirement	59
	Section 5.13.	Further Assurances	60
	Section 5.14.	Bank Accounts	60
	Section 5.15.	Parent Covenants	60
	Section 5.16.	Pledge of Interests	60
	Section 5.17.	Permanent Financing	60
	Section 5.18.	Keepwell	60
ARTICLE VI
INTENTIONALLY OMITTED			61
ARTICLE VII
NEGATIVE COVENANTS			61
	Section 7.1.	Liens	61
	Section 7.2.	Fundamental Changes	61
	Section 7.3.	Investments, Loans, Advances and Acquisitions	61
	Section 7.4.	Hedging Transactions	62
	Section 7.5.	Restricted Payments	62
	Section 7.6.	Transactions with Affiliates	62
	Section 7.7.	Parent Negative Covenants	62
	Section 7.8.	Restrictive Agreements	62
	Section 7.9.	Indebtedness	63
	Section 7.10.	Fees	63
	Section 7.11.	Amendment to Organizational Documents	63
	Section 7.12.	Sanctions and Anti-Corruption Laws	63

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ARTICLE VIII
EVENTS OF DEFAULT			64
	Section 8.1.	Events of Default	64
	Section 8.2.	Application of Proceeds from Collateral	65
ARTICLE IX
THE ADMINISTRATIVE AGENT			67
	Section 9.1.	Appointment of the Administrative Agent	67
	Section 9.2.	Nature of Duties of the Administrative Agent	67
	Section 9.3.	Lack of Reliance on the Administrative Agent	68
	Section 9.4.	Certain Rights of the Administrative Agent	68
	Section 9.5.	Reliance by the Administrative Agent	68
	Section 9.6.	The Administrative Agent in its Individual Capacity	68
	Section 9.7.	Successor Administrative Agent	68
	Section 9.8.	Withholding Tax	69
	Section 9.9.	The Administrative Agent May File Proofs of Claim	69
	Section 9.10.	Authorization to Execute Other Loan Documents	70
	Section 9.11.	Collateral and Guaranty Matters	70
	Section 9.12.	Documentation Agent; Syndication Agent.	70
	Section 9.13.	Right to Realize on Collateral and Enforce Guarantee	70
	Section 9.14.	Secured Bank Product Obligations and Hedging Obligations	70
ARTICLE X
MISCELLANEOUS			71
	Section 10.1.	Notices	71
	Section 10.2.	Waiver; Amendments	73
	Section 10.3.	Expenses; Indemnification	75
	Section 10.4.	Successors and Assigns	76
	Section 10.5.	Governing Law; Jurisdiction; Consent to Service of Process	79
	Section 10.6.	WAIVER OF JURY TRIAL	79
	Section 10.7.	Right of Set-off	79
	Section 10.8.	Counterparts; Integration	80
	Section 10.9.	Survival	80
	Section 10.10.	Severability	80
	Section 10.11.	Confidentiality	81
	Section 10.12.	Interest Rate Limitation	81
	Section 10.13.	Waiver of Effect of Corporate Seal	81
	Section 10.14.	Patriot Act	81
	Section 10.15.	No Advisory or Fiduciary Responsibility	82
	Section 10.16.	Location of Closing	82
	Section 10.17.	Electronic Signatures	82
	Section 10.18.	Acknowledgement and Consent to Bail-In of Affected Financial Institutions	82
	Section 10.19.	Certain ERISA Matters	83
	Section 10.20.	Replaced Credit Agreement	84
	Section 10.21.	Certain ERISA Matters	85
	Section 10.22.	Acknowledgment Regarding any Supported QFCs	86
	Section 10.23.	Erroneous Payments	87

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Schedules

Schedule I	-	Applicable Margin and Applicable Percentage
Schedule II	-	Commitment Amounts
Schedule III	-	Mortgaged Properties
Schedule IV	-	Litigation Disclosure
Schedule V	-	Subsidiaries; Ownership of Mortgaged Properties

Exhibits

Exhibit A	-	Form of Assignment and Assumption
Exhibit B	-	Form of Compliance Certificate
Exhibit C	-	Form of Guaranty
Exhibit D	-	Form of Perfection Certificate
Exhibit E	-	Form of Notice of Borrowing
Exhibit F	-	Form of Notice of Conversion/Continuation
Exhibits G (1-4)	-	Tax Certificates

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AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

THIS AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (this “Agreement”) is made and entered into as of June 30, 2021, by and among NEXPOINT RESIDENTIAL TRUST OPERATING PARTNERSHIP, L.P., a Delaware limited partnership (the “Borrower”), the several banks and other financial institutions and lenders from time to time party hereto as parties providing Revolving Commitments, Supplemental  Commitments and/or Second Supplemental Commitments, each as referenced herein (the “Lenders”), and TRUIST BANK, successor by merger to SunTrust Bank, in its capacity as administrative agent for the Lenders (the “Administrative Agent” or “Agent”).

W I T N E S S E T H:

WHEREAS, the Borrower is, prior to the effectiveness hereof, a party to the Replaced Credit Agreement (as defined herein) and has requested that the Lenders amend, restate, extend, and increase the credit facility established pursuant to the Replaced Credit Agreement;

WHEREAS, the Lenders are willing to do so on the terms and conditions set forth herein; and

WHEREAS, (a) this Agreement is an amendment, restatement, extension, and increase of the Replaced Credit Facility in its entirety and (b) this amendment, restatement, extension, and increase does not represent a novation with respect to the rights and “Obligations” under the Replaced Credit Facility;

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the Borrower, the Lenders, and the Administrative Agent agree as follows:

ARTICLE I

DEFINITIONS; CONSTRUCTION

Section 1.1.Definitions. In addition to the other terms defined herein, the following terms used herein shall have the meanings herein specified (to be equally applicable to both the singular and plural forms of the terms defined):

“Additional Lender” shall have the meaning set forth in Section 2.23.

“Adjusted EBITDA” means (a) EBITDA for the most recently ended calendar quarter, annualized, less (b) the Net Required Capex Reserve.

“Adjusted LIBO Rate” shall mean, with respect to each Interest Period for a Eurodollar Loan, (i) the rate per annum equal to the London interbank offered rate for deposits in U.S. Dollars appearing on Reuters screen page LIBOR 01 (or on any successor or substitute page of such service or any successor to such service, or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time) at approximately 11:00 A.M. (London time) two (2) Business Days prior to the first day of such Interest Period, with a maturity comparable to such Interest Period (provided that if such rate is less than zero, such rate shall be deemed to be zero), divided by (ii) a percentage equal to 1.00 minus the then stated maximum rate of all reserve requirements (including any marginal, emergency, supplemental, special or other reserves and without benefit of credits for proration, exceptions or offsets that may be available from time to time) expressed as a decimal (rounded upward to the next 1/100^th of 1%) applicable to any member bank of the Federal Reserve System in respect of Eurocurrency liabilities as defined in Regulation D (or any successor category of liabilities under Regulation D); provided that if the rate referred to in clause (i) above is not available at any such time for any reason, then the rate referred to in clause (i) shall instead be the interest rate per annum, as determined by the Administrative Agent, to be the arithmetic average of the rates per annum at which deposits in U. S. Dollars in an amount equal to the amount of such Eurodollar Loan are offered by major banks in the London interbank market to the Administrative Agent at approximately 11:00 A.M. (London time), two (2) Business Days prior to the first day of such Interest Period. For purposes of this Agreement, the Adjusted LIBO Rate will not be less than zero percent (0%).

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“Administrative Agent” shall mean Truist Bank, in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.

“Administrative Questionnaire” shall mean, with respect to each Lender, an administrative questionnaire in the form provided by the Administrative Agent and submitted to the Administrative Agent duly completed by such Lender.

“Affected Financial Institution” means (a) any EEA Financial Institution or (b) any UK Financial Institution.

“Affiliate” shall mean, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, the specified Person. For the purposes of this definition, “Control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ability to exercise voting power, by control or otherwise. The terms “Controlling” and “Controlled” have meanings correlative thereto.

“Aggregate Revolving Commitment Amount” shall mean the aggregate principal amount of the Aggregate Revolving Commitments from time to time. On the Closing Date, the Aggregate Revolving Commitment Amount is $225,000,000.00.

“Aggregate Revolving Commitments” shall mean, collectively, all Revolving Commitments of all Lenders at any time outstanding.

“Aggregate Second Supplemental Commitment Amount” shall mean the aggregate principal  amount of the Aggregate Second Supplemental Commitments from time to time. Prior to September 9, 2021, such  amount is zero ($0.00). As of September 9, 2021, the Aggregate Revolving Commitment Amount shall be  $35,000,000.00.

“Aggregate Second Supplemental Commitments” shall mean, collectively, all Supplemental  Second Commitments of all Lenders at any time outstanding.

“Aggregate Supplemental Commitment Amount” shall mean the aggregate principal amount of the Aggregate Supplemental Commitments from time to time. On the Closing Date, the Aggregate Revolving Commitment Amount is $25,000,000.00.

“Aggregate Supplemental Commitments” shall mean, collectively, all Supplemental Commitments of all Lenders at any time outstanding.

“Anti-Corruption Laws” shall mean all laws, rules and regulations of any jurisdiction applicable to the Borrower and its Subsidiaries concerning or relating to bribery or corruption.

“Anti-Money Laundering Laws” means all Legal Requirements related to the financing of terrorism or money laundering, including without limitation, any applicable provision of the Patriot Act and The Currency and Foreign Transactions Reporting Act (also known as the “Bank Secrecy Act,” 31 U.S.C. §§ 5311-5330 and 12U.S.C. §§ 1818(s), 1820(b) and 1951-1959).

“Applicable Lending Office” shall mean, for each Lender and for each Type of Loan, the “Lending Office” of such Lender (or an Affiliate of such Lender) designated for such Type of Loan in the Administrative Questionnaire submitted by such Lender or such other office of such Lender (or such Affiliate of such Lender) as such Lender may from time to time specify to the Administrative Agent and the Borrower as the office by which its Loans of such Type are to be made and maintained.

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“Applicable Margin” shall mean, as of any date, with respect to interest on all Loans outstanding on such date, the percentage per annum determined by reference to the applicable Leverage Ratio in effect on such date as set forth on Schedule I; provided that a change in the Applicable Margin resulting from a change in the Leverage Ratio shall be effective on the second Business Day after which the Borrower delivers each of the financialstatements required by Section 5.1(a) and (b) and the Compliance Certificate required by Section 5.1(c); provided, further, that if at any time the Borrower shall have failed to deliver such financial statements and such Compliance Certificate when so required, the Applicable Margin shall be at Level III as set forth on Schedule I until such time as such financial statements and Compliance Certificate are delivered, at which time the Applicable Margin shall be determined as provided above. Notwithstanding the foregoing, the Applicable Margin from the Closing Date until the date by which the financial statements and Compliance Certificate for the Fiscal Quarter ending June 30, 2021 are required to be delivered shall be at Level III as set forth on Schedule I. In the event that any financial statement or Compliance Certificate delivered hereunder is shown to be inaccurate (regardless of whether this Agreement or the Commitments are in effect when such inaccuracy is discovered), and such inaccuracy, if corrected, would have led to the application of a higher Applicable Margin based upon the pricing grid set forth on Schedule I (the “Accurate Applicable Margin”) for any period that such financial statement or Compliance Certificate covered, then (i) the Borrower shall immediately deliver to the Administrative Agent a correct financial statement or Compliance Certificate, as the case may be, for such period, (ii) the Applicable Margin shall be adjusted such that after giving effect to the corrected financial statement or Compliance Certificate, as the case may be, the Applicable Margin shall be reset to the Accurate Applicable Margin based upon the pricing grid set forth on Schedule I for such period and (iii) the Borrower shall immediately pay to the Administrative Agent, for the account of the Lenders, the accrued additional interest owing as a result of such Accurate Applicable Margin for such period. The provisions of this definition shall not limit the rights of the Administrative Agent and the Lenders with respect to Section 2.13(c) or Article VIII.

“Appraisal” (whether one or more) means a written appraisal of the Mortgaged Properties by an MAI appraiser satisfactory to the Administrative Agent. Each Appraisal must comply with all Legal Requirements and, unless specifically provided to the contrary in this Agreement, must be in form and substance reasonably satisfactory to the Administrative Agent.

“Approved Fund” shall mean any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arranger” shall mean Truist Securities, Inc., in its capacity as lead arranger and bookrunner.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 10.4(b)) and accepted by the Administrative Agent, in substantially the form of Exhibit A attached hereto or any other form approved by the Administrative Agent.

“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, any tenor for such Benchmark or payment period for interest calculated with reference to such Benchmark, as applicable, that is or may be used for determining the length of an Interest Period pursuant to this Agreement as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to clause (f) of Section 2.16.

“Availability Period”means the period from the Closing Date to but excluding the Maturity Date.

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.

“Bail-In Legislation” means (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation or requirement for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as

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amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).

“Bank Product Obligations” mean, collectively, all obligations and other liabilities of any Credit Party to any Bank Product Provider arising with respect to any Bank Products.

“Bank Product Provider” means any Person that, at the time it provides any Bank Product to any Credit Party, (i) is a Lender or an Affiliate of a Lender and (ii) except when the Bank Product Provider is Truist Bank and its Affiliates, has provided prior written notice to the Administrative Agent which has been acknowledged by the Borrower of (x) the existence of such Bank Product, (y) the maximum dollar amount of obligations arising thereunder (the “Bank Product Amount”) and (z) the methodology to be used by such parties in determining the obligations under such Bank Product from time to time. In no event shall any Bank Product Provider acting in such capacity be deemed a Lender for purposes hereof to the extent of and as to Bank Products except that each reference to the term “Lender” in Article IX and Section 10.3(b) shall be deemed to include such Bank Product Provider and in no event shall the approval of any such person in its capacity as Bank Product Provider be required in connection with the release or termination of any security interest or Lien of the Administrative Agent. The Bank Product Amount may be changed from time to time upon written notice to the Administrative Agent by the applicable Bank Product Provider. No Bank Product Amount may be established at any time that a Default or Event of Default exists.

“Bank Products” means any of the following services provided to any Credit Party by any Bank Product Provider: (a) any treasury or other cash management services, including deposit accounts, automated clearing house (ACH) origination and other funds transfer, depository (including cash vault and check deposit), zero balance accounts and sweeps, return items processing, controlled disbursement accounts, positive pay, lockboxes and lockbox accounts, account reconciliation and information reporting, payables outsourcing, payroll processing, trade finance services, investment accounts and securities accounts, and (b) card services, including credit cards (including purchasing cards and commercial cards), prepaid cards, including payroll, stored value and gift cards, merchant services processing, and debit card services.

“Base Rate” means for any day a rate per annum equal to the highest of (i) the rate of interest which the Administrative Agent announces from time to time as its prime lending rate, as in effect from time to time (the “Prime Rate”), (ii) the Federal Funds Rate, as in effect from time to time, plus 0.50%, (iii) the Adjusted LIBO Rate determined on a daily basis for an Interest Period of one (1) month, plus 1.00% (any changes in such rates to be effective as of the date of any change in such rate), and (iv) zero percent (0.00%). The Administrative Agent’s prime lending rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer. The Administrative Agent may make commercial loans or other loans at rates of interest at, above, or below the Administrative Agent’s prime lending rate. Any change in the Base Rate due to a change in the Prime Rate, the Federal Funds Rate, or the Adjusted LIBO Rate will be effective from and including the effective date of such change in the Prime Rate, the Federal Funds Rate, or the Adjusted LIBO Rate.

“Benchmark” means, initially, the Adjusted LIBO Rate; provided that if a Benchmark Transition Event, a Term SOFR Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have occurred with respect to Adjusted LIBO Rate or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to clause (b) or clause (c) of Section 2.16.

“Benchmark Replacement” means, for any Available Tenor, the first alternative set forth in the order below that can be determined by the Administrative Agent for the applicable Benchmark Replacement Date:

(1)the sum of: (a) Term SOFR and (b) the related Benchmark Replacement Adjustment;

(2)the sum of: (a) Daily Simple SOFR and (b) the related Benchmark Replacement Adjustment;

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(3)the sum of: (a) the alternate benchmark rate that has been selected by the Administrative Agent and the Borrower as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (ii) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement for the then-current Benchmark for U.S. dollar-denominated syndicated credit facilities at such time and (b) the related Benchmark Replacement Adjustment;

provided that, in the case of clause (1), such Unadjusted Benchmark Replacement is displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion; provided further that, notwithstanding anything to the contrary in this Agreement or in any other Loan Document, upon the occurrence of a Term SOFR Transition Event, and the delivery of a Term SOFR Notice, on the applicable Benchmark Replacement Date the “Benchmark Replacement” shall revert to and shall be deemed to be the sum of (a) Term SOFR and (b) the related Benchmark Replacement Adjustment, as set forth in clause (1) of this definition (subject to the first proviso above). If the Benchmark Replacement as determined pursuant to clause (1), (2) or (3) above would be less than the Floor, the Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.

“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest Period and Available Tenor for any setting of such Unadjusted Benchmark Replacement:

(1)for purposes of clauses (1) and (2) of the definition of “Benchmark Replacement,” the first alternative set forth in the order below that can be determined by the Administrative Agent:

a. the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Interest Period that has been selected or recommended by the Relevant Governmental Body for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for the applicable Corresponding Tenor;

b. the spread adjustment (which may be a positive or negative value or zero) as of the Reference Time such Benchmark Replacement is first set for such Interest Period that would apply to the fallback rate for a derivative transaction referencing the ISDA Definitions to be effective upon an index cessation event with respect to such Benchmark for the applicable Corresponding Tenor; and

(2)for purposes of clause (3) of the definition of “Benchmark Replacement,” the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Administrative Agent and the Borrower for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body on the applicable Benchmark Replacement Date or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated syndicated credit facilities;

provided that, in the case of clause (1) above, such adjustment is displayed on a screen or other information service that publishes such Benchmark Replacement Adjustment from time to time as selected by the Administrative Agent in its reasonable discretion.

“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Base Rate,” the definition of “Business Day,” the definition of “Interest Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that the Administrative Agent decides in its reasonable discretion may be appropriate to reflect the adoption and

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implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of such Benchmark Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

“Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current Benchmark:

(1)in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein; and (b) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof);

(2)in the case of clause (3) of the definition of “Benchmark Transition Event,” the date of the public statement or publication of information referenced therein; or

(3)in the case of a Term SOFR Transition Event, the date that is thirty (30) days after the date a Term SOFR Notice is provided to the Lenders and the Borrower pursuant to Section 2.16(c); or

(4)in the case of an Early Opt-in Election, the sixth (6th) Business Day after the date notice of such Early Opt-in Election is provided to the Lenders, so long as the Administrative Agent has not received, by 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Early Opt-in Election is provided to the Lenders, written notice of objection to such Early Opt-in Election from Lenders comprising the Required Lenders.

For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:

(1)a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

(2)a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or

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(3)a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are no longer representative.

For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).

“Benchmark Unavailability Period” means the period (if any) (x) beginning at the time that a Benchmark Replacement Date pursuant to clauses (1) or (2) of that definition has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 2.16 and (y) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section  2.16.

“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“Borrower” shall have the meaning set forth in the introductory paragraph hereof.

“Borrowing” means an advance of a Revolving Loan, Supplemental Loan, and/or Second  Supplemental Loan, as applicable, made in accordance with the terms of this Agreement.

“Business Day” shall mean any day other than (i) a Saturday, Sunday or other day on which commercial banks in Atlanta, Georgia or New York are authorized or required by law to close and (ii) if such day relates to a Borrowing of, a payment or prepayment of principal or interest on, a conversion of or into, or an Interest Period for, a Eurodollar Loan or a notice with respect to any of the foregoing, any such day that is also a day on which dealings in Dollar deposits are not conducted by and between banks in the London interbank market.

“Capital Expenditure Reserve” means, on an annual basis, an amount equal to $250 per unit with respect to each Real Property owned by the Parent, Borrower, or any Subsidiary.

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

“Capital Stock” shall mean all shares, options, warrants, general or limited partnership interests, membership interests or other equivalents (regardless of how designated) of or in a corporation, partnership, limited liability company or equivalent entity whether voting or nonvoting, including common stock, preferred stock or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the Securities and Exchange Commission under the Exchange Act).

“Capitalization Rate” means (a) for calculations hereunder through and including the calendar quarter/year ending June 30, 2023, 5.75%; and (b) for all calculations thereafter, 6.00%.

“Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof), of shares representing more than thirty percent (30%) of the aggregate ordinary voting power represented by the issued and outstanding capital stock of the Parent; (b) occupation of a majority of the seats (other than vacant seats) on the board of directors of the Parent by Persons who were neither (i) nominated by the board of directors of the Parent nor (ii) appointed by directors so nominated; (c) the acquisition of direct or indirect Control of the Parent by any Person or group; (d) the failure of the Borrower to own,

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directly or indirectly, free and clear of any Liens except those granted in favor of the Agent, at least 90% of the ownership interests in each Collateral Subsidiary; or (e) the replacement, removal or resignation of NexPoint Real Estate Advisors, L.P. as advisor to the Parent, unless replaced with an Affiliate thereof.

“Change in Law” shall mean the occurrence, after the date of this Agreement, of any of the following: (i) the adoption or taking effect of any law, rule, regulation or treaty, (ii) any change in any law, rule, regulation or treaty, or in the administration, interpretation, implementation or application thereof by any Governmental Authority, or (iii) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) of any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“Class” means the designation of Loan as either a Revolving Loan, Supplemental Loan, or Second  Supplemental Loan, as applicable.

“Closing Date” shall mean the date on which the conditions precedent set forth in Section 3.1 and Section 3.2 have been satisfied or waived in accordance with Section 10.2.

“Code” shall mean the Internal Revenue Code of 1986, as amended and in effect from time to time.

“Collateral” shall mean all tangible and intangible property, real and personal, of any Credit Party that is or purports to be the subject of a Lien to the Administrative Agent to secure the whole or any part of the Obligations or any Guarantee thereof, and shall include, without limitation, all casualty insurance proceeds and condemnation awards with respect to any of the foregoing.

“Collateral Documents” shall mean, collectively, the Guaranty, the Pledge Agreement, the Economic Interest Pledge Agreement, the Equity Proceeds Pledge Agreement, the Perfection Certificate, and all other instruments and agreements now or hereafter securing or perfecting the Liens securing the whole or any part of the Obligations or any Guarantee thereof, the Financing Statements, and all other documents, instruments, agreements and certificates executed and delivered by any Credit Party to the Administrative Agent and the Lenders in connection with the foregoing.

“Collateral Subsidiary” means each Subsidiary of the Borrower which owns a direct or indirect interest in a Mortgaged Property.

“Commitment(s)” means the Revolving Commitments, Supplemental Commitments, and/or the Second  Supplemental Commitments, as applicable.

“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended and in effect from time to time, and any successor statute.

“Compliance Certificate” shall mean a certificate from a Responsible Officer of the Parent in the form of, and containing the certifications set forth in, the certificate attached hereto as Exhibit B.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Contractual Obligation” of any Person shall mean any provision of any security issued by such Person or of any agreement, instrument or undertaking under which such Person is obligated or by which it or any of the property in which it has an interest is bound.

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“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise, which includes the customary powers of a managing member of any limited liability company, any general partner of any limited partnership, or any board of directors of a corporation. “Controlling” and “Controlled” have meanings correlative thereto.

“Core Funds from Operations” means, for any period, Guarantor’s net income (or loss) (after payment of all cash dividends payable on any preferred stock) determined on a consolidated basis for the Borrower, Guarantor, and their Wholly-Owned Subsidiaries for such period, excluding gains or losses from extraordinary items, impairment and other non-cash charges, acquisition fees and related expenses, plus real estate depreciation and amortization. Core Funds from Operations shall be adjusted for (i) the Borrower’s Equity Percentage of its Unconsolidated Affiliates to reflect funds from operations on the same basis, (ii) the amortization of intangibles associated with the amortization of above or below market rents, pursuant to ASC 805 (formerly FASB 141) and (iii) calculation of interest expense in accordance with FBS APB 14-1.

“Corresponding Tenor” with respect to any Available Tenor means, as applicable, either a tenor (including overnight) or an interest payment period having approximately the same length (disregarding business day adjustment) as such Available Tenor.

“Credit Party” means Borrower, Parent, and each other Guarantor.

“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being established by the Administrative Agent in accordance with the conventions for this rate selected or recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for business loans; provided, that if the Administrative Agent decides that any such convention is not administratively feasible for the Administrative Agent, then the Administrative Agent may establish another convention in its reasonable discretion.

“Debt Yield” means, as of any date of determination, the ratio (expressed as a percentage) of (i) Net Operating Income from all Real Property of the Borrower and its Subsidiaries for the most recently ended calendar quarter, annualized to (ii) all Indebtedness of the Borrower and the Guarantor (without duplication) as of such date.

“Debtor Relief Laws” means the Bankruptcy Code of the United States of America, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect.

“Default” shall mean any condition or event that, with the giving of notice or the lapse of time or both, would constitute an Event of Default.

“Default Interest” shall have the meaning set forth in Section 2.13(c).

“Defaulting Lender” shall mean, subject to Section 2.26(c), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two (2) Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within two (2) Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s good faith determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three (3) Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder

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(provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatoryauthority acting in such a capacity or (iii) become the subject of a Bail-in Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.26(b)) upon delivery of written notice of such determination to the Borrower and each Lender.

“Designated Jurisdiction” means any country, region, or territory to the extent that such country, region, or territory itself, or its government, is the subject or target of any Sanction.

“Development Assets” means (a) ground up construction projects; and (b) redevelopment projects that result in the complete cessation of operations at the applicable property.

“Dollar(s)” and the sign “$” shall mean lawful money of the United States.

“Domestic Subsidiary” shall mean each Subsidiary of the Borrower that is organized under the laws of the United States or any state or district thereof.

“Early Opt-in Election” means, if the then-current Benchmark is the Adjusted LIBO Rate, the occurrence of:

(1)a notification by the Administrative Agent to (or the request by the Borrower to the Administrative Agent to notify) each of the other parties hereto that at least five currently outstanding U.S. dollar-denominated syndicated credit facilities at such time contain (as a result of amendment or as originally executed) a SOFR-based rate (including SOFR, a term SOFR or any other rate based upon SOFR) as a benchmark rate (and such syndicated credit facilities are identified in such notice and are publicly available for review), and

(2)the joint election by the Administrative Agent and the Borrower to trigger a fallback from the Adjusted LIBO Rate and the provision by the Administrative Agent of written notice of such election to the Lenders.

“EBITDA” means an amount derived from (a) net income, plus (b) to the extent included in the determination of net income, depreciation, amortization, interest expense and income taxes, plus (c) asset management, acquisition and other fees and expenses, plus or minus (d) to the extent included in the determination of net income, any extraordinary losses or gains, such as those resulting from sales of payment of Indebtedness, plus (e) to the extent not capitalized, the amount of non-recurring expenses, fees, costs and charges incurred in connection with the Loan, plus (f) self-administration or internalization fees and expenses, plus (g) to the extent not capitalized, the amount of all non-recurring expenses, fees, costs and charges incurred with any acquisition, issuance of debt or equity, asset disposition or investment permitted hereunder, or any proposed or actual amendment, modification or refinancing of any Indebtedness, in each case, as determined for Borrower, Guarantor, and their Wholly-Owned Subsidiaries on a consolidated basis, and including (without duplication) the Equity Percentage of EBITDA for the Borrower’s Unconsolidated Affiliates.

“Economic Interests Pledge” means that certain Pledge and Security Agreement (Economic Interests), dated as of the date hereof, by and among the Borrower, certain of its Subsidiaries, and the Administrative Agent.

“EEA Financial Institution” shall mean (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established

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in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clause (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” shall mean any of the member states of the European Union, Iceland, Liechtenstein and Norway.

“EEA Resolution Authority” shall mean any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“Eligible Assignee” shall mean any Person that meets the requirements to be an assignee under Section 10.4 (subject to such consents, if any, as may be required under Section 10.4(b)(iii)).

“Environmental Claim” means any notice of violation, action, claim, Environmental Lien, demand, abatement or other order or direction (conditional or otherwise) by any Governmental Authority or any other Person for personal injury (including sickness, disease or death), tangible or intangible property damage, damage to the environment, nuisance, pollution, contamination or other adverse effects on the environment, or for fines, penalties or restriction, resulting from or based upon (i) the existence, or the continuation of the existence, of a Release (including, without limitation, sudden or non-sudden accidental or non-accidental Releases) of, or exposure to, any Hazardous Material, or other Release in, into or onto the environment (including, without limitation, the air, soil, surface water or groundwater) at, in, by, from or related to any property owned, operated or leased by the Borrower or any of its Subsidiaries or any activities or operations thereof; (ii) the environmental aspects of the transportation, storage, treatment or disposal of Hazardous Materials in connection with any property owned, operated or leased by the Borrower or any of its Subsidiaries or their operations or facilities; or (iii) the violation, or alleged violation, of any Environmental Laws or Environmental Permits of or from any Governmental Authority relating to environmental matters connected with any property owned, leased or operated by the Borrower or any of its Subsidiaries.

“Environmental Laws” means all applicable laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the management, release or threatened release of any Hazardous Material or to health and safety matters and includes (without limitation) the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. § 9601 et m., the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et m., the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. § 136 et m., the Resource Conservation and Recovery Act (“RCRA”), 42 U.S.C. § 6901 et seq., the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., the Clean Air Act, 42 U.S.C. §7401 et seq., the Clean Water Act, 33 U.S.C. § 1251 et m., the Occupational Safety and Health Act, 29 U.S.C. § 651 et m., (to the extent the same relates to any Hazardous Materials), and the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq., as such laws have been amended or supplemented, and the regulations promulgated pursuant thereto, and all analogous state and local statutes.

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) exposure to any Hazardous Materials in violation of any Environmental Law, (c) the Release or threatened Release of any Hazardous Materials into the environment in violation of any Environmental Law or (d) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“Environmental Lien” means any lien in favor of any Governmental Authority arising under any Environmental Law.

“Environmental Permit” means any permit required under any applicable Environmental Law or under any and all supporting documents associated therewith.

“Equity Interests” means, with respect to any Person, all of the shares, partnership or membership interests, economic and other rights, participations or other equivalents (however designated) of Capital Stock of such

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Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of Capital Stock of such Person, all of the securities convertible into or exchangeable for shares of Capital Stock ofsuch Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, membership or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

“Equity Offering” means, any issuance and/or sale after the effective Date by Parent, Borrower, any Guarantor or any of their Subsidiaries of any Equity Interests or equity securities of such Person, including, without limitation, (a) any new preferred securities, and (b) any conversion of equity interests or securities of any Subsidiary of Borrower into equity interests in the Borrower.

“Equity Percentage” means the aggregate ownership percentage of Borrower in each Unconsolidated Affiliate, which shall be calculated as the greater of (a) Borrower’s nominal capital ownership interest in the Unconsolidated Affiliate as set forth in the Unconsolidated Affiliate’s organizational documents, and (b) Borrower’s economic ownership interest in the Unconsolidated Affiliate, reflecting Borrower’s share of income and expenses of the Unconsolidated Affiliate.

“Equity Proceeds Pledge” shall mean the Pledge and Security Agreement (Equity Issuance Proceeds) dated as of even date herewith related to any equity issuance proceeds of the Parent or Borrower granted by the Parent and Borrower to the Administrative Agent, together with all other instruments, agreements and written obligations executed and/or delivered by any of the Credit Parties in connection therewith.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and any successor statute and the regulations promulgated and rulings issued thereunder.

“ERISA Affiliate” shall mean any person that for purposes of Title I or Title IV of ERISA or Section 412 of the Code would be deemed at any relevant time to be a “single employer” or otherwise aggregated with the Borrower or any of its Subsidiaries under Section 414(b), (c), (m) or (o) of the Code or Section 4001 of ERISA.

“ERISA Event” shall mean (i) any “reportable event” as defined in Section 4043 of ERISA with respect to a Plan (other than an event as to which the PBGC has waived under subsection .22, .23, .25, .27 or .28 of PBGC Regulation Section 4043 the requirement of Section 4043(a) of ERISA that it be notified of such event); (ii) any failure to make a required contribution to any Plan that would result in the imposition of a lien or other encumbrance or the provision of security under Section 430 of the Code or Section 303 or 4068 of ERISA, or the arising of such a lien or encumbrance, there being or arising any “unpaid minimum required contribution” or “accumulated funding deficiency” (as defined or otherwise set forth in Section 4971 of the Code or Part 3 of Subtitle B of Title 1 of ERISA), whether or not waived, or any filing of any request for or receipt of a minimum funding waiver under Section 412 of the Code or Section 303 of ERISA with respect to any Plan or Multiemployer Plan, or that such filing may be made, or any determination that any Plan is, or is expected to be, in at-risk status under Title IV of ERISA; (iii) any incurrence by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any liability under Title IV of ERISA with respect to any Plan or Multiemployer Plan (other than for premiums due and not delinquent under Section 4007 of ERISA); (iv) any institution of proceedings, or the occurrence of an event or condition which would reasonably be expected to constitute grounds for the institution of proceedings by the PBGC, under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan; (v) any incurrence by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan, or the receipt by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any notice that a Multiemployer Plan is in endangered or critical status under Section 305 of ERISA; (vi) any receipt by the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any notice, or any receipt by any Multiemployer Plan from the Borrower, any of its Subsidiaries or any of their respective ERISA Affiliates of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA; (vii) engaging in a non-exempt prohibited transaction within the meaning of Section 4975 of the Code or Section 406 of ERISA; or (viii) any filing of a notice of intent to terminate any Plan if such termination would require material additional contributions in order to be considered

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a standard termination within the meaning of Section 4041(b) of ERISA, any filing under Section 4041(c) of ERISA of a notice of intent to terminate any Plan, or the termination of any Plan under Section 4041(c) of ERISA.

“Erroneous Payment” has the meaning assigned to it in Section 10.23(a).

“Erroneous Payment Notice” has the meaning assigned to it in Section 10.23 (a).

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, bears interest at a rate determined by reference to the Adjusted LIBO Rate.

“Event of Default” shall have the meaning set forth in Section 8.1.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended and in effect from time to time.

“Excluded Swap Obligation” shall mean, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act at the time the Guarantee of such Guarantor becomes effective with respect to such related Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes illegal.

“Excluded Taxes” shall mean any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Borrower under Section 2.25) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.20, amounts with respect to such Taxes were payable either to such Lender's assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 2.20 and (d) any U.S. federal withholding Taxes imposed under FATCA.

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

“Federal Funds Rate” shall mean, for any day, the rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with member banks of the Federal Reserve System, as published by the Federal Reserve Bank of New York on the next succeeding Business Day or, if such rate is not so published for any Business Day, the Federal Funds Rate for such day shall be the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day on such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by the Administrative Agent. For purposes of this Agreement the Federal Funds Rate shall not be less than zero percent (0%).

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“Fee Letter” shall mean that certain fee letter, dated as of June 30, 2021, executed by Truist Securities, Inc. and Truist Bank and accepted by the Borrower.

“Financing Statements” means all such Uniform Commercial Code financing statements as the Administrative Agent shall require, duly authorized by the Borrower or Guarantor, to give notice of and to perfect or continue perfection of the Lenders’ security interest in all Collateral.

“Fiscal Quarter” shall mean any fiscal quarter of the Borrower.
“Fiscal Year” shall mean any fiscal year of the Borrower.

“Fixed Charge Coverage Ratio” means the ratio of (a) Adjusted EBITDA for the immediately preceding calendar quarter of Parent and its Subsidiaries to (b) the sum of (i) all principal due and payable and actually paid on Indebtedness (other than amounts paid in connection with balloon maturities), including the Equity Percentage for such amounts for the Borrower’s Unconsolidated Affiliates, plus (ii) all Interest Expense, plus (iii) the aggregate amount of all cash dividends payable on any preferred stock for the immediately preceding calendar quarter, in each case, for the Parent and its Subsidiaries.

“Flood Insurance Laws” shall mean, collectively, (i) the National Flood Insurance Reform Act of 1994 (which comprehensively revised the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973), as now or hereafter in effect or any successor statute thereto, (ii) the Flood Insurance Reform Act of 2004, as now or hereafter in effect or any successor statute thereto and (iii) the Biggert –Waters Flood Insurance Reform Act of 2012, as now or hereafter in effect or any successor statute thereto.

“Floor” means zero percent (0.00%) per annum.

“Foreign Lender” shall mean (a) if the Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if the Borrower is not a U.S. Person, a Lender that is resident or organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes.

“Foreign Person” shall mean any Person that is not a U.S. Person.

“Foreign Subsidiary” shall mean each Subsidiary of the Borrower that is organized under the laws of a jurisdiction other than one of the fifty states of the United States or the District of Columbia.

“GAAP” shall mean generally accepted accounting principles in the United States applied on a consistent basis and subject to the terms of Section 1.3.

“Governmental Authority” shall mean the government of the United States or any other nation, or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“Guarantee” of or by any Person (the “guarantor”) shall mean any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly and including any obligation, direct or indirect, of the guarantor (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (ii) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (iv) as an account party in respect of any letter of credit or letter of guaranty issued in support of such Indebtedness or obligation; provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee is made or, if

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not so stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith. The term “Guarantee” used as a verb has a corresponding meaning.

“Guarantor” means the Parent and any other Person who from time to time has executed a Guaranty as required by the terms of this Agreement.

“Guaranty” means, collectively, the guaranties provided by Guarantor in the form of Exhibit C attached hereto, or such other form as may be agreed upon by the parties.

“Hazardous Materials” shall mean l explosive or radioactive substances or wastes and hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and other substances or wastes of any nature regulated pursuant to any Environmental Law.

“Hedging Obligations” of any Person shall mean any and all obligations of such Person, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired under (i) any and all Hedging Transactions, (ii) any and all cancellations, buy backs, reversals, terminations or assignments of any Hedging Transactions and (iii) any and all renewals, extensions and modifications of any Hedging Transactions and any and all substitutions for any Hedging Transactions.

“Hedge Termination Value” shall mean, in respect of any one or more Hedging Transactions, after taking into account the effect of any legally enforceable netting agreement relating to such Hedging Transactions, (a) for any date on or after the date such Hedging Transactions have been closed out and termination value(s) determined in accordance therewith, such termination value(s) and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedging Transactions, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedging Transactions (which may include a Lender or any Affiliate of a Lender).

“Hedging Transaction” of any Person shall mean (a) any transaction (including an agreement with respect to any such transaction) now existing or hereafter entered into by such Person that is a rate swap transaction, swap option, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap or option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option, spot transaction, credit protection transaction, credit swap, credit default swap, credit default option, total return swap, credit spread transaction, repurchase transaction, reverse repurchase transaction, buy/sell-back transaction, securities lending transaction, or any other similar transaction (including any option with respect to any of these transactions) or any combination thereof, whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

“Increasing Lender” shall have the meaning set forth in Section 2.23.“Incremental Commitment” shall have the meaning set forth in Section 2.23.

“Indebtedness” of any Person shall mean, without duplication, (i) all obligations of such Person for borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person in respect of the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of business; provided that, for purposes of Section 8.1(g),trade payables overdue by more than 120 days shall be included in this definition except to the extent that any of such trade payables are being disputed in good faith and by appropriate measures), (iv) all obligations of such Person under any conditional sale or other title retention agreement(s) relating to property acquired by such Person, (v) all Capital Lease Obligations of such Person, (vi) all obligations, contingent or otherwise, of such Person in respect of letters of credit, acceptances or similar extensions of credit, (vii) all Guarantees of such Person of the type of Indebtedness described in clauses (i) through (vi)

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above, (viii) all Indebtedness of a third party secured by any Lien on property owned by such Person, whether or not such Indebtedness has been assumed by such Person, (ix) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value anyCapital Stock of such Person, (x) all Off-Balance Sheet Liabilities and (xi) all net Hedging Obligations. For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company or the foreign equivalent thereof) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person. The amount of any net obligation under any Swap Contract on any date shall be deemed to be the Swap Termination Value thereof as of such date. The amount of Indebtedness of any Person for purposes of clause (viii) that is expressly made nonrecourse or limited-recourse (limited solely to the assets securing such Indebtedness) to such Person shall be deemed to be equal to the lesser of (x) the aggregate unpaid amount of such Indebtedness and (y) the fair market value of the property encumbered thereby as determined by such Person in good faith.

“Indemnified Taxes” shall mean (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Credit Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

“Information Memorandum” shall mean any Confidential Information Memorandum relating to the Borrower and the transactions contemplated by this Agreement and the other Loan Documents prepared in connection with the syndication of any of the Commitments.

“Initial Maturity Date” means June 30, 2024.

“Interest Coverage Ratio” means the ratio of Adjusted EBITDA for the subject testing period to Interest Expense.

“Interest Expense” means, with respect to any Person, all paid, accrued or capitalized interest expense on such Person’s Indebtedness (whether direct, indirect or contingent, and including, without limitation, interest on all convertible debt), and including (without duplication) the Equity Percentage of Interest Expense for the Borrower’s Unconsolidated Affiliates.

“Interest Period” shall mean with respect to any Eurodollar Borrowing, a period of one, two, three or six months; provided that:

(i)the initial Interest Period for such Borrowing shall commence on the date of such Borrowing (including the date of any conversion from a Borrowing of another Type), and each Interest Period occurring thereafter in respect of such Borrowing shall commence on the day on which the next preceding Interest Period expires;

(ii)if any Interest Period would otherwise end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day, unless such Business Day falls in another calendar month, in which case such Interest Period would end on the immediately preceding Business Day;

(iii)any Interest Period which begins on the last Business Day of a calendar month or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period shall end on the last Business Day of such calendar month; and

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(iv)no Interest Period may extend beyond the Maturity Date. “IRS” shall mean the United States Internal Revenue Service.

“Legal Requirement” means any law, statute, ordinance, decree, requirement, order, judgment, rule, regulation (or interpretation of any of the foregoing) of, and the terms of any license or permit issued by, any Governmental Authority.

“Lender-Related Hedge Provider” means any Person that, at the time it enters into a Hedging Transaction with any Credit Party, (i) is a Lender or an Affiliate of a Lender and (ii) except when the Lender-Related Hedge Provider is Truist Bank or any of its Affiliates, has provided prior written notice to the Administrative Agent which has been acknowledged by the Borrower of (x) the existence of such Hedging Transaction and (y) the methodology to be used by such parties in determining the obligations under such Hedging Transaction from time to time. In no event shall any Lender-Related Hedge Provider acting in such capacity be deemed a Lender for purposes hereof to the extent of and as to Hedging Obligations except that each reference to the term “Lender” in Article IX and Section 10.3(b) shall be deemed to include such Lender-Related Hedge Provider. In no event shall the approval of any such Person in its capacity as Lender-Related Hedge Provider be required in connection with the release or termination of any security interest or Lien of the Administrative Agent.

“Lenders” shall have the meaning set forth in the introductory paragraph hereof and shall include, where appropriate, each Revolving Lender, each Supplemental Lender, and each Second  Supplemental Lender, and each Increasing Lender and each Additional Lender that joins this Agreement pursuant to Section 2.23.

“Lien” means, with respect to an asset, (a) any mortgage, deed of trust, lien (statutory or other), pledge, hypothecation, negative pledge, collateral assignment, encumbrance, deposit arrangement, charge or security interest in, on or of such asset; (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset; (c) the filing under the Uniform Commercial Code or comparable law of any jurisdiction of any financing statement naming the owner of the asset to which such Lien relates as debtor; (d) any other preferential arrangement of any kind or nature whatsoever intended to assure payment of any Indebtedness or other obligation; and (e) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities, including any dividend reinvestment or redemption plans.

“Loan Documents” shall mean, collectively, this Agreement, the Collateral Documents, the Fee Letter, the Second Supplemental Fee Letter,  all Notices of Borrowing, all Notices of Conversion/Continuation, all Compliance Certificates, the Modifications,  any promissory notes issued hereunder and any and all other instruments, agreements, documents and writings executed in connection with any of the foregoing.

“Loans” shall mean all Revolving Loans, all Supplemental Loans, and all Second  Supplemental Loans, and shall include, where appropriate, any loan made pursuant to Section 2.23.

“Management Company” means BH Management Services, LLC, an Iowa limited liability company.

“Mandatory Prepayment” has the meaning set forth in Section 2.12(a).

“Material Adverse Effect” means a material adverse effect on (a) the business, assets, operations, or financial condition of (i) the Parent, the Borrower and its Subsidiaries taken as a whole, (b) the ability of any of the Credit Parties to perform their obligations under the Loan Documents or (c) the rights of or benefits available to the Administrative Agent or the Lenders under the Loan Documents; provided, however, that none of the following shall constitute, or shall be considered in determining whether there has occurred, and no event, circumstance, change or effect resulting from or arising out of any of the following shall constitute, a Material Adverse Effect: (A) changes in the national or world economy or financial markets as a whole or changes in general economic conditions that affect the industries in which the Parent, the Borrower, and its Subsidiaries conduct their business, so long as such changes or conditions do not adversely affect the Parent, the Borrower, and its Subsidiaries, taken as a whole, in a materially disproportionate manner relative to other similarly situated participants in the industries or markets in which they operate; (B) any change in applicable Law, rule or regulation or GAAP or interpretation thereof after the date hereof,

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so long as such changes do not adversely affect the Parent, the Borrower, and its Subsidiaries, taken as a whole, in a materially disproportionate manner relative to other similarly situated participants in the industries or markets in which they operate; (C) the failure, in and of itself, of the Parent or the Borrower to meet any published or internally prepared estimates of revenues, earnings or other financial projections, performance measures or operating statistics; (D) a decline in the price, or a change in the trading volume, of the Parent; and (E) compliance with the terms of, and taking any action required by, this Agreement, or taking or not taking any actions at the request of, or with the consent of, the Administrative Agent.

“Material Contract” means any contract or other arrangement (other than Loan Documents), whether written or oral, to which any Credit Party is a party as to which the breach, nonperformance, cancellation or failure to renew by any party thereto could reasonably be expected to have a Material Adverse Effect.

“Maturity Date” means the earlier of (ia) the Initial Maturity Date, as such date may be extended as to the Extended Maturity Date provided in Section 2.22, and (iib) the date on which the Loans shall become due and payable pursuant to the terms hereof.

“Modifications” means a collective reference to: (a) that certain September 2021 Modification of  Loan Documents dated as of September 9, 2021; and (b) each other amendment, restatement, extension, supplement,  or modification of or with respect to any Loan Document(s) entered into following the Closing Date and in  accordance with the terms and conditions set forth in the Loan Documents for modifications thereof.

“Mortgaged Property” means all Real Properties from time to time granted as security under the Senior Loan.

“Multiemployer Plan” shall mean any “multiemployer plan” as defined in Section 4001(a)(3) of ERISA, which is contributed to by (or to which there is or may be an obligation to contribute of) the Borrower, any of its Subsidiaries or an ERISA Affiliate, and each such plan for the five-year period immediately following the latest date on which the Borrower, any of its Subsidiaries or an ERISA Affiliate contributed to or had an obligation to contribute to such plan.

“Net Operating Income” means, for any income producing Real Property and for a given period, the difference between (a) any rentals, proceeds and other income received from such property during the determination period, less (b) an amount equal to all costs and expenses (excluding Interest Expense, depreciation and amortization expense, and any expenditures that are capitalized in accordance with GAAP) incurred as a result of, or in connection with, or properly allocated to, the operation or leasing of such Real Property during the determination period (other than asset management fees); provided, that the calculation of such costs and expenses shall be adjusted for any annual costs or expenses related to taxes, insurance premiums, and other one-time annual expenses. Net Operating Income shall be calculated based on the most recently ended calendar quarter, annualized, with the exception of taxes, insurance premiums and other one-time annual expenses, which may be based on the most recently ended twelve-month period. If the Real Property has not been owned by the Borrower or a subsidiary for a full calendar quarter, the annualized Net Operating Income shall be calculated based upon the historical data provided by the Borrower, subject to adjustment by the Administrative Agent in its reasonable discretion and thereafter until such Real Property has been owned by the Borrower or its subsidiaries for the entirety of a calendar quarter, Net Operating Income shall be grossed up for such ownership period. Net Operating Income shall be calculated on a consolidated basis for the Borrower and its Wholly-Owned Subsidiaries and including (without duplication) the Equity Percentage of Net Operating Income for the Borrower’s Unconsolidated Affiliates but adjusted for non-cash operating items and other non-cash items.

“Net Required Capex Reserve” means, as of any date of determination, an amount, not less than zero ($0.00) equal to (a) the Capital Expenditure Reserve, less (b) the amount of capital expenditure reserves already held on the Borrower’s balance sheet in the form of cash or cash equivalents.

“Non-Consenting Lender” means any Lender that does not approve any consent, waiver or amendment that (i) requires the approval of all or all affected Lenders in accordance with the terms of Section 2.25  and (ii) has been approved by the Required Lenders.

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“Non-Defaulting Lender” shall mean, at any time, a Lender that is not a Defaulting Lender.

“Non-U.S. Plan” shall mean any plan, fund (including, without limitation, any superannuation fund) or other similar program established, contributed to (regardless of whether through direct contributions or through employee withholding) or maintained outside the United States by the Borrower or one or more of its Subsidiaries primarily for the benefit of employees of the Borrower or such Subsidiaries residing outside the United States, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement, or payments to be made upon termination of employment, and which plan is not subject to ERISA or the Code.

“Notice of Borrowing” shall have the meaning set forth in Section 2.5.

“Notice of Conversion/Continuation” shall have the meaning set forth in Section 2.7(b).

“Obligations” shall mean (a) all amounts owing by the Credit Parties to the Administrative Agent, any Lender, or the Arranger pursuant to or in connection with this Agreement or any other Loan Document or otherwise with respect to any Loan including, without limitation, all principal, interest (including any interest accruing after the filing of any petition in bankruptcy or the commencement of any insolvency, reorganization or like proceeding relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding), reimbursement obligations, fees, expenses, indemnification and reimbursement payments, costs and expenses (including all fees and expenses of counsel to the Administrative Agent and any Lender incurred pursuant to this Agreement or any other Loan Document), whether direct or indirect, absolute or contingent, liquidated or unliquidated, now existing or hereafter arising hereunder or thereunder, (b) all Hedging Obligations owed by any Credit Party to any Lender-Related Hedge Provider, and (c) all Bank Product Obligations, together with all renewals, extensions, modifications or refinancings of any of the foregoing; provided, however, that with respect to any Guarantor, the Obligations shall not include any Excluded Swap Obligations.

“OFAC” shall mean the U.S. Department of the Treasury’s Office of Foreign Assets Control.

“Off-Balance Sheet Liabilities” of any Person shall mean (i) any repurchase obligation or liability of such Person with respect to accounts or notes receivable sold by such Person, (ii) any liability of such Person under any sale and leaseback transactions that do not create a liability on the balance sheet of such Person, (iii) any Synthetic Lease Obligation or (iv) any obligation arising with respect to any other transaction which is the functional equivalent of or takes the place of borrowing but which does not constitute a liability on the balance sheet of such Person.

“Other Connection Taxes” shall mean, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Taxes” shall mean all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 2.25).

“Parent” means NexPoint Residential Trust, Inc., a Maryland corporation.

“Parent Company” shall mean, with respect to a Lender, the “bank holding company” as defined in Regulation Y, if any, of such Lender, and/or any Person owning, beneficially or of record, directly or indirectly, a majority of the shares of such Lender.

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“Participant” shall have the meaning set forth in Section 10.4(d).“Participant Register” shall have the meaning set forth in Section 10.4(d).

“Payment Office” shall mean the office of the Administrative Agent located at 303 Peachtree Street, N.E., Atlanta, Georgia 30308, or such other location as to which the Administrative Agent shall have given written notice to the Borrower and the Lenders.

“Payout Ratio” means the ratio of cash dividends or distributions to common equity holders of the Parent paid or payable for the applicable period to Core Funds from Operations.

“PBGC” shall mean the U.S. Pension Benefit Guaranty Corporation referred to and defined in ERISA, and any successor entity performing similar functions.

“Perfection Certificate” shall mean a certificate of the Borrower in the form attached hereto as Exhibit D.

“Permitted Encumbrances” means:

(a)Liens imposed by law for taxes that are not yet due or are being contested in compliance with Section 5.5;

(b)pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;

(c)deposits to secure the performance of bids, trade contracts, purchase, construction or sales contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business;

(d)the Title Instruments, Liens and other matters described in the Title Insurance Policy;

(e)uniform commercial code protective filings with respect to personal property leased to the Borrower or any Subsidiary;

(f)landlords’ liens for rent not yet due and payable; and

(g)liens arising under the Senior Loan; provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness other than the Senior Loan.

“Permitted Investments” means:

(a)direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of acquisition thereof;

(b)investments in commercial paper maturing within 270 days from the date of acquisition thereof and having an investment grade credit rating on the date of acquisition;

(c)investments in certificates of deposit, banker’s acceptances and time deposits maturing within 180 days from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof which has a combined capital and surplus and undivided profits of not less than $500,000,000;

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(d)fully collateralized repurchase agreements with a term of not more than 90 days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria described in clause (c) above; and

(e)investments of a Borrower in Subsidiaries and Unconsolidated Affiliates made in accordance with this Agreement.

“Person” shall mean any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” shall mean any “employee benefit plan” as defined in Section 3 of ERISA (other than a Multiemployer Plan) maintained or contributed to by the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA Affiliate has or may have an obligation to contribute, and each such plan that is subject to Title IV of ERISA for the five-year period immediately following the latest date on which the Borrower or any ERISA Affiliate maintained, contributed to or had an obligation to contribute to (or is deemed under Section 4069 of ERISA to have maintained or contributed to or to have had an obligation to contribute to, or otherwise to have liability with respect to) such plan.

“Platform” means Debt Domain, Intralinks, Syndtrak or a substantially similar electronic transmission system.

“Pledge Agreement” means those certain Equity Interests Pledge and Security Agreements executed by the Borrower in favor of Administrative Agent pledging Borrower’s interest in the Pledged Interests.

“Pledged Interests” means, collectively, the ownership (or in the reasonable discretion of the Administrative Agent, the economic) interests now or hereafter pledged by Borrower and each Collateral Subsidiary and the economic interest, including rights to receive cash and other distributions from each other Subsidiary of the Borrower hereunder and subject to the liens and security interests of the Loan Documents, or intended so to be.

“Pro Rata Share” shall mean, with respect to any Class of Commitment or Loan of any Lender at any time, a percentage, the numerator of which shall be such Lender’s Commitment of such Class (or if such Commitment has been terminated or expired or the Loans have been declared to be due and payable, such Lender’s Revolving Credit Exposure, Supplemental Credit Exposure, and/or Second  Supplemental Credit Exposure, as applicable), and the denominator of which shall be the sum of all Commitments of such Class of all Lenders (or if such Commitments have been terminated or expired or the Loans have been declared to be due and payable, all Revolving Credit Exposure of all Revolving Lenders, all Supplemental Credit Exposures of all Supplemental  Lenders, and/or all Second  Supplemental Credit Exposures of all Second  Supplemental Lenders, as applicable).

“Real Property” means, collectively, all interest in any land and improvements located thereon (including direct financing leases of land and improvements owned by a Credit Party or any of Borrower’s Subsidiaries), together with all equipment, furniture, materials, supplies and personal property now or hereafter located at or used in connection with the land and all appurtenances, additions, improvements, renewals, substitutions and replacements thereof now or hereafter acquired by a Credit Party or any of Borrower’s Subsidiaries.

“Recipient” shall mean, as applicable, (a) the Administrative Agent, and (b) any Lender.

“Reference Time” with respect to any setting of the then-current Benchmark means (1) if such Benchmark is the Adjusted LIBO Rate, 11:00 a.m. (London time) on the day that is two London banking days preceding the date of such setting, and (2) if such Benchmark is not the Adjusted LIBO Rate, the time determined by the Administrative Agent in its reasonable discretion.

“Regulation D” shall mean Regulation D of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

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“Regulation T” shall mean Regulation T of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

“Regulation U” shall mean Regulation U of the Board of Governors of the Federal

“Regulation X” shall mean Regulation X of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

“Regulation Y” shall mean Regulation Y of the Board of Governors of the Federal Reserve System, as the same may be in effect from time to time, and any successor regulations.

“Related Parties” shall mean, with respect to any Person, such Person’s Affiliates and the managers, administrators, trustees, partners, directors, officers, employees, agents, advisors or other representatives of such Person and such Person’s Affiliates.

“Release” shall mean any release, spill, emission, leaking, dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching or migration into the environment (including ambient air, surface water, groundwater, land surface or subsurface strata) or within any building, structure, facility or fixture.

“Relevant Governmental Body” means the Federal Reserve Board and/or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board and/or the Federal Reserve Bank of New York or any successor thereto.

“Replaced Credit Agreement” means that certain Revolving Credit Agreement dated as of January 28, 2019 among Borrower, Administrative Agent and the lenders party thereto, as the same may have been, prior to the date of this Agreement, amended, restated, supplemented, extended or otherwise modified (whether through modification agreements, letter agreements, or otherwise).

“Required Lenders” means, as of any date of determination, at least two (2) Lenders having more than 66 2/3% of the existing Commitments and Total Credit Exposures of all Lenders or, if the existing Commitments of each Lender to make Loans have been terminated pursuant to Article VIII, at least two (2) Lenders holding in the aggregate at least 66 2/3% of the Total Credit Exposures of all Lenders; provided that the Commitment and Total Credit Exposure of any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders; provided further that, at any time when there are two (2) or fewer Lenders, Required Lenders shall mean all Lenders that are not Defaulting Lenders.

“Required Revolving Lenders” means, as of any date of determination, at least two (2) Revolving Lenders having more than 66 2/3% of the existing Revolving Commitments and Revolving Credit Exposures of all Revolving Lenders or, if the existing Revolving Commitments of each Revolving Lender to make Revolving Loans have been terminated pursuant to Article VIII, at least two (2) Revolving Lenders holding in the aggregate at least 66 2/3% of the aggregate Revolving Credit Exposures of all Revolving Lenders; provided that the Revolving Commitment and Revolving Credit Exposure of any Defaulting Lender shall be excluded for purposes of making a determination of Required Revolving Lenders; provided further that, at any time when there are two (2) or fewer Revolving Lenders, Required Revolving Lenders shall mean all Revolving Lenders that are not Defaulting Lenders.

“Required Second Supplemental Lenders” means, as of any date of determination, at least two (2)  Second Supplemental Lenders having more than 66 2/3% of the existing Second Supplemental Commitments and  Second Supplemental Credit Exposures of all Supplemental Lenders or, if the existing Second Supplemental  Commitments of each Second Supplemental Lender to make Second Supplemental Loans have been terminated  pursuant to Article VIII, at least two (2) Second Supplemental Lenders holding in the aggregate at least 66 2/3% of  the aggregate Second Supplemental Credit Exposures of all Second Supplemental Lenders; provided that the Second  Supplemental Commitment and Second Supplemental Credit Exposure of any Defaulting Lender shall be excluded  for purposes of making a determination of Required Supplemental Lenders; provided further that, at any time when  there are two (2) or fewer Second Supplemental Lenders, Required Second Supplemental Lenders shall mean all  Second Supplemental Lenders that are not Defaulting Lenders.

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“Required Supplemental Lenders” means, as of any date of determination, at least two (2) Supplemental Lenders having more than 66 2/3% of the existing Supplemental Commitments and Supplemental Credit Exposures of all Supplemental Lenders or, if the existing Supplemental Commitments of each Supplemental Lender to make Supplemental Loans have been terminated pursuant to Article VIII, at least two (2) Supplemental Lenders holding in the aggregate at least 66 2/3% of the aggregate Supplemental Credit Exposures of all Supplemental Lenders; provided that the Supplemental Commitment and Supplemental Credit Exposure of any Defaulting Lender shall be excluded for purposes of making a determination of Required Supplemental Lenders;provided further that, at any time when there are two (2) or fewer Supplemental Lenders, Required Supplemental Lenders shall mean all Supplemental Lenders that are not Defaulting Lenders.

“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.

“Responsible Officer” shall mean (x) with respect to certifying compliance with the financial covenants set forth in Section 5.2, the chief financial officer or the treasurer of the Parent and (y) with respect to all other provisions, any of the president, the chief executive officer, the chief operating officer, the chief financial officer, the treasurer or a vice president of the Parent, Borrower, or such other representative of the Borrower as may be designated in writing by any one of the foregoing with the consent of the Administrative Agent.

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any ownership interests in the Parent, Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such ownership interests in the Parent or Borrower or any option, warrant or other right to acquire any such shares of capital stock of the Parent or the Borrower.

“Revolving Commitment” shall mean, with respect to each Revolving Lender, the commitment of such Revolving Lender to make Revolving Loans to the Borrower in an aggregate principal amount not exceeding the amount set forth with respect to such Revolving Lender on Schedule II, as such schedule may be amended pursuant to Section 2.23, or, in the case of a Person becoming a Revolving Lender after the Closing Date, the amount of the assigned “Revolving Commitment” as provided in the Assignment and Acceptance executed by such Person as an assignee, or the joinder executed by such Person, in each case as such commitment may subsequently be increased or decreased pursuant to the terms hereof.

“Revolving Credit Exposure” shall mean, with respect to any Revolving Lender at any time, the sum of the outstanding principal amount of such Revolving Lender’s Revolving Loans.

“Revolving Lender(s)” shall mean the parties hereto from time to time holding Revolving Commitments and/or Revolving Credit Exposure hereunder.

“Revolving Loan” shall mean a loan made by a Revolving Lender to the Borrower under its Revolving Commitment, which may either be a Base Rate Loan or a Eurodollar Loan.

“Sanctioned Country” shall mean, at any time, a country, region or territory that is, or whose government is, the subject or target of any Sanctions; including, without limitation, Crimea, Cuba, Iran, North Korea, Sudan and Syria.

“Sanctioned Person” shall mean, at any time, (a) any Person that is the subject or target of any Sanctions, (b) any Person located, organized, operating or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person.

“Sanctions” shall mean economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department

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of State, (b) the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom or (c) any other relevant sanctions authority.

“Screen Rate” shall mean the rate specified in clause (i) of the definition of Adjusted LIBO Rate.

“Second Supplemental Commitment” shall mean, with respect to each Second Supplemental  Lender, the commitment of such Second Supplemental Lender to make Second Supplemental Loans to the Borrower  in an aggregate principal amount not exceeding the amount set forth with respect to such Revolving Lender on  Schedule II, as such schedule may be amended in the case of a Person becoming a Second Supplemental Lender after  the Closing Date, the amount of the assigned “Second Supplemental Commitment” as provided in the Assignment

and Acceptance executed by such Person as an assignee, or the joinder executed by such Person, in each case as such  commitment may subsequently be increased or decreased pursuant to the terms hereof. Following its establishment  on September 9, 2021, the Second Supplemental Commitment shall not be subject to increase pursuant to Section  2.23 or otherwise, except in connection with the written consent of each of the Lenders.

“Second Supplemental Credit Exposure” shall mean, with respect to any Second Supplemental  Lender at any time, the sum of the outstanding principal amount of such Second Supplemental Lender’s Second  Supplemental Loans.

“Second Supplemental Fee Letter” shall mean that certain fee letter, dated as of September 9,  2021, executed by KeyBank National Association, as the sole existing Second Supplemental Lender, and accepted  by the Borrower.

“Second Supplemental Lender(s)” shall mean the parties hereto from time to time holding Second  Supplemental Commitments and/or Second Supplemental Credit Exposure hereunder.

“Second Supplemental Loan” shall mean a term loan made by a Second Supplemental Lender to  the Borrower under its Second Supplemental Commitment, which may either be a Base Rate Loan or a Eurodollar  Loan.

“Second Supplemental Maturity Date” means December 9, 2021.

“Senior Credit Agreement” means, collectively, each of those certain Loan Agreements, set forth on Schedule III hereof with respect to the Mortgaged Properties.

“Senior Loan” means each loan made pursuant to a Senior Credit Agreement.

“Senior Loan Documents” means each Senior Credit Agreement and all other instruments, agreements and written obligations executed and delivered in connection with the transactions contemplated by a Senior Credit Agreement.

“Secured Parties” shall mean the Administrative Agent, the Lenders, the Lender-Related Hedge Providers and the Bank Product Providers.

“SOFR” means, with respect to any Business Day, a rate per annum equal to the secured overnight financing rate for such Business Day published by the SOFR Administrator on the SOFR Administrator’s Website at approximately 8:00 a.m. (New York City time) on the immediately succeeding Business Day.

“SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

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“SOFR Administrator’s Website” means the website of the Federal Reserve Bank of New York, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.

“Solvent” shall mean, with respect to any Person on a particular date, that on such date (a) the fair value of the property of such Person is greater than the total amount of liabilities, including subordinated and contingent liabilities, of such Person; (b) the present fair saleable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts and liabilities, including subordinated and contingent liabilities as they become absolute and matured; (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature; and (d) such Person is not engaged in a business or transaction, and is not about to engage in a business or transaction, for which such Person’s property would constitute an unreasonably small capital. The amount of contingent liabilities (such as litigation, guaranties and pension plan liabilities) at any time shall be computed as the amount that, in light of all the facts and circumstances existing at the time, represents the amount that would reasonably be expected to become an actual or matured liability.

“Subsidiary” means, with respect to Borrower, Guarantor, Parent or any Credit Party, as applicable (the “parent”), at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held by parent, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent.

“Supplemental Commitment” shall mean, with respect to each Supplemental Lender, the commitment of such Supplemental Lender to make Supplemental Loans to the Borrower in an aggregate principal amount not exceeding the amount set forth with respect to such Revolving Lender on Schedule II, as such schedule may be amended pursuant to Section 2.23, or, in the case of a Person becoming a Supplemental Lender after the Closing Date, the amount of the assigned “Supplemental Commitment” as provided in the Assignment and Acceptance executed by such Person as an assignee, or the joinder executed by such Person, in each case as such commitment may subsequently be increased or decreased pursuant to the terms hereof.

“Supplemental Credit Exposure” shall mean, with respect to any Supplemental Lender at any time, the sum of the outstanding principal amount of such Supplemental Lender’s Supplemental Loans.

“Supplemental Lender(s)” shall mean the parties hereto from time to time holding Supplemental Commitments and/or Supplemental Credit Exposure hereunder.

“Supplemental Loan” shall mean a term loan made by a Supplemental Lender to the Borrower under its Supplemental Commitment, which may either be a Base Rate Loan or a Eurodollar Loan.

“Supplemental Maturity Date” means December 30, 2021.

“Swap Obligation” shall mean, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender).

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“Synthetic Lease” shall mean a lease transaction under which the parties intend that (i) the lease will be treated as an “operating lease” by the lessee pursuant to Accounting Standards Codification Sections 840-10 and 840-20, as amended, and (ii) the lessee will be entitled to various tax and other benefits ordinarily available to owners (as opposed to lessees) of like property.

“Synthetic Lease Obligations” shall mean, with respect to any Person, the sum of (i) all remaining rental obligations of such Person as lessee under Synthetic Leases which are attributable to principal and, without duplication, (ii) all rental and purchase price payment obligations of such Person under such Synthetic Leases assuming such Person exercises the option to purchase the lease property at the end of the lease term.

“Tangible Net Worth” shall mean total assets (without deduction for accumulated depreciation and accumulated amortization of lease intangibles) less (1) all intangible assets and (2) all liabilities (including contingent and indirect liabilities), all determined in accordance with GAAP. The term “intangible assets” shall include, without limitation, (i) deferred charges such as straight-line rents and other non-cash items, and (ii) the aggregate of all amounts appearing on the assets side of any such balance sheet for franchises, licenses, permits, patents, patent applications, copyrights, trademarks, trade names, goodwill, treasury stock, experimental or organizational expenses and other like intangibles (other than amounts related to the purchase price of real property which are allocated to lease intangibles). The term “liabilities” shall include, without limitation, (i) Indebtedness secured by Liens on property of the Person with respect to which Tangible Net Worth is being computed whether or not such Person is liable for the payment thereof, (ii) deferred liabilities, and (iii) Capital Lease Obligations. Tangible Net Worth shall be calculated on a consolidated basis Borrower, Guarantor, and their Wholly-Owned Subsidiaries and including the Borrower’s Equity Percentage of Tangible Net Worth of the Borrower’s Unconsolidated Affiliates.

“Taxes” shall mean any and all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees, or charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Term SOFR” means, for the applicable Corresponding Tenor as of the applicable Reference Time, the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body.

“Term SOFR Notice” means a notification by the Administrative Agent to the Lenders and the Borrower of the occurrence of a Term SOFR Transition Event.

“Term SOFR Transition Event” means the determination by the Administrative Agent that (a) Term SOFR has been recommended for use by the Relevant Governmental Body, (b) the administration of Term SOFR is administratively feasible for the Administrative Agent and (c) a Benchmark Transition Event has previously occurred resulting in a Benchmark Replacement in accordance with Section 2.16 that is not Term SOFR.

“Title Instruments” means true and correct copies of all instruments of record in the Office of the County Clerk, the Real Property Records or of any other Governmental Authority affecting title to all or any part of the Mortgaged Properties, including but not limited to those (if any) which impose restrictive covenants, easements, rights-of-way or other encumbrances on all or any part of the Mortgaged Properties.

“Title Insurance Policy” means, collectively, the policies of title issued in favor of the respective Collateral Subsidiary by a title insurance company satisfactory to each lender under a Senior Credit Agreement and insuring that title to each Mortgaged Property is vested in such Collateral Subsidiary, free and clear of any Lien, objection, exception or requirement, subject only to the Permitted Encumbrances.

“Total Asset Value” means the sum of (without duplication) (a) the aggregate Value of all of Borrower’s, Guarantor’s and their Subsidiaries’ Real Property, plus (b) the amount of any unencumbered cash and cash equivalents, excluding tenant security and other restricted deposits of the Borrower and its Subsidiaries, plus (c) the amount of restricted cash reserves available for funding planned real property capital improvements. For any non-wholly owned Real Properties, Total Asset Value shall be adjusted for Borrower’s, Guarantor’s and Subsidiaries’ Equity Percentage thereof.

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“Total Credit Exposure” shall mean, with respect to any Lender at any time, the sum of such Lender’s Revolving Credit Exposure, Supplemental Credit Exposure, and Second Supplemental Credit Exposure.

“Total Leverage Ratio” means the ratio (expressed as a percentage) of (a) the Indebtedness of Borrower and the Indebtedness of the Guarantor (without duplication) to (b) Total Asset Value.

“Type”, when used in reference to a Loan or a Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Base Rate.

“UK Financial Institution” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.

“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.

“Unadjusted Benchmark Replacement” means the Benchmark Replacement excluding the Benchmark Replacement Adjustment.

“Unconsolidated Affiliate” means, without duplication, in respect of any Person, any other Person (other than a Person whose stock is traded on a national trading exchange) in whom such Person holds, directly or indirectly, an investment consisting of a voting equity or ownership interest, which investment is accounted for in the financial statements of such Person on an equity basis of accounting.

“Unfunded Pension Liability” of any Plan shall mean the amount, if any, by which the value of the accumulated plan benefits under the Plan, determined on a plan termination basis in accordance with actuarial assumptions at such time consistent with those prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds the fair market value of all Plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions).

“Unhedged Variable Rate Debt” means any Indebtedness or portion thereof which is not subject to a Hedging Transaction.

“Unused Fee” shall have the meaning set forth in Section 2.14(b).

“Unused Fee Rate” means, for each day during a calendar quarter: (a) to the extent the unused amount of the Aggregate Revolving Commitments at the end of such day is greater than 50.0% of the Aggregate Revolving Commitments for such day, 0.25% per annum; and (b) to the extent the unused amount of the Aggregate Revolving Commitments at the end of such day is less than 50.0% of the Aggregate Revolving Commitments on such day, 0.15% per annum.

“Uniform Commercial Code” or “UCC” shall mean the Uniform Commercial Code as in effect from time to time in the State of New York.

“United States” or “U.S.” shall mean the United States of America.

“U.S. Borrower” shall mean any Borrower that is a U.S. Person.

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“U.S. Person” shall mean any Person that is a “United States person” as defined in Section 7701(a)(30) of the Code.

“U.S. Tax Compliance Certificate” shall have the meaning set forth in Section 2.20(e)(ii).“Value” means the sum of the following:

(a)for Real Property owned by the Borrower or any applicable Subsidiary for a period of less than six (6) calendar quarters, the greater of (i) the cost-basis book value of such Real Property; and (ii) an amount equal to (A) the aggregate Net Operating Income attributable thereto for the most recently ended calendar quarter, annualized, divided by (B) the Capitalization Rate; provided, that once a Real Property’s Value has been determined using subclause (ii) above, all future determinations of Value for such Real Property shall be performed pursuant to such subclause (ii); plus

(b)for all other Real Property (i) the aggregate Net Operating Income attributable thereto for the most recently ended calendar quarter, annualized, divided by (ii) the Capitalization Rate.

“Wholly-Owned” means, with respect to a Subsidiary of a Person, a Subsidiary of such Person all of the outstanding Equity Interests of which (other than (x) director’s qualifying shares and (y) shares issued to foreign nationals to the extent required by applicable law) are owned by such Person and/or by one or more wholly owned Subsidiaries of such Person. In determining whether a Subsidiary of a Person is a Wholly-Owned Subsidiary, all preferred shareholders of a Subsidiary that is organized as a real estate investment trust shall be disregarded.

“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

“Withholding Agent” shall mean the Borrower, any other Credit Party or the Administrative Agent, as applicable.

“Write-Down and Conversion Powers” means (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.

Section 1.2.Classifications of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Type (e.g. “Eurodollar Loan” or “Base Rate Loan”). Borrowings also may be classified and referred to by Type (e.g. “Revolving Eurodollar Borrowing”).

Section 1.3.Accounting Terms and Determination. Unless otherwise defined or specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance with GAAP as in effect from time to time, applied on a basis consistent with the most recent audited consolidated financial statement of the Borrower delivered pursuant to Section 5.1(a); provided that if the Borrower notifies the Administrative Agent that the Borrower wishes to amend any covenant in Section 5.2 to eliminate the effect of any change in GAAP on the operation of such covenant (or if the Administrative Agent notifies the Borrower that the Required Lenders wish to amend Section 5.2 for such purpose), then the Borrower’s compliance with such covenant shall be determined on the basis of GAAP in effect immediately before the relevant change in GAAP became effective, until either such notice is withdrawn or such covenant is amended in a manner satisfactory to the Borrower and the Required Lenders. Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to any election under Accounting Standards Codification Section 825-10 (or any other Financial Accounting Standard having a similar result

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or effect) to value any Indebtedness or other liabilities of any Credit Party or any Subsidiary of any Credit Party at “fair value”, as defined therein.

Section 1.4.Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word “shall”. In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the word “to” means “to but excluding”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as it was originally executed or as it may from time to time be amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and permitted assigns, (c) the words “hereof”, “herein” and “hereunder” and words of similar import shall be construed to refer to this Agreement as a whole and not to any particular provision hereof, (d) all references to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles, Sections, Exhibits and Schedules to this Agreement, (e) all references to a specific time shall be construed to refer to the time in the city and state of the Administrative Agent’s principal office, unless otherwise indicated and (f) any definition of or reference to any law shall include all statutory and regulatory provisions consolidating, amending, or interpreting any such law and any reference to or definition of any law or regulation, unless otherwise specified, shall refer to such law or regulation as amended, modified or supplemented from time to time.

Section 1.5.Divisions. For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized on the first date of its existence by the holders of its equity interests at such time.

Section 1.6.LIBOR. The London interbank offered rate (“LIBOR”) is intended to represent the rate at which contributing banks could obtain short-term borrowings from one another in the London interbank market. On March 5, 2021, the Financial Conduct Authority ("FCA"), the regulatory supervisor of LIBOR's administrator, announced in a public statement the future cessation of the 35 LIBOR benchmark settings currently published by ICE Benchmark administration. This public statement constitutes a Benchmark Transition Event. To the extent the Maturity Date goes beyond the cessation dates indicated in the FCA’s announcement, an alternate rate of interest will be determined at the appropriate time in accordance with Section 2.16(b) for any applicable tenors of LIBOR.

Upon the occurrence of a Benchmark Transition Event, a Term SOFR Transition Event or an Early Opt-in Election, Section 2.16(b) and (c) provide the mechanism for determining an alternative rate of interest. The Administrative Agent will promptly notify the Borrower, pursuant to Section 2.16(e), of any change to the reference rates upon which the interest rates on Eurodollar Loans are based. However, the Administrative Agent does not warrant or accept any responsibility for, and shall not have any liability with respect to, the administration, submission or any other matter related to LIBOR or other rates in the definition of “Adjusted LIBO Rate” or with respect to any alternative or successor rate thereto, or replacement rate thereof (including, without limitation, (i) any such alternative, successor or replacement rate implemented pursuant to Section 2.16(b) or (c), whether upon the occurrence of a Benchmark Transition Event, a Term SOFR Transition Event or an Early Opt-in Election, and (ii) the implementation of any Benchmark Replacement Conforming Changes pursuant to Section 2.16(d)), including without limitation, whether the composition or characteristics of any such alternative, successor or replacement reference rate will be similar to, or produce the same value or economic equivalence of, the Adjusted LIBO Rate or have the same volume or liquidity as did LIBOR prior to its discontinuance or unavailability.

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ARTICLE II

AMOUNT AND TERMS OF THE COMMITMENTS

Section 2.1.Establishment of Revolving Credit Facility. Subject to and upon the terms and conditions herein set forth, the Revolving Lenders hereby establish in favor of the Borrower a revolving credit facility pursuant to which each Revolving Lender severally agrees (to the extent of such Revolving Lender’s Revolving Commitment) to make Revolving Loans to the Borrower in accordance with Section 2.2.

Section 2.2.Revolving Loans. Subject to the terms and conditions set forth herein, each Revolving Lender severally agrees to make Revolving Loans, ratably in proportion to its Pro Rata Share of the Aggregate Revolving Commitments, to the Borrower, from time to time during the Availability Period, in an aggregate principal amount outstanding at any time that will not result in (a) such Revolving Lender’s Revolving Credit Exposure exceeding such Revolving Lender’s Revolving Commitment or (b) the aggregate Revolving Credit Exposures of all Revolving Lenders exceeding the Aggregate Revolving Commitment Amount. During the Availability Period, the Borrower shall be entitled to borrow, prepay and reborrow Revolving Loans in accordance with the terms and conditions of this Agreement; provided that the Borrower may not borrow or reborrow should there exist a Default or Event of Default.

Section 2.3.Establishment of Supplemental and Second Supplemental CreditFacilityFacilities. Subject to and upon the terms and conditions herein set forth,: (a) the Supplemental Lenders hereby establish in favor of the Borrower a term loan credit facility pursuant to which each Supplemental Lender severally agrees (to the extent of such Lender’s Supplemental Commitment) to make Supplemental Loans to the Borrower in accordance with Section 2.4: and (b) as of September 9, 2021, the Second Supplemental Lenders hereby  establish in favor of the Borrower a term loan credit facility pursuant to which each Second Supplemental Lender  severally agrees (to the extent of such Lender’s Second Supplemental Commitment) to make Second Supplemental  Loans to the Borrower in accordance with Section 2.4.

Section 2.4.Supplemental Loans and Second Supplemental Loans. The Supplemental  Lenders and Second Supplemental Lenders, respectively, agree to advance the Supplemental Loans and/or Second  Supplemental Loans, as applicable, on the following terms and conditions:

(a)Each Supplemental Lender severally agrees, as of the Closing Date, to make a one-time advance of Supplemental Loans to Borrower in a principal amount (as requested by Borrower) up to such Supplemental Lender’s Supplemental Commitment. No further advances of the Supplemental Loans shall be available to Borrower following the Closing Date. The Supplemental Loans are not revolving and may not be reborrowed following repayment thereof.

(b)Each Second Supplemental Lender severally agrees, as of September 9, 2021, to make a  one-time advance of Second Supplemental Loans to Borrower in a principal amount (as requested by Borrower) up  to such Second Supplemental Lender’s Second Supplemental Commitment. No further advances of the Second  Supplemental Loans shall be available to Borrower following September 9, 2021. The Second Supplemental Loans  are not revolving and may not be reborrowed following repayment thereof.

Section 2.5.Procedure for Borrowings. The Borrower shall give the Administrative Agent written notice (or telephonic notice promptly confirmed in writing) of each Borrowing, substantially in the form of Exhibit E attached hereto (a “Notice of Borrowing”), (x) prior to 11:00 a.m. one (1) Business Day prior to the requested date of each Base Rate Borrowing and (y) prior to 11:00 a.m. three (3) Business Days prior to the requested date of each Eurodollar Borrowing (except to the extent such prior notice is waived by Administrative Agent). Each Notice of Borrowing shall be irrevocable and shall specify (i) the aggregate principal amount of such Borrowing and whether such Borrowing consists of Revolving Loans, Supplemental Loans (for any notice given in connection with a Borrowing on the Closing Date), or bothSecond Supplemental Loans (for any notice given in  connection with a Borrowing as of September 9, 2021), or any or each of same (and the allocation between same, if applicable), (ii) the date of such Borrowing (which shall be a Business Day), (iii) the Type of such Loan comprising such Borrowing and (iv) in the case

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of a Eurodollar Borrowing, the duration of the initial Interest Period applicable thereto (subject to the provisions of the definition of Interest Period). Each Borrowing shall consist entirely of Base Rate Loans or Eurodollar Loans, as the Borrower may request. The aggregate principal amount of each Borrowing shall not be less than $1,000,000 or a larger multiple of $100,000; provided that Base Rate Loans made pursuant to Section 2.4 or Section 2.22(d) may be made in lesser amounts as provided therein. At no time shall the total number of Eurodollar Borrowings outstanding at any time exceed six (6). Promptly following the receipt of a Notice of Borrowing in accordance herewith, the Administrative Agent shall advise each Lender of the details thereof and the amount of each such Lender’s to be made as part of the requested Borrowing.

Section 2.6.Funding of Borrowings.

(a)Each Lender will make available each Loan to be made by it hereunder on the proposed date thereof by wire transfer in immediately available funds by 11:00 a.m. to the Administrative Agent at the Payment Office. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts that it receives, in like funds by the close of business on such proposed date, to an account maintained by the Borrower with the Administrative Agent or, at the Borrower’s option, by effecting a wire transfer of such amounts to an account designated by the Borrower to the Administrative Agent.

(b)Unless the Administrative Agent shall have been notified by any Lender prior to 5:00 p.m. one (1) Business Day prior to the date of a Borrowing in which such Lender is to participate that such Lender will not make available to the Administrative Agent such Lender’s share of a Borrowing, the Administrative Agent may assume that such Lender has made such amount available to the Administrative Agent on such date, and the Administrative Agent, in reliance on such assumption, may make available to the Borrower on such date a corresponding amount. If such corresponding amount is not in fact made available to the Administrative Agent by such Lender on the date of such Borrowing, the Administrative Agent shall be entitled to recover such corresponding amount on demand from such Lender together with interest (x) at the Federal Funds Rate until the second Business Day after such demand and (y) at the Base Rate at all times thereafter. If such Lender does not pay such corresponding amount forthwith upon the Administrative Agent’s demand therefor, the Administrative Agent shall promptly notify the Borrower, and the Borrower shall pay such corresponding amount to the Administrative Agent together with interest at the rate specified for such Borrowing within fifteen (15) Business Days of Borrower’s receipt of notice from Administrative Agent. Nothing in this subsection shall be deemed to relieve any Lender from its obligation to fund its Pro Rata Share of any Borrowing hereunder or to prejudice any rights which the Borrower may have against any Lender as a result of any default by such Lender hereunder.

(c)All Borrowings shall be made by the Lenders on the basis of their respective Pro

Rata Shares of the Aggregate Revolving Commitments or, the Supplemental Aggregate Revolving Commitments, and/or the Second Supplemental Aggregate Revolving Commitments, as applicable. No Lender shall be responsible for any default by any other Lender in its obligations hereunder, and each Lender and each Lender shall be obligated to make its Loans provided to be made by it hereunder, regardless of the failure of any other Lender to make its Loans hereunder.

Section 2.7.Interest Elections.

(a)Each Borrowing initially shall be of the Type specified in the applicable Notice of Borrowing. Thereafter, the Borrower may elect to convert such Borrowing into a different Type or to continue such Borrowing, all as provided in this Section. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders (as applicable) holding Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.

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(b)To make an election pursuant to this Section, the Borrower shall give the Administrative Agent written notice (or telephonic notice promptly confirmed in writing) of each Borrowing that is to be converted or continued, as the case may be, substantially in the form of Exhibit F attached hereto (a “Notice of  Conversion/Continuation”) (x) prior to 10:00 a.m. one (1) Business Day prior to the requested date of a conversion into a Base Rate Borrowing and (y) prior to 11:00 a.m. three (3) Business Days prior to a continuation of or conversion into a Eurodollar Borrowing. Each such Notice of Conversion/Continuation shall be irrevocable and shall specify (i) the Borrowing to which such Notice of Conversion/Continuation applies and, if different options are being elected with respect to different portions thereof, the portions thereof that are to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) shall be specified for each resulting Borrowing), (ii) the effective date of the election made pursuant to such Notice of Conversion/Continuation, which shall be a Business Day, (iii) whether the resulting Borrowing is to be a Base Rate Borrowing or a Eurodollar Borrowing, and (iv) if the resulting Borrowing is to be a Eurodollar Borrowing, the Interest Period applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of “Interest Period”. If any such Notice of Conversion/Continuation requests a Eurodollar Borrowing but does not specify an Interest Period, the Borrower shall be deemed to have selected an Interest Period of one month. The principal amount of any resulting Borrowing shall satisfy the minimum borrowing amount for Eurodollar Borrowings and Base Rate Borrowings set forth in Section 2.5.

(c)If, on the expiration of any Interest Period in respect of any Eurodollar Borrowing, the Borrower shall have failed to deliver a Notice of Conversion/Continuation, then, unless such Borrowing is repaid as provided herein, the Borrower shall be deemed to have elected to convert such Borrowing to a Base Rate Borrowing. No Borrowing may be converted into, or continued as, a Eurodollar Borrowing if a Default or an Event of Default exists, unless the Administrative Agent and each of the applicable Lenders shall have otherwise consented in writing. No conversion of any Eurodollar Loan shall be permitted except on the last day of the Interest Period in respect thereof.

(d)Upon receipt of any Notice of Conversion/Continuation, the Administrative Agent shall promptly notify each Lender (as applicable) of the details thereof and of such Lender’s portion of each resulting Borrowing.

Section 2.8.Optional Reduction and Termination of Commitments.

(a)Unless terminated sooner pursuant to the provisions below,: (i) all Supplemental Commitments shall terminate as of the Supplemental Maturity Date; (ii) all Second Supplemental Commitments shall  terminate as of the Second Supplemental Maturity Date; and (iii) all Revolving Commitments shall terminate on the Maturity Date.

(b)Upon at least three (3) Business Days’ prior written notice (or telephonic notice promptly confirmed in writing) to the Administrative Agent (which notice shall be irrevocable), the Borrower may reduce the Aggregate Revolving Commitments in part or terminate the Aggregate Revolving Commitments in whole; provided that (i) any partial reduction shall apply to reduce proportionately and permanently the Revolving Commitment of each Lender, (ii) any partial reduction pursuant to this Section shall be in an amount of at least $5,000,000 and any larger multiple of $1,000,000, and (iii) no such reduction shall be permitted which would reduce the Aggregate Revolving Commitment Amount to an amount less than the aggregate outstanding Revolving Credit Exposure of all Lenders.

(c)With the written approval of the Administrative Agent, the Borrower may terminate (on a non-ratable basis) the unused amount of the Revolving Commitment of a Defaulting Lender, and in such event the provisions of Section 2.26 will apply to all amounts thereafter paid by the Borrower for the account of any such Defaulting Lender under this Agreement (whether on account of principal, interest, fees, indemnity or other amounts); provided that such termination will not be deemed to be a waiver or release of any claim that the Borrower, the Administrative Agent or any other Lender may have against such Defaulting Lender.

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Section 2.9.Repayment of Loans. TheExcept to the extent accelerated prior to such dates or  subject to mandatory prepayment (whether pursuant to Section 2.12 or otherwise) pursuant to the terms hereof: (a)  the outstanding principal amount of all Revolving Loans shall be due and payable (together with accrued and unpaid interest thereon) on the Maturity Date. The; (b) the outstanding amount of all Supplemental Loans shall be due and payable (together with accrued and unpaid interest thereon) on the Supplemental Maturity Date; and (c) the  outstanding amount of all Second Supplemental Loans shall be due and payable (together with accrued and unpaid  interest thereon) on the Second Supplemental Maturity Date.

Section 2.10.Evidence of Indebtedness.

(a)Each Lender shall maintain in accordance with its usual practice appropriate records evidencing the Indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable thereon and paid to such Lender from time to time under this Agreement. The Administrative Agent shall maintain appropriate records in which shall be recorded (i) the Revolving Commitment of each Revolving Lender and, the Supplemental Commitment of each Supplemental Lender, and the Second Supplemental Commitment of each Second Supplemental Lender, (ii) the amount of each Loan made hereunder by each Lender, the Type thereof and, in the case of each Eurodollar Loan, the Interest Period applicable thereto, (iii) the date of any continuation of any Loan pursuant to Section 2.7, (iv) the date of any conversion of all or a portion of any Loan to another Type pursuant to Section 2.7, (v) the date and amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder in respect of the Loans and (vi) both the date and amount of any sum received by the Administrative Agent hereunder from the Borrower in respect of the Loans and each Lender’s Pro Rata Share thereof. The entries made in such records shall be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided that the failure or delay of any Lender or the Administrative Agent in maintaining or making entries into any such record or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans (both principal and unpaid accrued interest) of such Lender in accordance with the terms of this Agreement.

(b)This Agreement evidences the obligation of the Borrower to repay the Loans and is being executed as a “noteless” credit agreement. However, at the request of any Lender at any time, the Borrower agrees that it will prepare, execute and deliver to such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a form approved by the Administrative Agent. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment permitted hereunder) be represented by one or more promissory notes in such form payable to the order of the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).

Section 2.11.Optional Prepayments. The Borrower shall have the right at any time and from time to time to prepay any Borrowing, in whole or in part, without premium or penalty, by giving written notice (or telephonic notice promptly confirmed in writing) to the Administrative Agent no later than (i) in the case of any prepayment of any Eurodollar Borrowing, 11:00 a.m. not less than three (3) Business Days prior to the date of such prepayment, and (ii) in the case of any prepayment of any Base Rate Borrowing, not less than one (1) Business Day prior to the date of such prepayment. Each such notice shall be irrevocable and shall specify the proposed date of such prepayment and the principal amount of each Borrowing or portion thereof to be prepaid. Upon receipt of any such notice, the Administrative Agent shall promptly notify each affected Lender of the contents thereof and of such Lender’s Pro Rata Share of any such prepayment. If such notice is given, the aggregate amount specified in such notice shall be due and payable on the date designated in such notice, together with accrued interest to such date on the amount so prepaid in accordance with Section 2.13(d); provided that if a Eurodollar Borrowing is prepaid on a date other than the last day of an Interest Period applicable thereto, the Borrower shall also pay all amounts required pursuant to Section 2.19. Each partial prepayment of any Loan shall be in an amount that would be permitted in the case of an advance of a Borrowing of the same Type pursuant to Section 2.2. Each prepayment of a Borrowing shall be applied ratably to the Loans comprising such Borrowing.

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Section 2.12.Mandatory Prepayments.

(a)The Borrower shall prepay the Loans (a “Mandatory Prepayment”) in an amount equal to one hundred percent (100%) of the net proceeds payable to Borrower or Guarantor (i) generated by equity issuances by the Parent or the Borrower, and (ii) payable to the Borrower, Guarantor or any Subsidiary (after payment of usual and customary closing costs and expenses and repayment of any Indebtedness secured by such Real Property) generated by the sale, finance, refinance or other recapitalization of any Real Property owned directly or indirectly by Parent, including, without limitation, any net proceeds thereof to be redeployed into the acquisition of one or more real properties to complete a 1031 exchange transaction; provided, however, that the applicable Credit Party shall, during the term of this Agreement or in connection with any sale, financing, refinancing, or recapitalization of any such Real Property, be permitted to retain the proceeds referenced in subclause (ii) above to the extent the Borrower provides the Administrative Agent with a Compliance Certificate including pro forma calculations of the financial covenants set forth in Section 5.2 hereof taking into account such transaction and showing that the Borrower will be in compliance with the terms and conditions of this Agreement in the event such proceeds are used for the Borrower’s general corporate purposes in lieu of being applied as a mandatory prepayment as otherwise required above.

(b)Without limiting the foregoing, if the Revolving Loans are not repaid in full on or before ninety (90) days prior to the then applicable Maturity Date, the Borrower shall, by such date, present a written plan to the Administrative Agent outlining its intended method for generating funds to repay the Revolving Loan in full by the Maturity Date, which plan shall be subject to the reasonable approval of the Administrative Agent. If the Administrative Agent reasonably determines that the sources reflected in the approved plan evidence a shortfall in available proceeds anticipated to be available to repay the Revolving Loan in full on the Maturity Date, the Borrower shall, within ten (10) Business Days of such notice from Administrative Agent and on the first Business Day of each calendar month thereafter, make a monthly principal payment in an amount as reasonably determined by the Administrative Agent equal to one third of such total shortfall per month.

(c)If at any time the aggregate Revolving Credit Exposure of all Lenders exceeds the Aggregate Revolving Commitment Amount, as reduced pursuant to Section 2.8 or otherwise, the Borrower shall immediately repay the Revolving Loans in an amount equal to such excess, together with all accrued and unpaid interest on such excess amount and any amounts due under Section 2.19. Each prepayment shall be applied as follows: first, to the Base Rate Loans to the full extent thereof; and second, to the Eurodollar Loans to the full extent thereof.

(d)ToAs of the extent any Supplemental Loans remain outstanding as of the date on which any Additional Lender or Increasing Lender enters into an Incremental Commitment hereunder pursuant to the terms of Section 2.23 hereof, to the  extent any Supplemental Loans remain outstanding as of  such date, Borrower shall, concurrently with the effectiveness of such Incremental Commitment, prepay, through a Borrowing of such Incremental Commitments, the Supplemental Loans in an amount equal to the lesser of (i) the amount of such Incremental Commitment; and (ii) the then-remaining outstanding balance of the Supplemental Loans.

(e)On or prior to October 31, 2021, Borrower shall have made mandatory  prepayments of the outstanding Supplemental Loans such that the aggregate amount of prepayments that have,  during the term of this Agreement, been applied against the Supplemental Loans as of such date is not less than  $15,000,000.00; provided, that (i) for purposes of clarification, any prepayments of the Loans made by Borrower  shall be subject to the application provisions of clause (g) below (such that all outstanding fees and expenses payable  the Administrative Agent and the entire outstanding balance of the Second Supplemental Loans shall be fully prepaid  prior to any prepayment being applied to the Supplemental Loans); (ii) Borrower’s obligation to make the mandatory  prepayment required pursuant to this clause (e) shall be subject to a grace/cure period that will end on the earlier of  (A) November 12, 2021; and (B) the date on which Borrower or its Subsidiaries consummate each of the sales of the  real property assets owned by NXRT Cedar Pointe and FRBH Beechwood, LLC; and (iii) failure to make the  mandatory prepayment required pursuant to this clause (e) as of the outside date permitted in subclause (ii) above  shall, notwithstanding anything contained to the contrary herein (including, without limitation, any other cure or  grace periods that might otherwise apply to such payment obligation), constitute an immediate Event of Default  (subject to no further grace or cure periods).

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(f)On or prior to November 30, 2021, Borrower shall have made mandatory  prepayments of the outstanding Supplemental Loans such that the aggregate amount of prepayments that have,  during the term of this Agreement, been applied against the Supplemental Loans as of such date is not less than  $20,000,000.00; provided, that (i) for purposes of clarification, any prepayments of the Loans made by Borrower  shall be subject to the application provisions of clause (g) below (such that all outstanding fees and expenses payable  the Administrative Agent and the entire outstanding balance of the Second Supplemental Loans shall be fully prepaid  prior to any prepayment being applied to the Supplemental Loans); and (ii) failure to make the mandatory  prepayment required pursuant to this clause (f) as of the date required above shall, notwithstanding anything  contained to the contrary herein (including, without limitation, any other cure or grace periods that might otherwise  apply to such payment obligation), constitute an immediate Event of Default (subject to no grace or cure periods).

()(e) Any Except with respect to any prepayment made pursuant to Sections 2.12(c)  and (d) above (which shall be applied as set forth in such sections), any prepayments made by the Borrower pursuant to this Section shall be applied as follows: first, to the Administrative Agent’s fees and reimbursable expenses then due and payable pursuant to any of the Loan Documents; second, to the extent made on or prior to the Second  Supplemental Maturity Date, to any then-outstanding Second Supplemental Loans (and accrued interest with respect  thereto), pro rata to the Second Supplemental Lenders based on their respective Second Supplemental  Commitments, third, to the extent made on or prior to the Supplemental Maturity Date, to any then-outstanding Supplemental Loans (and accrued interest with respect thereto), pro rata to the Supplemental Lenders based on their respective Supplemental Commitments, and thirdfourth, to the principal balance of the Revolving Loans, until the same shall have been paid in full, pro rata to the Revolving Lenders based on their respective Revolving Commitments. The Supplemental Commitments of the Supplemental Lenders and/or the Second Supplemental  Commitments of the Second Supplemental Lenders, as applicable, shall be permanently reduced by the amount of any prepayments made pursuant to the above. The Revolving Commitments of the Revolving Lenders shall not be permanently reduced by the amount of any prepayments made pursuant to the above, unless an Event of Default has occurred and is continuing and the Required Revolving Lenders so request. Notwithstanding the foregoing, to the extent any Event of Default is then-continuing as of the date of the application of any prepayment made pursuant to this Section, such prepayment shall be applied as provided in Section 8.2 hereof.

Section 2.13.Interest on Loans.

(a)The Borrower shall pay interest on (i) each Base Rate Loan at the Base Rate plus the Applicable Margin in effect from time to time and (ii) each Eurodollar Loan at the Adjusted LIBO Rate for the applicable Interest Period in effect for such Loan plus the Applicable Margin in effect from time to time.

(b)[intentionally omitted].

(c)Notwithstanding subsections (a) and (b) of this Section, at the option of the Required Lenders if an Event of Default has occurred and is continuing, and automatically after acceleration, the Borrower shall pay interest (“Default Interest”) with respect to all Eurodollar Loans at the rate per annum equal to 400 basis points above the otherwise applicable interest rate for such Eurodollar Loans for the then-current Interest Period until the last day of such Interest Period, and thereafter, and with respect to all Base Rate Loans and all other Obligations hereunder (other than Loans), at the rate per annum equal to 200 basis points above the otherwise applicable interest rate for Base Rate Loans.

(d)Interest on the principal amount of all Loans shall accrue from and including the date such Loans are made to but excluding the date of any repayment thereof. Accrued interest on outstanding (i) Base Rate Loans shall be payable monthly in arrears on the first (1st) day of each calendar month and on the Maturity Date; and (ii) with respect to any Eurodollar Loan, the last day of each Interest Period applicable thereto, and, in the case of any Eurodollar Loans having an Interest Period in excess of three months, on each day which occurs every three months after the initial date of such Interest Period and on the Maturity Date. Interest on any Loan which is converted into a Loan of another Type or which is repaid or prepaid shall be payable on the date of such conversion or on the date of any such repayment or prepayment (on the amount repaid or prepaid) thereof. All Default Interest shall be payable on demand.

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(e)The Administrative Agent shall determine each interest rate applicable to the Loans hereunder and shall promptly notify the Borrower and the Lenders of such rate in writing (or by telephone, promptly confirmed in writing). Any such determination shall be conclusive and binding for all purposes, absent manifest error.

Section 2.14.Fees.

(a)The Borrower shall pay to the Administrative Agent and its affiliates on the Closing Date and from time to time all fees in the Fee Letter that are due and payable on such dates. In addition, the  Borrower shall pay to the Second Supplemental Lenders from time to time all fees set forth in the Second  Supplemental Fee Letter on such date.

(b)The Borrower agrees to pay to the Administrative Agent, for the account of each Lender, an unused fee (the “Unused Fee”), which shall accrue for each day during the period from and including the date of this Agreement to, but excluding, date on which any of the Commitments of such Lender terminates, at the applicable Unused Fee Rate multiplied, for each day, by the unused amount of the Commitments (whether relating to Supplemental Loans, Second Supplemental Loans, or Revolving Loans) of such Lender under the Loans as of the end of such day. The sum of the daily Unused Fees accrued through and including the last day of March, June, September and December of each year shall be payable on the first Business Day of the month following the end of the applicable quarter. All Unused Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day) and shall be based on the then-existing total Supplemental Commitments, Second Supplemental Commitments, and Revolving Commitments of the Lenders.

(c)All fees payable hereunder shall be paid on the dates due in immediately available funds. Fees paid shall not be refundable under any circumstances.

Section 2.15.Computation of Interest and Fees.

Interest hereunder based on the Administrative Agent’s prime lending rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year) and paid for the actual number of days elapsed (including the first day but excluding the last day). All other interest and all fees hereunder shall be computed on the basis of a year of 360 days and paid for the actual number of days elapsed (including the first day but excluding the last day). Each determination by the Administrative Agent of an interest rate or fee hereunder shall be made in good faith and, except for manifest error, shall be final, conclusive and binding for all purposes.

Section 2.16.Inability to Determine Interest Rates.

(a)If, prior to the commencement of any Interest Period for any Eurodollar Borrowing:

(i)the Administrative Agent shall have determined (which determination shall be conclusive and binding upon the Borrower) that, by reason of circumstances affecting the relevant interbank market, adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate (including, without limitation, because the Screen Rate is not available or published on a current basis) for such Interest Period, provided that no Benchmark Transition Event or Early Opt-In Election shall have occurred at such time or for such Interest Period, or

(ii)the Administrative Agent shall have received notice from the Required Lenders that the Adjusted LIBO Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making, funding or maintaining their Eurodollar Loans for such Interest Period,

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then the Administrative Agent shall give written notice thereof (or telephonic notice, promptly confirmed in writing) to the Borrower and to the Lenders as soon as practicable thereafter. Until the Administrative Agent shall notify the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) the obligations of the Lenders to make Eurodollar Loans or to continue or convert outstanding Loans as or into Eurodollar Loans shall be suspended and (ii) all such affected Loans shall be converted into Base Rate Loans on the last day of the then current Interest Period applicable thereto unless the Borrower prepays such Loans in accordance with this Agreement. Unless the Borrower notifies the Administrative Agent at least one (1) Business Day before the date of any Eurodollar Borrowing for which a Notice of Borrowing has previously been given that it elects not to borrow, continue or convert to a Eurodollar Borrowing on such date, then such Borrowing shall be made as, continued as or converted into a Base Rate Borrowing.

(b)Notwithstanding anything to the contrary herein or in any other Loan Document, if a Benchmark Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then (x) if a Benchmark Replacement is determined in accordance with clause (1) or (2) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document and (y) if a Benchmark Replacement is determined in accordance with clause (3) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of objection to such Benchmark Replacement from Lenders comprising the Required Lenders.

(c)Notwithstanding anything to the contrary herein or in any other Loan Document and subject to the proviso below in this paragraph, if a Term SOFR Transition Event and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then the applicable Benchmark Replacement will replace the then-current Benchmark for all purposes hereunder or under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings, without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document; provided that this clause (c) shall not be effective unless the Administrative Agent has delivered to the Lenders and the Borrower a Term SOFR Notice.

(d)In connection with the implementation of a Benchmark Replacement, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.

(e)The Administrative Agent will promptly notify the Borrower and the Lenders of (i) any occurrence of a Benchmark Transition Event, a Term SOFR Transition Event or an Early Opt-in Election, as applicable, and its related Benchmark Replacement Date, (ii) the implementation of any Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement Conforming Changes, (iv) the removal or reinstatement of any tenor of a Benchmark pursuant to clause (f) below and (v) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any Lender (or group of Lenders) pursuant to this Section 2.16, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section 2.16.

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(f)Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including Term SOFR or the Adjusted LIBO Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is or will be no longer representative, then the Administrative Agent may modify the definition of “Interest Period” for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is or will no longer be representative for a Benchmark (including a Benchmark Replacement), then the Administrative Agent may modify the definition of “Interest Period” for all Benchmark settings at or after such time to reinstate such previously removed tenor.

(g)Upon the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Borrower may revoke any request for a Eurodollar Borrowing of, conversion to or continuation of Eurodollar Loans to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Borrower will be deemed to have converted any such request into a request for a Borrowing of or conversion to Base Rate Loans. During any Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of Base Rate based upon the then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of Base Rate.

Section 2.17.Illegality. If any Change in Law shall make it unlawful or impossible for any Lender to perform any of its obligations hereunder or to make, maintain or fund any Eurodollar Loan and such Lender shall so notify the Administrative Agent, the Administrative Agent shall promptly give notice thereof to the Borrower and the other Lenders, whereupon until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such suspension no longer exist, the obligation of such Lender to make Eurodollar Loans, or to continue or convert outstanding Loans as or into Eurodollar Loans, shall be suspended. In the case of the making of a Eurodollar Borrowing, such Lender’s applicable Loan(s) shall be made as a Base Rate Loan as part of the same Borrowing for the same Interest Period and, if the affected Eurodollar Loan is then outstanding, such Loan shall be converted to a Base Rate Loan either (i) on the last day of the then current Interest Period applicable to such Eurodollar Loan if such Lender may lawfully continue to maintain such Loan to such date or (ii) immediately if such Lender shall determine that it may not lawfully continue to maintain such Eurodollar Loan to such date. Notwithstanding the foregoing, the affected Lender shall, prior to giving such notice to the Administrative Agent, use reasonable efforts to designate a different Applicable Lending Office if such designation would avoid the need for giving such notice and if such designation would not otherwise be disadvantageous to such Lender in the good faith exercise of its discretion.

Section 2.18.Increased Costs.

(a)If any Change in Law shall:

(i)impose, modify or deem applicable any reserve, special deposit or similar requirement that is not otherwise included in the determination of the Adjusted LIBO Rate hereunder against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate); or

(ii)subject any Recipient to any Taxes (other than (A) Indemnified Taxes and (B) Taxes described in clauses (iii) through (v) of the definition of Excluded Taxes; or

(iii)impose on any Lender or the eurodollar interbank market any other condition affecting this Agreement or any Eurodollar Loans made by such Lender or any participation therein;

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and the result of any of the foregoing is to increase the cost to such Lender of making, converting into, continuing or maintaining a Eurodollar Loan or to increase the cost to such Lender or to reduce the amount received or receivable by such Lender hereunder (whether of principal, interest or any other amount), then, from time to time, such Lender may provide the Borrower (with a copy thereof to the Administrative Agent) with written notice and demand with respect to such increased costs or reduced amounts, and within five (5) Business Days after receipt of such notice and demand, the Borrower shall pay to such Lender such additional amounts as will compensate such Lender for any such increased costs incurred or reduction suffered.

(b)If any Lender shall have determined that any Change in Law regarding capital or liquidity ratios or requirements has or would have the effect of reducing the rate of return on such Lender’s capital (or on the capital of the Parent Company of such Lender) as a consequence of its obligations hereunder to a level below that which such Lender or such Parent Company could have achieved but for such Change in Law (taking into consideration such Lender’s policies or the policies of such Parent Company with respect to capital adequacy and liquidity), then, from time to time, such Lender may provide the Borrower (with a copy thereof to the Administrative Agent) with written notice and demand with respect to such reduced amounts, and within five (5) Business Days after receipt of such notice and demand the Borrower shall pay to such Lender such additional amounts as will compensate such Lender or such Parent Company for any such reduction suffered.

(c)A certificate of such Lender setting forth the amount or amounts necessary to compensate such Lender or the Parent Company of such Lender specified in subsection (a) or (b) of this Section shall be delivered to the Borrower (with a copy to the Administrative Agent) and shall be conclusive, absent manifest error.

(d)Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender under this Section for any increased costs or reductions incurred more than six (6) months prior to the date that such Lender notifies the Borrower of such increased costs or reductions and of such Lender’s intention to claim compensation therefor; provided, further, that if the Change in Law giving rise to such increased costs or reductions is retroactive, then such six-month period shall be extended to include the period of such retroactive effect.

Section 2.19.Funding Indemnity. In the event of (a) the payment of any principal of a Eurodollar Loan other than on the last day of the Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion or continuation of a Eurodollar Loan other than on the last day of the Interest Period applicable thereto, or (c) the failure by the Borrower to borrow, prepay, convert or continue any Eurodollar Loan on the date specified in any applicable notice (regardless of whether such notice is withdrawn or revoked), then, in any such event, the Borrower shall compensate each Lender, within ten (10) Business Days after written demand from such Lender, for any loss, cost or expense attributable to such event. In the case of a Eurodollar Loan, such loss, cost or expense shall be deemed to include an amount determined by such Lender to be the excess, if any, of (A) the amount of interest that would have accrued on the principal amount of such Eurodollar Loan if such event had not occurred at the Adjusted LIBO Rate applicable to such Eurodollar Loan for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Eurodollar Loan) over (B) the amount of interest that would accrue on the principal amount of such Eurodollar Loan for the same period if the Adjusted LIBO Rate were set on the date such Eurodollar Loan was prepaid or converted or the date on which the Borrower failed to borrow, convert or continue such Eurodollar Loan. A certificate as to any additional amount payable under this Section submitted to the Borrower by any Lender (with a copy to the Administrative Agent) shall be conclusive, absent manifest error.

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Section 2.20.Taxes.

(a)Defined Terms. For purposes of this Section 2.20, the term “applicable law” includes FATCA.

(b)Payments Free of Taxes. Any and all payments by or on account of any obligation of any Credit Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Credit Party shall be increased as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

(c)Payment of Other Taxes by the Borrower. The Borrower shall timely pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

(d)Indemnification by the Borrower. The Borrower shall indemnify each Recipient, within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(e)Indemnification by the Lenders. Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the Borrower has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 10.4(d) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).

(f)Evidence of Payments. As soon as practicable after any payment of Taxes by the Borrower or any other Credit Party to a Governmental Authority pursuant to this Section 2.20, the Borrower or other Credit Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

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(g)Status of Lenders.

(i)Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.20(g)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(ii)Without limiting the generality of the foregoing, in the event that the Borrower is a U.S. Borrower,

(A)any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;

(B)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:

(i)in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(ii)executed originals of IRS Form W-8ECI;

(iii)in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit G-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a

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“U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN; or

(iv)to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or Exhibit G-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-4 on behalf of each such direct and indirect partner;

(C)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and

(D)if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.

(h)Treatment of Certain Refunds. If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.20 (including by the payment of additional amounts pursuant to this Section 2.20), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section with respect to the Taxes giving rise to such refund), net of all reasonable third-party out-of-pocket expenses (including Taxes) of such indemnified party actually incurred and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this paragraph (h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such

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indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (h) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This paragraph shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it reasonably deems confidential) to the indemnifying party or any other Person.

(i)Survival. Each party’s obligations under this Section 2.20 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.

Section 2.21.Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

(a)The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, or fees, or of amounts payable under Section 2.18, 2.19 or 2.20, or otherwise) prior to 12:00 noon on the date when due, in immediately available funds, free and clear of any defenses, rights of set-off, counterclaim, or withholding or deduction of taxes. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at the Payment Office, except except that payments pursuant to Sections 2.18, 2.19, 2.20 and 10.3 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be made payable for the period of such extension. All payments hereunder shall be made in Dollars.

(b)If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied as follows: first, to all fees and reimbursable expenses of the Administrative Agent then due and payable pursuant to any of the Loan Documents; second, to all reimbursable expenses of the Lenders then due and payable pursuant to any of the Loan Documents, pro rata to the Lenders based on their respective pro rata shares of such fees and expenses; third, to all interest and fees then due and payable hereunder, pro rata to the Lenders based on their respective pro rata shares of such interest and fees; and fourth, to all principal of the Loans then due and payable hereunder, pro rata to the parties entitled thereto based on their respective pro rata shares of such principal.

(c)If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans that would result in such Lender receiving payment of a greater proportion of the aggregate amount of its Revolving Credit Exposure  or, Supplemental Credit Exposure, or Second Supplemental Credit Exposure than the proportion received by any other Lender with respect to its Revolving Credit Exposure, Supplemental Credit Exposure, or Second Supplemental Credit Exposure, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Revolving Credit Exposure, Supplemental Credit Exposure, or Second Supplemental Credit Exposure (as applicable) of other applicable Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Revolving Credit Exposure, Supplemental Credit Exposure, or Second Supplemental Credit Exposure (as applicable); provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this subsection shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender) or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Revolving Credit Exposure,

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Supplemental Credit Exposure, or Second Supplemental Credit Exposure to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this subsection shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

(d)Unless the Administrative Agent shall have received notice from the Borrower

prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount or amounts due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

Section 2.22.Extension of Maturity Date. The Borrower shall have the right and option to extend the Maturity Date (but not, in any case, the Supplemental Maturity Date or the Second Supplemental Maturity  Date) for a single one-year term, to June 30, 2025 (the “Extended Maturity Date”), upon satisfaction of the following conditions precedent, which must be satisfied prior to the effectiveness of any extension of the Initial Maturity Date:

(a)Extension Request. The Borrower shall deliver written notice of such request (the “Extension Request”) to the Agent not later than the date which is thirty (30) days prior to the Initial Maturity Date.

(b)Payment of Extension Fee. The Borrower shall pay to the Agent for the pro rata accounts of the Lenders in accordance with their respective Revolving Loan Commitments an extension fee in an amount equal to 0.15% of the full Revolving Loan Commitments on the Initial Maturity Date, which fee shall, when paid, be fully earned and nonrefundable under any circumstances.

(c)No Default. On the date the Extension Request is given and the effective date of such extension there shall exist no Default or Event of Default.

Section 2.23.Increase of Revolving Commitments; Additional Lenders.

(a)From time to time after the Closing Date and in accordance with this Section, the Borrower and one or more Increasing Lenders or Additional Lenders (each as defined below) may enter into an agreement to increase the aggregate Revolving Commitments hereunder (each such increase, an “Incremental Commitment”) so long as the following conditions are satisfied:

(i)the aggregate principal amount of all such Incremental Commitments made from time to time pursuant to this Section shall not result in the aggregate Revolving Commitments hereunder exceeding $350,000,000.00 (the principal amount of each such Incremental Commitment, the “Incremental Commitment Amount”);

(ii)the Borrower shall execute and deliver such documents and instruments and take such other actions as may be reasonably required by the Administrative Agent in connection with and at the time of any such proposed increase;

(iii)at the time of and immediately after giving effect to any such proposed increase, no Default or Event of Default shall exist, all representations and warranties of each Credit Party set forth in the Loan Documents shall be true and correct in all material respects;

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(iv)any Incremental Commitments provided pursuant to this Section shall be secured by the same collateral securing the pre-existing Revolving Commitments, terminate as of the Maturity Date and otherwise be subject to the same terms, conditions, and pricing as the pre-existing Revolving Commitments; provided, that (A) any commitment or upfront fees related thereto and payable to any applicable Increasing Lender or Additional Lender shall be as may be agreed to between the Borrower and any such party; and (B) any arrangement fees related thereto and payable to Arranger shall be as may be agreed to between Borrower and Arranger in connection with such Incremental Commitments (and the effectiveness of any such Incremental Commitments shall be conditioned upon the Arranger’s approval of such arrangement fees);

(v)the Borrower and its Subsidiaries shall be in pro forma compliance with each of the financial covenants set forth in Section 5.2 as of the most recently ended Fiscal Quarter for which financial statements are required to have been delivered, and calculated as if all such Incremental Commitments had been established (and fully funded) as of the first day of the relevant period for testing compliance;

(vi)the Borrower may not request and receive more than two (2) incremental increases in the Revolving Commitments (with all increases in such commitments entered into as of the same day being deemed a single increase) and each such incremental increase shall be in an aggregate amount of not less than $20,000,000.

(b)Except as may be otherwise agreed to by the Administrative Agent and each of the Increasing Lenders (as defined hereinafter), the Borrower shall provide at least 5 days’ written notice to the Administrative Agent (who shall promptly provide a copy of such notice to each Lender) of any proposal to establish an Incremental Commitment. The Borrower may also, but is not required to, specify any fees offered to those Lenders (the “Increasing Lenders”) that agree to increase the principal amount of their Revolving Commitments, which fees may be variable based upon the amount by which any such Lender is willing to increase the principal amount of its Revolving Commitment. Each Increasing Lender shall as soon as practicable, specify in a written notice to the Borrower and the Administrative Agent the amount of such proposed Incremental Commitment that it is willing to provide. No Lender (or any successor thereto) shall have any obligation, express or implied, to offer to increase the aggregate principal amount of its Revolving Commitment, and any decision by a Lender to increase its Revolving Commitment shall be made in its sole discretion independently from any other Lender. Only the consent of each Increasing Lender shall be required for an increase in the aggregate principal amount of the Revolving Commitments pursuant to this Section. No Lender which declines to increase the principal amount of its Revolving Commitment may be replaced with respect to its existing Revolving Commitment as a result thereof without such Lender’s consent. If any Lender shall fail to notify the Borrower and the Administrative Agent in writing about whether it will increase its Revolving Commitment prior to the date on which the Borrower and Administrative Agent have selected allocations for any Incremental Commitments, such Lender shall be deemed to have declined to increase its Revolving Commitment. The Borrower may accept some or all of the offered amounts or designate new lenders that are acceptable to the Administrative Agent (such approval not to be unreasonably withheld) as additional Lenders hereunder in accordance with this Section (the “Additional Lenders”), which Additional Lenders may assume all or a portion of such Incremental Commitment. The Borrower and the Administrative Agent shall have discretion jointly to adjust the allocation of such Incremental Commitments among the Increasing Lenders and the Additional Lenders.

(c)Subject to subsections (a) and (b) of this Section, any increase requested by the Borrower shall be effective upon delivery to the Administrative Agent of each of the following documents:

(i)an originally executed copy of an instrument of joinder, in form and substance reasonably acceptable to the Administrative Agent, executed by the Borrower, by each Additional Lender and by each Increasing Lender, setting forth the new Revolving Commitments of such Lenders and setting forth the agreement of each Additional Lender to become a party to this Agreement and to be bound by all of the terms and provisions hereof;

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(ii)such evidence of appropriate corporate authorization on the part of the Borrower with respect to such Incremental Commitment and such opinions of counsel for the Borrower with respect to such Incremental Commitment as the Administrative Agent may reasonably request;

(iii)a certificate of the Borrower signed by a Responsible Officer, in form and substance reasonably acceptable to the Administrative Agent, certifying that each of the conditions in subsection (a) of this Section has been satisfied;

(iv)to the extent requested by any Additional Lender or any Increasing Lender, executed promissory notes evidencing such Incremental Commitments, issued by the Borrower in accordance with Section 2.10; and

(v)any other certificates or documents that the Administrative Agent shall reasonably request, in form and substance reasonably satisfactory to the Administrative Agent.

Upon the effectiveness of any such Incremental Commitment, the Commitments and Pro Rata Share of each Lender will be adjusted to give effect to the Incremental Commitments, and Schedule II shall automatically be deemed amended accordingly.

(d)If the Borrower incurs Incremental Commitments under this Section, the Borrower shall, after such time, repay and incur Revolving Loans ratably as between the Incremental Commitments and the Revolving Commitments outstanding immediately prior to such incurrence. Notwithstanding anything to the contrary in Section 10.2, the Administrative Agent is expressly permitted to amend the Loan Documents to the extent necessary to give effect to any increase pursuant to this Section and mechanical changes necessary or advisable in connection therewith (including amendments to implement the requirements in the preceding two sentences, amendments to ensure pro rata allocations of Eurodollar Loans and Base Rate Loans between Loans incurred pursuant to this Section and Loans outstanding immediately prior to any such incurrence).

(e)For purposes of clarification, the provisions of this Section 2.23 shall permit the increase of the Revolving Commitments only and shall not result in the increase of any Supplemental Commitments or any Second Supplemental Commitments hereunder.

Section 2.24.Mitigation of Obligations. Each Lender will notify Borrower of any event occurring after the Closing Date that will entitle such Person to compensation pursuant to Section 2.18 or Section  2.20, as the case may be, as promptly as practicable after it obtains knowledge thereof and determines to request such compensation, provided that such Person shall not be liable for any costs, fees, expenses, or additional interest due to the failure to provide such notice. If any Lender requests compensation under Section 2.18, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.20, then such Lender shall use reasonable efforts to avoid or minimize the amounts payable, including, without limitation, the designation of a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the sole judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable under Section 2.18 or Section 2.20, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable and documented costs and expenses incurred by any Lender in connection with such designation or assignment.

Section 2.25.Replacement of Lenders. If (a) any Lender requests compensation under Section 2.18, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.20, (b) any Lender is a Defaulting Lender, or (c) in connection with any proposed amendment, modification, termination, waiver or consent with respect to any of the provisions hereof as contemplated by Section 10.2(b), the consent of Required Lenders shall have been obtained but the consent of one or more of such other Lenders (each a “Non-Consenting Lender”) whose consent is required shall not have been obtained, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions set forth in

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Section 10.4(b)), all of its interests, rights (other than its existing rights to payments pursuant to Section 2.18 or 2.20, as applicable) and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender) (a “Replacement Lender”); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not be unreasonably withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal amount of all Loans owed to it, accrued interest thereon, accrued fees and all other amounts payable to it hereunder from the assignee (in the case of such outstanding principal and accrued interest) and from the Borrower (in the case of all other amounts), (iii) in the case of a claim for compensation under Section 2.18 or payments required to be made pursuant to Section 2.20, such assignment will result in a reduction in such compensation or payments, and (iv) in the case of a Non-Consenting Lender, each Replacement Lender shall consent, at the time of such assignment, to each matter in respect of which such terminated Lender was a Non-Consenting Lender. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

Section 2.26.Defaulting Lenders .

(a)[Intentionally Omitted].

(b)Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:

(i)Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders and in Section 10.2.

(ii)Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 10.7 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; third, if so determined by the Administrative Agent and the Borrower, to be held in a deposit account and released pro rata in order to satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement; fourth, to the payment of any amounts owing to the Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; fifth, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender's breach of its obligations under this Agreement; and sixth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made at a time when the conditions set forth in Section  3.2 were satisfied or waived, such payment shall be applied solely to pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of such Defaulting Lender until such time as all Loans are held by the Lenders pro rata in accordance with the Commitments under the applicable Facility without giving effect to sub-section (iv) below. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender pursuant to this Section  2.26(b)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

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(iii)No Defaulting Lender shall be entitled to receive any Unused Feepursuant to Section 2.14(b) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).

(c)Defaulting Lender Cure. If the Borrower and the Administrative Agent, agree in

writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein, that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans to be held pro rata by the Lenders in accordance with the applicable Commitments (without giving effect to Section 2.26(b)(iv)),whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

ARTICLE III

CONDITIONS PRECEDENT TO LOANS

Section 3.1.Conditions to Effectiveness. The obligations of the Lenders to make Loans hereunder shall not become effective until the date on which each of the following conditions is satisfied:

(a)The Administrative Agent shall have received payment of all fees, expenses and other amounts due and payable on or prior to the Closing Date, including, without limitation, reimbursement or payment of all out-of-pocket expenses of the Administrative Agent, the Arranger and their Affiliates (including reasonable fees, charges and disbursements of counsel to the Administrative Agent) required to be reimbursed or paid by the Borrower hereunder, under any other Loan Document and under any agreement with the Administrative Agent or the Arranger.

(b)The Administrative Agent (or its counsel) shall have received the following, each to be in form and substance reasonably satisfactory to the Administrative Agent:

(i)a counterpart of this Agreement signed by or on behalf of each party hereto or written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement;

(ii)a certificate of the Secretary or Assistant Secretary of each Credit Party in a form acceptable to Administrative Agent, attaching and certifying copies of its bylaws, or partnership agreement or limited liability company agreement, and of the resolutions of its board of directors or other equivalent governing body, or comparable organizational documents and authorizations, authorizing the execution, delivery and performance of the Loan Documents to which it is a party and certifying the name, title and true signature of each officer of such Credit Party executing the Loan Documents to which it is a party;

(iii)certified copies of the articles or certificate of incorporation, certificate of organization or limited partnership, or other registered organizational documents of each Credit Party, together with certificates of good standing or existence, as may be available from the Secretary of State of the jurisdiction of organization of such Credit Party and each other jurisdiction where such Credit Party is required to be qualified to do business as a foreign corporation;

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(iv)a favorable written opinion of counsel to the Credit Parties, addressed to the Administrative Agent and each of the Lenders, and covering such matters relating to the Credit Parties, the Loan Documents and the transactions contemplated therein as the Administrative Agent shall reasonably request (which opinions will expressly permit reliance by permitted successors and assigns of the Administrative Agent and the Lenders);

(v)a certificate in a form reasonably acceptable to Administrative Agent, dated the Closing Date and signed by a Responsible Officer, certifying that after giving effect to the funding of any initial Borrowing, (x) no Default or Event of Default exists, (y) all representations and warranties of each Credit Party set forth in the Loan Documents are true and correct in all material respects and (z) since the date of the financial statements of the Borrower described in Section 4.4, there shall have been no change which has had or could reasonably be expected to have a Material Adverse Effect;

(vi)a duly executed Notice of Borrowing for any initial Borrowing;

(vii)a duly executed funds disbursement agreement, together with a report setting forth the sources and uses of the proceeds hereof;

(viii)copies of any consents, approvals, authorizations, registrations and filings and orders required or advisable to be made or obtained under any Legal Requirements, or by any Contractual Obligation of any Credit Party, in connection with the execution, delivery, performance, validity and enforceability of the Loan Documents or any of the transactions contemplated thereby;

(ix)copies of (A) the internally prepared quarterly financial statements of the Parent and its Subsidiaries on a consolidated basis for the Fiscal Quarter ended September 30, 2018, and (B) the audited consolidated financial statements for the Parent and its Subsidiaries for the Fiscal Year ended 2017;

(x)a duly completed and executed Compliance Certificate signed by a Responsible Officer of Parent, including pro forma calculations of the financial covenants set forth in Section 5.2 hereof as of the Closing Date, and calculated as if any initial Borrowing had been funded as of the first day of the relevant period for testing compliance (and setting forth in reasonable detail such calculations);

(xi)a certificate, dated the Closing Date and signed by the chief financial officer of each Credit Party, confirming that each Credit Party is Solvent before and after giving effect to the funding of any initial Borrowing and the consummation of the transactions contemplated to occur on the Closing Date;

(xii)executed counterparts of each of the other Loan Documents, together with (A) copies of favorable UCC, tax, judgment and fixture lien search reports in all necessary or appropriate jurisdictions and under all legal and trade names of the Credit Parties, as requested by the Administrative Agent, indicating that there are no prior Liens on any of the Collateral other than Permitted Encumbrances and Liens to be released on the Closing Date, (B) a Perfection Certificate, duly completed and executed by the Borrower, (C) original certificates evidencing all issued and outstanding shares of Capital Stock of all Subsidiaries owned directly by any Credit Party (or, if the pledge of all of the voting Capital Stock of any Foreign Subsidiary would result in materially adverse tax consequences, limited to 65% of the issued and outstanding voting Capital Stock of such Foreign Subsidiary and 100% of the issued and outstanding non-voting Capital Stock of such Foreign Subsidiary, as applicable) and (D) stock or membership interest powers or other appropriate instruments of transfer executed in blank;

(xiii)[intentionally omitted];

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(xiv)all documentation and other information required by bank regulatory authorities or reasonably requested by the Administrative Agent or any Lender under or in respect of applicable “know your customer” and anti-money laundering Legal Requirements including the Patriot Act and, if Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, a Beneficial Ownership Certification in relation to Borrower; and

(xv)all such other documents and materials required by the closing checklist related to this Agreement and prepared by counsel for the Administrative Agent.

Without limiting the generality of the provisions of this Section, for purposes of determining compliance with the conditions specified in this Section, the Administrative Agent and each Lender that has signed this Agreement shall be deemed to have consented to, approved of, accepted or been satisfied with each document or other matter required thereunder to be consented to, approved by or acceptable or satisfactory to Administrative Agent or Lenders for purposes of the closing and initial funding of the Loans unless the Borrower shall have received notice from the Administrative Agent (and the Administrative Agent shall have received notice from such Lender) prior to the proposed Closing Date specifying its objection thereto; provided, however, that such deemed consent, approval, acceptance, or satisfaction shall not in any manner limit the effectiveness of or act as a waiver of any of the representations, warranties, or covenants of the Borrower set forth herein or in any manner limit, restrict, or waive required compliance by Borrower with same.

Section 3.2.Conditions to Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing is subject to Section 2.26(c) and the satisfaction of the following conditions:

(a)at the time of and immediately after giving effect to such Borrowing, no Default or Event of Default shall exist;

(b)at the time of and immediately after giving effect to such Borrowing, all representations and warranties of each Credit Party set forth in the Loan Documents shall be true and correct in all material respects (other than those representations and warranties that are expressly qualified by a Material Adverse Effect or other materiality, in which case such representations and warranties shall be true and correct in all respects);

(c)the Borrower shall have delivered the required Notice of Borrowing; and

(d)the Administrative Agent shall have received such other documents, certificates, information or legal opinions as the Administrative Agent or the Required Lenders may reasonably request, all in form and substance reasonably satisfactory to the Administrative Agent or the Required Lenders.

Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in subsections (a), (b) and (c) of this Section.

Section 3.3.Delivery of Documents. All of the Loan Documents, certificates, legal opinions and other documents and papers referred to in this Article, unless otherwise specified, shall be delivered to the Administrative Agent for the account of each of the Lenders and in sufficient counterparts or copies for each of the Lenders and shall be in form and substance satisfactory in all respects to the Administrative Agent.

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Administrative Agent and each Lender as follows:

Section 4.1.Existence; Power. Each Credit Party and each of its Subsidiaries is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.

Section 4.2.Organizational Power; Authorization. The Transactions are within the corporate, partnership or limited liability company powers (as applicable) of the respective Credit Parties and their Subsidiaries and have been duly authorized by all necessary corporate, partnership or limited liability company action. This Agreement and the Loan Documents have been duly executed and delivered by each Credit Party which is a party thereto and constitute the legal, valid and binding obligation of each such Person, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law. The Replaced Credit Agreement has been or concurrently with the Closing Date is being fully amended and restated by this Agreement and all Liens securing obligations under the Replaced Credit Agreement have been or concurrently with the Closing Date shall, as of the Closing Date, secure the Obligations hereunder and under the other Loan Documents.

Section 4.3.Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect or which shall be completed at the appropriate time for such filings under applicable securities laws, (b) will not violate any applicable law or regulation or the charter, by-laws or other organizational documents of any Credit Party or any Collateral Subsidiary or any order of any Governmental Authority, (c) will not violate or result in a default under any indenture, agreement or other instrument binding upon any Credit Party or any Collateral Subsidiary or its assets, or give rise to a right thereunder to require any payment to be made by any Credit Party or any of the Borrower’s Subsidiaries, and (d) will not result in the creation or imposition of any Lien on any asset of any Credit Party or any Collateral Subsidiary, except pursuant to the Pledge Agreement, the Equity Proceeds Pledge and the Senior Loan.

Section 4.4.Financial Condition; No Material Adverse Change.

(d)The Borrower has heretofore furnished to the Lenders audited financial statements as of and for the annual fiscal period ended December 31, 2020 and management-prepared financial statements as of and for the quarterly fiscal period ended September 30, 2020. Such financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of the Borrower and its consolidated Subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year-end audit adjustments.

(e)Since December 31, 2020, no event has occurred which would reasonably be expected to have a Material Adverse Effect.

Section 4.5.Properties.

(a)Each of the Borrower and its Subsidiaries has title to, or valid leasehold interests in, all its real and personal property material to its business, except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes, or Liens permitted under Section 7.1. All leases that individually or in the aggregate are material to the business or operations of the Borrower and its Subsidiaries are valid and subsisting and are in full force.

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(b)To each Credit Party’s actual knowledge, all franchises, licenses, authorizations, rights of use, governmental approvals and permits (including all certificates of occupancy and building permits) required to have been issued by Governmental Authority to enable all Real Property owned or leased by Borrower or any of its Subsidiaries to be operated as then being operated have been lawfully issued and are in full force and effect, other than those which the failure to obtain in the aggregate would not be reasonably expected to have a Material Adverse Effect. To each Credit Party’s actual knowledge, no Credit Party or any Subsidiary thereof is in violation of the terms or conditions of any such franchises, licenses, authorizations, rights of use, governmental approvals and permits, which violation would reasonably be expected to have a Material Adverse Effect.

(c)None of the Credit Parties has received any notice or has any actual knowledge of any pending, threatened or contemplated condemnation proceeding affecting the Mortgaged Properties or any part thereof, or any proposed termination or impairment of any parking (except as contemplated in any approved expansion approved by Administrative Agent) at the Mortgaged Properties or of any sale or other disposition of the Mortgaged Properties or any part thereof in lieu of condemnation, which in the aggregate, are reasonably likely to have a Material Adverse Effect.

(d)The properties of the Borrower and its Subsidiaries are insured with financially sound and reputable insurance companies which are not Affiliates of the Borrower, in such amounts with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Borrower or any applicable Subsidiary operates. The Borrower and/or its Subsidiaries maintain all insurance required under applicable Flood Insurance Laws to be maintained with respect to the Real Properties.

Section 4.6.Intellectual Property. To the actual knowledge of each Credit Party, such Credit Party and its Subsidiaries owns, or is licensed to use, all patents and other intellectual property material to its business, and the use thereof by such Credit Party or such Subsidiary does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. To the actual knowledge of each Credit Party, there are no material slogans or other advertising devices, projects, processes, methods, substances, parts or components, or other material now employed, or now contemplated to be employed, by any Credit Party or any Subsidiary of any Credit Party, with respect to the operation of any Real Property, and no claim or litigation regarding any slogan or advertising device, project, process, method, substance, part or component or other material employed, or now contemplated to be employed by any Credit Party or any Subsidiary of any Credit Party, is pending or threatened, the outcome of which could reasonably be expected to have a Material Adverse Effect.

Section 4.7.Litigation and Environmental Matters.

(a)To the actual knowledge of the Borrower, except as set forth in Schedule IV attached hereto, there are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, threatened against or affecting any Credit Party or any of the Borrower’s Subsidiaries (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect or (ii) that involve this Agreement or the Transactions.

(b)Except with respect to any matters that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect:

(i)to the actual knowledge of the Credit Parties, all Real Property leased or owned by Borrower or any of its Subsidiaries is free from contamination by any Hazardous Material, except to the extent such contamination would not reasonably be expected to cause a Material Adverse Effect;

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(ii)to the actual knowledge of the Credit Parties, the operations of Borrower and its Subsidiaries, and the operations at the Real Property leased or owned by Borrower or any of its Subsidiaries are in compliance with all applicable Environmental Laws, except to the extent such noncompliance would not reasonably be expected to cause a Material Adverse Effect;

(iii)neither the Borrower nor any of its Subsidiaries have known liabilities with respect to Hazardous Materials and, to the knowledge of each Credit Party, no facts or circumstances exist which would reasonably be expected to give rise to liabilities with respect to Hazardous Materials, in either case, except to the extent such liabilities would not reasonably be expected to have a Material Adverse Effect;

(iv)to Borrower’s actual knowledge, (A) the Borrower and its Subsidiaries and all Real Property owned or leased by Borrower or its Subsidiaries have all Environmental Permits necessary for the operations at such Real Property and are in compliance with such Environmental Permits; (B) there are no legal proceedings pending nor, to the knowledge of any Credit Party, threatened to revoke, or alleging the violation of, such Environmental Permits; and (C) none of the Credit Parties have received any notice from any source to the effect that there is lacking any Environmental Permit required in connection with the current use or operation of any such properties, in each case, except to the extent the nonobtainment or loss of an Environmental Permit would not reasonably be expected to have a Material Adverse Effect;

(v)to the actual knowledge of each Credit Party, none of the Credit Parties are subject to any pending legal proceeding alleging the violation of any Environmental Law nor are any such proceedings threatened, in either case, except to the extent any such proceedings would not reasonably be expected to have a Material Adverse Effect;

(vi)to the actual knowledge of each Credit Party, none of the operations of the Borrower or any of its Subsidiaries or, of any owner of premises currently leased by Borrower or any of its Subsidiaries or of any tenant of premises currently leased from Borrower or any of its Subsidiaries, involve the generation, transportation, treatment, storage or disposal of hazardous waste, as defined under 40 C.F.R. Part 261.3 (in effect as of the date of this Agreement) or any state, local, territorial or foreign equivalent, in violation of Environmental Laws; and

(vii)to the knowledge of the Credit Parties, there is not now (except, in all cases, to the extent the existence thereof would not reasonably be expected to have a Material Adverse Effect), on, in or under any Real Property leased or owned by Borrower or any of its Subsidiaries (A) any underground storage tanks or surface tanks, dikes or impoundments (other than for surface water); (B) any friable asbestos-containing materials; (C) any polychlorinated biphenyls; or (D) any radioactive substances other than naturally occurring radioactive material.

Section 4.8.Compliance with Laws and Agreements. Each of the Credit Parties and their Subsidiaries is in material compliance with all Legal Requirements (including all Environmental Laws) applicable to it or its property and all indentures, agreements and other instruments binding upon it or to its knowledge, its property, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is continuing.

Section 4.9.Investment Company Act. Neither the Borrower nor any of its Subsidiaries is (a) an “investment company” or is “controlled” by an “investment company”, as such terms are defined in, or subject to regulation under, the Investment Company Act of 1940, as amended and in effect from time to time, (b) a “holding company” as defined in, or subject to regulation under, the Public Utility Holding Company Act of 1935, or (c) otherwise subject to any other regulatory scheme limiting its ability to incur debt or requiring any approval or consent from, or registration or filing with, any Governmental Authority in connection therewith.

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Section 4.10.Taxes. Each Credit Party and each of the Borrower’s Subsidiaries has timely filed or caused to be filed all Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings and for which such Person has set aside on its books adequate reserves or (b) to the extent that the failure to do so would not reasonably be expected to result in a Material Adverse Effect.

Section 4.11.ERISA. No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, would reasonably be expected to result in a Material Adverse Effect. Neither the Borrower nor any of its Subsidiaries have any Plans as of the date hereof. As to any future Plan the present value of all accumulated benefit obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) will not exceed the fair market value of the assets of such Plan, and the present value of all accumulated benefit obligations of all underfunded Plans (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) will not exceed the fair market value of the assets of all such underfunded Plans.

Section 4.12.Disclosure. To the actual knowledge of the Borrower, the Borrower has disclosed or made available to the Lenders all agreements, instruments and corporate or other restrictions to which it, any other Credit Party, or any of its Subsidiaries is subject, and all other matters known to it, that, in the aggregate, would reasonably be expected to result in a Material Adverse Effect. None of the reports, financial statements, certificates or other information furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time. As of the Closing Date, the information included in the Beneficial Ownership Certification is true and correct in all respects.

Section 4.13.Solvency. As of the Closing Date and after giving effect to the transactions contemplated by this Agreement and the other Loan Documents (including any contribution rights under the Guaranty), including all Loans made or to be made hereunder, the Borrower is not insolvent on a balance sheet basis such that the sum of such Person’s assets exceeds the sum of such Person’s liabilities, the Borrower is able to pay its debts as they become due, and the Borrower has sufficient capital to carry on its business.

Section 4.14.Margin Regulations. None of the proceeds of any of the Loans will be used, directly or indirectly, for “purchasing” or “carrying” any “margin stock” within the respective meanings of each of such terms under Regulation U or for any purpose that violates the provisions of Regulation T, Regulation U or Regulation X. Neither the Borrower nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying “margin stock”.

Section 4.15.Subsidiaries; REIT Qualification. As of the Closing Date, no Person owns any Equity Interests in the Mortgaged Properties except as set forth on Schedule V attached hereto. The Borrower qualifies as a “qualified REIT subsidiary” under Section 856 of the Code. The Parent is a Maryland corporation duly organized pursuant to articles of incorporation filed with the Maryland Department of Assessments and Taxation and is in good standing under the laws of Maryland. The Parent conducts its business in a manner which enables it to qualify as a real estate investment trust under, and to be entitled to the benefits of, §856 of the Code, and has elected to be treated as and will be entitled to the benefits of a real estate investment trust thereunder.

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Section 4.16.Labor Relations. There are no strikes, lockouts or other material labor disputes or grievances against the Borrower or any of its Subsidiaries, or, to the Borrower’s knowledge, threatened against or affecting the Borrower or any of its Subsidiaries, and no significant unfair labor practice charges or grievances are pending against the Borrower or any of its Subsidiaries, or, to the Borrower’s knowledge, threatened against any of them before any Governmental Authority. All payments due from the Borrower or any of its Subsidiaries pursuant to the provisions of any collective bargaining agreement have been paid or accrued as a liability on the books of the Borrower or any such Subsidiary, except where the failure to do so could not reasonably be expected to have a Material Adverse Effect.

Section 4.17.Sanctions and Anti-Corruption Laws. None of the Credit Parties, any of the other Subsidiaries, or any other Affiliate thereof is (or will be) (a) a Sanctioned Person, (b) located, organized or resident in a Designated Jurisdiction, (c) to the best of Borrower’s knowledge, without any independent inquiry, is or has been (within the previous five (5) years) engaged in any transaction with any Sanctioned Person or any Person who is located, organized or resident in any Designated Jurisdiction to the extent that such transactions would violate Sanctions, or (d) has violated any Anti-Money Laundering Law in any material respect. Each Credit Party and its Subsidiaries, and to the knowledge of the Credit Parties, each director, officer, employee, agent and Affiliate of the Credit Parties and each such Subsidiary, is in compliance with the Anti-Corruption Laws in all material respects. The Credit Parties have implemented and maintain in effect policies and procedures designed to promote and achieve compliance with the Anti-Corruption Laws and applicable Sanctions.

Section 4.18.Affected Financial Institutions. No Credit Party is an Affected Financial Institution.

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ARTICLE V

AFFIRMATIVE COVENANTS

Until the Commitments have expired or been terminated and all Loans have been paid in full, the Borrower covenants and agrees with the Lenders that:

Section 5.1.Financial Statements and Other Information. The Borrower will deliver to the Administrative Agent and each Lender:

(a)within 120 days after the end of each Fiscal Year, the Parent’s audited consolidated balance sheet and related statements of operations, stockholders’ equity and cash flows as of the end of and for such Fiscal Year, together with all notes thereto, setting forth in each case in comparative form the figures for the previous Fiscal Year, all reported on by KPMG or other independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Parent and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;

(b)within 60 days after the end of each Fiscal Quarter, the Parent’s consolidated balance sheet and related statements of operations, stockholders’ equity and cash flows as of the end of and for such Fiscal Quarter and the then elapsed portion of the Fiscal Year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous Fiscal Year and including supporting notes and schedules, all certified by a Responsible Officer as presenting fairly in all material respects the financial condition and results of operations of the Parent on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;

(c)concurrently with any delivery of financial statements under clause (a) or (b) above, a Compliance Certificate of a Responsible Officer of the Parent;

(d)promptly after the same become publicly available for Forms 10-K and 10-Q described below, and upon written request for items other than Forms 10-K and 10-Q described below, copies of all periodic and other reports, proxy statements and other materials filed by the Parent, the Borrower or any Subsidiary with the Securities and Exchange Commission (including registration statements and reports on Form 10-K, 10-Q and 8-K (or their equivalents)), or any Governmental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange, or distributed by the Parent or the Borrower to its shareholders generally, as the case may be;

(e)promptly following any request therefor (but no more often than once per Fiscal Quarter), such other information regarding the operations, business affairs and financial condition of any Credit Party or any Subsidiary of the Borrower, or compliance with the terms of the Loan Documents, as the Administrative Agent or any Lender may reasonably request; and

(f)promptly following any request therefor, any information and documentation reasonably requested by the Administrative Agent or any Lender for purposes of compliance with applicable “know your customer” requirements under the PATRIOT Act or other applicable anti-money laundering laws.

The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Arrangers will make available to the Lenders materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on the Platform and (b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to receive material non-public information with respect to the Borrower or its Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such Persons’ securities. The Borrower hereby agrees that it will use commercially reasonable efforts to identify that portion of the Borrower Materials that may be distributed to Public Lenders and that (w) all such Borrower Materials shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean

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that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC”, the Borrower shall be deemed to have authorized the Administrative Agent, the Arrangers, and the Lenders to treat such Borrower Materials as not containing any material non-public information (although it may be sensitive and proprietary) with respect to the Borrower or its securities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower Materials constitute confidential information, they shall be treated as set forth in Section10.12); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Side Information”; and (z) the Administrative Agent and the Arrangers shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Side Information”.

Section 5.2.Financial Tests. The Parent shall have and maintain at all times, on a consolidated basis in accordance with GAAP, tested as of the close of each calendar quarter:

(a)A Total Leverage Ratio not to exceed sixty-five percent (65%);

(b)A minimum Fixed Charge Coverage Ratio of not less than 1.50:1.00;

(c)Tangible Net Worth at all times of not less than the sum of (i) $602,132,376.00, plus (ii) 90% of the net proceeds of all equity issuances of the Parent raised after the Closing Date;

(d)A maximum Payout Ratio of ninety percent (90%) commencing for the quarter ending June 30, 2021;

(e)A minimum Interest Coverage Ratio of not less than 1.85:1.00;

(f)The aggregate Unhedged Variable Rate Debt of the Borrower and its Subsidiaries shall not exceed thirty percent (30%) of Total Asset Value; and

(g)[Intentionally Omitted].

(h)A minimum Debt Yield of 8.00% at all times commencing with the quarter ending on June 30, 2021.

(i)A minimum amount of cash designated as restricted capital expenditures reserves equal to not less than the Capital Expenditure Reserve.

Section 5.3.Notices of Material Events. The Borrower will furnish to the Administrative Agent and each Lender written notice of the following promptly after it becomes aware of same (unless specific time is set forth below):

(a)the occurrence of any Default under this Agreement or any default or event of default under a Senior Loan Document;

(b)within fifteen (15) Business Days after the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting any Credit Party or any Affiliate thereof that, if adversely determined, would reasonably be expected to result in a Material Adverse Effect;

(c)within fifteen (15) Business Days after the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, would reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding $10,000,000.00; and

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(d)any other development that results in, or would reasonably be expected to result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of a Responsible Officer of Borrower setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.

At the Administrative Agent’s option, after the happening of any of the events listed in clauses (a), (b) or (d) above which would reasonably be expected to result in a Material Adverse Effect on any of the Mortgaged Properties, the Administrative Agent may obtain, or cause the Borrower to obtain, an updated Appraisal for the Mortgaged Properties giving rise to such events, all at the Borrower’s expense.

Section 5.4.Existence; Conduct of Business. The Borrower will, and will cause Parent and each of its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges and franchises material to the conduct of its business; provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under this Agreement and shall not apply to the real estate investment trust status of the Parent until such time as the Parent has made its initial election to be treated as a real estate investment trust under the Code. The Borrower must at all times be a wholly owned Subsidiary of Parent. The Borrower may not be organized under the laws of a jurisdiction other than the United States of America, any State thereof or the District of Columbia.

Section 5.5.Payment of Obligations. The Borrower will, and will cause Parent and each of its Subsidiaries to, pay its obligations, including Tax liabilities, that, if not paid, would result in a Material Adverse Effect before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending such contest would not reasonably be expected to result in a Material Adverse Effect. The Borrower will, and will cause each of its Subsidiaries to, comply with all of its obligations and liabilities (as applicable) under the Senior Loan Documents.

Section 5.6.Maintenance of Properties; Insurance.

(a)The Borrower will, and will cause Parent and each of its Subsidiaries to, (i) keep and maintain all property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted, and (ii) maintain, with financially sound and reputable insurance companies, insurance in such amounts and against such risks as are reasonable and customary for similarly situated Properties (including, without limitation, all insurance required under applicable Flood Insurance Laws to be maintained with respect to the Real Properties).

(b)The Borrower will pay and discharge, or cause to be paid and discharged, all taxes, assessments, maintenance charges, permit fees, impact fees, development fees, capital repair charges, utility reservations and standby fees and all other similar impositions of every kind and character charged, levied, assessed or imposed against any interest in any of the Mortgaged Property owned by it or any of its Subsidiaries, as they become payable and before they become delinquent. The Borrower shall furnish receipts evidencing proof of such payment to the Administrative Agent promptly after payment and before delinquency.

Section 5.7.Books and Records. The Borrower will, and will cause Parent and each of its Subsidiaries to (a) keep proper books of record and account in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities; and (b) permit any representatives designated by the Administrative Agent or any Lender, upon reasonable prior notice and subject to rights of tenants, to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested.

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Section 5.8.Compliance with Laws. The Borrower will, and will cause Parent and each of its Subsidiaries to, comply with all laws, rules, regulations and requirements of any Governmental Authority applicable to its business and properties, including, without limitation, all Environmental Laws, ERISA and OSHA, except where the failure to do so, either individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. The Borrower will maintain in effect and enforce policies and procedures designed to promote and achieve compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with applicable Anti-Corruption Laws and applicable Sanctions.

Section 5.9.Use of Proceeds. The proceeds of the Loans will be used solely to (i) fund a portion of the cost to consummate real estate acquisitions and related investments made by Borrower and its Subsidiaries and for general corporate purposes, and (ii) be distributed to the Parent to fund the cost of the acquisition of shares of capital stock of the Parent purchased from unrelated third-party investors, provided at no time shall the amount of the Loans advanced for such purpose exceed $10,000,000.00. No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that would violate any rule or regulation of the Board of Governors of the Federal Reserve System, including Regulation T, Regulation U or Regulation X.

Section 5.10.Fiscal Year.. Borrower shall maintain as its fiscal year the twelve (12) month period ending on December 31 of each year.

Section 5.11.Environmental Matters. Borrower shall comply and shall cause each of its Subsidiaries and each Real Property owned or leased by such parties to comply in all material respects with all applicable Environmental Laws currently or hereafter in effect, except to the extent noncompliance would not reasonably be expected to have a Material Adverse Effect.

Section 5.12.Collateral Requirement.

(a)General Requirement. Until repayment in full of all outstanding Loans and termination of all Commitments, the Obligations shall be secured by a perfected first priority lien and security interest to be held by the Administrative Agent for the benefit of the Lenders, pursuant to the terms of the Collateral Documents, in (i) the Equity Interests of each Collateral Subsidiary; provided that the Borrower shall not, pursuant to this subclause (i), be required to pledge any portion of such Equity Interests to the extent (and only to the extent) that such a grant of a security interest is prohibited by, or under the terms thereof, may give rise to a default, breach, right of recoupment, buyout, repurchase, purchase option, right of first refusal or similar rights (whether effective with the pledge or any related exercise of rights thereunder), claim, defense or remedy, or directly or indirectly results in the termination of or requires any consent not obtained under, the Senior Loans; provided further that, to the extent such pledge of any portion of such Equity Interests is restricted as set forth in the previous proviso, the Borrower shall, to the extent permitted under any such debt instruments, pledge to the Administrative Agent, pursuant to documentation reasonably acceptable to the Administrative Agent, all of the economic interests and rights to receive dividends or distributions in respect of the Equity Interests of such Collateral Subsidiary; and (ii) the proceeds of all Equity Offerings and any other capital events with respect to any Credit Party and any of their Subsidiaries. No later than twenty (20) Business Days after the end of each fiscal quarter, the Borrower shall pledge to the Agent such portion of the Equity Interests or economic interests in any Subsidiaries that were formed or acquired during the immediately preceding fiscal quarter as is required to be pledged pursuant to clause (ii) of the immediately preceding sentence, in each case, pursuant to documentation reasonably acceptable to the Administrative Agent and shall execute such documents and take such action as the Administrative Agent shall reasonably require in order to perfect its security interest in such additional Equity Interests or economic interests, as applicable.

(b)[Intentionally Omitted].

(c)Release of Collateral. Upon the refinancing or repayment of the Loans in full and termination of all Commitments, then the Administrative Agent shall release the Collateral from the lien and security interest of the Collateral Documents.

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Section 5.13.Further Assurances. At any time upon the request of the Administrative Agent, Borrower will, promptly and at its expense, execute, acknowledge and deliver such further documents and perform such other acts and things as the Administrative Agent may reasonably request to evidence the Loans made hereunder and interest thereon in accordance with the terms of this Agreement.

Section 5.14.Bank Accounts. Subject to the terms of the Senior Loan Documents, the Credit Parties shall maintain (and cause each Subsidiary thereof to maintain) all property, operating and depository accounts and all corporate accounts, with Truist Bank. The Credit Parties shall also utilize Truist Bank (and cause each Subsidiary thereof to utilize Truist Bank) for all cash management services.

Section 5.15.Parent Covenants. The Parent will:

(a)own, directly or indirectly, all of the general partner interests in the Borrower and at least ninety percent (90%) of the limited partnership interests in the Borrower, free and clear of all Liens;

(b)maintain management and control of Borrower;

(c)conduct substantially all of its operations through Borrower and/or one or more of Borrower’s Subsidiaries;

(d)comply with all Legal Requirements to maintain, and, will at all times elect, qualify as and maintain, its status as a real estate investment trust under Section 856(c)(i) of the Code; and

(e)subject to the terms of the Loan Documents, promptly contribute to Borrower the net proceeds of any stock sales or debt offerings.

Section 5.16.Pledge of Interests. If a Borrower or any of its Subsidiaries acquires any Real Property or any direct or indirect beneficial interest in any entity which owns Real Property and in connection with the acquisition of such Real Property grants any mortgage interest under the Senior Loan, Administrative Agent shall be granted a Pledged Interest therein, subject to such limitations as may be imposed under the Senior Loan.

Section 5.17.Permanent Financing. Borrower agrees that it shall use all reasonable efforts to utilize Truist Bank to place permanent debt (e.g. CMBS, Fannie/Freddie, life company placements) with respect to all Real Property acquired, in whole or in part, with proceeds from the Loans; provided, that Borrower may utilize other providers of permanent debt in the case of such provider acting as broker on the purchase and sale of the Real Property in question.

Section 5.18.Keepwell. Each Borrower that is a Qualified ECP Party at the time that the Agreement becomes effective with respect to any Hedging Obligation, hereby jointly and severally, absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Borrower that is not then an “eligible contract participant” under the Commodity Exchange Act (a “Specified Party”) to honor all of its obligations under the Agreement in respect of Hedging Obligations (but, in each case, only up to the maximum amount of such liability that can be hereby incurred without rendering such Qualified ECP Party’s obligations and undertakings under this Section 5.16 voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations and undertakings of each Qualified ECP Party under this Section 5.16 shall remain in full force and effect until the Loans have been repaid in full. Each Qualified ECP Party intends this Section 5.16 to constitute, and this Section shall be deemed to constitute, a guarantee of the obligations of, and a “keepwell, support, or other agreement” for the benefit of, each Specified Party for all purposes of the Commodity Exchange Act.

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ARTICLE VI

[INTENTIONALLY OMITTED]

ARTICLE VII

NEGATIVE COVENANTS

Until the Commitments have expired or been terminated and all Loans have been paid in full, the Borrower covenants and agrees with the Lenders that:

Section 7.1.Liens. Neither the Parent nor the Borrower will create, incur, assume or permit to exist any Lien on the Collateral or the Mortgaged Properties, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof, except solely with respect to the Mortgaged Properties, Permitted Encumbrances.

Section 7.2.Fundamental Changes. The Parent and the Borrower will not, and will not permit any Collateral Subsidiary to:

(a)merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one transaction or in a series of transactions) all or substantially all of the assets of the Borrower or all or substantially all of the stock of its Subsidiaries (in each case, whether now owned or hereafter acquired), or liquidate or dissolve;

(b)sell, transfer, lease or otherwise dispose of any of its assets to the extent such transaction would result in a breach of Section 5.2 or, with respect to the sale of any Real Property, the Equity Interests in which constitute Collateral, unless the Borrower shall pledge to the Administrative Agent additional or substitute Collateral that is acceptable to the Lenders; or

(c)engage to any material extent in any business other than the ownership of interest in entities that own, develop, operate and manage the Properties and businesses reasonably related thereto, except as allowed by Section 7.3.

Section 7.3.Investments, Loans, Advances and Acquisitions. The Parent and the Borrower will not purchase, hold or acquire (including pursuant to any merger with any Person that was not a wholly owned Subsidiary prior to such merger) any capital stock, evidences of indebtedness (subject to Section 7.9 below) or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, or make or permit to exist any investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit, except:

(a)Permitted Investments; and

(b)Investments (directly or indirectly) in Real Properties, provided that:

(i)Investments in unimproved land shall not exceed 5% of Total Asset Value;

(ii)Investments in Development Assets shall not exceed 10% of Total Asset Value;

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(iii)Investments in joint ventures in which Parent, Borrower, or any of its Subsidiaries fails to hold a 90% ownership interest shall not exceed 5% of Total Asset Value; and

(iv)Investments in Real Properties other than multifamily properties shall not to exceed 10% of Total Asset Value.

Provided further that the aggregate Investment described in Section 7.3(b) (i), (ii), (iii) and (iv) above shall not exceed 20% of Total Asset Value. To the extent that any of the terms of subsection (b) are not satisfied, Total Asset Value shall be reduced by any overage amount.

Section 7.4.Hedging Transactions. The Borrower will not, and will not permit any of its Subsidiaries to, enter into any Hedging Transaction, other than Hedging Transactions entered into in the ordinary course of business to hedge or mitigate risks to which any Subsidiary of the Borrower is exposed in the conduct of its business or the management of its liabilities.

Section 7.5.Restricted Payments. The Parent will not, and will not permit any of its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, during any calendar quarter, any Restricted Payment, except that any of the following Restricted Payments are permitted: (a) Restricted Payments by the Parent required to comply with Section 5.15(d), (b) provided no Default is then in existence, Restricted Payments made by the Parent to its equity holders, including in connection with the existing redemption and dividend reinvestment plans, not to exceed the Payout Ratio set forth in Section 5.2(d), (c) provided no Default is then in existence, Restricted Payments made by the Parent to its equity holders, to repurchase their capital stock or equity interest, subject to the limitation on Loan advances set forth in Section 5.9, and (d) Restricted Payments declared and paid ratably by Subsidiaries to Borrower and/or Parent with respect to their capital stock or equity interest.

Section 7.6.Transactions with Affiliates. The Borrower will not, and will not permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except (a) in the ordinary course of business at prices and on terms and conditions not less favorable to the Borrower or such Subsidiary than would be obtained on an arm’s-length basis from unrelated third parties, (b) transactions between or among the Borrower and its wholly owned Subsidiaries not involving any other Affiliate, (c) transactions related to the closing of and ongoing activities necessary to implement the loan obligations and requirements of this Agreement, and (d) any Restricted Payment permitted by Section 7.5.

Section 7.7.Parent Negative Covenants. The Parent will not (a) own any property other than (i) the ownership interests of Borrower and (ii) other assets with no more than $10,000,000.00 in value; (b) give or allow any Lien on the ownership interests of Borrower; (c) engage to any material extent in any business other than the ownership, development, operation and management residential properties.

Section 7.8.Restrictive Agreements. Neither the Borrower nor Parent will, and will not permit any of its Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets, or (b) the ability of any Subsidiary to pay dividends or other distributions with respect to any shares of its capital stock or to make or repay loans or advances to the Borrower or any other Subsidiary or to Guarantee Indebtedness of the Borrower or any other Subsidiary; provided that the restrictions contained in this Section 7.8 shall not apply to (i) restrictions and conditions imposed by law or by this Agreement or as otherwise approved by the Administrative Agent, (ii) customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iii) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness or Liens permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, or ownership interests in the obligors with respect to such Indebtedness, and (iv) solely with respect to clause (a), provisions in leases restricting the assignment thereof.

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Section 7.9.Indebtedness. Neither the Parent, the Borrower nor any Collateral Subsidiary shall, without the prior written consent of the Required Lenders, create, incur, assume, guarantee or be or remain liable, contingently or otherwise with respect to any Indebtedness on a recourse basis, except: (a) Indebtedness under this Agreement; (b) Indebtedness of a Collateral Subsidiary as of date hereof under the Senior Loan Documents; (c) Indebtedness under any Hedging Obligations, (d) Indebtedness whose recourse is solely for so-called “bad-boy” acts,including without limitation, (i) failure to account for a tenant’s security deposits, if any, for rent or any other payment collected by a borrower from a tenant under the lease, all in accordance with the provisions of any applicable loan documents, (ii) fraud or a material misrepresentation made by a Borrower or any Guarantor, or the holders of beneficial or ownership interests in Borrower or any Guarantor, in connection with the financing evidenced by the applicable loan documents; (iii) any attempt by a Borrower or any Guarantor to divert or otherwise cause to be diverted any amounts payable to the applicable lender in accordance with the applicable loan documents; (iv) the misappropriation or misapplication of any insurance proceeds or condemnation awards relating to any Real Property; (v) voluntary or involuntary bankruptcy by a Borrower or any Guarantor; (vi) any environmental matter(s) affecting any Real Property; (vii) failure to deliver statements, schedules, reports, or books and records in accordance with the provisions of any applicable loan documents; (viii) failure to pay any deferred amounts in accordance with the provisions of any applicable loan documents; (ix) any material waste of any Real Property; (x) the failure to comply with any single purpose entity requirements in accordance with the provisions of any applicable loan documents; and (xi) the occurrence of any transfer of any interest in violation of the provisions of any applicable loan documents; and (e) Indebtedness for trade payables and operating expenses incurred in the ordinary course of business.

Section 7.10.Fees. Provided that no Default or Event of Default shall be in existence, each Credit Party may pay all management, property and other asset fees then due and payable. At any time that any Default or Event of Default exists under this Agreement or any other Loan Document, then in any of such event(s), no Credit Party or any Subsidiary may pay any management, property, asset or similar fees to any other Credit Party or to any Subsidiary or Affiliate, including, without limitation, to the Management Company; provided that any such fees may accrue during the continuance of any such Default or Event of Default and be payable at such time as no Default or Event of Default is continuing hereunder. All such parties shall execute subordination agreements in form and substance acceptable to the Administrative Agent with respect to such fees. Notwithstanding the foregoing, Credit Parties and their Subsidiaries may pay at all times any due and payable fees to third party property managers.

Section 7.11.Amendment to Organizational Documents. Without the prior written consent of Administrative Agent, which consent shall not be unreasonably withheld, conditioned or delayed, no Borrower will amend, modify or waive any rights under its certificate of incorporation, bylaws or other organizational documents in any manner, except: (a) modifications necessary to clarify existing provisions of such organizational documents; (b) modifications which would not have a Material Adverse Effect, and (c) modifications in connection with mergers, consolidations, investments and other transactions not otherwise prohibited by the other provisions of this Agreement.

Section 7.12.Sanctions and Anti-Corruption Laws. No Borrower shall permit the proceeds of any Loan: (a) to be lent, contributed or otherwise made available to fund any activity or business in any Designated Jurisdiction; (b) to fund any activity or business of any Sanctioned Person or any Person located, organized, formed, incorporated or residing in any Designated Jurisdiction or who is the subject of any Sanctions; (c) in any other manner that will result in any material violation by any Person (including any Lender or Administrative Agent) of any Sanctions; or (d) to be used in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws.

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ARTICLE VIII

EVENTS OF DEFAULT

Section 8.1.Events of Default. If any of the following events (each, an “Event of Default”)shall occur:

(a)the Borrower shall fail to pay any principal of the Loans when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise, and such failure (other than the payment due on the Maturity Date, for which there shall be no grace period) shall continue unremedied for a period of over three (3) Business Days;

(b)the Borrower shall fail to pay any interest on the Loans or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under any Loan Documents, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of over three (3) Business Days (such three Business Day period commencing after written notice from the Administrative Agent as to any such failure);

(c)any representation or warranty made or deemed made by or on behalf of any Credit Party in or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement or any amendment or modification hereof or waiver hereunder, shall prove to have been incorrect in any material respect when made or deemed made;

(d)the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Article V or VII other than Sections 5.4, 5.5, 5.6, 5.7(a), 5.8, and 5.11;

(e)any Credit Party shall fail to observe or perform any covenant, condition or agreement contained in any Loan Document (other than those specified in clause (a), (b) or (d) of this Article), and such failure shall continue unremedied for a period of over 30 days after notice thereof from the Administrative Agent to the Borrower (which notice will be given at the request of any Lender) and if such default is not cureable within thirty (30) days and the Credit Party is diligently pursuing cure of same, the cure period may be extended for thirty (30) days (for a total of 60 days after the original notice from the Administrative Agent) upon written request from the Borrower to the Administrative Agent;

(f)an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of any Credit Party or any Collateral Subsidiary or its debts, or of a substantial part of its assets, under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Credit Party or any Collateral Subsidiary or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;

(g)any Credit Party or any Subsidiary of the Borrower shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for such Person or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;

(h)any Credit Party or any Collateral Subsidiary shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;

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(i)one or more judgments for the payment of money in an aggregate amount in excess of $10,000,000 shall be rendered against any Credit Party, any Subsidiary of the Borrower or any combination thereof and the same shall remain undischarged for a period of sixty (60) consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of such Person to enforce any such judgment;

(j)an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when taken together with all other ERISA Events that have occurred, would reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding $10,000,000;

(k)the Guaranty of the Loan by the Guarantor shall for any reason terminate or cease to be in full force and effect;

(l)any Credit Party shall default under any agreement and such default would reasonably be expected to result in a Material Adverse Effect;

(m)any Credit Party shall (or shall attempt to) disavow, revoke or terminate any Loan Document to which it is a party or shall otherwise challenge or contest in any action, suit or proceeding in any court or before any Governmental Authority the validity or enforceability of any Loan Document;

(n)any provision of any Loan Document with respect to the Collateral shall for any reason cease to be valid and binding on, enforceable against, any Credit Party resulting in a Material Adverse Effect, or any lien created under any Loan Document ceases to be a valid and perfected first priority lien in any of the Collateral purported to be covered thereby;

(o)a Change in Control shall occur;

(p)(i) Any Borrower or Guarantor defaults under any recourse Indebtedness, or (ii) any Subsidiaries of Parent or Borrower defaults under any non-recourse Indebtedness in an aggregate amount equal to or greater than $75,000,000 at any time (such $75,000,000 calculated based on the Equity Percentage of Indebtedness for the Borrower’s Unconsolidated Affiliates); or

(q)An Event of Default occurs under any of the Senior Loan Documents or any other debt securing the Mortgaged Properties;

then, and in every such event (other than an event described in clause (f) or (g) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take some or all of the following actions, at the same or different times: (i) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all reasonable fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower, and (ii) exercise any other rights or remedies provided under this Agreement or any other Loan Document, or any other right or remedy available by law or equity; and in case of any event described in clause (f) or (g) of this Article, the principal of the Loans then outstanding, together with accrued interest thereon and all reasonable fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.

Section 8.2.Application of Proceeds from Collateral. All proceeds from each sale of, or other realization upon, all or any part of the Collateral by any Secured Party after an Event of Default arises shall be applied as follows:

(a)first, to the reimbursable expenses of the Administrative Agent incurred in connection with such sale or other realization upon the Collateral, until the same shall have been paid in full;

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(b)second, to the fees and other reimbursable expenses of the Administrative Agent then due and payable pursuant to any of the Loan Documents, until the same shall have been paid in full;

(c)third, to all reimbursable expenses, if any, of the Lenders then due and payable pursuant to any of the Loan Documents, until the same shall have been paid in full;

(d)fourth, to the fees and interest then due and payable under the terms of this Agreement, until the same shall have been paid in full;

(e)fifth, to the aggregate outstanding principal amount of the Second Supplemental  Loans until the same shall have been paid in full, allocated pro rata among the Second Supplemental Lenders based  on their respective pro rata shares of the aggregate amount of the Second Supplemental Loans;

(f)sixth, to the aggregate outstanding principal amount of the other Loans, the Bank Product Obligations and the Net Mark-to-Market Exposure of the Hedging Obligations that constitute Obligations, until the same shall have been paid in full, allocated pro rata among the Secured Parties based on their respective pro rata shares of the aggregate amount of such Loans, , Bank Product Obligations and Hedge Termination Value of such Hedging Obligations; and

(a)(f) sixthseventh, to the extent any proceeds remain, to the Borrower or as otherwise provided by a court of competent jurisdiction.

All amounts allocated pursuant to the foregoing clauses third through fifth, fourth, and sixth to the Lenders as a result of amounts owed to the Lenders under the Loan Documents shall be allocated among, and distributed to, the Lenders pro rata based on their respective Pro Rata Shares.

Notwithstanding the foregoing, (a) no amount received from any Guarantor (including any proceeds of any sale of, or other realization upon, all or any part of the Collateral owned by such Guarantor) shall be applied to any Excluded Swap Obligation of such Guarantor and (b) Bank Product Obligations and Hedging Obligations shall be excluded from the application described above if the Administrative Agent has not received written notice thereof, together with such supporting documentation as the Administrative Agent may request, from the Bank Product Provider or the Lender-Related Hedge Provider, as the case may be. Each Bank Product Provider or Lender-Related Hedge Provider that has given the notice contemplated by the preceding sentence shall, by such notice, be deemed to have acknowledged and accepted the appointment of the Administrative Agent pursuant to the terms of Article IX hereof for itself and its Affiliates as if a “Lender” party hereto.

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ARTICLE IX

THE ADMINISTRATIVE AGENT

Section 9.1.Appointment of the Administrative Agent.

(a)Each Lender irrevocably appoints Truist Bank as the Administrative Agent and authorizes it to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent under this Agreement and the other Loan Documents, together with all such actions and powers that are reasonably incidental thereto. The Administrative Agent may perform any of its duties hereunder or under the other Loan Documents by or through any one or more sub-agents or attorneys-in-fact appointed by the Administrative Agent. The Administrative Agent and any such sub-agent or attorney-in-fact may perform any and all of its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions set forth in this Article shall apply to any such sub-agent, attorney-in-fact or Related Party and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as the Administrative Agent.

(b)It is understood and agreed that the use of the term “agent” herein or in any other Loan Document (or any similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law. Instead such term is used as a matter of market custom and is intended to create or reflect only an administrative relationship between contracting parties.

Section 9.2.Nature of Duties of the Administrative Agent. The Administrative Agent shall not have any duties or obligations except those expressly set forth in this Agreement and the other Loan Documents. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default or an Event of Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except those discretionary rights and powers expressly contemplated by the Loan Documents that the Administrative Agent is required to exercise in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 10.2), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and (c) except as expressly set forth in the Loan Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by the Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it, its sub-agents or its attorneys-in-fact with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 10.2) or in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final non-appealable judgment. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents or attorneys-in-fact except to the extent that a court of competent jurisdiction determines in a final and nonappelable judgment that the Administrative Agent acted with gross negligence or willful misconduct in the selection of such sub-agents. The Administrative Agent shall not be deemed to have knowledge of any Default or Event of Default unless and until written notice thereof (which notice shall include an express reference to such event being a “Default” or “Event of Default” hereunder) is given to the Administrative Agent by the Borrower or any Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements, or other terms and conditions set forth in any Loan Document, (iv) the validity, enforceability, effectiveness or genuineness of any Loan Document or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article III or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent. The Administrative Agent may consult with legal counsel (including counsel for the Borrower) concerning all matters pertaining to such duties.

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Section 9.3.Lack of Reliance on the Administrative Agent. Each of the Lenders acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each of the Lenders also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, continue to make its own decisions in taking or not taking any action under or based on this Agreement, any related agreement or any document furnished hereunder or thereunder.

Section 9.4.Certain Rights of the Administrative Agent. If the Administrative Agent shall request instructions from the Required Lenders with respect to any action or actions (including the failure to act) in connection with this Agreement, the Administrative Agent shall be entitled to refrain from such act or taking such act unless and until it shall have received instructions from such Lenders, and the Administrative Agent shall not incur liability to any Person by reason of so refraining. Without limiting the foregoing, no Lender shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or refraining from acting hereunder in accordance with the instructions of the Required Lenders where required by the terms of this Agreement.

Section 9.5.Reliance by the Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, posting or other distribution) believed by it to be genuine and to have been signed, sent or made by the proper Person. The Administrative Agent may also rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person and shall not incur any liability for relying thereon. The Administrative Agent may consult with legal counsel (including counsel for the Borrower), independent public accountants and other experts selected by it and shall not be liable for any action taken or not taken by it in accordance with the advice of such counsel, accountants or experts.

Section 9.6.The Administrative Agent in its Individual Capacity. The bank serving as the Administrative Agent shall have the same rights and powers under this Agreement and any other Loan Document in its capacity as a Lender as any other Lender and may exercise or refrain from exercising the same as though it were not the Administrative Agent; and the terms “Lenders”, “Required Lenders”, “Required Revolving Lenders”, “Required Supplemental Lenders”, “Required Second Supplemental Lenders”,  or any similar terms shall, unless the context clearly otherwise indicates, include the Administrative Agent in its individual capacity. The bank acting as the Administrative Agent and its Affiliates may accept deposits from, lend money to, and generally engage in any kind of business with the Borrower or any Subsidiary or Affiliate of the Borrower as if it were not the Administrative Agent hereunder.

Section 9.7.Successor Administrative Agent.

(a)The Administrative Agent may resign at any time by giving notice thereof to the Lenders and the Borrower. Upon any such resignation, the Required Lenders shall have the right to appoint a successor Administrative Agent, subject to approval by the Borrower provided that no Default or Event of Default shall exist at such time. If no successor Administrative Agent shall have been so appointed, and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of resignation, then the retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent which shall be a commercial bank organized under the laws of the United States or any state thereof or a bank which maintains an office in the United States.

(b)Upon the acceptance of its appointment as the Administrative Agent hereunder by a successor, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. If, within 45 days after written notice is given of the retiring Administrative Agent’s resignation under this Section, no successor Administrative Agent shall have been appointed and shall have accepted such appointment, then on such 45th day (i) the retiring Administrative Agent’s resignation shall become effective, (ii) the retiring Administrative Agent shall thereupon be discharged from its duties and obligations under the Loan Documents and (iii) the Required Lenders shall thereafter perform all duties of the retiring Administrative Agent under the Loan Documents until such time as the Required

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Lenders appoint a successor Administrative Agent as provided above. After any retiring Administrative Agent’s resignation hereunder, the provisions of this Article shall continue in effect for the benefit of such retiring Administrative Agent and its representatives and agents in respect of any actions taken or not taken by any of them while it was serving as the Administrative Agent.

Section 9.8.Withholding Tax. To the extent required by any applicable law, the Administrative Agent may withhold from any interest payment to any Lender an amount equivalent to any applicable withholding tax. If the Internal Revenue Service or any authority of the United States or any other jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Lender (because the appropriate form was not delivered or was not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstances that rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason), such Lender shall indemnify the Administrative Agent (to the extent that the Administrative Agent has not already been reimbursed by the Borrower and without limiting the obligation of the Borrower to do so) fully for all amounts paid, directly or indirectly, by the Administrative Agent as tax or otherwise, including penalties and interest, together with all expenses incurred, including legal expenses, allocated staff costs and any out of pocket expenses.

Section 9.9.The Administrative Agent May File Proofs of Claim.

(a)In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Credit Party, the Administrative Agent (irrespective of whether the principal of any Loan or, any Revolving Credit Exposure or, anySupplemental Credit Exposure, or any Second Supplemental Credit Exposure shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise:

(i)to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans or, any Revolving Credit Exposure, anySupplemental Credit Exposure, or any Second Supplemental Credit Exposure and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and its agents and counsel and all other amounts due the Lenders and the Administrative Agent under Section 10.3) allowed in such judicial proceeding; and

(ii)to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same.

(b)Any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, if the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Section 10.3.

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

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Section 9.10.Authorization to Execute Other Loan Documents. Each Lender herebyauthorizes the Administrative Agent to execute on behalf of all Lenders all Loan Documents (including, without limitation, the Collateral Documents and any subordination agreements) other than this Agreement.

Section 9.11.Collateral and Guaranty Matters. The Lenders irrevocably authorize the Administrative Agent, at its option and in its discretion:

(a)to release any Lien on any property granted to or held by the Administrative Agent under any Loan Document (i) that is sold or to be sold as part of or in connection with any sale permitted hereunder or under any other Loan Document, or (ii) if approved, authorized or ratified in writing in accordance with Section  10.2; and

(b)to release any Credit Party from its obligations under the applicable Collateral Documents if such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder or is otherwise entitled, pursuant to the terms hereof, to such release.

Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release its interest in particular types or items of property, or to release any Credit Party from its obligations under the applicable Collateral Documents pursuant to this Section. In each case as specified in this Section, the Administrative Agent is authorized, at the Borrower’s expense, to execute and deliver to the applicable Credit Party such documents as such Credit Party may reasonably request to evidence the release of such item of Collateral from the Liens granted under the applicable Collateral Documents, or to release such Credit Party from its obligations under the applicable Collateral Documents, in each case in accordance with the terms of the Loan Documents and this Section.

Section 9.12.Documentation Agent; Syndication Agent. Each Lender hereby designates each of KeyBank National Association and Citizens Bank, N.A. as Documentation Agents and agrees that the Documentation Agents shall have no duties or obligations under any Loan Documents to any Lender or any Credit Party.

Section 9.13.Right to Realize on Collateral and Enforce Guarantee. Anything contained in any of the Loan Documents to the contrary notwithstanding, the Borrower, the Administrative Agent and each Lender hereby agree that (a) no Lender shall have any right individually to realize upon any of the Collateral or to enforce the Collateral Documents, it being understood and agreed that all powers, rights and remedies hereunder and under the Collateral Documents may be exercised solely by the Administrative Agent, and (b) in the event of a foreclosure by the Administrative Agent on any of the Collateral pursuant to a public or private sale or other disposition, the Administrative Agent or any Lender may be the purchaser or licensor of any or all of such Collateral at any such sale or other disposition and the Administrative Agent, as agent for and representative of the Lenders (but not any Lender or Lenders in its or their respective individual capacities unless the Required Lenders shall otherwise agree in writing), shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such public sale, to use and apply any of the Obligations as a credit on account of the purchase price for any collateral payable by the Administrative Agent at such sale or other disposition.

Section 9.14.Secured Bank Product Obligations and Hedging Obligations. No Bank Product Provider or Lender-Related Hedge Provider that obtains the benefits of Section 8.2, the Collateral Documents or any Collateral by virtue of the provisions hereof or of any other Loan Document shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents. Notwithstanding any other provision of this Article to the contrary, the Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, Bank Product Obligations and Hedging Obligations unless the Administrative Agent has received written notice of such Obligations, together with such supporting documentation as the Administrative Agent may request, from the applicable Bank Product Provider or Lender-Related Hedge Provider, as the case may be.

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ARTICLE X

MISCELLANEOUS

Section 10.1.Notices.

(a)Written Notices.

(i)Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications to any party herein to be effective shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:

To the Borrower:	c/o NexPoint Residential Trust, Inc. 2515 McKinney Avenue, Suite 1100 Dallas, Texas 75201 Attention: Matt McGraner Telephone No. (833) 463-6697 Email: mmcgraner@highlandcapital.com)
	and:
	Attention: Brian Mitts, Chief Financial Officer Telephone No. (833) 463-6697 Email: bmitts@nexpoint.com)
With a copy to:	Wick Phillips Gould & Martin, LLP 3131 McKinney, Suite 500 Dallas, Texas 75204 Attention: Chris Fuller Telephone No. (214) 740-4023 Email: chris.fuller@wickphillips.com)

To the Administrative Agent:	Truist Bank 303 Peachtree Street, N.E. Atlanta, Georgia 30308 Attention: Karen Weich
	Telephone No. (404) 813-9293
With copies to:	Truist Bank Legal Department - CRE 303 Peachtree Street, N.E., Suite 3600 Mail Code GA-ATL-0643 Atlanta, Georgia 30308
To any other Lender:	the address set forth in the Administrative Questionnaire or the Assignment and Acceptance executed by such Lender

Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto.

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(ii)Any agreement of the Administrative Agent or any Lender herein to receive certain notices by telephone or facsimile is solely for the convenience and at the request of the Borrower. The Administrative Agent and each Lender shall be entitled to rely on the authority of any Person purporting to be a Person authorized by the Borrower to give such notice and the Administrative Agent and the Lenders shall not have any liability to the Borrower or other Person on account of any action taken or not taken by the Administrative Agent or any Lender in reliance upon such telephonic or facsimile notice. The obligation of the Borrower to repay the Loans and all other Obligations hereunder shall not be affected in any way or to any extent by any failure of the Administrative Agent or any Lender to receive written confirmation of any telephonic or facsimile notice or the receipt by the Administrative Agent or any Lender of a confirmation which is at variance with the terms understood by the Administrative Agent and such Lender to be contained in any such telephonic or facsimile notice.

(b)Electronic Communications.

(i)Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices to any Lender if such Lender has notified the Administrative Agent that it is incapable of receiving, or is unwilling to receive, notices by electronic communication. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

(ii)Unless the Administrative Agent otherwise prescribes, (A) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement) and (B) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (A) of notification that such notice or communication is available and identifying the website address therefor; provided that, in the case of clauses (A) and (B) above, if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient.

(iii)The Borrower agrees that the Administrative Agent may, but shall not be obligated to, make Communications (as defined below) available to the Lenders by posting the Communications on Debt Domain, Intralinks, Syndtrak, ClearPar or a substantially similar electronic system.

(iv)THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” NEITHER THE ADMINISTRATIVE AGENT NOR ANY OF ITS RELATED PARTIES WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS IN THE COMMUNICATIONS (AS DEFINED BELOW) AND FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE ADMINISTRATIVE AGENT OR ANY OF ITS RELATED PARTIES IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of its Related Parties have any liability to any Credit Party or any of their respective Subsidiaries, any Lender, or any other Person or entity for losses, claims, damages, liabilities or expenses of any kind, including, without limitation, direct or indirect, special, incidental or consequential damages, losses or expenses, whether or not based on strict liability (whether in tort, contract or otherwise), arising out of any Credit Party’s or the Administrative Agent’s transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of the Administrative

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Agent or such Related Party; provided , however, that in no event shall the Administrative Agent or any Related Party have any liability to any Credit Party or any of their respective Subsidiaries, any Lender, or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages) arising out of any Credit Party’s or the Administrative Agent’s transmission of Communications. “Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of any Credit Party pursuant to any Loan Document or the transactions contemplated therein which is distributed by the Administrative Agent or any Lender by means of electronic communications pursuant to this Section, including through the Platform.

(c)Telephonic Notices. Unless otherwise expressly provided herein, all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier or electronic mail as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

(i)if to Borrower or the Administrative Agent to the address, telecopier number, electronic mail address or telephone number specified for such Person in Section 10.1  above or to such other address, telecopier number, electronic mail address or telephone number as shall be designated by such party in a notice to the other parties hereto delivered in accordance with the terms hereof; and

(ii)if to any other Lender, to the address, telecopier number, electronic mail address or telephone number specified in its Administrative Questionnaire.

(d)All such notices and other communications sent to any party hereto in accordance with the provisions of this Agreement or made upon the earlier to occur of (i) actual receipt by the relevant party hereto and (ii) (A) if delivered by hand or by courier, when signed for by or on behalf of the relevant party hereto; (B) if delivered by mail, four (4) Business Days after deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent and receipt has been confirmed by telephone; and (D) if delivered by electronic mail, to the extent provided in clause (b) above and effective as provided in such clause; provided that notices and other communications to the Administrative Agent pursuant to Article II shall not be effective until actually received by such Person. In no event shall a voice mail message be effective as a notice, communication or confirmation hereunder.

(e)Loan Documents may be transmitted and/or signed by facsimile or other electronic communication. The effectiveness of any such documents and signatures shall, subject to applicable Law, have the same force and effect as manually signed originals and shall be binding on all Credit Parties, the Agents and the Lenders.

Section 10.2.Waiver; Amendments.

(a)No failure or delay by the Administrative Agent or any Lender in exercising any right or power hereunder or under any other Loan Document, and no course of dealing between the Borrower and the Administrative Agent or any Lender, shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, preclude any other or further exercise thereof or the exercise of any other right or power hereunder or thereunder. The rights and remedies of the Administrative Agent and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies provided by law. No waiver of any provision of this Agreement or of any other Loan Document or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by subsection (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default or Event of Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default or Event of Default at the time.

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(b)No amendment or waiver of any provision of this Agreement or of the other Loan Documents (other than the Fee Letter or Second Supplemental Fee Letter, as applicable), nor consent to any departure by the Borrower therefrom, shall in any event be effective unless the same shall be in writing and signed by the Borrower and the Required Lenders, or the Borrower and the Administrative Agent with the consent of the Required Lenders, and then such amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided that, subject to Section 2.16(b), in addition to the consent of the Required Lenders, no amendment, waiver or consent shall:

(i)increase the Commitment of any Lender without the written consent of such Lender;

(ii)reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees or other amounts payable hereunder, without the written consent of each Lender affected thereby;

(iii)postpone the date fixed for any payment of any principal of, or interest on, any Loan or any fees or other amounts hereunder or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date for the termination or reduction of any Commitment, without the written consent of each Lender affected thereby;

(iv)(A) change Section 2.21(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender or (B) change Section 8.2 in a manner that would alter the pro rata sharing of payments or the order of application required thereby without the written consent of each Lender;

(v)change any of the provisions of this subsection (b) or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders which are required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the consent of each Lender or change the definitions of “Required Revolving Lenders” or, “Required Supplemental Lenders”, or “Required Second Supplemental Lenders” without the written consent of each Revolving Lender or, Supplemental Lender, or Second Supplemental Lender (as applicable), respectively;

(vi)release all or substantially all of the guarantors, or limit the liability of such guarantors, under any guaranty agreement guaranteeing any of the Obligations, without the written consent of each Lender; or

(vii)release all or substantially all collateral (if any) securing any of the Obligations, without the written consent of each Lender;

provided, further, that no such amendment, waiver or consent shall amend, modify or otherwise affect the rights, duties or obligations of the Administrative Agent without the prior written consent of such Person.

Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of such Lender may not be increased or extended, and amounts payable to such Lender hereunder may not be permanently reduced, without the consent of such Lender (other than reductions in fees and interest in which such reduction does not disproportionately affect such Lender). Notwithstanding anything contained herein to the contrary, this Agreement may be amended and restated without the consent of any Lender (but with the consent of the Borrower and the Administrative Agent) if, upon giving effect to such amendment and restatement, such Lender shall no longer be a party to this Agreement (as so amended and restated), the Commitments of such Lender shall have terminated (but such Lender shall continue to be entitled to the benefits of Sections 2.18, 2.19, 2.20 and 10.3), such Lender shall have no other commitment or other obligation hereunder and such Lender shall have been paid in full all principal, interest and other amounts owing to it or accrued for its account under this Agreement.

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Notwithstanding anything to the contrary herein, the Administrative Agent may, with the consent of the Borrower only, amend, modify or supplement any Loan Document to cure any obvious ambiguity, omission, mistake, defect or inconsistency.

Section 10.3.Expenses; Indemnification.

(a)The Borrower shall pay (i) all reasonable, out-of-pocket costs and expenses of the Administrative Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent and its Affiliates, in connection with the syndication of the credit facilities provided for herein, the preparation and administration of the Loan Documents and any amendments, modifications or waivers thereof (whether or not the transactions contemplated in this Agreement or any other Loan Document shall be consummated), including the reasonable fees, charges and disbursements of counsel for the Administrative Agent and its Affiliates, and (ii) all reasonable out-of-pocket costs and expenses (including, without limitation, the reasonable fees, charges and disbursements of outside counsel) incurred by the Administrative Agent or any Lender in connection with the enforcement or protection of its rights in connection with this Agreement, including its rights under this Section, or in connection with the Loans made hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans.

(b)The Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrower or any other Credit Party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or the use or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or Release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Credit Party, and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from (x) the gross negligence or willful misconduct of such Indemnitee or (y) a claim brought by the Borrower or any other Credit Party against an Indemnitee for a material breach of such Indemnitee’s obligations hereunder or under any other Loan Document.

(c)The Borrower shall pay, and hold the Administrative Agent and each of the Lenders harmless from and against, any and all present and future stamp, documentary, and other similar taxes with respect to this Agreement and any other Loan Documents, any collateral described therein or any payments due thereunder, and save the Administrative Agent and each Lender harmless from and against any and all liabilities with respect to or resulting from any delay or omission to pay such taxes.

(d)To the extent that the Borrower fails to pay any amount required to be paid to the Administrative Agent under subsection (a), (b) or (c) hereof, each Lender severally agrees to pay to the Administrative Agent such Lender’s pro rata share (in accordance with its respective Commitment (or Total Credit Exposure, as applicable) determined as of the time that the unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified payment, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent in its capacity as such.

(e)To the extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to actual or direct damages) arising out of, in connection with or as a result of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated therein,

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any Loan or the use of proceeds thereof; provided that nothing in this clause (e) shall relieve the Borrower of any obligation it may have to indemnify any Indemnitee against special, indirect, consequential or punitive damages asserted against such Indemnitee by a third party.

(f)All amounts due under this Section shall be payable promptly after written demand therefor.

Section 10.4.Successors and Assigns.

(a)The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender, and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of subsection (d) of this Section or (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (f) of this Section (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitments, Loans and other Revolving Credit Exposure or, Supplemental Credit Exposure, or Second Supplemental Credit Exposure at the time owing to it); provided that any such assignment shall be subject to the following conditions:

(i)Minimum Amounts.

(A)in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitments, Loans and other Revolving Credit Exposure, Supplemental Credit Exposure, or Second Supplemental Credit Exposure at the time owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and

(B)in any case not described in subsection (b)(i)(A) of this Section, the aggregate amount of the Commitment (which for this purpose includes Loans and Revolving Credit Exposure, Supplemental Credit Exposure,or Second Supplemental Credit Exposure outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding balance of the Loans and Revolving Credit Exposure, Supplemental Credit Exposure, or Second Supplemental Credit Exposure of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Acceptance, as of the Trade Date) shall not be less than $5,000,000 with respect to Loans and in minimum increments of $1,000,000, unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed).

(ii)Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loans, other Revolving Credit Exposure, Supplemental Credit  Exposure, or Second Supplemental Credit Exposure or the Commitments assigned.

(iii)Required Consents. No consent shall be required for any assignment except to the extent required by subsection (b)(i)(B) of this Section and, in addition:

(A)the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be required unless (x) an Event of Default has occurred and is continuing at the time of

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such assignment or (y) such assignment is to a Lender, an Affiliate of such Lender or an Approved Fund of such Lender; and

(B)the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required.

(iv)Assignment and Acceptance. The parties to each assignment shall deliver to the Administrative Agent (A) a duly executed Assignment and Acceptance, (B) a processing and recordation fee of $3,500, (C) an Administrative Questionnaire unless the assignee is already a Lender and (D) the documents required under Section 2.20(e).

(v)No Assignment to the certain Persons. No such assignment shall be made to (A) the Borrower or any of the Borrower’s Affiliates or Subsidiaries, except to the extent expressly approved by the Administrative Agent (in its discretion) in writing and subject to such terms and conditions as may be imposed by the Administrative Agent in connection with same, or (B) to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B).

(vi)No Assignment to Natural Persons. No such assignment shall be made to a natural person.

(vii)Certain Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or sub participations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent and each other Lender hereunder (and interest accrued thereon). Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Acceptance, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 2.18, 2.19, 2.20 and 10.3 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided that, except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lender’s having been a Defaulting Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (d) of this Section. If the consent of the Borrower to an assignment is required hereunder (including a consent to an assignment which does not meet the minimum assignment thresholds specified above), the Borrower shall be deemed to have given its consent unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after notice thereof has actually been delivered by the assigning Lender (through the Administrative Agent) to the Borrower.

(c)The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrower, shall maintain at one of its offices in Atlanta, Georgia a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amount of the Loans and Revolving Credit Exposure and/, Supplemental Credit Exposure,  or SecondSupplemental Credit Exposure owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).

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Information contained in the Register with respect to any Lender shall be available for inspection by such Lender at any reasonable time and from time to time upon reasonable prior notice; information contained in the Register shall also be available for inspection by the Borrower at any reasonable time and from time to time upon reasonable prior notice. In establishing and maintaining the Register, the Administrative Agent shall serve as the Borrower’s agent solely for tax purposes and solely with respect to the actions described in this Section, and the Borrower hereby agrees that, to the extent Truist Bank serves in such capacity, Truist Bank and its officers, directors, employees, agents, sub-agents and affiliates shall constitute “Indemnitees”.

(d)Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a natural person, the Borrower or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent, and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver with respect to the following to the extent affecting such Participant: (i) increase the Commitment of such Lender; (ii) reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder; (iii) postpone the date fixed for any payment of any principal of, or interest on, any Loan or any fees hereunder or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date for the termination or reduction of any Commitment; (iv) change Section 2.21(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby; (v) change any of the provisions of Section 10.2(b) or the definition of “Required Lenders” or “Required Revolving Lenders” or, “Required Supplemental Lenders”, or “Required Second Supplemental Lenders” (as applicable, based on the Commitments and Loans assigned) or any other provision hereof specifying the number or percentage of Lenders which are required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder; (vi) release all or substantially all of the guarantors, or limit the liability of such guarantors, under any guaranty agreement guaranteeing any of the Obligations; or (vii) release all or substantially all collateral (if any) securing any of the Obligations. Subject to subsection (e) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.18, 2.19, and 2.20 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section; provided that such Participant agrees to be subject to Section 2.24 as though it were a Lender. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.7 as though it were a Lender; provided that such Participant agrees to be subject to Section 2.21 as though it were a Lender.

Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register in the United States on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”). The entries in the Participant Register shall be conclusive, absent manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. The Borrower and the Administrative Agent shall have inspection rights to such Participant Register (upon reasonable prior notice to the applicable Lender) solely for purposes of demonstrating that such Loans or other obligations under the Loan Documents are in “registered form” for purposes of the Code. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

(e)A Participant shall not be entitled to receive any greater payment under Sections 2.18 and 2.20 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent. A Participant shall not be entitled to the benefits of Section 2.20 unless the Borrower is notified of the

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participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.20(e) and (f) as though it were a Lender.

(f)Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including, without limitation, any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

Section 10.5.Governing Law; Jurisdiction; Consent to Service of Process.

(a)This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions contemplated hereby and thereby shall be construed in accordance with and be governed by the law (without giving effect to the conflict of law principles thereof) of the State of New York.

(b)The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the non-exclusive jurisdiction of the state and federal courts in Atlanta, Georgia and New York, New York, and of any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any other Loan Document or the transactions contemplated hereby or thereby, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such courts or, to the extent permitted by applicable law, such appellate court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower or its properties in the courts of any jurisdiction.

(c)The Borrower irrevocably and unconditionally waives any objection which it may now or hereafter have to the laying of venue of any such suit, action or proceeding described in subsection (b) of this Section and brought in any court referred to in subsection (b) of this Section. Each of the parties hereto irrevocably waives, to the fullest extent permitted by applicable law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(d)Each party to this Agreement irrevocably consents to the service of process in the manner provided for notices in Section 10.1. Nothing in this Agreement or in any other Loan Document will affect the right of any party hereto to serve process in any other manner permitted by law.

Section 10.6.WAIVER OF JURY TRIAL. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

Section 10.7.Right of Set-off. In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, each Lender shall have the right, at any time or from time to time upon the occurrence and during the continuance of an Event of Default, without prior notice to the Borrower, any such

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notice being expressly waived by the Borrower to the extent permitted by applicable law, to set off and apply against all deposits (general or special, time or demand, provisional or final) of the Borrower at any time held or other obligations at any time owing by such Lender to or for the credit or the account of the Borrower against any and all Obligations held by such Lender, irrespective of whether such Lender shall have made demand hereunder and although such Obligations may be unmatured; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.26(b) and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. Each Lender agrees promptly to notify the Administrative Agent and the Borrower after any such set-off and any application made by such Lender; provided that the failure to give such notice shall not affect the validity of such set-off and application. Each Lender agrees to apply all amounts collected from any such set-off to the Obligations before applying such amounts to any other Indebtedness or other obligations owed by the Borrower and any of its Subsidiaries to such Lender.

Section 10.8.Counterparts; Integration. This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. This Agreement, the Fee Letter, the other Loan Documents, and any separate letter agreements relating to any fees payable to the Administrative Agent and its Affiliates constitute the entire agreement among the parties hereto and thereto and their affiliates regarding the subject matters hereof and thereof and supersede all prior agreements and understandings, oral or written, regarding such subject matters. Delivery of an executed counterpart to this Agreement or any other Loan Document by facsimile transmission or by electronic mail in pdf format shall be as effective as delivery of a manually executed counterpart hereof.

Section 10.9.Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates, reports, notices or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and, except as expressly provided in this Agreement, shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan and so long as the Commitments have not expired or terminated. The provisions of Sections 2.18, 2.19, 2.20, and 10.3 and Article IX shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Commitments, or the termination of this Agreement or any provision hereof.

Section 10.10.Severability. Any provision of this Agreement or any other Loan Document held to be illegal, invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be ineffective to the extent of such illegality, invalidity or unenforceability without affecting the legality, validity or enforceability of the remaining provisions hereof or thereof; and the illegality, invalidity or unenforceability of a particular provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

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Section 10.11.Confidentiality. Each of the Administrative Agent and the Lenders agrees to, in good faith, to maintain the confidentiality of any information relating to the Borrower or any of its Subsidiaries or any of their respective businesses, to the extent designated in writing as confidential and provided to it by the Borrower or any of its Subsidiaries, other than any such information that is available to the Administrative Agent or any Lender on a non-confidential basis prior to disclosure by the Borrower or any of its Subsidiaries, except that such information may be disclosed (i) to any Related Party of the Administrative Agent or any such Lender including, without limitation, accountants, legal counsel and other advisors, (ii) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (iii) to the extent requested by any regulatory agency or authority purporting to have jurisdiction over it (including any self-regulatory authority such as the National Association of Insurance Commissioners), (iv) to the extent that such information becomes publicly available other than as a result of a breach of this Section, or which becomes available to the Administrative Agent, any Lender or any Related Party of any of the foregoing on a non-confidential basis from a source other than the Borrower or any of its Subsidiaries, (v) in connection with the exercise of any remedy hereunder or under any other Loan Documents or any suit, action or proceeding relating to this Agreement or any other Loan Documents or the enforcement of rights hereunder or thereunder, (vi) subject to execution by such Person of an agreement containing provisions substantially the same as those of this Section, to (A) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, or (B) any actual or prospective party (or its Related Parties) to any swap or derivative or other transaction under which payments are to be made by reference to the Borrower and its obligations, this Agreement or payments hereunder, (vii) to any rating agency, (viii) to the CUSIP Service Bureau or any similar organization, or (ix) with the consent of the Borrower. Any Person required to maintain the confidentiality of any information as provided for in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such information as such Person would accord its own confidential information. In the event of any conflict between the terms of this Section and those of any other Contractual Obligation entered into with any Credit Party (whether or not a Loan Document), the terms of this Section shall govern.

Section 10.12.Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which may be treated as interest on such Loan under applicable law (collectively, the “Charges”), shall exceed the maximum lawful rate of interest (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by a Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Rate to the date of repayment (to the extent permitted by applicable law), shall have been received by such Lender.

Section 10.13.Waiver of Effect of Corporate Seal. The Borrower represents and warrants that neither it nor any other Credit Party is required to affix its corporate seal to this Agreement or any other Loan Document pursuant to any Legal Requirements, agrees that this Agreement is delivered by the Borrower under seal and waives any shortening of the statute of limitations that may result from not affixing the corporate seal to this Agreement or such other Loan Documents.

Section 10.14.Patriot Act. The Administrative Agent and each Lender hereby notifies the Credit Parties that, (a) pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies each Credit Party, which information includes the name and address of such Credit Party and other information that will allow such Lender or the Administrative Agent, as applicable, to identify such Credit Party in accordance with the Patriot Act, and (b) pursuant to the Beneficial Ownership Regulation, it is required to obtain a Beneficial Ownership Certificate.

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Section 10.15.No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower and each other Credit Party acknowledges and agrees and acknowledges its Affiliates’ understanding that (i) (A) the services regarding this Agreement provided by the Administrative Agent and/or the Lenders are arm’s-length commercial transactions between the Borrower, each other Credit Party and their respective Affiliates, on the one hand, and the Administrative Agent and the Lenders, on the other hand, (B) each of the Borrower and the other Credit Parties have consulted their own legal, accounting, regulatory and tax advisors to the extent they have deemed appropriate, and (C) the Borrower and each other Credit Party is capable of evaluating and understanding, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) each of the Administrative Agent and the Lenders is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower, any other Credit Party or any of their respective Affiliates, or any other Person, and (B) neither the Administrative Agent nor any Lender has any obligation to the Borrower, any other Credit Party or any of their Affiliates with respect to the transaction contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent, the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower, the other Credit Parties and their respective Affiliates, and each of the Administrative Agent and the Lenders has no obligation to disclose any of such interests to the Borrower, any other Credit Party or any of their respective Affiliates. To the fullest extent permitted by law, each of the Borrower and the other Credit Parties hereby waives and releases any claims that it may have against the Administrative Agent or any Lender with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

Section 10.16.Location of Closing. All parties agree that the closing of the transactions contemplated by this Agreement has occurred in New York.

Section 10.17.Electronic Signatures. The words “execution,” “execute,” “signed,” “signature,” and words of like import in or related to this Agreement or any other document to be signed in connection with this Agreement and the transactions contemplated hereby shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by the Administrative Agent, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that notwithstanding anything contained herein to the contrary the Administrative Agent is under no obligation to agree to accept electronic signatures in any form or in any format unless expressly agreed to by the Administrative Agent pursuant to procedures approved by it.

Section 10.18.Acknowledgement and Consent to Bail-In of Affected Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Affected Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of the applicable Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a)the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an Affected Financial Institution; and

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(b)the effects of any Bail-in Action on any such liability, including, if applicable (i) a reduction in full or in part or cancellation of any such liability, (ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such Affected Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document or (iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of the applicable Resolution Authority.

Section 10.19.Certain ERISA Matters.

(a)Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, the Arranger, and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Credit Party, that at least one of the following is and will be true:

(i)such Lender is not using “plan assets” (within the meaning of 29 CFR § 2510.3-101, as modified by Section 3(42) of ERISA) of one or more Benefit Plans in connection with the Loans or the Commitments,

(ii)the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement,

(iii)(A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement, or

(iv)such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.

(b)In addition, unless sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or such Lender has not provided another representation, warranty and covenant as provided in sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, the Arranger, and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Credit Party, that:

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(i)none of the Administrative Agent, the Arranger, or any of their respective Affiliates is a fiduciary with respect to the assets of such Lender (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related to hereto or thereto),

(ii)the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement is independent (within the meaning of 29 CFR § 2510.3-21) and is a bank, an insurance carrier, an investment adviser, a broker-dealer or other person that holds, or has under management or control, total assets of at least $50 million, in each case as described in 29 CFR § 2510.3-21(c)(1)(i)(A)-(E),

(iii)the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement is capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies (including in respect of the Obligations),

(iv)the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement is a fiduciary under ERISA or the Code, or both, with respect to the Loans, the Commitments, and this Agreement and is responsible for exercising independent judgment in evaluating the transactions hereunder, and

(c)The Administrative Agent and the Arranger hereby inform the Lenders that each such Person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the transactions contemplated hereby, and that such Person has a financial interest in the transactions contemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Loans, the Commitments, and this Agreement, (ii) may recognize a gain if it extended the Loans or the Commitments for an amount less than the amount being paid for an interest in the Loans or the Commitments by such Lender or (iii) may receive fees or other payments in connection with the transactions contemplated hereby, the Loan Documents or otherwise, including structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees, administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums, banker’s acceptance fees, breakage or other early termination fees or fees similar to the foregoing.

Section 10.20.Replaced Credit Agreement. Each of the parties hereto hereby agrees that (a) this Agreement is an amendment and restatement of the Replaced Credit Agreement in its entirety, (b) all documents, instruments or agreements creating security interests or liens in favor of the “Administrative Agent” or “Lenders” as defined in the Replaced Credit Agreement and securing the obligations thereunder continue to secure the Obligations under this Agreement and (c) nothing contained herein is intended to represent a novation of any type with respect to the rights and “Obligations” as defined in the Replaced Credit Agreement or with respect to any other Indebtedness evidenced by the Replaced Credit Agreement or any documents, instruments or agreements executed in connection therewith. On the date of this Agreement, the rights and obligations of the parties hereto evidenced by the Replaced Credit Agreement shall be evidenced by this Agreement and the other Loan Documents, the “Loans” as defined in the Replaced Credit Agreement shall remain outstanding and be continued as, and converted to, Loans as defined herein and shall bear interest and be subject to such other fees as set forth in this Agreement.

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Section 10.21.Certain ERISA Matters.

(a)Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, the Arranger, and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Credit Party, that at least one of the following is and will be true:

(i)such Lender is not using “plan assets” (within the meaning of 29 CFR § 2510.3-101, as modified by Section 3(42) of ERISA) of one or more Benefit Plans in connection with the Loans or the Commitments,

(ii)the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement,

(iii)(A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement, or

(iv)such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.

(b)In addition, unless sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or such Lender has not provided another representation, warranty and covenant as provided in sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent, the Arranger, and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Credit Party, that:

(i)none of the Administrative Agent, the Arranger, or any of their respective Affiliates is a fiduciary with respect to the assets of such Lender (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related to hereto or thereto),

(ii)the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement is independent (within the meaning of 29 CFR § 2510.3-21) and is a bank, an insurance carrier, an investment adviser, a broker-dealer or other person that holds, or has under management or control, total assets of at least $50 million, in each case as described in 29 CFR § 2510.3-21(c)(1)(i)(A)-(E),

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(iii)the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement is capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies (including in respect of the Obligations),

(iv)the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Commitments, and this Agreement is a fiduciary under ERISA or the Code, or both, with respect to the Loans, the Commitments, and this Agreement and is responsible for exercising independent judgment in evaluating the transactions hereunder, and

(v)no fee or other compensation is being paid directly to the Administrative Agent, the Arranger or any their respective Affiliates for investment advice (as opposed to other services) in connection with the Loans, the Commitments, or this Agreement.

(c)The Administrative Agent and the Arranger hereby inform the Lenders that each such Person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the transactions contemplated hereby, and that such Person has a financial interest in the transactions contemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Loans, the Commitments, and this Agreement, (ii) may recognize a gain if it extended the Loans or the Commitments for an amount less than the amount being paid for an interest in the Loans or the Commitments by such Lender or (iii) may receive fees or other payments in connection with the transactions contemplated hereby, the Loan Documents or otherwise, including structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees, administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums, banker’s acceptance fees, breakage or other early termination fees or fees similar to the foregoing.

Section 10.22.Acknowledgement Regarding Any Supported QFCs. To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Hedging Obligations or any other agreement or instrument that is a QFC (such support, “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States):

(a)In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States. Without limitation of the foregoing, it is understood and agreed that rights and remedies of the parties with respect

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to a Defaulting Lender shall in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.

(b)As used in this Section 10.20, the following terms have the following meanings:

“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.

“Covered Entity” means any of the following:

(i)a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. §252.82(b);

(ii)a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. §47.3(b); or

(iii)a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. §382.2(b).

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§252.81, 47.2 or 382.1, as applicable.

“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).

Section 10.23.Erroneous Payments.

(a)Each Lender hereby agrees that (i) if Administrative Agent notifies such Lender that Administrative Agent has determined in its sole discretion that any funds received by such Lender from Administrative Agent or any of its Affiliates were erroneously transmitted to, or otherwise erroneously or mistakenly received by, such Lender or Issuing Bank (whether or not known to such Lender or Issuing Bank) (whether as a payment, prepayment or repayment of principal, interest, fees or otherwise; individually and collectively, a “Erroneous Payment”) and demands the return of such Erroneous Payment (or a portion thereof), such Lender shall promptly, but in no event later than one Business Day thereafter, return to Administrative Agent the amount of any such Erroneous Payment (or portion thereof) as to which such a demand was made, in same day funds (in the currency so received), together with interest thereon in respect of each day from and including the date such Erroneous Payment (or portion thereof) was received by such Lender to the date such amount is repaid to Administrative Agent in same day funds at the greater of the Federal Funds Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect and (ii) to the extent permitted by applicable law, such Lender shall not assert any right or claim to the Erroneous Payment, and hereby waives, any claim, counterclaim, defense or right of set-off or recoupment with respect to any demand, claim or counterclaim by Administrative Agent for the return of any Erroneous Payments received, including without limitation waiver of any defense based on “discharge for value” or any similar doctrine. A notice of Administrative Agent to any Lender under this clause (a) shall be conclusive, absent manifest error.

(b)Without limiting immediately preceding clause (a), each Lender hereby further agrees that if it receives an Erroneous Payment from Administrative Agent (or any of its Affiliates) (x) that is in a different amount than, or on a different date from, that specified in a notice of payment sent by Administrative Agent (or any of its Affiliates) with respect to such Erroneous Payment (an “Erroneous Payment Notice”), (y) that was not preceded or accompanied by an Erroneous Payment Notice, or (z) that such Lender otherwise becomes aware was transmitted, or received, in error or by mistake (in whole or in part), in each case, an error has been made (and that it is deemed to have knowledge of such error at the time of receipt of such Erroneous Payment) with respect to such Erroneous Payment, and to the extent permitted by applicable law, such Lender shall not assert any right or claim to the Erroneous Payment, and hereby waives, any claim, counterclaim, defense or right of set-off or recoupment with respect to any demand, claim or

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counterclaim by Administrative Agent for the return of any Erroneous Paymentsreceived, including without limitation waiver of any defense based on “discharge for value” or any similar doctrine. Each Lender and each Issuing Bank agrees that, in each such case, it shall promptly (and, in all events, within one Business Day of its knowledge (or deemed knowledge) of such error) notify Administrative Agent of such occurrence and, upon demand from Administrative Agent, it shall promptly, but in all events no later than one Business Day thereafter, return to Administrative Agent the amount of any such Erroneous Payment (or portion thereof) as to which such a demand was made in same day funds (in the currency so received), together with interest thereon in respect of each day from and including the date such Erroneous Payment (or portion thereof) was received by such Lender to the date such amount is repaid to Administrative Agent in same day funds at the greater of the Federal Funds Rate and a rate determined by Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect.

(c)Borrower hereby agrees that (x) in the event an Erroneous Payment (or portion thereof) is not recovered from any Lender that has received such Erroneous Payment (or portion thereof) for any reason, Administrative Agent shall be subrogated to all the rights of such Lender with respect to such amount and (y) an Erroneous Payment shall not pay, prepay, repay, discharge or otherwise satisfy any Obligations owed by Borrower.

(d)Each party’s obligations under this Section 10.23 shall survive the resignation or replacement of Administrative Agent, the termination of the Commitments or the repayment, satisfaction or discharge of all Obligations (or any portion thereof) under any Loan Document.

[Remainder of page intentionally blank; signature pages follow.]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.

BORROWER:
NEXPOINT RESIDENTIAL TRUST OPERATING PARTNERSHIP, L.P., a Delaware limited partnership
By:	NEXPOINT RESIDENTIAL TRUST, OPERATING PARTNERSHIP GP, LLC, a Delaware limited liability company, its General Partner
	By:	NEXPOINT RESIDENTIAL TRUST, INC., a Maryland corporation, its Sole Member
		By:
		Name:
		Title:

[Signatures Continue on the Following Page]

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ADMINISTRATIVE AGENT:

TRUIST BANK, successor by merger to SunTrust Bank, as Administrative Agent,

By:

Name:

Title:

LENDERS:

TRUIST BANK, successor by merger to SunTrust Bank

By:

Name:

Title:

[Signatures Continue on the Following Page]

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LENDERS:

[]

By:

Name:

Title:

[Signatures Continue on the Following Page]

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The Parent, as Guarantor, hereby joins in the execution of this Agreement to evidence its agreement to the provisions of Sections 5.1, 5.2, 5.15, 7.5 and 7.7 of this Agreement.

NEXPOINT RESIDENTIAL TRUST, INC., a Maryland corporation

By:

Name:

Title:

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SCHEDULE I

Applicable Margin

Level	Total Leverage Ratio	Applicable Margin for Eurodollar Loans	Applicable Margin for ABR Loans
I	<55%	1.90%	0.90%
II	>55% and <60%	2.15%	1.15%
III	>60%	2.40%	1.40%

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SCHEDULE II

Commitment Amounts

Lender	Revolving Commitment Amount	Supplemental Commitment Amount	Second Supplemental
			Commitment Amount
Truist Bank	$70,000,000.00	$10,000,000.00	N/A
KeyBank National Association	$50,000,000.00	$15,000,000.00	$35,000,000.00
Citizens Bank, N.A.	$50,000,000.00	N/A	N/A
Raymond James Bank, N.A.	$30,000,000.00	N/A	N/A
Synovus Bank	$25,000,000.00	N/A	N/A

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SCHEDULE III

Mortgaged Properties

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SCHEDULE IV

Litigation Disclosures

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SCHEDULE V

Subsidiaries; Ownership of Mortgaged Properties

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EXHIBIT A

FORM OF ASSIGNMENT AND ASSUMPTION

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ANNEX 1

STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION

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EXHIBIT B

FORM OF COMPLIANCE CERTIFICATE

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EXHIBIT C

FORM OF GUARANTY AND SECURITY AGREEMENT

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EXHIBIT D

FORM OF PERFECTION CERTIFICATE

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EXHIBIT E

FORM OF NOTICE OF BORROWING

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EXHIBIT F

FORM OF NOTICE OF CONVERSION/CONTINUATION

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EXHIBIT G-1

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)

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EXHIBIT G-2

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

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EXHIBIT G-3

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

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EXHIBIT G-4

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

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EXHIBIT B

CLEAN/UPDATED CREDIT AGREEMENT

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jim Dondero, certify that:

1. I have reviewed this quarterly report on Form 10-Q of NexPoint Residential Trust, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 28, 2022

/s/ Jim Dondero

Jim Dondero

President

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Brian Mitts, certify that:

1. I have reviewed this quarterly report on Form 10-Q of NexPoint Residential Trust, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: April 28, 2022

/s/ Brian Mitts

Brian Mitts

Chief Financial Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATIONS PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of NexPoint Residential Trust, Inc. (the “Company”) for the period ending March 31, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Jim Dondero, President of the Company, and Brian Mitts, Chief Financial Officer of the Company, each certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and  

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.  

Dated: April 28, 2022	/s/ Jim Dondero
	Jim Dondero President (Principal Executive Officer)
Dated: April 28, 2022	/s/ Brian Mitts
	Brian Mitts Chief Financial Officer (Principal Financial Officer)

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2022	Apr. 28, 2022
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Trading Symbol	NXRT
Entity Registrant Name	NexPoint Residential Trust, Inc.
Entity Central Index Key	0001620393
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		25,700,190
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity File Number	001-36663
Entity Tax Identification Number	47-1881359
Entity Address, Address Line One	300 Crescent Court
Entity Address, Address Line Two	Suite 700
Entity Address, City or Town	Dallas
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75201
City Area Code	(214)
Local Phone Number	276-6300
Document Quarterly Report	true
Document Transition Report	false
Entity Interactive Data Current	Yes
Entity Incorporation, State or Country Code	MD
Title of 12(b) Security	Common Stock, par value $0.01 per share
Security Exchange Name	NYSE

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Operating Real Estate Investments
Land	$ 375,857	$ 375,857
Buildings and improvements	1,745,341	1,743,866
Intangible lease assets	1,376	2,576
Construction in progress	4,529	6,078
Furniture, fixtures and equipment	127,030	120,419
Total Gross Operating Real Estate Investments	2,254,133	2,248,796
Accumulated depreciation and amortization	(309,002)	(287,096)
Total Net Real Estate Investments	1,945,131	1,961,700
Cash and cash equivalents	99,538	49,450
Restricted cash	32,586	39,246
Accounts receivable, net	9,421	4,844
Prepaid and other assets	11,631	4,701
Fair market value of interest rate swaps	58,104	3,526
TOTAL ASSETS	2,156,411	2,063,467
Liabilities:
Mortgages payable, net	1,276,240	1,276,285
Credit facility, net	332,979	278,215
Accounts payable and other accrued liabilities	12,539	12,590
Accrued real estate taxes payable	7,896	13,182
Accrued interest payable	2,788	2,491
Security deposit liability	2,989	2,945
Prepaid rents	1,811	1,775
Total Liabilities	1,637,242	1,587,483
Redeemable noncontrolling interests in the Operating Partnership	6,614	6,139
Stockholders' Equity:
Preferred stock, $0.01 par value: 100,000,000 shares authorized; 0 shares issued
Common stock, $0.01 par value: 500,000,000 shares authorized; 25,700,190 and 25,500,567 shares issued and outstanding, respectively	257	255
Additional paid-in capital	411,059	407,803
Accumulated earnings less dividends	44,246	59,209
Accumulated other comprehensive income	56,993	2,578
Total Stockholders' Equity	512,555	469,845
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 2,156,411	$ 2,063,467

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2022	Dec. 31, 2021
Statement Of Financial Position [Abstract]
Preferred stock, shares authorized	100,000,000	100,000,000
Preferred stock, shares issued	0	0
Preferred stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	500,000,000	500,000,000
Common stock, shares, issued	25,700,190	25,500,567
Common stock, shares, outstanding	25,700,190	25,500,567
Common stock, par value	$ 0.01	$ 0.01

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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) shares in Thousands, $ in Thousands		3 Months Ended
		Mar. 31, 2022	Mar. 31, 2021
Revenues
Rental income		$ 59,297	$ 50,340
Other income		1,489	1,456
Total revenues		60,786	51,796
Expenses
Property operating expenses		13,596	11,216
Real estate taxes and insurance		8,720	8,722
Property management fees	[1]	1,757	1,485
Advisory and administrative fees	[2]	1,843	1,868
Corporate general and administrative expenses		3,486	2,940
Property general and administrative expenses		2,006	1,559
Depreciation and amortization		23,718	20,758
Total expenses		55,126	48,548
Operating income		5,660	3,248
Interest expense		(10,636)	(10,616)
Casualty gain		128
Miscellaneous income		181	468
Net loss		(4,667)	(6,900)
Net loss attributable to redeemable noncontrolling interests in the Operating Partnership		(14)	(21)
Net loss attributable to common stockholders		(4,653)	(6,879)
Other comprehensive income
Unrealized gains on interest rate derivatives		54,579	31,342
Total comprehensive income		49,912	24,442
Comprehensive income attributable to redeemable noncontrolling interests in the Operating Partnership		150	73
Comprehensive income attributable to common stockholders		$ 49,762	$ 24,369
Weighted average common shares outstanding - basic		25,620	25,068
Weighted average common shares outstanding - diluted	[3]	25,620	25,068
Loss per share - basic		$ (0.18)	$ (0.27)
Loss per share - diluted		$ (0.18)	$ (0.27)

[1] Fees incurred to an unaffiliated third party that is an affiliate of the noncontrolling limited partner of the Company’s Operating Partnership (see Note 10).

[2] Fees incurred to the Adviser (see Note 11).

[3] If the Company sustains a net loss for the period presented, unvested restricted stock units are not included in the diluted earnings per share calculation.

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	2022 At The Market Offering	2021 At The Market Offering	Common Stock	Common Stock 2022 At The Market Offering	Additional Paid-in Capital	Additional Paid-in Capital 2022 At The Market Offering	Additional Paid-in Capital 2021 At The Market Offering	Accumulated Earnings (Loss) Less Dividends	Accumulated Other Comprehensive Income (Loss)
Beginning Balance, Values at Dec. 31, 2020	$ 407,927			$ 250		$ 376,710			$ 75,321	$ (44,354)
Beginning Balance, Shares at Dec. 31, 2020				25,016,957
Net loss attributable to common stockholders	(6,879)								(6,879)
Vesting of stock-based compensation	364			$ 1		363
Vesting of stock-based compensation, Shares				110,184
Issuance of common stock through at-the-market offering			$ (176)					$ (176)
Common stock dividends declared	(8,776)								(8,776)
Other comprehensive income	31,248									31,248
Adjustment to reflect redemption value of redeemable noncontrolling interests in the Operating Partnership	(215)								(215)
Ending Balance, Values at Mar. 31, 2021	423,493			$ 251		376,897			59,451	(13,106)
Ending Balance, Shares at Mar. 31, 2021				25,127,141
Beginning Balance, Values at Dec. 31, 2021	$ 469,845			$ 255		407,803			59,209	2,578
Beginning Balance, Shares at Dec. 31, 2021	25,500,567			25,500,567
Net loss attributable to common stockholders	$ (4,653)								(4,653)
Vesting of stock-based compensation	(880)			$ 1		(881)
Vesting of stock-based compensation, Shares				147,532
Issuance of common stock through at-the-market offering		$ 4,138			$ 1		$ 4,137
Issuance of common shares, Shares					52,091
Common stock dividends declared	(9,976)								(9,976)
Other comprehensive income	54,415									54,415
Adjustment to reflect redemption value of redeemable noncontrolling interests in the Operating Partnership	(334)								(334)
Ending Balance, Values at Mar. 31, 2022	$ 512,555			$ 257		$ 411,059			$ 44,246	$ 56,993
Ending Balance, Shares at Mar. 31, 2022	25,700,190			25,700,190
Issuance of common shares,Shares					52,091

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Statement Of Stockholders Equity [Abstract]
Common stock, dividend per share declared	$ 0.38	$ 0.34125

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Cash flows from operating activities
Net loss	$ (4,667)	$ (6,900)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	23,718	20,758
Amortization/write-off of deferred financing costs	565	571
Change in fair value on derivative instruments included in interest expense	2,384	3,663
Net cash paid on derivative settlements	(3,646)	(3,618)
Amortization/write-off of fair market value adjustment of assumed debt	(50)	(51)
Provision for bad debts, net	1,248	734
Vesting of stock-based compensation	1,877	1,608
Insurance proceeds received for business interruption		121
Casualty gain	94	(468)
Changes in operating assets and liabilities, net of effects of acquisitions:
Operating assets	(6,413)	578
Operating liabilities	(6,428)	(3,252)
Net cash provided by operating activities	8,682	13,744
Cash flows from investing activities
Prepaid acquisition deposits	(1,615)
Insurance proceeds received from casualty losses	273	3,178
Additions to real estate investments	(9,120)	(10,765)
Net cash used in investing activities	(10,462)	(7,587)
Cash flows from financing activities
Mortgage payments	(381)	(198)
Credit facilities proceeds received	55,000
Deferred financing costs paid	(415)
Interest rate cap fees paid	(10)
Proceeds from the issuance of common stock through at-the-market offering, net of offering costs	4,138	(176)
Payments for taxes related to net share settlement of stock-based compensation	(2,757)	(1,244)
Dividends paid to common stockholders	(10,367)	(8,923)
Net cash provided by (used in) financing activities	45,208	(10,541)
Net increase (decrease) in cash, cash equivalents and restricted cash	43,428	(4,384)
Cash, cash equivalents and restricted cash, beginning of period	88,696	57,015
Cash, cash equivalents and restricted cash, end of period	132,124	52,631
Supplemental Disclosure of Cash Flow Information
Interest paid	7,442	6,489
Supplemental Disclosure of Noncash Activities
Capitalized construction costs included in accounts payable and other accrued liabilities	2,846	2,237
Change in fair value on derivative instruments designated as hedges	54,579	31,342
Decrease in dividends payable upon vesting of restricted stock units	(391)	(147)
Write-off of assets due to casualty losses	1,904	$ 2,028
Write-off of fully amortized in-place leases	$ 1,200

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Organization and Description of Business

3 Months Ended

Mar. 31, 2022

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Organization and Description of Business

1. Organization and Description of Business

NexPoint Residential Trust, Inc. (the “Company”, “we”, “our”) was incorporated in Maryland on September 19, 2014, and has elected to be taxed as a real estate investment trust (“REIT”). The Company is focused on “value-add” multifamily investments primarily located in the Southeastern and Southwestern United States. Substantially all of the Company’s business is conducted through NexPoint Residential Trust Operating Partnership, L.P. (the “OP”), the Company’s operating partnership. The Company owns its properties (the “Portfolio”) through the OP and its wholly owned taxable REIT subsidiary (“TRS”). The OP owns approximately 99.9% of the Portfolio; the TRS owns approximately 0.1% of the Portfolio. The Company’s wholly owned subsidiary, NexPoint Residential Trust Operating Partnership GP, LLC (the “OP GP”), is the sole general partner of the OP. As of March 31, 2022, there were 23,819,402 common units in the OP (“OP Units”) outstanding, of which 23,746,169, or 99.7%, were owned by the Company and 73,233, or 0.3%, were owned by a noncontrolling limited partner (see Note 10).

The Company is externally managed by NexPoint Real Estate Advisors, L.P. (the “Adviser”), through an agreement dated March 16, 2015, as amended, and renewed on February 14, 2022 for a one-year term (the “Advisory Agreement”), by and among the Company, the OP and the Adviser. The Adviser conducts substantially all of the Company’s operations and provides asset management services for its real estate investments. The Company expects it will only have accounting employees while the Advisory Agreement is in effect. All of the Company’s investment decisions are made by the Adviser, subject to general oversight by the Adviser’s investment committee and the Company’s board of directors (the “Board”). The Adviser is wholly owned by NexPoint Advisors, L.P. (the “Sponsor”).

The Company’s investment objectives are to maximize the cash flow and value of properties owned, acquire properties with cash flow growth potential, provide quarterly cash distributions and achieve long-term capital appreciation for its stockholders through targeted management and a value-add program. Consistent with the Company’s policy to acquire assets for both income and capital gain, the Company intends to hold at least majority interests in its properties for long-term appreciation and to engage in the business of directly or indirectly acquiring, owning, and operating well-located multifamily properties with a value-add component in large cities and suburban submarkets of large cities primarily in the Southeastern and Southwestern United States consistent with its investment objectives. Economic and market conditions may influence the Company to hold properties for different periods of time. From time to time, the Company may sell a property if, among other deciding factors, the sale would be in the best interest of its stockholders.

The Company may allocate up to 30% of the portfolio to investments in real estate-related debt and securities with the potential for high current income or total returns. These allocations may include first and second mortgages and subordinated, bridge, mezzanine, construction and other loans, as well as debt securities related to or secured by multifamily real estate and common and preferred equity securities, which may include securities of other REITs or real estate companies.

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Basis of Accounting

The accompanying unaudited consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”). GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the dates of the unaudited consolidated financial statements and the amounts of revenues and expenses during the reporting periods. Actual amounts realized or paid could differ from those estimates. All significant intercompany accounts and transactions have been eliminated in consolidation. There have been no significant changes to the Company’s significant accounting policies during the three months ended March 31, 2022.

The accompanying unaudited consolidated financial statements have been prepared according to the rules and regulations of the SEC.  Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted according to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not misleading.

In the opinion of management, all adjustments and eliminations necessary for the fair presentation of the Company’s financial position as of March 31, 2022 and results of operations for the three months ended March 31, 2022 and 2021 have been included.  Such adjustments are normal and recurring in nature.  The unaudited information included in this quarterly report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2021 and notes thereto included in its Annual Report on Form 10-K filed with the SEC on February 18, 2022.

Principles of Consolidation

The Company accounts for subsidiary partnerships, joint ventures and other similar entities in which it holds an ownership interest in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810, Consolidation. The Company first evaluates whether each entity is a variable interest entity (“VIE”). Under the VIE model, the Company consolidates an entity when it has control to direct the activities of the VIE and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the voting model, the Company consolidates an entity when it controls the entity through ownership of a majority voting interest. The unaudited consolidated financial statements include the accounts of the Company and its subsidiaries, including the OP and its subsidiaries.

Revenue Recognition

The Company’s primary operations consist of rental income earned from its residents under lease agreements typically with terms of one year or less. Rental income is recognized when earned. This policy effectively results in income recognition on the straight-line method over the related terms of the leases. The Company records an allowance to reflect revenue that may not be collectable. This is recorded through a provision for bad debts which is included in rental income in the accompanying consolidated statements of operations and comprehensive income. Resident reimbursements and other income consist of charges billed to residents for utilities, carport and garage rental, and pets, and administrative, application and other fees and are recognized when earned. 

Purchase Price Allocation

Upon acquisition of a property considered to be an asset acquisition, the purchase price and related acquisition costs (“total consideration”) are allocated to land, buildings, improvements, furniture, fixtures, and equipment, and intangible lease assets in accordance with FASB ASC 805, Business Combinations. Acquisition costs are capitalized in accordance with FASB ASC 805.

The allocation of total consideration, which is determined using inputs that are classified within Level 3 of the fair value hierarchy established by FASB ASC 820, Fair Value Measurement and Disclosures (“ASC 820”) (see Note 7), is based on management’s estimate of the property’s “as-if” vacant fair value and is calculated by using all available information such as the replacement cost of such asset, appraisals, property condition reports, market data and other related information. The allocation of the total consideration to intangible lease assets represents the value associated with the in-place leases, which may include lost rent, leasing commissions, legal and other related costs, which the Company, as buyer of the property, did not have to incur to obtain the residents. If any debt is assumed in an acquisition, the difference between the fair value, which is estimated using inputs that are classified within Level 2 of the fair value hierarchy, and the face value of debt is recorded as a premium or discount and amortized as interest expense over the life of the debt assumed.

Real estate assets, including land, buildings, improvements, furniture, fixtures and equipment, and intangible lease assets are stated at historical cost less accumulated depreciation and amortization. Costs incurred in making repairs and maintaining real estate assets are expensed as incurred. Expenditures for improvements, renovations, and replacements are capitalized at cost. Real estate-related depreciation and amortization are computed on a straight-line basis over the estimated useful lives as described in the following table:

Land	Not depreciated
Buildings	30 years
Improvements	15 years
Furniture, fixtures, and equipment	3 years
Intangible lease assets	6 months

Construction in progress includes the cost of renovation projects being performed at the various properties. Once a project is complete, the historical cost of the renovation is placed into service in one of the categories above depending on the type of renovation project and is depreciated over the estimated useful lives as described in the table above.

Impairment

Real estate assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The key inputs into our impairment analysis include, but are not limited to, the holding period, net operating income, and capitalization rates. In such cases, the Company will evaluate the recoverability of such real estate assets based on estimated future cash flows and the estimated liquidation value of such real estate assets, and provide for impairment if such undiscounted cash flows are insufficient to recover the carrying amount of the real estate asset. If impaired, the real estate asset will be written down to its estimated fair value. The Company’s impairment analysis identifies and evaluates events or changes in circumstances that indicate the carrying amount of a real estate investment may not be recoverable, including determining the period the Company will hold the rental property, net operating income, and the estimated capitalization rate for each respective real estate investment.

As of March 31, 2022, the Company has not recorded any impairment on its real estate assets.  However, we continue to monitor the impact of COVID-19 (see “–Coronavirus (“COVID-19”)” for additional information, below).

Held for Sale

The Company periodically classifies real estate assets as held for sale when certain criteria are met, in accordance with GAAP. At that time, the Company presents the net real estate assets and the net debt associated with the real estate held for sale separately in its consolidated balance sheet, and the Company ceases recording depreciation and amortization expense related to that property. Real estate held for sale is reported at the lower of its carrying amount or its estimated fair value less estimated costs to sell. As of March 31, 2022, there are no properties held for sale.      

Income Taxes

The Company has elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), and expects to continue to qualify as a REIT. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement to distribute annually at least 90% of its “REIT taxable income,” as defined by the Code, to its stockholders. As a REIT, the Company will be subject to federal income tax on its undistributed REIT taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions it pays with respect to any calendar year are less than the sum of (1) 85% of its ordinary income, (2) 95% of its capital gain net income and (3) 100% of its undistributed income from prior years. The Company intends to operate in such a manner so as to qualify as a REIT, but no assurance can be given that the Company will operate in a manner so as to qualify as a REIT. Taxable income from certain non-REIT activities is managed through a TRS and is subject to applicable federal, state, and local income and margin taxes. The Company had no significant taxes associated with its TRS for the three months ended March 31, 2022 and 2021.

If the Company fails to meet these requirements, it could be subject to federal income tax on all of the Company’s taxable income at regular corporate rates for that year. The Company would not be able to deduct distributions paid to stockholders in any year in which it fails to qualify as a REIT. Additionally, the Company will also be disqualified from electing to be taxed as a REIT for the four taxable years following the year during which qualification was lost unless the Company is entitled to relief under specific statutory provisions. As of March 31, 2022, the Company believes it is in compliance with all applicable REIT requirements.

The Company evaluates the accounting and disclosure of tax positions taken or expected to be taken in the course of preparing the Company’s tax returns to determine whether the tax positions are “more-likely-than-not” (greater than 50 percent probability) of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. The Company’s management is required to analyze all open tax years, as defined by the statute of limitations, for all major jurisdictions, which include federal and certain states. The Company has no examinations in progress and none are expected at this time.

The Company recognizes its tax positions and evaluates them using a two-step process. First, the Company determines whether a tax position is more likely than not to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Second, the Company will determine the amount of benefit to recognize and record the amount that is more likely than not to be realized upon ultimate settlement.

The Company had no material unrecognized tax benefit or expense, accrued interest or penalties as of March 31, 2022. The Company and its subsidiaries are subject to federal income tax as well as income tax of various state and local jurisdictions. The 2021, 2020 and 2019 tax years remain open to examination by tax jurisdictions to which the Company and its subsidiaries are subject. When applicable, the Company recognizes interest and/or penalties related to uncertain tax positions on its consolidated statements of operations and comprehensive income.

Recent Accounting Pronouncements

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During the first quarter of 2022, the Company transitioned a portion its debt to one-month term SOFR (“Term SOFR”). The Company has taken the ASC 848 elections needed to allow for the hedged forecasted transactions to transition while not discontinuing the associated hedge accounting designations. Application of these hedged accounting expedients preserves the presentation of derivatives consistent with past presentation.  The Company will continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

Coronavirus (“COVID-19”)

As a result of the COVID-19 pandemic, the Company may experience difficulties collecting monthly rent on time, leasing additional apartment units and/or renewing leases with existing tenants, selling or purchasing properties and accessing debt and equity capital on attractive terms, or at all. To date, the Company has not been materially impacted by the COVID-19 pandemic and will continue to monitor the impact of the COVID-19 pandemic on all aspects of its business. For additional information regarding the risks to the Company related to the COVID-19 pandemic, or any other future pandemic. See “Item 1A. Risk factors” within “Part I” of our annual report on Form 10-K, filed with the U.S. Securities and Exchange Commission on February 18, 2022, for additional discussion of the risks posed by the COVID-19 pandemic.

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Investments in Subsidiaries

3 Months Ended

Mar. 31, 2022

Schedule Of Investments [Abstract]

Investments in Subsidiaries

3. Investments in Subsidiaries

The Company conducts its operations through the OP, which owns properties through single asset limited liability companies that are special purpose entities (“SPEs”). The Company consolidates the SPEs that it controls as well as any VIEs where it is the primary beneficiary.  The Company controls and consolidates the OP as a VIE. In connection with its indirect equity investments in the properties acquired, the Company, through the OP and the TRS, directly or indirectly holds 100% of the membership interests in SPEs that directly own the properties. All of the properties the SPEs own are consolidated in the Company’s consolidated financial statements. The assets of each entity can only be used to settle obligations of that particular entity, and the creditors of each entity have no recourse to the assets of other entities or the Company.

Additionally, the Company has in the past and may in the future enter into purchase and sale transactions structured as reverse like-kind exchanges (“1031 Exchanges”) under Section 1031 of the Code. For a reverse 1031 Exchange in which the Company purchases a new property prior to selling the property to be matched in the like-kind exchange (the Company refers to the new property being acquired in the 1031 Exchange prior to the sale of the related property as a “Parked Asset”), legal title to the Parked Asset is held by an Exchange Accommodation Titleholder (“EAT”) engaged to execute the 1031 Exchange until the sale transaction and the 1031 Exchange are completed. The Company, through a wholly owned subsidiary, enters into a master lease agreement with the EAT whereby the EAT leases the acquired property and all other rights acquired in connection with the acquisition to the Company. The term of the master lease agreement is the earlier of the completion of the reverse 1031 Exchange or 180 days from the date that the property was acquired. The EAT is classified as a VIE as it does not have sufficient equity investment at risk to finance its activities without additional subordinated financial support. The Company consolidates the EAT as its primary beneficiary because it has the ability to control the activities that most significantly impact the EAT’s economic performance and the Company retains all of the legal and economic benefits and obligations related to the Parked Assets prior to completion of the 1031 Exchange. As such, the Parked Assets are included in the Company’s consolidated financial statements as VIEs until legal title and control is transferred to the Company upon either completion of the 1031 Exchange or termination of the master lease agreement, at which time they will be consolidated as wholly owned subsidiaries.

As of March 31, 2022, the Company, through the OP and the wholly owned TRS, owned 39 properties through SPEs. The following table represents the Company’s ownership in each property by virtue of its 100% ownership of the SPEs that directly own the title to each property as of March 31, 2022 and December 31, 2021:

				Effective Ownership Percentage at
Property Name		Location	Year Acquired	March 31, 2022			December 31, 2021
Arbors on Forest Ridge		Bedford, Texas	2014		100	%		100	%
Cutter's Point		Richardson, Texas	2014		100	%		100	%
Silverbrook		Grand Prairie, Texas	2014		100	%		100	%
The Summit at Sabal Park		Tampa, Florida	2014		100	%		100	%
Courtney Cove		Tampa, Florida	2014		100	%		100	%
Radbourne Lake		Charlotte, North Carolina	2014		100	%		100	%
Timber Creek		Charlotte, North Carolina	2014		100	%		100	%
Sabal Palm at Lake Buena Vista		Orlando, Florida	2014		100	%		100	%
Cornerstone		Orlando, Florida	2015		100	%		100	%
The Preserve at Terrell Mill		Marietta, Georgia	2015		100	%		100	%
Versailles		Dallas, Texas	2015		100	%		100	%
Seasons 704 Apartments		West Palm Beach, Florida	2015		100	%		100	%
Madera Point		Mesa, Arizona	2015		100	%		100	%
Venue at 8651		Fort Worth, Texas	2015		100	%		100	%
Parc500		West Palm Beach, Florida	2016		100	%		100	%
The Venue on Camelback		Phoenix, Arizona	2016		100	%		100	%
Old Farm		Houston, Texas	2016		100	%		100	%
Stone Creek at Old Farm		Houston, Texas	2016		100	%		100	%
Hollister Place		Houston, Texas	2017		100	%		100	%
Rockledge Apartments		Marietta, Georgia	2017		100	%		100	%
Atera Apartments		Dallas, Texas	2017		100	%		100	%
Crestmont Reserve		Dallas, Texas	2018		100	%		100	%
Brandywine I & II		Nashville, Tennessee	2018		100	%		100	%
Bella Vista		Phoenix, Arizona	2019		100	%		100	%
The Enclave		Tempe, Arizona	2019		100	%		100	%
The Heritage		Phoenix, Arizona	2019		100	%		100	%
Summers Landing		Fort Worth, Texas	2019		100	%		100	%
Residences at Glenview Reserve		Nashville, Tennessee	2019		100	%		100	%
Residences at West Place		Orlando, Florida	2019		100	%		100	%
Avant at Pembroke Pines		Pembroke Pines, Florida	2019		100	%		100	%
Arbors of Brentwood		Nashville, Tennessee	2019		100	%		100	%
Torreyana Apartments		Las Vegas, Nevada	2019		100	%		100	%
Bloom		Las Vegas, Nevada	2019		100	%		100	%
Bella Solara		Las Vegas, Nevada	2019		100	%		100	%
Fairways at San Marcos		Chandler, AZ	2020		100	%		100	%
The Verandas at Lake Norman	(1)	Charlotte, North Carolina	2021		100	%		100	%
Creekside at Matthews	(1)	Charlotte, North Carolina	2021		100	%		100	%
Six Forks Station		Raleigh, North Carolina	2021		100	%		100	%
High House at Cary	(2)	Cary, North Carolina	2021		100	%		100	%

(1) The EAT that directly owned The Verandas at Lake Norman and Creekside at Matthews was consolidated as a VIE at June 30, 2021 giving the Company an effective 100% ownership interest.  The master lease agreement with the EAT that directly owned these properties terminated on December 28, 2021, at which time legal title and control transferred to the Company. Upon the transfer of title, the EAT that directly owned these properties was no longer considered a VIE.

(2) Formerly known as Hudson High House.

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Real Estate Investments Statistics

3 Months Ended

Mar. 31, 2022

Business Combinations [Abstract]

Real Estate Investments Statistics

4. Real Estate Investments Statistics

As of March 31, 2022, the Company was invested in a total of 39 multifamily properties, as listed below:

						Average Effective Monthly Rent Per Unit (1) as of				% Occupied (2) as of
Property Name	Rentable Square Footage (in thousands)		Number of Units (3)		Date Acquired	March 31, 2022		December 31, 2021		March 31, 2022			December 31, 2021
Arbors on Forest Ridge		155		210	1/31/2014	$	1,040	$	1,021		94.8	%		96.2	%
Cutter's Point		198		196	1/31/2014		1,261		1,219		95.4	%		95.4	%
Silverbrook		526		642	1/31/2014		1,068		1,043		94.2	%		94.1	%
The Summit at Sabal Park		205		252	8/20/2014		1,253		1,198		94.4	%		96.0	%
Courtney Cove		225		324	8/20/2014		1,187		1,132		93.5	%		93.8	%
Radbourne Lake		247		225	9/30/2014		1,293		1,227		93.3	%		94.2	%
Timber Creek		248		352	9/30/2014		1,058		1,032		96.4	%		96.1	%
Sabal Palm at Lake Buena Vista		371		400	11/5/2014		1,453		1,377		95.8	%		97.8	%
Cornerstone		318		430	1/15/2015		1,183		1,152		95.6	%		95.6	%
The Preserve at Terrell Mill		692		752	2/6/2015		1,182		1,156		94.4	%		90.9	%
Versailles		301		388	2/26/2015		1,166		1,024		88.1	%		96.4	%
Seasons 704 Apartments		217		222	4/15/2015		1,502		1,410		94.1	%		96.8	%
Madera Point		193		256	8/5/2015		1,190		1,140		96.1	%		94.5	%
Venue at 8651		289		333	10/30/2015		1,033		1,006		95.4	%		94.5	%
Parc500		266		217	7/27/2016		1,609		1,543		94.5	%		96.3	%
The Venue on Camelback		256		415	10/11/2016		960		915		94.9	%		92.3	%
Old Farm		697		734	12/29/2016		1,218		1,207		94.7	%		93.9	%
Stone Creek at Old Farm		186		190	12/29/2016		1,268		1,248		96.3	%		96.8	%
Hollister Place		246		260	2/1/2017		1,105		1,065		89.2	%		92.5	%
Rockledge Apartments		802		708	6/30/2017		1,446		1,408		94.9	%		93.9	%
Atera Apartments		334		380	10/25/2017		1,352		1,310		95.0	%		93.9	%
Crestmont Reserve		199		242	9/26/2018		1,052		985		93.0	%		95.5	%
Brandywine I & II		414		632	9/26/2018		1,080		1,031		95.1	%		95.6	%
Bella Vista		243		248	1/28/2019		1,543		1,515		96.8	%		96.0	%
The Enclave		194		204	1/28/2019		1,603		1,507		95.1	%		96.6	%
The Heritage		199		204	1/28/2019		1,514		1,432		91.7	%		95.6	%
Summers Landing		139		196	6/7/2019		1,090		1,033		96.4	%		93.9	%
Residences at Glenview Reserve		344		360	7/17/2019		1,125		1,074		94.7	%		95.6	%
Residences at West Place		345		342	7/17/2019		1,420		1,345		94.2	%		93.0	%
Avant at Pembroke Pines		1,442		1,520	8/30/2019		1,772		1,695		95.1	%		93.9	%
Arbors of Brentwood		325		346	9/10/2019		1,344		1,284		94.8	%		95.1	%
Torreyana Apartments		309		316	11/22/2019		1,419		1,365		94.6	%		93.7	%
Bloom		498		528	11/22/2019		1,263		1,238		91.1	%		89.2	%
Bella Solara		271		320	11/22/2019		1,343		1,309		91.9	%		91.3	%
Fairways at San Marcos		340		352	11/2/2020		1,476		1,425		96.3	%		96.3	%
The Verandas at Lake Norman		241		264	6/30/2021		1,258		1,215		93.2	%		93.2	%
Creekside at Matthews		263		240	6/30/2021		1,393		1,350		91.7	%		94.2	%
Six Forks Station		360		323	9/10/2021		1,246		1,228		91.2	%		95.4	%
High House at Cary		293		302	12/7/2021		1,372		1,361		93.4	%		94.7	%
		13,391		14,825

(1) Average effective monthly rent per unit is equal to the average of the contractual rent for commenced leases as of March 31, 2022 and December 31, 2021, respectively, minus any tenant concessions over the term of the lease, divided by the number of units under commenced leases as of March 31, 2022 and December 31, 2021, respectively.

(2) Percent occupied is calculated as the number of units occupied as of March 31, 2022 and December 31, 2021, divided by the total number of units, expressed as a percentage.

(3) Includes 49 down units due to casualty events as of March 31, 2022 (see Note 5).

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Real Estate Investments

3 Months Ended

Mar. 31, 2022

Real Estate [Abstract]

Real Estate Investments

5. Real Estate Investments

As of March 31, 2022, the major components of the Company’s investments in multifamily properties were as follows (in thousands):

Operating Properties	Land		Buildings and Improvements			Intangible Lease Assets			Construction in Progress		Furniture, Fixtures and Equipment			Totals
Arbors on Forest Ridge	$	2,330	$	11,760		$	—		$	1	$	1,865		$	15,956
Cutter's Point		3,330		13,088			—			1		7,393			23,812
Silverbrook		4,860		25,691			—			196		5,690			36,437
The Summit at Sabal Park		5,770		13,885			—			—		2,048			21,703
Courtney Cove		5,880		14,345			—			17		2,548			22,790
Radbourne Lake		2,440		22,848			—			—		2,642			27,930
Timber Creek		11,260		13,334			—			380		3,931			28,905
Sabal Palm at Lake Buena Vista		7,580		42,461			—			10		2,874			52,925
Cornerstone		1,500		30,915			—			21		3,833			36,269
The Preserve at Terrell Mill		10,170		53,148			—			—		9,414			72,732
Versailles		6,720		21,953			—			2		4,155			32,830
Seasons 704 Apartments		7,480		14,725			—			—		2,262			24,467
Madera Point		4,920		18,155			—			—		2,698			25,773
Venue at 8651		2,350		17,548			—			322		3,914			24,134
Parc500		3,860		21,193			—			5		4,228			29,286
The Venue on Camelback		8,340		38,513			—			141		3,450			50,444
Old Farm		11,078		71,070			—			174		4,031			86,353
Stone Creek at Old Farm		3,493		19,718			—			2		936			24,149
Hollister Place		2,782		21,202			—			1,468		2,793			28,245
Rockledge Apartments		17,451		97,417			—			—		6,405			121,273
Atera Apartments		22,371		38,691			—			7		2,545			63,614
Crestmont Reserve		4,124		21,068			—			—		1,558			26,750
Brandywine I & II		6,237		73,769			—			—		5,385			85,391
Bella Vista		10,942		37,310			—			6		2,865			51,123
The Enclave		11,046		30,515			—			—		2,500			44,061
The Heritage		6,835		35,131			—			26		2,562			44,554
Summers Landing		1,798		18,447			—			1		821			21,067
Residences at Glenview Reserve		3,367		42,339			—			—		2,602			48,308
Residences at West Place		3,345		52,369			—			—		1,855			57,569
Avant at Pembroke Pines		48,434		276,632			—			1,056		12,425			338,547
Arbors of Brentwood		6,346		56,063			—			—		2,414			64,823
Torreyana Apartments		23,824		43,771			—			3		1,533			69,131
Bloom		23,805		82,595			—			19		3,007			109,426
Bella Solara		12,605		53,440			—			22		2,068			68,135
Fairways at San Marcos		10,993		72,922			—			297		2,005			86,217
The Verandas at Lake Norman		9,510		52,800			—			115		857			63,282
Creekside at Matthews		11,515		45,337			—			—		1,046			57,898
Six Forks Station		11,357		61,517			—			218		1,045			74,137
High House at Cary		23,809		67,656			1,376			19		827			93,687
		375,857		1,745,341			1,376			4,529		127,030			2,254,133
Accumulated depreciation and amortization		—		(218,292	)		(917	)		—		(89,793	)		(309,002	)
Total Operating Properties	$	375,857	$	1,527,049		$	459		$	4,529	$	37,237		$	1,945,131

As of December 31, 2021, the major components of the Company’s investments in multifamily properties were as follows (in thousands):

Operating Properties	Land		Buildings and Improvements			Intangible Lease Assets			Construction in Progress		Furniture, Fixtures and Equipment			Totals
Arbors on Forest Ridge	$	2,330	$	11,755		$	—		$	—	$	1,821		$	15,906
Cutter's Point		3,330		13,091			—			—		7,379			23,800
Silverbrook		4,860		27,495			—			—		5,566			37,921
The Summit at Sabal Park		5,770		13,882			—			—		1,978			21,630
Courtney Cove		5,880		14,350			—			—		2,444			22,674
Radbourne Lake		2,440		22,744			—			64		2,455			27,703
Timber Creek		11,260		13,310			—			239		3,827			28,636
Sabal Palm at Lake Buena Vista		7,580		42,456			—			2		2,758			52,796
Cornerstone		1,500		30,901			—			21		3,722			36,144
The Preserve at Terrell Mill		10,170		53,080			—			—		8,997			72,247
Versailles		6,720		21,887			—			—		4,075			32,682
Seasons 704 Apartments		7,480		14,644			—			—		2,078			24,202
Madera Point		4,920		18,090			—			48		2,612			25,670
Venue at 8651		2,350		17,495			—			334		3,843			24,022
Parc500		3,860		21,172			—			—		4,147			29,179
The Venue on Camelback		8,340		38,328			—			306		3,248			50,222
Old Farm		11,078		70,993			—			99		3,902			86,072
Stone Creek at Old Farm		3,493		19,714			—			2		899			24,108
Hollister Place		2,782		21,196			—			1,308		2,739			28,025
Rockledge Apartments		17,451		97,374			—			—		5,968			120,793
Atera Apartments		22,371		36,857			—			1,824		2,384			63,436
Crestmont Reserve		4,124		21,067			—			—		1,515			26,706
Brandywine I & II		6,237		73,737			—			—		5,160			85,134
Bella Vista		10,942		37,193			—			51		2,687			50,873
The Enclave		11,046		30,469			—			11		2,403			43,929
The Heritage		6,835		35,011			—			68		2,386			44,300
Summers Landing		1,798		18,433			—			1		790			21,022
Residences at Glenview Reserve		3,367		42,306			—			—		2,366			48,039
Residences at West Place		3,345		52,310			—			—		1,591			57,246
Avant at Pembroke Pines		48,434		275,968			—			1,414		11,611			337,427
Arbors of Brentwood		6,346		56,040			—			—		2,235			64,621
Torreyana Apartments		23,824		43,700			—			25		1,371			68,920
Bloom		23,805		82,545			—			16		2,697			109,063
Bella Solara		12,605		53,415			—			24		1,854			67,898
Fairways at San Marcos		10,993		72,920			—			2		1,989			85,904
The Verandas at Lake Norman		9,510		52,884			—			6		650			63,050
Creekside at Matthews		11,515		45,271			—			18		756			57,560
Six Forks Station		11,357		62,129			1,200			195		748			75,629
High House at Cary		23,809		67,654			1,376			—		768			93,607
		375,857		1,743,866			2,576			6,078		120,419			2,248,796
Accumulated depreciation and amortization		—		(203,125	)		(1,029	)		—		(82,942	)		(287,096	)
Total Operating Properties	$	375,857	$	1,540,741		$	1,547		$	6,078	$	37,477		$	1,961,700

Depreciation expense was $22.6 million and $19.9 million for the three months ended March 31, 2022 and 2021, respectively.

Amortization expense related to the Company’s intangible lease assets was $1.1 million and $0.8 million for the three months ended March 31, 2022 and 2021, respectively. Amortization expense related to the Company’s intangible lease assets for all acquisitions completed through March 31, 2022 is expected to be $0.5 million for the remainder of the year ended December 31, 2022. Due to the six-month useful life attributable to intangible lease assets, the value of intangible lease assets on any acquisition prior to September 30, 2021 has been fully amortized and the assets and related accumulated amortization have been written off as of March 31, 2022.

Acquisitions

There were no acquisitions of real estate during the three months ended March 31, 2022 and 2021.

Dispositions

There were no dispositions of real estate during the three months ended March 31, 2022 and 2021.

Casualty Losses

As of March 31, 2022, seven of the Company’s properties, Silverbrook, Venue at 8651, Bloom, Old Farm, Timber Creek, The Preserve at Terrell Mill and Six Forks, suffered significant property damages as a result of fires and flooding. As of March 31, 2022, 49 units were excluded from the Portfolio’s total unit count and all same store pools due to reconstruction. Business interruption proceeds for lost rent are included in miscellaneous income in the accompanying consolidated statements of operations and comprehensive income in relation to these events.

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Debt

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Debt

6. Debt

Mortgage Debt

The following table contains summary information concerning the mortgage debt of the Company as of March 31, 2022 (dollars in thousands):

Operating Properties		Type	Term (months)		Outstanding Principal (1)				Interest Rate (2)	Maturity Date
Arbors on Forest Ridge	(3)	Floating		84	$	13,130			2.13%	7/1/2024
Cutter's Point	(3)	Floating		84		16,640			2.13%	7/1/2024
Silverbrook	(3)	Floating		84		30,590			2.13%	7/1/2024
The Summit at Sabal Park	(3)	Floating		84		13,560			2.07%	7/1/2024
Courtney Cove	(3)	Floating		84		13,680			2.07%	7/1/2024
The Preserve at Terrell Mill	(3)	Floating		84		42,480			2.07%	7/1/2024
Versailles	(3)	Floating		84		23,880			2.07%	7/1/2024
Seasons 704 Apartments	(3)	Floating		84		17,460			2.07%	7/1/2024
Madera Point	(3)	Floating		84		15,150			2.07%	7/1/2024
Venue at 8651	(3)	Floating		84		13,734			2.23%	7/1/2024
The Venue on Camelback	(3)	Floating		84		28,093			2.13%	7/1/2024
Old Farm	(3)	Floating		84		52,886			2.13%	7/1/2024
Stone Creek at Old Farm	(3)	Floating		84		15,274			2.13%	7/1/2024
Timber Creek	(3)	Floating		84		24,100			1.71%	10/1/2025
Radbourne Lake	(3)	Floating		84		20,000			1.74%	10/1/2025
Sabal Palm at Lake Buena Vista	(3)	Floating		84		42,100			1.75%	9/1/2025
Cornerstone	(4)	Fixed		120		20,672			4.24%	3/1/2023
Parc500	(5)	Fixed		120		14,590			4.49%	8/1/2025
Hollister Place	(3)	Floating		84		14,811			1.79%	10/1/2025
Rockledge Apartments	(3)	Floating		84		68,100			2.02%	7/1/2024
Atera Apartments	(3)	Floating		84		29,500			1.93%	11/1/2024
Crestmont Reserve	(3)	Floating		84		12,061			1.63%	10/1/2025
Brandywine I & II	(3)	Floating		84		43,835			1.63%	10/1/2025
Bella Vista	(6)	Floating		84		29,040			1.77%	2/1/2026
The Enclave	(6)	Floating		84		25,322			1.77%	2/1/2026
The Heritage	(6)	Floating		84		24,625			1.77%	2/1/2026
Summers Landing	(7)	Floating		84		10,109			1.63%	10/1/2025
Residences at Glenview Reserve	(8)	Floating		84		26,270			1.89%	10/1/2025
Residences at West Place	(8)	Fixed		120		33,817			4.24%	10/1/2028
Avant at Pembroke Pines	(3)	Floating		84		177,100			1.88%	9/1/2026
Arbors of Brentwood	(3)	Floating		84		34,237			1.88%	10/1/2026
Torreyana Apartments	(6)	Floating		84		37,400			2.15%	12/1/2026
Bloom	(6)	Floating		84		58,850			2.15%	12/1/2026
Bella Solara	(6)	Floating		84		36,575			2.15%	12/1/2026
Fairways at San Marcos	(6)	Floating		84		46,464			2.29%	12/1/2027
The Verandas at Lake Norman	(9)	Floating		84		34,925			2.01%	7/1/2028
Creekside at Matthews	(9)	Floating		84		31,900			2.01%	7/1/2028
Six Forks Station	(10)	Floating		120		41,180			1.87%	10/1/2031
High House at Cary	(9)	Floating		84		46,625			2.17%	1/1/2029
					$	1,280,765
Fair market value adjustment						1,009		(11)
Deferred financing costs, net of accumulated amortization of $5,433						(5,534	)
					$	1,276,240

(1) Mortgage debt that is non-recourse to the Company and encumbers the multifamily properties.

(2) Interest rate is based on a reference rate plus an applicable margin, except for fixed rate mortgage debt. References rates used in our portfolio include one-month LIBOR and 30-Day Average Secured Overnight Financing Rate (“SOFR”). As of March 31, 2022, one-month LIBOR was 0.452% and SOFR was 0.15934%.

(3) Loan can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%. Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(4) Debt in the amount of $18.0 million was assumed upon acquisition of this property and recorded at approximated fair value. The assumed debt carries a 4.09% fixed rate, was originally issued in March 2013, and had a term of 120 months with an initial 24 months of interest only. At the time of acquisition, the principal balance of the first mortgage remained unchanged and had a remaining term of 98 months with 2 months of interest only. The first mortgage is pre-payable and subject to yield maintenance from the 13^th month through August 31, 2022 and is pre-payable at par starting on September 1, 2022 until maturity. Concurrently with the acquisition of the property, the Company placed a supplemental second mortgage on the property with a principal amount of approximately $5.8 million, a fixed rate of 4.70%, and with a maturity date that is the same time as the first mortgage. The supplemental second mortgage is pre-payable and subject to yield maintenance from the date of issuance through August 31, 2022 and is pre-payable at par starting on September 1, 2022 until maturity. As of March 31, 2022, the total indebtedness secured by the property had a blended interest rate of 4.24%.

(5) Debt was assumed upon acquisition of this property and recorded at approximated fair value. The loan is open to pre-payment in the last four months of the term.

(6) Loan can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%.  Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(7) Debt was assumed upon acquisition of this property and recorded at approximated fair value.  It can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%. Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(8) Debt was assumed upon acquisition of this property and recorded at approximated fair value. The loan can be prepaid at the greater of par plus 1.00% of the unpaid principal balance or the product obtained by multiplying the present value of the principal being prepaid by the excess of the monthly fixed interest rate of the loan over a daily discount rate. The loan is open to pre-payment in the last three months of the term.  

(9) Loan can be pre-paid in the first 24 months of the term in certain circumstances at par plus 5.00%.  Starting in the 25th month of the term through the 36th month of the term, the loan can be pre-paid at par plus 2% of the unpaid principal balance. Starting in the 37th month of the term, the loan can be pre-paid at par plus 1% of the unpaid principal balance. The loan is open to pre-payment in the last three months of the term.

(10) Loan can be pre-paid in the first 24 months of the term in certain circumstances at par plus 5.00%. Starting in the 25th month of the term through the 116th of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last four months of the term.

(11) The Company reflected a valuation adjustment on its fixed rate debt for Parc500 and Residences at West Place to adjust it to fair market value on their respective dates of acquisition for the difference between the fair value and the assumed principal amount of debt. The difference is amortized into interest expense over the remaining terms of the mortgages.

The weighted average interest rate of the Company’s mortgage indebtedness was 2.10% as of March 31, 2022 and 1.81% as of December 31, 2021. The increase between the periods is primarily related to an increase in one-month LIBOR of approximately 35 basis points to 0.452% as of March 31, 2022 from 0.10125% as of December 31, 2021. As of March 31, 2022, the adjusted weighted average interest rate of the Company’s mortgage indebtedness was 2.95%. For purposes of calculating the adjusted weighted average interest rate of the outstanding mortgage indebtedness, the Company has included the weighted average fixed rate of 1.2128% for one-month LIBOR on its combined $1.4 billion notional amount of interest rate swap agreements, which effectively fix the interest rate on $1.4 billion of the Company’s floating rate mortgage debt (see Note 7).

Each of the Company’s mortgages is a non-recourse obligation subject to customary provisions. The loan agreements contain customary events of default, including defaults in the payment of principal or interest, defaults in compliance with the covenants contained in the documents evidencing the loan, defaults in payments under any other security instrument covering any part of the property, whether junior or senior to the loan, and bankruptcy or other insolvency events. As of March 31, 2022, the Company believes it is in compliance with all provisions. 

Credit Facility

The following table contains summary information concerning the Company’s credit facility as of March 31, 2022 (dollars in thousands):

	Type	Term (months)		Outstanding Principal			Interest Rate (1)	Maturity Date
Corporate Credit Facility	Floating		36	$	335,000		2.80%	6/30/2024
Deferred financing costs, net of accumulated amortization of $461					(2,021	)
				$	332,979

(1) Interest rate is based on Term SOFR plus an applicable margin.  Term SOFR as of March 31, 2022 was 0.3024%.

On March 25, 2022, the Company entered into a loan modification agreement by and among the Company, the OP, Truist Bank and the Lenders party thereto, which modified the Company’s existing credit facility, dated as of June 30, 2021 (as modified, amended and supplemented, the “Corporate Credit Facility”). As of March 31, 2022, there was $350.0 million available for borrowing under the Corporate Credit Facility. Subject to conditions provided in the Corporate Credit Facility, the commitments under Corporate Credit Facility may be increased up to an additional $150.0 million if the lenders agree to increase their commitments or if the lenders agree for the increase to be funded by any additional lender proposed by the Company, through the OP. The Corporate Credit Facility will mature on June 30, 2024 with respect to the revolving commitments, unless the Company exercises its option to voluntarily and permanently reduce all of the revolving commitments before the maturity date or elects to exercise its right and option to extend the facility with respect to the revolving commitments for a single one-year term. As of March 31, 2022, there was $335.0 million in aggregate principal outstanding under the Corporate Credit Facility.

Advances under the Corporate Credit Facility accrue interest at a per annum rate equal to, at the Company’s election, either Term SOFR plus a margin of 1.90% to 2.40%, depending on the Company’s total leverage ratio and a benchmark replacement adjustment of 0.1%, or a base rate determined according to the highest of (a) the prime rate, (b) the federal funds rate plus 0.50%, (c) Term SOFR plus 1.0% or (d) 0.0% plus a margin of 0.90% to 1.40%, depending on the Company’s total leverage ratio. An unused commitment fee at a rate of 0.15% or 0.25%, depending on the outstanding aggregate revolving commitments, applies to unutilized borrowing capacity under the Corporate Credit Facility. Amounts owing under the Corporate Credit Facility may be prepaid at any time without premium or penalty. The Corporate Credit Facility is guaranteed by the Company and the obligations under the Corporate Credit Facility are, subject to some exceptions, secured by a continuing security interest in substantially all of the assets of the Company. The Company is in compliance with all of the covenants required in its Corporate Credit Facility.

Deferred Financing Costs

The Company defers costs incurred in obtaining financing and amortizes the costs over the terms of the related loans using the straight-line method, which approximates the effective interest method. Deferred financing costs, net of amortization, are recorded as a reduction from the related debt on the Company’s consolidated balance sheets. Upon repayment of or in conjunction with a material change in the terms of the underlying debt agreement, any unamortized costs are charged to loss on extinguishment of debt and modification costs (see “Loss on Extinguishment of Debt and Modification Costs” below). For the three months ended March 31, 2022 and 2021, amortization of deferred financing costs of approximately $0.6 million and $0.6 million, respectively, is included in interest expense on the consolidated statements of operations and comprehensive income.

Loss on Extinguishment of Debt and Modification Costs

Loss on extinguishment of debt and modification costs includes prepayment penalties and defeasance costs incurred on the early repayment of debt, costs incurred in a debt modification that are not capitalized as deferred financing costs and other costs incurred in a debt extinguishment.

Schedule of Debt Maturities

The aggregate scheduled maturities, including amortizing principal payments, of total debt for the next five calendar years subsequent to March 31, 2022 are as follows (in thousands):

	Operating Properties		Credit Facility		Total
2022	$	1,040	$	—	$	1,040
2023		21,047		—		21,047
2024		394,956		335,000		729,956
2025		205,662		—		205,662
2026		423,149		—		423,149
Thereafter		234,911		—		234,911
Total	$	1,280,765	$	335,000	$	1,615,765

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Fair Value of Derivative and Financial Instruments

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Fair Value Measures and Derivative Financial Instruments

7. Fair Value of Derivatives and Financial Instruments

Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability. As a basis for considering market participant assumptions in fair value measurements, ASC 820 establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy):

• Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access.

• Level 2 inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs may include quoted prices for similar assets and liabilities in active markets, as well as inputs that are observable for the asset or liability (other than quoted prices), such as interest rates and yield curves that are observable at commonly quoted intervals.

• Level 3 inputs are the unobservable inputs for the asset or liability, which are typically based on an entity’s own assumption, as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on input from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company utilizes independent third parties to perform the allocation of value analysis for each property acquisition and to perform the market valuations on its derivative financial instruments and has established policies, as described above, processes and procedures intended to ensure that the valuation methodologies for investments and derivative financial instruments are fair and consistent as of the measurement date.

Derivative Financial Instruments and Hedging Activities

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company may enter into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash payments principally related to the Company’s borrowings. In order to minimize counterparty credit risk, the Company enters into and expects to enter into hedging arrangements only with major financial institutions that have high credit ratings.

The Company utilizes an independent third party to perform the market valuations on its derivative financial instruments. The valuation of these instruments is determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts (or payments) and the discounted expected variable cash payments (or receipts). The variable cash payments (or receipts) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. The fair values of interest rate caps are determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates rise above the strike rate of the caps. The variable interest rates used in the calculation of projected receipts on the cap are based on an expectation of future interest rates derived from observable market interest rate curves and volatilities. To comply with the provisions of ASC 820, the Company incorporates credit valuation adjustments to appropriately reflect both the Company’s own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements. In adjusting the fair value of the Company’s derivative contracts for the effect of nonperformance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts and guarantees. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with the Company’s derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties. The Company has determined that the significance of the impact of the credit valuation adjustments made to its derivative contracts, which determination was based on the fair value of each individual contract, was not significant to the overall valuation. As a result, all of the Company’s derivatives held as of March 31, 2022 and December 31, 2021 were classified as Level 2 of the fair value hierarchy.

The Company’s main objective in using interest rate derivatives is to add stability to interest expense related to floating rate debt. To accomplish this objective, the Company primarily uses interest rate swaps and caps as part of its interest rate risk management strategy. Interest rate swaps involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. The interest rate swaps have terms ranging from four to five years. Interest rate caps involve the receipt of variable-rate amounts from a counterparty if interest rates rise above the strike rate on the contract in exchange for an up-front premium. The interest rate caps have terms ranging from three to four years. During the three months ended March 31, 2022 and 2021, interest rate cap derivatives were used to hedge the variable cash flows associated with a portion of the Company’s floating rate debt. The interest rate cap agreements the Company has entered into effectively cap one-month LIBOR on $458.8 million of the Company’s floating rate mortgage indebtedness at a weighted average rate of 4.79% as of March 31, 2022.

In order to fix a portion of, and mitigate the risk associated with, the Company’s floating rate indebtedness (without incurring substantial prepayment penalties or defeasance costs typically associated with fixed rate indebtedness when repaid early or refinanced), the Company, through the OP, has entered into nine interest rate swap transactions with KeyBank National Association (“KeyBank”) and four with Truist Bank with a combined notional amount of $1.4 billion. The interest rate swaps the Company has entered into effectively replace the floating interest rate with respect to that amount with a weighted average fixed rate of 1.2128%. The Company has designated these interest rate swaps as cash flow hedges of interest rate risk.

As of March 31, 2022, the Company had the following outstanding interest rate swaps that were designated as cash flow hedges of interest rate risk (dollars in thousands):

Effective Date	Termination Date	Counterparty	Notional Amount		Fixed Rate (1)
April 1, 2017	April 1, 2022	KeyBank	$	100,000		1.9570	%
May 1, 2017	April 1, 2022	KeyBank		50,000		1.9610	%
July 1, 2017	July 1, 2022	KeyBank		100,000		1.7820	%
June 1, 2019	June 1, 2024	KeyBank		50,000		2.0020	%
June 1, 2019	June 1, 2024	Truist		50,000		2.0020	%
September 1, 2019	September 1, 2026	KeyBank		100,000		1.4620	%
September 1, 2019	September 1, 2026	KeyBank		125,000		1.3020	%
January 3, 2020	September 1, 2026	KeyBank		92,500		1.6090	%
March 4, 2020	June 1, 2026	Truist		100,000		0.8200	%
June 1, 2021	September 1, 2026	KeyBank		200,000		0.8450	%
June 1, 2021	September 1, 2026	KeyBank		200,000		0.9530	%
March 1, 2022	March 1, 2025	Truist		145,000		0.5730	%
March 1, 2022	March 1, 2025	Truist		105,000		0.6140	%
			$	1,417,500		1.2128	%	(2)

(1) The floating rate option for the interest rate swaps is one-month LIBOR. As of March 31, 2022, one-month LIBOR was 0.452%.

(2) Represents the weighted average fixed rate of the interest rate swaps.

As of March 31, 2022, the Company had the following outstanding interest rate swaps that were designated as cash flow hedges of interest rate risk with future effective dates (dollars in thousands):

Effective Date	Termination Date	Counterparty	Notional Amount		Fixed Rate (1)
September 1, 2026	January 1, 2027	KeyBank	$	92,500		1.7980	%

(1) The floating rate option for the interest rate swaps is one-month LIBOR. As of March 31, 2022, one-month LIBOR was 0.452%.

(2) Represents the weighted average fixed rate of the interest rate swaps.

Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to interest rate movements but either do not meet the strict requirements to apply hedge accounting in accordance with FASB ASC 815, Derivatives and Hedging, or the Company has elected not to designate such derivatives as hedges. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in net income (loss) as interest expense.

As of March 31, 2022 and 2021, the Company had the following outstanding derivatives that were not designated as hedges in qualifying hedging relationships (dollars in thousands):

As of March 31,	Number of Instruments		Notional Amount
2022		15	$	458,846
2021		15	$	379,406

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated balance sheets as of March 31, 2022 and December 31, 2021 (in thousands):

		Asset Derivatives				Liability Derivatives
	Balance Sheet Location	March 31, 2022		December 31, 2021		March 31, 2022		December 31, 2021
Derivatives designated as hedging instruments:
Interest rate swaps	Fair market value of interest rate swaps	$	58,350	$	11,045	$	246	$	7,519
Derivatives not designated as hedging instruments:
Interest rate caps	Prepaid and other assets		1,453		263		—		—
Total		$	59,803	$	11,308	$	246	$	7,519

The tables below present the effect of the Company’s derivative financial instruments on the consolidated statements of operations and comprehensive income for the three months ended March 31, 2022 and 2021 (in thousands):

	Amount of gain (loss) recognized in OCI				Location of gain (loss) reclassified from accumulated	Amount of gain (loss) reclassified from OCI into income
	2022		2021		OCI into income	2022			2021
Derivatives designated as hedging instruments:
For the three months ended March 31,
Interest rate products	$	51,017	$	27,679	Interest expense	$	(3,562	)	$	(3,663	)

	Location of gain (loss)	Amount of gain (loss) recognized in income
	recognized in income	2022		2021
Derivatives not designated as hedging instruments:
For the three months ended March 31,
Interest rate products	Interest expense	$	1,184	$	12

Other Financial Instruments Carried at Fair Value

Redeemable noncontrolling interests in the OP have a redemption feature and are marked to their redemption value if such value exceeds the carrying value of the redeemable noncontrolling interests in the OP (see Note 10). The redemption value is based on the fair value of the Company’s common stock at the redemption date, and therefore, is calculated based on the fair value of the Company’s common stock at the balance sheet date. Since the valuation is based on observable inputs such as quoted prices for similar instruments in active markets, redeemable noncontrolling interests in the OP are classified as Level 2 if they are adjusted to their redemption value.

Financial Instruments Not Carried at Fair Value

At March 31, 2022 and December 31, 2021, the fair values of cash and cash equivalents, restricted cash, accounts receivable, prepaid and other assets, excluding interest rate caps, accounts payable and other accrued liabilities, accrued real estate taxes payable, accrued interest payable, security deposits and prepaid rent approximated their carrying values because of the short term nature of these instruments. The estimated fair values of other financial instruments were determined by the Company using available market information and appropriate valuation methodologies. Considerable judgment is necessary to interpret market data and develop estimated fair values. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company would realize on the disposition of the financial instruments. The use of different market assumptions or estimation methodologies may have a material effect on the estimated fair value amounts.

Long-term indebtedness is carried at amounts that reasonably approximate their fair value. In calculating the fair value of its long-term indebtedness, the Company used interest rate and spread assumptions that reflect current credit worthiness and market conditions available for the issuance of long-term debt with similar terms and remaining maturities. These financial instruments utilize Level 2 inputs.

The table below presents the carrying value and estimated fair value of our debt at March 31, 2022 and December 31, 2021 (in thousands):

	March 31, 2022				December 31, 2021
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Fixed rate debt	$	69,079	$	68,962	$	69,285	$	71,141
Floating rate debt (1)	$	1,546,686	$	1,635,044	$	1,491,861	$	1,525,298

(1) Includes balances outstanding under our Corporate Credit Facility.

Real estate assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In such cases, the Company will evaluate the recoverability of such real estate assets based on estimated future cash flows and the estimated liquidation value of such real estate assets, and provide for impairment if such undiscounted cash flows are insufficient to recover the carrying amount of the real estate asset. If impaired, the real estate asset will be written down to its estimated fair value. There can be no assurance that the estimates discussed herein, using Level 3 inputs, are indicative of the amounts the Company could realize on disposition of the real estate asset. For the three months ended March 31, 2022 and 2021, the Company did not record any impairment charges related to real estate assets.

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Stockholders' Equity

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Stockholders' Equity

8. Stockholders’ Equity

Common Stock

During the three months ended March 31, 2022, the Company issued 147,532 shares of common stock pursuant to its long-term incentive plan (see “Long Term Incentive Plan” below) and 52,091 pursuant to its at-the-market offering (see “At-the-Market Offering” below).

As of March 31, 2022, the Company had 25,700,190 shares of common stock, par value $0.01 per share, issued and outstanding.

Share Repurchase Program

On June 15, 2016, the Board authorized the Company to repurchase up to $30.0 million of its common stock, par value $0.01 per share, during a two-year period that was set to expire on June 15, 2018 (the “Share Repurchase Program”). On April 30, 2018, the Board increased the Share Repurchase Program from $30.0 million to up to $40.0 million and extended it by an additional two years to June 15, 2020. On March 13, 2020, the Board further increased the Share Repurchase Program from $40.0 million to up to $100.0 million and extended it to March 12, 2023.  The Company may utilize various methods to affect the repurchases, and the timing and extent of the repurchases will depend upon several factors, including market and business conditions, regulatory requirements and other corporate considerations, including whether the Company’s common stock is trading at a significant discount to net asset value per share. Repurchases under this program may be discontinued at any time.

During the three months ended March 31, 2022 and 2021, the Company did not repurchase any shares of its common stock. Since the inception of the Share Repurchase Program through March 31, 2022, the Company had repurchased 2,382,155 shares of its common stock, par value $0.01 per share, at a total cost of approximately $61.2 million, or $25.70 per share.

Treasury Shares

From time to time, in accordance with the Company’s Share Repurchase Program, the Company may repurchase shares of its common stock in the open market. Until any such shares are retired, the cost of the shares is included in common stock held in treasury at cost on the consolidated balance sheet. The number of shares of common stock classified as treasury shares reduces the number of shares of the Company’s common stock outstanding and, accordingly, are considered in the weighted average number of shares outstanding during the period. During the three months ended March 31, 2022 and 2021, the Company retired no shares of its common stock held in treasury. As of March 31, 2022, the Company did not have any shares of common stock held in treasury.

Long Term Incentive Plan

On June 15, 2016, the Company’s stockholders approved a long-term incentive plan (the “2016 LTIP”) and the Company filed a registration statement on Form S-8 registering 2,100,000 shares of common stock, par value $0.01 per share, which the Company may issue pursuant to the 2016 LTIP. The 2016 LTIP authorizes the compensation committee of the Board to provide equity-based compensation in the form of stock options, appreciation rights, restricted shares, restricted stock units, performance shares, performance units and certain other awards denominated or payable in, or otherwise based on, the Company’s common stock or factors that may influence the value of the Company’s common stock, plus cash incentive awards, for the purpose of providing the Company’s directors, officers and other key employees (and those of the Adviser and the Company’s subsidiaries), the Company’s non-employee directors, and potentially certain non-employees who perform employee-type functions, incentives and rewards for performance.

Restricted Stock Units.

Under the 2016 LTIP, restricted stock units may be granted to the Company’s directors, officers and other key employees (and those of the Adviser and the Company’s subsidiaries) and typically vest over a three to five-year period for officers, employees and certain key employees of the Adviser and annually for directors. Beginning on the date of grant, restricted stock units earn dividends that are payable in cash on the vesting date. On February 21, 2019, pursuant to the 2016 LTIP, the Company granted 186,662 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. On February 20, 2020, pursuant to the 2016 LTIP, the Company granted 168,183 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. On May 11, 2020, pursuant to the 2016 LTIP, the Company granted 116,852 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. On February 18, 2021, pursuant to the 2016 LTIP, the Company granted 204,663 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. On February 17, 2022, pursuant to the 2016 LTIP, the Company granted 142,159 restricted stock units to its directors, officers, employees and certain key employees of the Adviser. The following table includes the number of restricted stock units granted, vested, forfeited and outstanding as of March 31, 2022:

	2022
	Number of Units				Weighted Average Grant Date Fair Value
Outstanding January 1,		589,283			$	39.17
Granted		142,159				83.88
Vested		(180,497	)	(1)		35.87
Outstanding March 31,		550,945			$	51.79

(1) Certain key employees of the Adviser elected to net the taxes owed upon vesting against the shares issued resulting in 147,532 shares being issued as shown on the Consolidated Statement of Stockholders’ Equity.

The following table contains information regarding the vesting of restricted stock units under the 2016 LTIP for the next five calendar years subsequent to March 31, 2022:

	Shares Vesting
	February			May		Total
2022		—	(1)		22,022		22,022
2023		139,095			22,019		161,114
2024		132,699			22,017		154,716
2025		97,811			22,017		119,828
2026		66,114			—		66,114
2027		27,151			—		27,151
Total		462,870			88,075		550,945

(1) Shares vested prior to March 31, 2022.

As of March 31, 2022, the Company had issued 839,788 shares of common stock under the 2016 LTIP. For the three months ended March 31, 2022 and 2021, the Company recognized approximately $1.9 million and $1.6 million, respectively, of equity-based compensation expense related to grants of restricted stock units.  As of March 31, 2022, the Company had recognized a liability of approximately $1.2 million related to dividends earned on restricted stock units that are payable in cash upon vesting.

At-the-Market Offering

On March 4, 2020, the Company, the OP and the Adviser entered into separate equity distribution agreements with each of Jefferies LLC (“Jefferies”), Raymond James & Associates, Inc. (“Raymond James”), KeyBanc Capital Markets Inc. (“KeyBanc”) and Truist Securities (f/k/a SunTrust Robinson Humphrey, Inc., “SunTrust,” and together with Jefferies, Raymond James and KeyBanc, the “ATM Sales Agents”), pursuant to which the Company may issue and sell from time to time shares of the Company’s common stock, par value $0.01 per share, having an aggregate sales price of up to $225,000,000 (the “2020 ATM Program”).  Sales of shares of common stock, if any, may be made in transactions that are deemed to be “at the market” offerings, as defined in Rule 415 under the Securities Act, including, without limitation, sales made by means of ordinary brokers’ transactions on the New York Stock Exchange, to or through a market maker at market prices prevailing at the time of sale, at prices related to prevailing market prices or at negotiated prices based on prevailing market prices.  In addition to the issuance and sale of shares of common stock, the Company may enter into forward sale agreements with each of Jefferies, KeyBanc and Raymond James, or their respective affiliates, through the 2020 ATM Program.  During the three months ended March 31, 2022, the Company issued 52,091 shares of common stock at an average price of $83.16 per share for gross proceeds of $4.3 million under the ATM Program. The Company paid approximately $0.1 million in fees to the 2020 ATM Sales Agents with respect to such sales and incurred other issuance costs of approximately $0.1 million, both of which were netted against the gross proceeds and recorded in additional paid in capital. The following table contains summary information of the 2020 ATM Program since its inception:

Gross proceeds	$	62,310,967
Common shares issued		1,120,910
Gross average sale price per share	$	55.59
Sales commissions	$	934,665
Offering costs		1,184,340
Net proceeds		60,191,962
Average price per share, net	$	53.70

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Earnings (Loss) Per Share

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

The following table sets forth the computation of basic and diluted loss per share for the periods presented (in thousands, except per share amounts):

		For the Three Months Ended March 31,
		2022			2021
Numerator for loss per share:
Net loss		$	(4,667	)	$	(6,900	)
Net loss attributable to redeemable noncontrolling interests in the Operating Partnership			(14	)		(21	)
Net loss attributable to common stockholders		$	(4,653	)	$	(6,879	)
Denominator for loss per share:
Weighted average common shares outstanding			25,620			25,068
Denominator for basic loss per share			25,620			25,068
Weighted average unvested restricted stock units			573			582
Denominator for diluted earnings per share	(1)		25,620			25,068
Loss per weighted average common share:
Basic		$	(0.18	)	$	(0.27	)
Diluted		$	(0.18	)	$	(0.27	)

(1) If the Company sustains a net loss for the period presented, unvested restricted stock units are not included in the diluted earnings per share calculation.

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Noncontrolling Interests

3 Months Ended

Mar. 31, 2022

Noncontrolling Interest [Abstract]

Noncontrolling Interests

10. Noncontrolling Interests

Redeemable Noncontrolling Interests in the OP

Interests in the OP held by limited partners are represented by OP Units. Net income (loss) is allocated to holders of OP Units based upon net income (loss) attributable to common stockholders and the weighted average number of OP Units outstanding to total common shares plus OP Units outstanding during the period. Capital contributions, distributions, and profits and losses are allocated to OP Units in accordance with the terms of the partnership agreement of the OP. Each time the OP distributes cash to the Company, outside limited partners of the OP receive their pro-rata share of the distribution. Redeemable noncontrolling interests in the OP have a redemption feature and are marked to their redemption value if such value exceeds the carrying value of the redeemable noncontrolling interests in the OP.

On June 30, 2017, the Company and the OP entered into a contribution agreement with BH Equities, LLC and its affiliates (collectively, “BH Equity”), whereby the Company purchased 100% of the joint venture interests in the Portfolio owned by BH Equity, representing approximately 8.4% ownership in the Portfolio (the “BH Buyout”), for total consideration of approximately $51.7 million (the “Purchase Amount”). The Purchase Amount consisted of approximately $49.7 million in cash that was paid on June 30, 2017 and 73,233 OP Units (initially valued at $2.0 million) that were issued on August 1, 2017. The number of OP Units issued was calculated by dividing $2.0 million by the midpoint of the range of the Company’s net asset value as publicly disclosed in connection with the Company’s release of its second quarter of 2017 earnings results, which was $27.31 per share.

In connection with the issuance of OP Units to BH Equity on August 1, 2017, the Company and the OP amended the partnership agreement of the OP (the “Amendment”). Pursuant to the Amendment, limited partners holding OP Units have the right to cause the OP to redeem their units at a redemption price equal to and in the form of the Cash Amount (as defined in the partnership agreement of the OP), provided that such OP Units have been outstanding for at least one year. The Company, through the OP GP, as the general partner of the OP may, in its sole discretion, purchase the OP Units by paying to the limited partner either the Cash Amount or the REIT Share Amount (one share of common stock of the Company for each OP Unit), as defined in the partnership agreement of the OP. Notwithstanding the foregoing, a limited partner will not be entitled to exercise its redemption right to the extent the issuance of the Company’s common stock to the redeeming limited partner would (1) be prohibited, as determined in the Company’s sole discretion, under the Company’s charter or (2) cause the acquisition of common stock by such redeeming limited partner to be “integrated” with any other distribution of the Company’s common stock for purposes of complying with the Securities Act. Accordingly, the Company records the OP Units held by noncontrolling limited partners outside of permanent equity and reports the OP Units at the greater of their carrying value or their redemption value using the Company’s stock price at each balance sheet date.

The following table sets forth the redeemable noncontrolling interests in the OP for the three months ended March 31, 2022 (in thousands):

Redeemable noncontrolling interests in the OP, December 31, 2021	$	6,139
Net loss attributable to redeemable noncontrolling interests in the OP		(14	)
Other comprehensive income attributable to redeemable noncontrolling interests in the OP		164
Contributions from redeemable noncontrolling interests in the OP		—
Distributions to redeemable noncontrolling interests in the OP		(9	)
Adjustment to reflect redemption value of redeemable noncontrolling interests in the OP		334
Redeemable noncontrolling interests in the OP, March 31, 2022	$	6,614

Noncontrolling Interests

Noncontrolling interests have in the past and may in the future be comprised of joint venture partners’ interests in joint ventures the Company consolidates. When applicable, the Company reports its joint venture partners’ interests in its consolidated joint ventures and other subsidiary interests held by third parties as noncontrolling interests. The Company records these noncontrolling interests at their initial fair value, adjusting the basis prospectively for their share of the respective consolidated investment’s net income or loss, equity contributions, return of capital, and distributions. Generally, these noncontrolling interests are not redeemable by the equity holders and are presented as part of permanent equity. Income and losses are allocated to the noncontrolling interest holder based on its economic ownership percentage

Fees and Reimbursements to BH and its Affiliates

The Company has entered into management agreements with BH Management Services, LLC (“BH”), the Company’s property manager and an independently owned third party, who manages the Company’s properties and supervises the implementation of the Company’s value-add program. BH is an affiliate of BH Equity, who was a noncontrolling interest member of the Company’s joint ventures prior to the BH Buyout on June 30, 2017. Through BH Equity’s noncontrolling interests in such joint ventures, BH Equity was deemed to be a related party. With the completion of the BH Buyout, BH Equity is no longer deemed to be a related party. BH Equity became a noncontrolling limited partner of the OP upon execution of the Amendment. BH and its affiliates do not have common ownership in any joint venture with the Adviser; there is also no common ownership between BH and its affiliates and the Adviser.

The property management fee paid to BH is approximately 3% of the monthly gross income from each property managed. Currently, BH manages all of the Company’s properties. Additionally, the Company may pay BH certain other fees, including: (1) a fee of $15-25 per unit for the one-time setup and inspection of properties, (2) a construction supervision fee of 5-6% of total project costs, which is capitalized, (3) acquisition fees and due diligence costs reimbursements, and (4) other owner approved fees at $55 per hour. BH also acts as a paymaster for the properties and is reimbursed at cost for various operating expenses it pays on behalf of the properties. The following is a summary of fees that the properties incurred to BH and its affiliates, as well as reimbursements paid to BH from the properties for various operating expenses, for the three months ended March 31, 2022 and 2021 (in thousands):

		For the Three Months Ended March 31,
		2022		2021
Fees incurred
Property management fees	(1)	$	1,750	$	1,479
Construction supervision fees	(2)		325		254
Design fees	(2)		—		54
Aerwave fees	(3)		124		—
Reimbursements
Payroll and benefits	(3)		5,164		4,238
Other reimbursements	(4)		1,028		825

(1) Included in property management fees on the consolidated statements of operations and comprehensive income.

(2) Capitalized on the consolidated balance sheets and reflected in buildings and improvements.

(3) Included in property operating expenses on the consolidated statements of operations and comprehensive income.

(4) Includes property operating expenses such as repairs and maintenance costs and certain property general and administrative expenses, which are included on the consolidated statements of operations and comprehensive income.

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Related Party Transactions

3 Months Ended

Mar. 31, 2022

Related Party Transactions [Abstract]

Related Party Transactions

11. Related Party Transactions

Advisory and Administrative Fee

In accordance with the Advisory Agreement, the Company pays the Adviser an advisory fee equal to 1.00% of the Average Real Estate Assets (as defined below). The duties performed by the Company’s Adviser under the terms of the Advisory Agreement include, but are not limited to: providing daily management for the Company, selecting and working with third party service providers, managing the Company’s properties or overseeing the third party property manager, formulating an investment strategy for the Company and selecting suitable properties and investments, managing the Company’s outstanding debt and its interest rate exposure through derivative instruments, determining when to sell assets, and managing the value-add program or overseeing a third party vendor that implements the value-add program. “Average Real Estate Assets” means the average of the aggregate book value of Real Estate Assets before reserves for depreciation or other non-cash reserves, computed by taking the average of the book value of real estate assets at the end of each month (1) for which any fee under the Advisory Agreement is calculated or (2) during the year for which any expense reimbursement under the Advisory Agreement is calculated. “Real Estate Assets” is defined broadly in the Advisory Agreement to include, among other things, investments in real estate-related securities and mortgages and reserves for capital expenditures (the value-add program). The advisory fee is payable monthly in arrears in cash, unless the Adviser elects, in its sole discretion, to receive all or a portion of the advisory fee in shares of common stock, subject to certain limitations.

In accordance with the Advisory Agreement, the Company also pays the Adviser an administrative fee equal to 0.20% of the Average Real Estate Assets. The administrative fee is payable monthly in arrears in cash, unless the Adviser elects, in its sole discretion, to receive all or a portion of the administrative fee in shares of common stock, subject to certain limitations.

The advisory and administrative fees paid to the Adviser on the Contributed Assets (as defined in the Advisory Agreement) are subject to an annual cap of approximately $5.4 million (the “Contributed Assets Cap”) (see “Expense Cap” below).

Pursuant to the terms of the Advisory Agreement, the Company will reimburse the Adviser for all documented Operating Expenses and Offering Expenses it incurs on behalf of the Company. “Operating Expenses” include legal, accounting, financial and due diligence services performed by the Adviser that outside professionals or outside consultants would otherwise perform, the Company’s pro rata share of rent, telephone, utilities, office furniture, equipment, machinery and other office, internal and overhead expenses of the Adviser required for the Company’s operations, and compensation expenses under the 2016 LTIP. Operating Expenses do not include expenses for the advisory and administrative services described in the Advisory Agreement. Certain Operating Expenses, such as the Company’s ratable share of rent, telephone, utilities, office furniture, equipment, machinery and other office, internal and overhead expenses incurred by the Adviser or its affiliates that relate to the operations of the Company, may be billed monthly to the Company under a shared services agreement. “Offering Expenses” include all expenses (other than underwriters’ discounts) in connection with an offering, including, without limitation, legal, accounting, printing, mailing and filing fees and other documented offering expenses. For the three months ended March 31, 2022 and 2021, the Adviser did not bill any Operating Expenses or Offering Expenses to the Company and any such expenses the Adviser incurred during the periods are considered to be permanently waived.

Expense Cap

Pursuant to the terms of the Advisory Agreement, expenses paid or incurred by the Company for operating expenses and advisory and administrative fees payable to the Adviser and Operating Expenses will not exceed 1.5% of Average Real Estate Assets per calendar year (or part thereof that the Advisory Agreement is in effect (the “Expense Cap”)). The Expense Cap does not limit the reimbursement of expenses related to Offering Expenses. The Expense Cap also does not apply to legal, accounting, financial, due diligence and other service fees incurred in connection with mergers and acquisitions, extraordinary litigation or other events outside the Company’s ordinary course of business or any out-of-pocket acquisitions or due diligence expenses incurred in connection with the acquisition or disposition of real estate assets. Also, advisory and administrative fees are further limited on Contributed Assets to approximately $5.4 million in any calendar year. Contributed Assets refers to all Real Estate Assets contributed to the Company as part of its spin-off. The Contributed Assets Cap is not reduced for dispositions of such assets subsequent to its spin-off. Advisory and administrative fees on New Assets are not subject to the above limitation and are based on an annual rate of 1.2% on Average Real Estate Assets, but are subject to the Expense Cap. New Assets are all Real Estate Assets that are not Contributed Assets.

For the three months ended March 31, 2022 and 2021, the Company incurred advisory and administrative fees of $1.8 million and $1.9 million, respectively.  

For the three months ended March 31, 2022 and 2021, the Adviser elected to voluntarily waive the advisory and administrative fees of approximately $4.9 million and $4.0 million, respectively. The advisory and administrative fees waived by the Adviser are considered to be permanently waived for the periods.  The Adviser is not contractually obligated to waive fees on New Assets in the future and may cease waiving fees on New Assets at its discretion.

Other Related Party Transactions

The Company has in the past, and may in the future, utilize the services of affiliated parties. For the three months ended March 31, 2022 and 2021, the Company did not pay any fees to NexBank Title, Inc. (“NexBank Title”). NexBank Title is an affiliate of the Adviser through common beneficial ownership. NexBank Title provides title insurance and work related to providing title insurance on properties related to acquisitions, dispositions and refinancing transactions. These amounts are either capitalized as real estate assets or deferred financing costs, expensed as loss on extinguishment of debt and modification costs, or expensed as selling costs when determining gain (loss) on sales of real estate, depending on the appropriate accounting as determined for each specific transaction. The Company holds multiple operating accounts at NexBank Capital, Inc. (“NexBank”), an affiliate of the Adviser through common beneficial ownership.

On July 30, 2021, three of our property-owning subsidiaries entered into agreements with NLMF Holdco, LLC, an entity under common control with our Adviser and in which we own a 10% equity interest. As of March 31, 2022, the Company has funded approximately $0.3 million to NLMF Holdco, LLC which is included in prepaid and other assets on the consolidated balance sheet of the Company. For the three months ended March 31, 2022, the Company incurred expenses of $0.1 million for fiber internet service which is included in property operating expenses on the consolidated statement of operations and comprehensive loss.  Additionally, on July 30, 2021, we entered into agreements with NLMF Leaseco, LLC, which is controlled by Matt McGraner, one of our officers. We expect that these actions will provide faster, more reliable and lower cost internet to our residents.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2022

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

12. Commitments and Contingencies

Commitments

In the normal course of business, the Company enters into various rehabilitation construction related purchase commitments with parties that provide these goods and services. In the event the Company were to terminate rehabilitation construction services prior to the completion of projects, the Company could potentially be committed to satisfy outstanding or uncompleted purchase orders with such parties. As of March 31, 2022, management does not anticipate any material deviations from schedule or budget related to rehabilitation projects currently in process.

The Company’s agreement with NLMF Holdco, LLC may result in additional funding requirements to cover future project costs. The maximum exposure of potential commitments is expected to be no more than $4.0 million. As of March 31, 2022, the Company has funded approximately $0.3 million to NLMF Holdco, LLC which is included in prepaid and other assets on the consolidated balance sheet of the Company.

Contingencies

In the normal course of business, the Company is subject to claims, lawsuits, and legal proceedings. While it is not possible to ascertain the ultimate outcome of all such matters, management believes that the aggregate amount of such liabilities, if any, in excess of amounts provided or covered by insurance, will not have a material adverse effect on the consolidated balance sheets or consolidated statements of operations and comprehensive income of the Company. The Company is not involved in any material litigation nor, to management’s knowledge, is any material litigation currently threatened against the Company or its properties or subsidiaries.

Environmental liabilities could have a material adverse effect on the Company’s business, assets, cash flows or results of operations. As of March 31, 2022, the Company was not aware of any environmental liabilities. There can be no assurance that material environmental liabilities do not exist.

Self-Insurance Program

On March 1, 2021, the Adviser entered into a self-insurance policy resulting in an aggregate amount of $2,468,750 (the “2021 Aggregate Amount”) which is allocated across properties managed by the Adviser with approximately $1.6 million being allocated to the Company. As of December 31, 2021, all of the $1.6 million of the 2021 Aggregate Amount allocated to the Company has been prepaid. Under ASC 450-20 “Loss Contingencies”, the Company does not reserve for the 2021 Aggregate Amount or any portion thereof until a claim is made and the amount of the claim and the timing of payment on the claim can be reasonably estimated.  For the period from March 1, 2021 to February 28, 2022, the Company incurred claims related to its entire allocated 2021 Aggregate Amount at Old Farm and Silverbrook.

On March 1, 2022, the Adviser entered into a new policy resulting in a new aggregate amount of $2,497,500 (the “2022 Aggregate Amount”) which is allocated across properties managed by the Adviser with approximately $1.8 million being allocated to the Company. Under ASC 450-20 “Loss Contingencies”, the Company does not reserve for the 2021 Aggregate Amount or any portion thereof until a claim is made and the amount of the claim and the timing of payment on the claim can be reasonably estimated.  For the period from March 1, 2022 to March 31, 2022, the Company incurred $0.6 million in claims related to a fire at Six Forks Station under the 2022 Aggregate Amount.

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Subsequent Events

3 Months Ended

Mar. 31, 2022

Subsequent Events [Abstract]

Subsequent Events

13. Subsequent Events

Dividends Declared

On April 25, 2022, the Company’s Board declared a quarterly dividend of $0.38 per share, payable on June 30, 2022 to stockholders of record on June 15, 2022.

Acquisitions

On April 1, 2022, the Company acquired The Adair and Estates on Maryland, from investors in a Delaware Statutory Trust managed by an entity affiliated with the Adviser, for total consideration of $143.4 million (the “Purchase Price”), as detailed in the table below (dollars in thousands). The Purchase Price consisted of 26,558 OP Units (valued at $2.6 million) that were issued on April 1, 2022 and approximately $71.1 million in cash. The number of OP Units issued was calculated by dividing $2.6 million by the midpoint of the range of the Company’s net asset value as publicly disclosed in connection with the Company’s release of its fourth quarter of 2021 earnings results, which was $98.30 per share. The Company’s Audit Committee approved the acquisitions. These transactions were initially disclosed in our Form 10-K.

Property Name	Location	Purchase Price		Mortgage Debt		# Units		Effective Ownership
The Adair	Sandy Springs, GA	$	65,500	$	35,115		232		100	%
Estates on Maryland	Phoenix, AZ		77,900		43,157		330		100	%
		$	143,400	$	78,272		562

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Basis of Accounting

Basis of Accounting

The accompanying unaudited consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States (“GAAP”). GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the dates of the unaudited consolidated financial statements and the amounts of revenues and expenses during the reporting periods. Actual amounts realized or paid could differ from those estimates. All significant intercompany accounts and transactions have been eliminated in consolidation. There have been no significant changes to the Company’s significant accounting policies during the three months ended March 31, 2022.

The accompanying unaudited consolidated financial statements have been prepared according to the rules and regulations of the SEC.  Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted according to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not misleading.

In the opinion of management, all adjustments and eliminations necessary for the fair presentation of the Company’s financial position as of March 31, 2022 and results of operations for the three months ended March 31, 2022 and 2021 have been included.  Such adjustments are normal and recurring in nature.  The unaudited information included in this quarterly report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2021 and notes thereto included in its Annual Report on Form 10-K filed with the SEC on February 18, 2022.

Principles of Consolidation

Principles of Consolidation

The Company accounts for subsidiary partnerships, joint ventures and other similar entities in which it holds an ownership interest in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 810, Consolidation. The Company first evaluates whether each entity is a variable interest entity (“VIE”). Under the VIE model, the Company consolidates an entity when it has control to direct the activities of the VIE and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE. Under the voting model, the Company consolidates an entity when it controls the entity through ownership of a majority voting interest. The unaudited consolidated financial statements include the accounts of the Company and its subsidiaries, including the OP and its subsidiaries.

Revenue Recognition

Revenue Recognition

The Company’s primary operations consist of rental income earned from its residents under lease agreements typically with terms of one year or less. Rental income is recognized when earned. This policy effectively results in income recognition on the straight-line method over the related terms of the leases. The Company records an allowance to reflect revenue that may not be collectable. This is recorded through a provision for bad debts which is included in rental income in the accompanying consolidated statements of operations and comprehensive income. Resident reimbursements and other income consist of charges billed to residents for utilities, carport and garage rental, and pets, and administrative, application and other fees and are recognized when earned. 

Purchase Price Allocation

Purchase Price Allocation

Upon acquisition of a property considered to be an asset acquisition, the purchase price and related acquisition costs (“total consideration”) are allocated to land, buildings, improvements, furniture, fixtures, and equipment, and intangible lease assets in accordance with FASB ASC 805, Business Combinations. Acquisition costs are capitalized in accordance with FASB ASC 805.

The allocation of total consideration, which is determined using inputs that are classified within Level 3 of the fair value hierarchy established by FASB ASC 820, Fair Value Measurement and Disclosures (“ASC 820”) (see Note 7), is based on management’s estimate of the property’s “as-if” vacant fair value and is calculated by using all available information such as the replacement cost of such asset, appraisals, property condition reports, market data and other related information. The allocation of the total consideration to intangible lease assets represents the value associated with the in-place leases, which may include lost rent, leasing commissions, legal and other related costs, which the Company, as buyer of the property, did not have to incur to obtain the residents. If any debt is assumed in an acquisition, the difference between the fair value, which is estimated using inputs that are classified within Level 2 of the fair value hierarchy, and the face value of debt is recorded as a premium or discount and amortized as interest expense over the life of the debt assumed.

Real estate assets, including land, buildings, improvements, furniture, fixtures and equipment, and intangible lease assets are stated at historical cost less accumulated depreciation and amortization. Costs incurred in making repairs and maintaining real estate assets are expensed as incurred. Expenditures for improvements, renovations, and replacements are capitalized at cost. Real estate-related depreciation and amortization are computed on a straight-line basis over the estimated useful lives as described in the following table:

Land	Not depreciated
Buildings	30 years
Improvements	15 years
Furniture, fixtures, and equipment	3 years
Intangible lease assets	6 months

Construction in progress includes the cost of renovation projects being performed at the various properties. Once a project is complete, the historical cost of the renovation is placed into service in one of the categories above depending on the type of renovation project and is depreciated over the estimated useful lives as described in the table above.

Impairment

Impairment

Real estate assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The key inputs into our impairment analysis include, but are not limited to, the holding period, net operating income, and capitalization rates. In such cases, the Company will evaluate the recoverability of such real estate assets based on estimated future cash flows and the estimated liquidation value of such real estate assets, and provide for impairment if such undiscounted cash flows are insufficient to recover the carrying amount of the real estate asset. If impaired, the real estate asset will be written down to its estimated fair value. The Company’s impairment analysis identifies and evaluates events or changes in circumstances that indicate the carrying amount of a real estate investment may not be recoverable, including determining the period the Company will hold the rental property, net operating income, and the estimated capitalization rate for each respective real estate investment.

As of March 31, 2022, the Company has not recorded any impairment on its real estate assets.  However, we continue to monitor the impact of COVID-19 (see “–Coronavirus (“COVID-19”)” for additional information, below).

Held-for-Sale

Held for Sale

The Company periodically classifies real estate assets as held for sale when certain criteria are met, in accordance with GAAP. At that time, the Company presents the net real estate assets and the net debt associated with the real estate held for sale separately in its consolidated balance sheet, and the Company ceases recording depreciation and amortization expense related to that property. Real estate held for sale is reported at the lower of its carrying amount or its estimated fair value less estimated costs to sell. As of March 31, 2022, there are no properties held for sale.      

Income Taxes

Income Taxes

The Company has elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), and expects to continue to qualify as a REIT. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement to distribute annually at least 90% of its “REIT taxable income,” as defined by the Code, to its stockholders. As a REIT, the Company will be subject to federal income tax on its undistributed REIT taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions it pays with respect to any calendar year are less than the sum of (1) 85% of its ordinary income, (2) 95% of its capital gain net income and (3) 100% of its undistributed income from prior years. The Company intends to operate in such a manner so as to qualify as a REIT, but no assurance can be given that the Company will operate in a manner so as to qualify as a REIT. Taxable income from certain non-REIT activities is managed through a TRS and is subject to applicable federal, state, and local income and margin taxes. The Company had no significant taxes associated with its TRS for the three months ended March 31, 2022 and 2021.

If the Company fails to meet these requirements, it could be subject to federal income tax on all of the Company’s taxable income at regular corporate rates for that year. The Company would not be able to deduct distributions paid to stockholders in any year in which it fails to qualify as a REIT. Additionally, the Company will also be disqualified from electing to be taxed as a REIT for the four taxable years following the year during which qualification was lost unless the Company is entitled to relief under specific statutory provisions. As of March 31, 2022, the Company believes it is in compliance with all applicable REIT requirements.

The Company evaluates the accounting and disclosure of tax positions taken or expected to be taken in the course of preparing the Company’s tax returns to determine whether the tax positions are “more-likely-than-not” (greater than 50 percent probability) of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. The Company’s management is required to analyze all open tax years, as defined by the statute of limitations, for all major jurisdictions, which include federal and certain states. The Company has no examinations in progress and none are expected at this time.

The Company recognizes its tax positions and evaluates them using a two-step process. First, the Company determines whether a tax position is more likely than not to be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. Second, the Company will determine the amount of benefit to recognize and record the amount that is more likely than not to be realized upon ultimate settlement.

The Company had no material unrecognized tax benefit or expense, accrued interest or penalties as of March 31, 2022. The Company and its subsidiaries are subject to federal income tax as well as income tax of various state and local jurisdictions. The 2021, 2020 and 2019 tax years remain open to examination by tax jurisdictions to which the Company and its subsidiaries are subject. When applicable, the Company recognizes interest and/or penalties related to uncertain tax positions on its consolidated statements of operations and comprehensive income.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) (“ASU 2020-04”). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During the first quarter of 2022, the Company transitioned a portion its debt to one-month term SOFR (“Term SOFR”). The Company has taken the ASC 848 elections needed to allow for the hedged forecasted transactions to transition while not discontinuing the associated hedge accounting designations. Application of these hedged accounting expedients preserves the presentation of derivatives consistent with past presentation.  The Company will continue to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

Coronavirus (?COVID-19?)

Coronavirus (“COVID-19”)

As a result of the COVID-19 pandemic, the Company may experience difficulties collecting monthly rent on time, leasing additional apartment units and/or renewing leases with existing tenants, selling or purchasing properties and accessing debt and equity capital on attractive terms, or at all. To date, the Company has not been materially impacted by the COVID-19 pandemic and will continue to monitor the impact of the COVID-19 pandemic on all aspects of its business. For additional information regarding the risks to the Company related to the COVID-19 pandemic, or any other future pandemic. See “Item 1A. Risk factors” within “Part I” of our annual report on Form 10-K, filed with the U.S. Securities and Exchange Commission on February 18, 2022, for additional discussion of the risks posed by the COVID-19 pandemic.

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Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Estimated Useful Lives of Assets

Expenditures for improvements, renovations, and replacements are capitalized at cost. Real estate-related depreciation and amortization are computed on a straight-line basis over the estimated useful lives as described in the following table:

Land	Not depreciated
Buildings	30 years
Improvements	15 years
Furniture, fixtures, and equipment	3 years
Intangible lease assets	6 months

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Investments in Subsidiaries (Tables)

3 Months Ended

Mar. 31, 2022

Schedule Of Investments [Abstract]

Schedule of Ownership in Each Property

As of March 31, 2022, the Company, through the OP and the wholly owned TRS, owned 39 properties through SPEs. The following table represents the Company’s ownership in each property by virtue of its 100% ownership of the SPEs that directly own the title to each property as of March 31, 2022 and December 31, 2021:

				Effective Ownership Percentage at
Property Name		Location	Year Acquired	March 31, 2022			December 31, 2021
Arbors on Forest Ridge		Bedford, Texas	2014		100	%		100	%
Cutter's Point		Richardson, Texas	2014		100	%		100	%
Silverbrook		Grand Prairie, Texas	2014		100	%		100	%
The Summit at Sabal Park		Tampa, Florida	2014		100	%		100	%
Courtney Cove		Tampa, Florida	2014		100	%		100	%
Radbourne Lake		Charlotte, North Carolina	2014		100	%		100	%
Timber Creek		Charlotte, North Carolina	2014		100	%		100	%
Sabal Palm at Lake Buena Vista		Orlando, Florida	2014		100	%		100	%
Cornerstone		Orlando, Florida	2015		100	%		100	%
The Preserve at Terrell Mill		Marietta, Georgia	2015		100	%		100	%
Versailles		Dallas, Texas	2015		100	%		100	%
Seasons 704 Apartments		West Palm Beach, Florida	2015		100	%		100	%
Madera Point		Mesa, Arizona	2015		100	%		100	%
Venue at 8651		Fort Worth, Texas	2015		100	%		100	%
Parc500		West Palm Beach, Florida	2016		100	%		100	%
The Venue on Camelback		Phoenix, Arizona	2016		100	%		100	%
Old Farm		Houston, Texas	2016		100	%		100	%
Stone Creek at Old Farm		Houston, Texas	2016		100	%		100	%
Hollister Place		Houston, Texas	2017		100	%		100	%
Rockledge Apartments		Marietta, Georgia	2017		100	%		100	%
Atera Apartments		Dallas, Texas	2017		100	%		100	%
Crestmont Reserve		Dallas, Texas	2018		100	%		100	%
Brandywine I & II		Nashville, Tennessee	2018		100	%		100	%
Bella Vista		Phoenix, Arizona	2019		100	%		100	%
The Enclave		Tempe, Arizona	2019		100	%		100	%
The Heritage		Phoenix, Arizona	2019		100	%		100	%
Summers Landing		Fort Worth, Texas	2019		100	%		100	%
Residences at Glenview Reserve		Nashville, Tennessee	2019		100	%		100	%
Residences at West Place		Orlando, Florida	2019		100	%		100	%
Avant at Pembroke Pines		Pembroke Pines, Florida	2019		100	%		100	%
Arbors of Brentwood		Nashville, Tennessee	2019		100	%		100	%
Torreyana Apartments		Las Vegas, Nevada	2019		100	%		100	%
Bloom		Las Vegas, Nevada	2019		100	%		100	%
Bella Solara		Las Vegas, Nevada	2019		100	%		100	%
Fairways at San Marcos		Chandler, AZ	2020		100	%		100	%
The Verandas at Lake Norman	(1)	Charlotte, North Carolina	2021		100	%		100	%
Creekside at Matthews	(1)	Charlotte, North Carolina	2021		100	%		100	%
Six Forks Station		Raleigh, North Carolina	2021		100	%		100	%
High House at Cary	(2)	Cary, North Carolina	2021		100	%		100	%

(1) The EAT that directly owned The Verandas at Lake Norman and Creekside at Matthews was consolidated as a VIE at June 30, 2021 giving the Company an effective 100% ownership interest.  The master lease agreement with the EAT that directly owned these properties terminated on December 28, 2021, at which time legal title and control transferred to the Company. Upon the transfer of title, the EAT that directly owned these properties was no longer considered a VIE.

(2) Formerly known as Hudson High House.

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Real Estate Investments Statistics (Tables)

3 Months Ended

Mar. 31, 2022

Multifamily Properties

Business Acquisition [Line Items]

Summary of Investment in Multifamily Properties

As of March 31, 2022, the Company was invested in a total of 39 multifamily properties, as listed below:

						Average Effective Monthly Rent Per Unit (1) as of				% Occupied (2) as of
Property Name	Rentable Square Footage (in thousands)		Number of Units (3)		Date Acquired	March 31, 2022		December 31, 2021		March 31, 2022			December 31, 2021
Arbors on Forest Ridge		155		210	1/31/2014	$	1,040	$	1,021		94.8	%		96.2	%
Cutter's Point		198		196	1/31/2014		1,261		1,219		95.4	%		95.4	%
Silverbrook		526		642	1/31/2014		1,068		1,043		94.2	%		94.1	%
The Summit at Sabal Park		205		252	8/20/2014		1,253		1,198		94.4	%		96.0	%
Courtney Cove		225		324	8/20/2014		1,187		1,132		93.5	%		93.8	%
Radbourne Lake		247		225	9/30/2014		1,293		1,227		93.3	%		94.2	%
Timber Creek		248		352	9/30/2014		1,058		1,032		96.4	%		96.1	%
Sabal Palm at Lake Buena Vista		371		400	11/5/2014		1,453		1,377		95.8	%		97.8	%
Cornerstone		318		430	1/15/2015		1,183		1,152		95.6	%		95.6	%
The Preserve at Terrell Mill		692		752	2/6/2015		1,182		1,156		94.4	%		90.9	%
Versailles		301		388	2/26/2015		1,166		1,024		88.1	%		96.4	%
Seasons 704 Apartments		217		222	4/15/2015		1,502		1,410		94.1	%		96.8	%
Madera Point		193		256	8/5/2015		1,190		1,140		96.1	%		94.5	%
Venue at 8651		289		333	10/30/2015		1,033		1,006		95.4	%		94.5	%
Parc500		266		217	7/27/2016		1,609		1,543		94.5	%		96.3	%
The Venue on Camelback		256		415	10/11/2016		960		915		94.9	%		92.3	%
Old Farm		697		734	12/29/2016		1,218		1,207		94.7	%		93.9	%
Stone Creek at Old Farm		186		190	12/29/2016		1,268		1,248		96.3	%		96.8	%
Hollister Place		246		260	2/1/2017		1,105		1,065		89.2	%		92.5	%
Rockledge Apartments		802		708	6/30/2017		1,446		1,408		94.9	%		93.9	%
Atera Apartments		334		380	10/25/2017		1,352		1,310		95.0	%		93.9	%
Crestmont Reserve		199		242	9/26/2018		1,052		985		93.0	%		95.5	%
Brandywine I & II		414		632	9/26/2018		1,080		1,031		95.1	%		95.6	%
Bella Vista		243		248	1/28/2019		1,543		1,515		96.8	%		96.0	%
The Enclave		194		204	1/28/2019		1,603		1,507		95.1	%		96.6	%
The Heritage		199		204	1/28/2019		1,514		1,432		91.7	%		95.6	%
Summers Landing		139		196	6/7/2019		1,090		1,033		96.4	%		93.9	%
Residences at Glenview Reserve		344		360	7/17/2019		1,125		1,074		94.7	%		95.6	%
Residences at West Place		345		342	7/17/2019		1,420		1,345		94.2	%		93.0	%
Avant at Pembroke Pines		1,442		1,520	8/30/2019		1,772		1,695		95.1	%		93.9	%
Arbors of Brentwood		325		346	9/10/2019		1,344		1,284		94.8	%		95.1	%
Torreyana Apartments		309		316	11/22/2019		1,419		1,365		94.6	%		93.7	%
Bloom		498		528	11/22/2019		1,263		1,238		91.1	%		89.2	%
Bella Solara		271		320	11/22/2019		1,343		1,309		91.9	%		91.3	%
Fairways at San Marcos		340		352	11/2/2020		1,476		1,425		96.3	%		96.3	%
The Verandas at Lake Norman		241		264	6/30/2021		1,258		1,215		93.2	%		93.2	%
Creekside at Matthews		263		240	6/30/2021		1,393		1,350		91.7	%		94.2	%
Six Forks Station		360		323	9/10/2021		1,246		1,228		91.2	%		95.4	%
High House at Cary		293		302	12/7/2021		1,372		1,361		93.4	%		94.7	%
		13,391		14,825

(1) Average effective monthly rent per unit is equal to the average of the contractual rent for commenced leases as of March 31, 2022 and December 31, 2021, respectively, minus any tenant concessions over the term of the lease, divided by the number of units under commenced leases as of March 31, 2022 and December 31, 2021, respectively.

(2) Percent occupied is calculated as the number of units occupied as of March 31, 2022 and December 31, 2021, divided by the total number of units, expressed as a percentage.

(3) Includes 49 down units due to casualty events as of March 31, 2022 (see Note 5).

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Real Estate Investments (Tables)

3 Months Ended

Mar. 31, 2022

Real Estate [Abstract]

Summary of Major Components of Investments in Multifamily Properties

As of March 31, 2022, the major components of the Company’s investments in multifamily properties were as follows (in thousands):

Operating Properties	Land		Buildings and Improvements			Intangible Lease Assets			Construction in Progress		Furniture, Fixtures and Equipment			Totals
Arbors on Forest Ridge	$	2,330	$	11,760		$	—		$	1	$	1,865		$	15,956
Cutter's Point		3,330		13,088			—			1		7,393			23,812
Silverbrook		4,860		25,691			—			196		5,690			36,437
The Summit at Sabal Park		5,770		13,885			—			—		2,048			21,703
Courtney Cove		5,880		14,345			—			17		2,548			22,790
Radbourne Lake		2,440		22,848			—			—		2,642			27,930
Timber Creek		11,260		13,334			—			380		3,931			28,905
Sabal Palm at Lake Buena Vista		7,580		42,461			—			10		2,874			52,925
Cornerstone		1,500		30,915			—			21		3,833			36,269
The Preserve at Terrell Mill		10,170		53,148			—			—		9,414			72,732
Versailles		6,720		21,953			—			2		4,155			32,830
Seasons 704 Apartments		7,480		14,725			—			—		2,262			24,467
Madera Point		4,920		18,155			—			—		2,698			25,773
Venue at 8651		2,350		17,548			—			322		3,914			24,134
Parc500		3,860		21,193			—			5		4,228			29,286
The Venue on Camelback		8,340		38,513			—			141		3,450			50,444
Old Farm		11,078		71,070			—			174		4,031			86,353
Stone Creek at Old Farm		3,493		19,718			—			2		936			24,149
Hollister Place		2,782		21,202			—			1,468		2,793			28,245
Rockledge Apartments		17,451		97,417			—			—		6,405			121,273
Atera Apartments		22,371		38,691			—			7		2,545			63,614
Crestmont Reserve		4,124		21,068			—			—		1,558			26,750
Brandywine I & II		6,237		73,769			—			—		5,385			85,391
Bella Vista		10,942		37,310			—			6		2,865			51,123
The Enclave		11,046		30,515			—			—		2,500			44,061
The Heritage		6,835		35,131			—			26		2,562			44,554
Summers Landing		1,798		18,447			—			1		821			21,067
Residences at Glenview Reserve		3,367		42,339			—			—		2,602			48,308
Residences at West Place		3,345		52,369			—			—		1,855			57,569
Avant at Pembroke Pines		48,434		276,632			—			1,056		12,425			338,547
Arbors of Brentwood		6,346		56,063			—			—		2,414			64,823
Torreyana Apartments		23,824		43,771			—			3		1,533			69,131
Bloom		23,805		82,595			—			19		3,007			109,426
Bella Solara		12,605		53,440			—			22		2,068			68,135
Fairways at San Marcos		10,993		72,922			—			297		2,005			86,217
The Verandas at Lake Norman		9,510		52,800			—			115		857			63,282
Creekside at Matthews		11,515		45,337			—			—		1,046			57,898
Six Forks Station		11,357		61,517			—			218		1,045			74,137
High House at Cary		23,809		67,656			1,376			19		827			93,687
		375,857		1,745,341			1,376			4,529		127,030			2,254,133
Accumulated depreciation and amortization		—		(218,292	)		(917	)		—		(89,793	)		(309,002	)
Total Operating Properties	$	375,857	$	1,527,049		$	459		$	4,529	$	37,237		$	1,945,131

As of December 31, 2021, the major components of the Company’s investments in multifamily properties were as follows (in thousands):

Operating Properties	Land		Buildings and Improvements			Intangible Lease Assets			Construction in Progress		Furniture, Fixtures and Equipment			Totals
Arbors on Forest Ridge	$	2,330	$	11,755		$	—		$	—	$	1,821		$	15,906
Cutter's Point		3,330		13,091			—			—		7,379			23,800
Silverbrook		4,860		27,495			—			—		5,566			37,921
The Summit at Sabal Park		5,770		13,882			—			—		1,978			21,630
Courtney Cove		5,880		14,350			—			—		2,444			22,674
Radbourne Lake		2,440		22,744			—			64		2,455			27,703
Timber Creek		11,260		13,310			—			239		3,827			28,636
Sabal Palm at Lake Buena Vista		7,580		42,456			—			2		2,758			52,796
Cornerstone		1,500		30,901			—			21		3,722			36,144
The Preserve at Terrell Mill		10,170		53,080			—			—		8,997			72,247
Versailles		6,720		21,887			—			—		4,075			32,682
Seasons 704 Apartments		7,480		14,644			—			—		2,078			24,202
Madera Point		4,920		18,090			—			48		2,612			25,670
Venue at 8651		2,350		17,495			—			334		3,843			24,022
Parc500		3,860		21,172			—			—		4,147			29,179
The Venue on Camelback		8,340		38,328			—			306		3,248			50,222
Old Farm		11,078		70,993			—			99		3,902			86,072
Stone Creek at Old Farm		3,493		19,714			—			2		899			24,108
Hollister Place		2,782		21,196			—			1,308		2,739			28,025
Rockledge Apartments		17,451		97,374			—			—		5,968			120,793
Atera Apartments		22,371		36,857			—			1,824		2,384			63,436
Crestmont Reserve		4,124		21,067			—			—		1,515			26,706
Brandywine I & II		6,237		73,737			—			—		5,160			85,134
Bella Vista		10,942		37,193			—			51		2,687			50,873
The Enclave		11,046		30,469			—			11		2,403			43,929
The Heritage		6,835		35,011			—			68		2,386			44,300
Summers Landing		1,798		18,433			—			1		790			21,022
Residences at Glenview Reserve		3,367		42,306			—			—		2,366			48,039
Residences at West Place		3,345		52,310			—			—		1,591			57,246
Avant at Pembroke Pines		48,434		275,968			—			1,414		11,611			337,427
Arbors of Brentwood		6,346		56,040			—			—		2,235			64,621
Torreyana Apartments		23,824		43,700			—			25		1,371			68,920
Bloom		23,805		82,545			—			16		2,697			109,063
Bella Solara		12,605		53,415			—			24		1,854			67,898
Fairways at San Marcos		10,993		72,920			—			2		1,989			85,904
The Verandas at Lake Norman		9,510		52,884			—			6		650			63,050
Creekside at Matthews		11,515		45,271			—			18		756			57,560
Six Forks Station		11,357		62,129			1,200			195		748			75,629
High House at Cary		23,809		67,654			1,376			—		768			93,607
		375,857		1,743,866			2,576			6,078		120,419			2,248,796
Accumulated depreciation and amortization		—		(203,125	)		(1,029	)		—		(82,942	)		(287,096	)
Total Operating Properties	$	375,857	$	1,540,741		$	1,547		$	6,078	$	37,477		$	1,961,700

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Debt (Tables)

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Summary of Mortgage Debt of Company and Encumbers Multifamily Properties

The following table contains summary information concerning the mortgage debt of the Company as of March 31, 2022 (dollars in thousands):

Operating Properties		Type	Term (months)		Outstanding Principal (1)				Interest Rate (2)	Maturity Date
Arbors on Forest Ridge	(3)	Floating		84	$	13,130			2.13%	7/1/2024
Cutter's Point	(3)	Floating		84		16,640			2.13%	7/1/2024
Silverbrook	(3)	Floating		84		30,590			2.13%	7/1/2024
The Summit at Sabal Park	(3)	Floating		84		13,560			2.07%	7/1/2024
Courtney Cove	(3)	Floating		84		13,680			2.07%	7/1/2024
The Preserve at Terrell Mill	(3)	Floating		84		42,480			2.07%	7/1/2024
Versailles	(3)	Floating		84		23,880			2.07%	7/1/2024
Seasons 704 Apartments	(3)	Floating		84		17,460			2.07%	7/1/2024
Madera Point	(3)	Floating		84		15,150			2.07%	7/1/2024
Venue at 8651	(3)	Floating		84		13,734			2.23%	7/1/2024
The Venue on Camelback	(3)	Floating		84		28,093			2.13%	7/1/2024
Old Farm	(3)	Floating		84		52,886			2.13%	7/1/2024
Stone Creek at Old Farm	(3)	Floating		84		15,274			2.13%	7/1/2024
Timber Creek	(3)	Floating		84		24,100			1.71%	10/1/2025
Radbourne Lake	(3)	Floating		84		20,000			1.74%	10/1/2025
Sabal Palm at Lake Buena Vista	(3)	Floating		84		42,100			1.75%	9/1/2025
Cornerstone	(4)	Fixed		120		20,672			4.24%	3/1/2023
Parc500	(5)	Fixed		120		14,590			4.49%	8/1/2025
Hollister Place	(3)	Floating		84		14,811			1.79%	10/1/2025
Rockledge Apartments	(3)	Floating		84		68,100			2.02%	7/1/2024
Atera Apartments	(3)	Floating		84		29,500			1.93%	11/1/2024
Crestmont Reserve	(3)	Floating		84		12,061			1.63%	10/1/2025
Brandywine I & II	(3)	Floating		84		43,835			1.63%	10/1/2025
Bella Vista	(6)	Floating		84		29,040			1.77%	2/1/2026
The Enclave	(6)	Floating		84		25,322			1.77%	2/1/2026
The Heritage	(6)	Floating		84		24,625			1.77%	2/1/2026
Summers Landing	(7)	Floating		84		10,109			1.63%	10/1/2025
Residences at Glenview Reserve	(8)	Floating		84		26,270			1.89%	10/1/2025
Residences at West Place	(8)	Fixed		120		33,817			4.24%	10/1/2028
Avant at Pembroke Pines	(3)	Floating		84		177,100			1.88%	9/1/2026
Arbors of Brentwood	(3)	Floating		84		34,237			1.88%	10/1/2026
Torreyana Apartments	(6)	Floating		84		37,400			2.15%	12/1/2026
Bloom	(6)	Floating		84		58,850			2.15%	12/1/2026
Bella Solara	(6)	Floating		84		36,575			2.15%	12/1/2026
Fairways at San Marcos	(6)	Floating		84		46,464			2.29%	12/1/2027
The Verandas at Lake Norman	(9)	Floating		84		34,925			2.01%	7/1/2028
Creekside at Matthews	(9)	Floating		84		31,900			2.01%	7/1/2028
Six Forks Station	(10)	Floating		120		41,180			1.87%	10/1/2031
High House at Cary	(9)	Floating		84		46,625			2.17%	1/1/2029
					$	1,280,765
Fair market value adjustment						1,009		(11)
Deferred financing costs, net of accumulated amortization of $5,433						(5,534	)
					$	1,276,240

(1) Mortgage debt that is non-recourse to the Company and encumbers the multifamily properties.

(2) Interest rate is based on a reference rate plus an applicable margin, except for fixed rate mortgage debt. References rates used in our portfolio include one-month LIBOR and 30-Day Average Secured Overnight Financing Rate (“SOFR”). As of March 31, 2022, one-month LIBOR was 0.452% and SOFR was 0.15934%.

(3) Loan can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%. Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(4) Debt in the amount of $18.0 million was assumed upon acquisition of this property and recorded at approximated fair value. The assumed debt carries a 4.09% fixed rate, was originally issued in March 2013, and had a term of 120 months with an initial 24 months of interest only. At the time of acquisition, the principal balance of the first mortgage remained unchanged and had a remaining term of 98 months with 2 months of interest only. The first mortgage is pre-payable and subject to yield maintenance from the 13^th month through August 31, 2022 and is pre-payable at par starting on September 1, 2022 until maturity. Concurrently with the acquisition of the property, the Company placed a supplemental second mortgage on the property with a principal amount of approximately $5.8 million, a fixed rate of 4.70%, and with a maturity date that is the same time as the first mortgage. The supplemental second mortgage is pre-payable and subject to yield maintenance from the date of issuance through August 31, 2022 and is pre-payable at par starting on September 1, 2022 until maturity. As of March 31, 2022, the total indebtedness secured by the property had a blended interest rate of 4.24%.

(5) Debt was assumed upon acquisition of this property and recorded at approximated fair value. The loan is open to pre-payment in the last four months of the term.

(6) Loan can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%.  Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(7) Debt was assumed upon acquisition of this property and recorded at approximated fair value.  It can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%. Starting in the 13^th month of the term through the 81^st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.

(8) Debt was assumed upon acquisition of this property and recorded at approximated fair value. The loan can be prepaid at the greater of par plus 1.00% of the unpaid principal balance or the product obtained by multiplying the present value of the principal being prepaid by the excess of the monthly fixed interest rate of the loan over a daily discount rate. The loan is open to pre-payment in the last three months of the term.  

(9) Loan can be pre-paid in the first 24 months of the term in certain circumstances at par plus 5.00%.  Starting in the 25th month of the term through the 36th month of the term, the loan can be pre-paid at par plus 2% of the unpaid principal balance. Starting in the 37th month of the term, the loan can be pre-paid at par plus 1% of the unpaid principal balance. The loan is open to pre-payment in the last three months of the term.

(10) Loan can be pre-paid in the first 24 months of the term in certain circumstances at par plus 5.00%. Starting in the 25th month of the term through the 116th of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last four months of the term.

(11) The Company reflected a valuation adjustment on its fixed rate debt for Parc500 and Residences at West Place to adjust it to fair market value on their respective dates of acquisition for the difference between the fair value and the assumed principal amount of debt. The difference is amortized into interest expense over the remaining terms of the mortgages.

Schedule of Credit Facility

The following table contains summary information concerning the Company’s credit facility as of March 31, 2022 (dollars in thousands):

	Type	Term (months)		Outstanding Principal			Interest Rate (1)	Maturity Date
Corporate Credit Facility	Floating		36	$	335,000		2.80%	6/30/2024
Deferred financing costs, net of accumulated amortization of $461					(2,021	)
				$	332,979

(1) Interest rate is based on Term SOFR plus an applicable margin.  Term SOFR as of March 31, 2022 was 0.3024%.

Schedule of Debt Maturities

Schedule of Debt Maturities

The aggregate scheduled maturities, including amortizing principal payments, of total debt for the next five calendar years subsequent to March 31, 2022 are as follows (in thousands):

	Operating Properties		Credit Facility		Total
2022	$	1,040	$	—	$	1,040
2023		21,047		—		21,047
2024		394,956		335,000		729,956
2025		205,662		—		205,662
2026		423,149		—		423,149
Thereafter		234,911		—		234,911
Total	$	1,280,765	$	335,000	$	1,615,765

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Fair Value of Derivative and Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Summary of Company's Outstanding Interest Rate Swaps

As of March 31, 2022, the Company had the following outstanding interest rate swaps that were designated as cash flow hedges of interest rate risk (dollars in thousands):

Effective Date	Termination Date	Counterparty	Notional Amount		Fixed Rate (1)
April 1, 2017	April 1, 2022	KeyBank	$	100,000		1.9570	%
May 1, 2017	April 1, 2022	KeyBank		50,000		1.9610	%
July 1, 2017	July 1, 2022	KeyBank		100,000		1.7820	%
June 1, 2019	June 1, 2024	KeyBank		50,000		2.0020	%
June 1, 2019	June 1, 2024	Truist		50,000		2.0020	%
September 1, 2019	September 1, 2026	KeyBank		100,000		1.4620	%
September 1, 2019	September 1, 2026	KeyBank		125,000		1.3020	%
January 3, 2020	September 1, 2026	KeyBank		92,500		1.6090	%
March 4, 2020	June 1, 2026	Truist		100,000		0.8200	%
June 1, 2021	September 1, 2026	KeyBank		200,000		0.8450	%
June 1, 2021	September 1, 2026	KeyBank		200,000		0.9530	%
March 1, 2022	March 1, 2025	Truist		145,000		0.5730	%
March 1, 2022	March 1, 2025	Truist		105,000		0.6140	%
			$	1,417,500		1.2128	%	(2)

(1) The floating rate option for the interest rate swaps is one-month LIBOR. As of March 31, 2022, one-month LIBOR was 0.452%.

(2) Represents the weighted average fixed rate of the interest rate swaps.

As of March 31, 2022, the Company had the following outstanding interest rate swaps that were designated as cash flow hedges of interest rate risk with future effective dates (dollars in thousands):

Effective Date	Termination Date	Counterparty	Notional Amount		Fixed Rate (1)
September 1, 2026	January 1, 2027	KeyBank	$	92,500		1.7980	%

(1) The floating rate option for the interest rate swaps is one-month LIBOR. As of March 31, 2022, one-month LIBOR was 0.452%.

(2) Represents the weighted average fixed rate of the interest rate swaps.

Schedule of Outstanding Interest Rate Derivatives

As of March 31, 2022 and 2021, the Company had the following outstanding derivatives that were not designated as hedges in qualifying hedging relationships (dollars in thousands):

As of March 31,	Number of Instruments		Notional Amount
2022		15	$	458,846
2021		15	$	379,406

Summary of Derivative Financial Instruments and Classification on the Consolidated Balance Sheet

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification on the consolidated balance sheets as of March 31, 2022 and December 31, 2021 (in thousands):

		Asset Derivatives				Liability Derivatives
	Balance Sheet Location	March 31, 2022		December 31, 2021		March 31, 2022		December 31, 2021
Derivatives designated as hedging instruments:
Interest rate swaps	Fair market value of interest rate swaps	$	58,350	$	11,045	$	246	$	7,519
Derivatives not designated as hedging instruments:
Interest rate caps	Prepaid and other assets		1,453		263		—		—
Total		$	59,803	$	11,308	$	246	$	7,519

Summary of Derivative Financial Instruments on Consolidated Statements of Operations and Comprehensive Income

The tables below present the effect of the Company’s derivative financial instruments on the consolidated statements of operations and comprehensive income for the three months ended March 31, 2022 and 2021 (in thousands):

	Amount of gain (loss) recognized in OCI				Location of gain (loss) reclassified from accumulated	Amount of gain (loss) reclassified from OCI into income
	2022		2021		OCI into income	2022			2021
Derivatives designated as hedging instruments:
For the three months ended March 31,
Interest rate products	$	51,017	$	27,679	Interest expense	$	(3,562	)	$	(3,663	)

	Location of gain (loss)	Amount of gain (loss) recognized in income
	recognized in income	2022		2021
Derivatives not designated as hedging instruments:
For the three months ended March 31,
Interest rate products	Interest expense	$	1,184	$	12

Schedule of Carrying Value and Estimated Fair Value of Debt Instruments

The table below presents the carrying value and estimated fair value of our debt at March 31, 2022 and December 31, 2021 (in thousands):

	March 31, 2022				December 31, 2021
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Fixed rate debt	$	69,079	$	68,962	$	69,285	$	71,141
Floating rate debt (1)	$	1,546,686	$	1,635,044	$	1,491,861	$	1,525,298

(1) Includes balances outstanding under our Corporate Credit Facility.

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Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2022

Class Of Stock [Line Items]

Summary of Restricted Stock Units

The following table includes the number of restricted stock units granted, vested, forfeited and outstanding as of March 31, 2022:

	2022
	Number of Units				Weighted Average Grant Date Fair Value
Outstanding January 1,		589,283			$	39.17
Granted		142,159				83.88
Vested		(180,497	)	(1)		35.87
Outstanding March 31,		550,945			$	51.79

(1) Certain key employees of the Adviser elected to net the taxes owed upon vesting against the shares issued resulting in 147,532 shares being issued as shown on the Consolidated Statement of Stockholders’ Equity.

Summary Information of 2020 ATM Program

The following table contains summary information of the 2020 ATM Program since its inception:

Gross proceeds	$	62,310,967
Common shares issued		1,120,910
Gross average sale price per share	$	55.59
Sales commissions	$	934,665
Offering costs		1,184,340
Net proceeds		60,191,962
Average price per share, net	$	53.70

2016 LTIP

Class Of Stock [Line Items]

Summary of Vesting of Restricted Stock Units

The following table contains information regarding the vesting of restricted stock units under the 2016 LTIP for the next five calendar years subsequent to March 31, 2022:

	Shares Vesting
	February			May		Total
2022		—	(1)		22,022		22,022
2023		139,095			22,019		161,114
2024		132,699			22,017		154,716
2025		97,811			22,017		119,828
2026		66,114			—		66,114
2027		27,151			—		27,151
Total		462,870			88,075		550,945

(1) Shares vested prior to March 31, 2022.

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Earnings (Loss) Per Share (Tables)

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Earnings (Loss) Per Share

The following table sets forth the computation of basic and diluted loss per share for the periods presented (in thousands, except per share amounts):

		For the Three Months Ended March 31,
		2022			2021
Numerator for loss per share:
Net loss		$	(4,667	)	$	(6,900	)
Net loss attributable to redeemable noncontrolling interests in the Operating Partnership			(14	)		(21	)
Net loss attributable to common stockholders		$	(4,653	)	$	(6,879	)
Denominator for loss per share:
Weighted average common shares outstanding			25,620			25,068
Denominator for basic loss per share			25,620			25,068
Weighted average unvested restricted stock units			573			582
Denominator for diluted earnings per share	(1)		25,620			25,068
Loss per weighted average common share:
Basic		$	(0.18	)	$	(0.27	)
Diluted		$	(0.18	)	$	(0.27	)

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Noncontrolling Interests (Tables)

3 Months Ended

Mar. 31, 2022

Noncontrolling Interest [Abstract]

Schedule of Redeemable Noncontrolling Interests

The following table sets forth the redeemable noncontrolling interests in the OP for the three months ended March 31, 2022 (in thousands):

Redeemable noncontrolling interests in the OP, December 31, 2021	$	6,139
Net loss attributable to redeemable noncontrolling interests in the OP		(14	)
Other comprehensive income attributable to redeemable noncontrolling interests in the OP		164
Contributions from redeemable noncontrolling interests in the OP		—
Distributions to redeemable noncontrolling interests in the OP		(9	)
Adjustment to reflect redemption value of redeemable noncontrolling interests in the OP		334
Redeemable noncontrolling interests in the OP, March 31, 2022	$	6,614

Summary of Fees Incurred to BH And Its Affiliates As Well As Reimbursements Paid to BH

The following is a summary of fees that the properties incurred to BH and its affiliates, as well as reimbursements paid to BH from the properties for various operating expenses, for the three months ended March 31, 2022 and 2021 (in thousands):

		For the Three Months Ended March 31,
		2022		2021
Fees incurred
Property management fees	(1)	$	1,750	$	1,479
Construction supervision fees	(2)		325		254
Design fees	(2)		—		54
Aerwave fees	(3)		124		—
Reimbursements
Payroll and benefits	(3)		5,164		4,238
Other reimbursements	(4)		1,028		825

(1) Included in property management fees on the consolidated statements of operations and comprehensive income.

(2) Capitalized on the consolidated balance sheets and reflected in buildings and improvements.

(3) Included in property operating expenses on the consolidated statements of operations and comprehensive income.

(4) Includes property operating expenses such as repairs and maintenance costs and certain property general and administrative expenses, which are included on the consolidated statements of operations and comprehensive income.

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Subsequent Events (Tables)

3 Months Ended

Mar. 31, 2022

Subsequent Events [Abstract]

Summary of Acquired Properties

The Company’s Audit Committee approved the acquisitions.

Property Name	Location	Purchase Price		Mortgage Debt		# Units		Effective Ownership
The Adair	Sandy Springs, GA	$	65,500	$	35,115		232		100	%
Estates on Maryland	Phoenix, AZ		77,900		43,157		330		100	%
		$	143,400	$	78,272		562

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Organization and Description of Business - Additional Information (Details)	3 Months Ended
	Mar. 31, 2022 shares
Real Estate Properties [Line Items]
Date of incorporation	Sep. 19, 2014
OP Units, outstanding	23,819,402
OP Units owned	23,746,169
Maximum
Real Estate Properties [Line Items]
Investments in real estate-related debt and securities	30.00%
NexPoint Residential Trust Operating Partnership LP
Real Estate Properties [Line Items]
Percentage of OP Units, outstanding owned by company	99.70%
B H Equity
Real Estate Properties [Line Items]
Percentage of OP Units, outstanding owned by noncontrolling limited partner	0.30%
OP
Real Estate Properties [Line Items]
Percentage of ownership in portfolio	99.90%
TRS
Real Estate Properties [Line Items]
Percentage of ownership in portfolio	0.10%
Noncontrolling Limited Partner | B H Equity
Real Estate Properties [Line Items]
OP Units owned	73,233

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Summary of Significant Accounting Policies - Estimated Useful Lives of Assets (Details)	3 Months Ended
	Mar. 31, 2022
Land
Property Plant And Equipment [Line Items]
Estimated useful lives of assets	Not depreciated
Buildings
Property Plant And Equipment [Line Items]
Estimated useful lives of assets	30 years
Improvements
Property Plant And Equipment [Line Items]
Estimated useful lives of assets	15 years
Furniture, Fixtures, and Equipment
Property Plant And Equipment [Line Items]
Estimated useful lives of assets	3 years
Intangible Lease Assets
Property Plant And Equipment [Line Items]
Estimated useful lives of assets	6 months

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Summary of Significant Accounting Policies - Additional Information (Details)	3 Months Ended
	Mar. 31, 2022 USD ($) Property	Mar. 31, 2021 USD ($)
Summary Of Significant Accounting Policies [Line Items]
Impairment on real estate assets	$ 0	$ 0
Number of properties held for sale | Property	0
Minimum percentage of distributed taxable income to qualify as REIT	90.00%
Percentage of non-deductible excise tax on distribution	4.00%
Percentage of ordinary income considered for payment of distribution	85.00%
Percentage of capital gain net income considered for payment of distribution	95.00%
Percentage of undistributed income of prior considered for payment of distribution	100.00%
Unrecognized tax benefit or expense, accrued interest or penalties	$ 0
SOFR
Summary Of Significant Accounting Policies [Line Items]
Debt portion transitioned period	1 month
Minimum [Member]
Summary Of Significant Accounting Policies [Line Items]
Percentage of uncertain tax positions likelihood of being sustained	50.00%

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Investments in Subsidiaries - Additional Information (Details) - subsidiary	3 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Schedule Of Investments [Abstract]
Consolidated investment in SPEs	100.00%	100.00%
Number of wholly owned subsidiaries	39

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Investments in Subsidiaries - Schedule of Ownership in Each Property (Details)	3 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Arbors on Forest Ridge | Bedford, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2014
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Cutter's Point | Richardson, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2014
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Silverbrook | Grand Prairie, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2014
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
The Summit at Sabal Park | Tampa, Florida
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2014
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Courtney Cove | Tampa, Florida
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2014
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Radbourne Lake | Charlotte, North Carolina
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2014
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Timber Creek | Charlotte, North Carolina
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2014
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Sabal Palm at Lake Buena Vista | Orlando, Florida
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2014
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Cornerstone | Orlando, Florida
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2015
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
The Preserve at Terrell Mill | Marietta, Georgia
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2015
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Versailles | Dallas, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2015
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Seasons 704 Apartments | West Palm Beach, Florida
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2015
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Madera Point | Mesa, Arizona
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2015
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Venue at 8651 | Fort Worth, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2015
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Parc500 | West Palm Beach, Florida
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2016
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
The Venue on Camelback | Phoenix, Arizona
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2016
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Old Farm | Houston, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2016
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Stone Creek at Old Farm | Houston, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2016
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Hollister Place | Houston, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2017
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Rockledge Apartments | Marietta, Georgia
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2017
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Atera Apartments | Dallas, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2017
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Crestmont Reserve | Dallas, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2018
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Brandywine I & II | Nashville, Tennessee
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2018
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Bella Vista | Phoenix, Arizona
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Fairways at San Marcos | Chandler Arizona
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2020
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
The Enclave | Tempe, Arizona
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
The Heritage | Phoenix, Arizona
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Summers Landing | Fort Worth, Texas
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
The Verandas at Lake Norman | Charlotte, North Carolina
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2021
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Residences at Glenview Reserve | Nashville, Tennessee
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Residences at West Place | Orlando, Florida
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Creekside At Matthews | Charlotte, North Carolina
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2021
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Avant at Pembroke Pines | Pembroke Pines, Florida
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Torreyana Apartments | Las Vegas, Nevada
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Six Forks Station | Raleigh North Carolina
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2021
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Arbors of Brentwood | Nashville, Tennessee
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Bloom | Las Vegas, Nevada
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
High House at Cary | Cary North Carolina
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2021
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Bella Solara | Las Vegas, Nevada
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Year of acquisition	2019
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%

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Investments in Subsidiaries - Schedule of Ownership in Each Property (Parenthetical) (Details)	Mar. 31, 2022	Dec. 31, 2021
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Effective ownership percentage, wholly owned subsidiary	100.00%	100.00%
Creekside At Matthews
Wholly Owned Subsidiaries And Variable Interest Entities [Line Items]
Effective ownership percentage, wholly owned subsidiary	100.00%

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Real Estate Investments Statistics - Additional Information (Details)	Mar. 31, 2022 Property
Multifamily Properties
Business Acquisition [Line Items]
Number of multifamily properties	39

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Real Estate Investments Statistics - Summary of Investment in Multifamily Properties (Details) ft² in Thousands		3 Months Ended
		Mar. 31, 2022 ft² Property $ / Property	Dec. 31, 2021 $ / Property
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		13,391
Number of Units | Property	[1]	14,825
Arbors on Forest Ridge
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		155
Number of Units | Property	[1]	210
Date Acquired		Jan. 31, 2014
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,040	1,021
% Occupied	[3]	94.80%	96.20%
Cutter's Point
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		198
Number of Units | Property	[1]	196
Date Acquired		Jan. 31, 2014
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,261	1,219
% Occupied	[3]	95.40%	95.40%
Silverbrook
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		526
Number of Units | Property	[1]	642
Date Acquired		Jan. 31, 2014
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,068	1,043
% Occupied	[3]	94.20%	94.10%
The Summit at Sabal Park
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		205
Number of Units | Property	[1]	252
Date Acquired		Aug. 20, 2014
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,253	1,198
% Occupied	[3]	94.40%	96.00%
Courtney Cove
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		225
Number of Units | Property	[1]	324
Date Acquired		Aug. 20, 2014
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,187	1,132
% Occupied	[3]	93.50%	93.80%
Radbourne Lake
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		247
Number of Units | Property	[1]	225
Date Acquired		Sep. 30, 2014
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,293	1,227
% Occupied	[3]	93.30%	94.20%
Timber Creek
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		248
Number of Units | Property	[1]	352
Date Acquired		Sep. 30, 2014
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,058	1,032
% Occupied	[3]	96.40%	96.10%
Sabal Palm at Lake Buena Vista
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		371
Number of Units | Property	[1]	400
Date Acquired		Nov. 05, 2014
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,453	1,377
% Occupied	[3]	95.80%	97.80%
Cornerstone
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		318
Number of Units | Property	[1]	430
Date Acquired		Jan. 15, 2015
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,183	1,152
% Occupied	[3]	95.60%	95.60%
The Preserve at Terrell Mill
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		692
Number of Units | Property	[1]	752
Date Acquired		Feb. 06, 2015
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,182	1,156
% Occupied	[3]	94.40%	90.90%
Versailles
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		301
Number of Units | Property	[1]	388
Date Acquired		Feb. 26, 2015
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,166	1,024
% Occupied	[3]	88.10%	96.40%
Seasons 704 Apartments
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		217
Number of Units | Property	[1]	222
Date Acquired		Apr. 15, 2015
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,502	1,410
% Occupied	[3]	94.10%	96.80%
Madera Point
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		193
Number of Units | Property	[1]	256
Date Acquired		Aug. 05, 2015
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,190	1,140
% Occupied	[3]	96.10%	94.50%
Venue at 8651
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		289
Number of Units | Property	[1]	333
Date Acquired		Oct. 30, 2015
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,033	1,006
% Occupied	[3]	95.40%	94.50%
Parc500
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		266
Number of Units | Property	[1]	217
Date Acquired		Jul. 27, 2016
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,609	1,543
% Occupied	[3]	94.50%	96.30%
The Venue on Camelback
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		256
Number of Units | Property	[1]	415
Date Acquired		Oct. 11, 2016
Average Effective Monthly Rent Per Unit | $ / Property	[2]	960	915
% Occupied	[3]	94.90%	92.30%
Old Farm
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		697
Number of Units | Property	[1]	734
Date Acquired		Dec. 29, 2016
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,218	1,207
% Occupied	[3]	94.70%	93.90%
Stone Creek at Old Farm
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		186
Number of Units | Property	[1]	190
Date Acquired		Dec. 29, 2016
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,268	1,248
% Occupied	[3]	96.30%	96.80%
Hollister Place
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		246
Number of Units | Property	[1]	260
Date Acquired		Feb. 01, 2017
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,105	1,065
% Occupied	[3]	89.20%	92.50%
Rockledge Apartments
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		802
Number of Units | Property	[1]	708
Date Acquired		Jun. 30, 2017
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,446	1,408
% Occupied	[3]	94.90%	93.90%
Atera Apartments
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		334
Number of Units | Property	[1]	380
Date Acquired		Oct. 25, 2017
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,352	1,310
% Occupied	[3]	95.00%	93.90%
Crestmont Reserve
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		199
Number of Units | Property	[1]	242
Date Acquired		Sep. 26, 2018
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,052	985
% Occupied	[3]	93.00%	95.50%
Brandywine I & II
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		414
Number of Units | Property	[1]	632
Date Acquired		Sep. 26, 2018
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,080	1,031
% Occupied	[3]	95.10%	95.60%
Bella Vista
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		243
Number of Units | Property	[1]	248
Date Acquired		Jan. 28, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,543	1,515
% Occupied	[3]	96.80%	96.00%
The Enclave
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		194
Number of Units | Property	[1]	204
Date Acquired		Jan. 28, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,603	1,507
% Occupied	[3]	95.10%	96.60%
The Heritage
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		199
Number of Units | Property	[1]	204
Date Acquired		Jan. 28, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,514	1,432
% Occupied	[3]	91.70%	95.60%
Fairways at San Marcos
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		340
Number of Units | Property	[1]	352
Date Acquired		Nov. 02, 2020
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,476	1,425
% Occupied	[3]	96.30%	96.30%
Summers Landing
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		139
Number of Units | Property	[1]	196
Date Acquired		Jun. 07, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,090	1,033
% Occupied	[3]	96.40%	93.90%
Residences at Glenview Reserve
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		344
Number of Units | Property	[1]	360
Date Acquired		Jul. 17, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,125	1,074
% Occupied	[3]	94.70%	95.60%
Residences at West Place
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		345
Number of Units | Property	[1]	342
Date Acquired		Jul. 17, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,420	1,345
% Occupied	[3]	94.20%	93.00%
The Verandas at Lake Norman
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		241
Number of Units | Property	[1]	264
Date Acquired		Jun. 30, 2021
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,258	1,215
% Occupied	[3]	93.20%	93.20%
Avant at Pembroke Pines
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		1,442
Number of Units | Property	[1]	1,520
Date Acquired		Aug. 30, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,772	1,695
% Occupied	[3]	95.10%	93.90%
Arbors of Brentwood
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		325
Number of Units | Property	[1]	346
Date Acquired		Sep. 10, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,344	1,284
% Occupied	[3]	94.80%	95.10%
Torreyana Apartments
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		309
Number of Units | Property	[1]	316
Date Acquired		Nov. 22, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,419	1,365
% Occupied	[3]	94.60%	93.70%
Creekside At Matthews
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		263
Number of Units | Property	[1]	240
Date Acquired		Jun. 30, 2021
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,393	1,350
% Occupied	[3]	91.70%	94.20%
Bloom
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		498
Number of Units | Property	[1]	528
Date Acquired		Nov. 22, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,263	1,238
% Occupied	[3]	91.10%	89.20%
Six Forks Station
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		360
Number of Units | Property	[1]	323
Date Acquired		Sep. 10, 2021
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,246	1,228
% Occupied	[3]	91.20%	95.40%
Bella Solara
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		271
Number of Units | Property	[1]	320
Date Acquired		Nov. 22, 2019
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,343	1,309
% Occupied	[3]	91.90%	91.30%
High House at Cary
Real Estate Properties [Line Items]
Rentable Square Footage | ft²		293
Number of Units | Property	[1]	302
Date Acquired		Dec. 07, 2021
Average Effective Monthly Rent Per Unit | $ / Property	[2]	1,372	1,361
% Occupied	[3]	93.40%	94.70%

[1] Includes 49 down units due to casualty events as of March 31, 2022 (see Note 5).

[2] Average effective monthly rent per unit is equal to the average of the contractual rent for commenced leases as of March 31, 2022 and December 31, 2021, respectively, minus any tenant concessions over the term of the lease, divided by the number of units under commenced leases as of March 31, 2022 and December 31, 2021, respectively.

[3] Percent occupied is calculated as the number of units occupied as of March 31, 2022 and December 31, 2021, divided by the total number of units, expressed as a percentage.

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Real Estate Investments - Summary of Major Components of Investments in Multifamily Properties (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Real Estate Properties [Line Items]
Land	$ 375,857	$ 375,857
Buildings and improvements	1,745,341	1,743,866
Intangible lease assets	1,376	2,576
Construction in progress	4,529	6,078
Furniture, fixtures and equipment	127,030	120,419
Real estate investment, gross	2,254,133	2,248,796
Accumulated depreciation and amortization	(309,002)	(287,096)
Multifamily Properties | Arbors on Forest Ridge
Real Estate Properties [Line Items]
Land	2,330	2,330
Buildings and improvements	11,760	11,755
Construction in progress	1
Furniture, fixtures and equipment	1,865	1,821
Real estate investment, gross	15,956	15,906
Multifamily Properties | Cutter's Point
Real Estate Properties [Line Items]
Land	3,330	3,330
Buildings and improvements	13,088	13,091
Construction in progress	1
Furniture, fixtures and equipment	7,393	7,379
Real estate investment, gross	23,812	23,800
Multifamily Properties | Silverbrook
Real Estate Properties [Line Items]
Land	4,860	4,860
Buildings and improvements	25,691	27,495
Construction in progress	196
Furniture, fixtures and equipment	5,690	5,566
Real estate investment, gross	36,437	37,921
Multifamily Properties | The Summit at Sabal Park
Real Estate Properties [Line Items]
Land	5,770	5,770
Buildings and improvements	13,885	13,882
Furniture, fixtures and equipment	2,048	1,978
Real estate investment, gross	21,703	21,630
Multifamily Properties | Courtney Cove
Real Estate Properties [Line Items]
Land	5,880	5,880
Buildings and improvements	14,345	14,350
Construction in progress	17
Furniture, fixtures and equipment	2,548	2,444
Real estate investment, gross	22,790	22,674
Multifamily Properties | Radbourne Lake
Real Estate Properties [Line Items]
Land	2,440	2,440
Buildings and improvements	22,848	22,744
Construction in progress		64
Furniture, fixtures and equipment	2,642	2,455
Real estate investment, gross	27,930	27,703
Multifamily Properties | Timber Creek
Real Estate Properties [Line Items]
Land	11,260	11,260
Buildings and improvements	13,334	13,310
Construction in progress	380	239
Furniture, fixtures and equipment	3,931	3,827
Real estate investment, gross	28,905	28,636
Multifamily Properties | Sabal Palm at Lake Buena Vista
Real Estate Properties [Line Items]
Land	7,580	7,580
Buildings and improvements	42,461	42,456
Construction in progress	10	2
Furniture, fixtures and equipment	2,874	2,758
Real estate investment, gross	52,925	52,796
Multifamily Properties | Cornerstone
Real Estate Properties [Line Items]
Land	1,500	1,500
Buildings and improvements	30,915	30,901
Construction in progress	21	21
Furniture, fixtures and equipment	3,833	3,722
Real estate investment, gross	36,269	36,144
Multifamily Properties | The Preserve at Terrell Mill
Real Estate Properties [Line Items]
Land	10,170	10,170
Buildings and improvements	53,148	53,080
Furniture, fixtures and equipment	9,414	8,997
Real estate investment, gross	72,732	72,247
Multifamily Properties | Versailles
Real Estate Properties [Line Items]
Land	6,720	6,720
Buildings and improvements	21,953	21,887
Construction in progress	2
Furniture, fixtures and equipment	4,155	4,075
Real estate investment, gross	32,830	32,682
Multifamily Properties | Seasons 704 Apartments
Real Estate Properties [Line Items]
Land	7,480	7,480
Buildings and improvements	14,725	14,644
Furniture, fixtures and equipment	2,262	2,078
Real estate investment, gross	24,467	24,202
Multifamily Properties | Madera Point
Real Estate Properties [Line Items]
Land	4,920	4,920
Buildings and improvements	18,155	18,090
Construction in progress		48
Furniture, fixtures and equipment	2,698	2,612
Real estate investment, gross	25,773	25,670
Multifamily Properties | Venue at 8651
Real Estate Properties [Line Items]
Land	2,350	2,350
Buildings and improvements	17,548	17,495
Construction in progress	322	334
Furniture, fixtures and equipment	3,914	3,843
Real estate investment, gross	24,134	24,022
Multifamily Properties | Parc500
Real Estate Properties [Line Items]
Land	3,860	3,860
Buildings and improvements	21,193	21,172
Construction in progress	5
Furniture, fixtures and equipment	4,228	4,147
Real estate investment, gross	29,286	29,179
Multifamily Properties | The Venue on Camelback
Real Estate Properties [Line Items]
Land	8,340	8,340
Buildings and improvements	38,513	38,328
Construction in progress	141	306
Furniture, fixtures and equipment	3,450	3,248
Real estate investment, gross	50,444	50,222
Multifamily Properties | Old Farm
Real Estate Properties [Line Items]
Land	11,078	11,078
Buildings and improvements	71,070	70,993
Construction in progress	174	99
Furniture, fixtures and equipment	4,031	3,902
Real estate investment, gross	86,353	86,072
Multifamily Properties | Stone Creek at Old Farm
Real Estate Properties [Line Items]
Land	3,493	3,493
Buildings and improvements	19,718	19,714
Construction in progress	2	2
Furniture, fixtures and equipment	936	899
Real estate investment, gross	24,149	24,108
Multifamily Properties | Hollister Place
Real Estate Properties [Line Items]
Land	2,782	2,782
Buildings and improvements	21,202	21,196
Construction in progress	1,468	1,308
Furniture, fixtures and equipment	2,793	2,739
Real estate investment, gross	28,245	28,025
Multifamily Properties | Rockledge Apartments
Real Estate Properties [Line Items]
Land	17,451	17,451
Buildings and improvements	97,417	97,374
Furniture, fixtures and equipment	6,405	5,968
Real estate investment, gross	121,273	120,793
Multifamily Properties | Atera Apartments
Real Estate Properties [Line Items]
Land	22,371	22,371
Buildings and improvements	38,691	36,857
Construction in progress	7	1,824
Furniture, fixtures and equipment	2,545	2,384
Real estate investment, gross	63,614	63,436
Multifamily Properties | Crestmont Reserve
Real Estate Properties [Line Items]
Land	4,124	4,124
Buildings and improvements	21,068	21,067
Furniture, fixtures and equipment	1,558	1,515
Real estate investment, gross	26,750	26,706
Multifamily Properties | Brandywine I & II
Real Estate Properties [Line Items]
Land	6,237	6,237
Buildings and improvements	73,769	73,737
Furniture, fixtures and equipment	5,385	5,160
Real estate investment, gross	85,391	85,134
Multifamily Properties | Bella Vista
Real Estate Properties [Line Items]
Land	10,942	10,942
Buildings and improvements	37,310	37,193
Construction in progress	6	51
Furniture, fixtures and equipment	2,865	2,687
Real estate investment, gross	51,123	50,873
Multifamily Properties | The Enclave
Real Estate Properties [Line Items]
Land	11,046	11,046
Buildings and improvements	30,515	30,469
Construction in progress		11
Furniture, fixtures and equipment	2,500	2,403
Real estate investment, gross	44,061	43,929
Multifamily Properties | The Heritage
Real Estate Properties [Line Items]
Land	6,835	6,835
Buildings and improvements	35,131	35,011
Construction in progress	26	68
Furniture, fixtures and equipment	2,562	2,386
Real estate investment, gross	44,554	44,300
Multifamily Properties | Summers Landing
Real Estate Properties [Line Items]
Land	1,798	1,798
Buildings and improvements	18,447	18,433
Construction in progress	1	1
Furniture, fixtures and equipment	821	790
Real estate investment, gross	21,067	21,022
Multifamily Properties | Residences at Glenview Reserve
Real Estate Properties [Line Items]
Land	3,367	3,367
Buildings and improvements	42,339	42,306
Furniture, fixtures and equipment	2,602	2,366
Real estate investment, gross	48,308	48,039
Multifamily Properties | Residences at West Place
Real Estate Properties [Line Items]
Land	3,345	3,345
Buildings and improvements	52,369	52,310
Furniture, fixtures and equipment	1,855	1,591
Real estate investment, gross	57,569	57,246
Multifamily Properties | Avant at Pembroke Pines
Real Estate Properties [Line Items]
Land	48,434	48,434
Buildings and improvements	276,632	275,968
Construction in progress	1,056	1,414
Furniture, fixtures and equipment	12,425	11,611
Real estate investment, gross	338,547	337,427
Multifamily Properties | Arbors of Brentwood
Real Estate Properties [Line Items]
Land	6,346	6,346
Buildings and improvements	56,063	56,040
Furniture, fixtures and equipment	2,414	2,235
Real estate investment, gross	64,823	64,621
Multifamily Properties | Fairways at San Marcos
Real Estate Properties [Line Items]
Land	10,993	10,993
Buildings and improvements	72,922	72,920
Construction in progress	297	2
Furniture, fixtures and equipment	2,005	1,989
Real estate investment, gross	86,217	85,904
Multifamily Properties | Torreyana Apartments
Real Estate Properties [Line Items]
Land	23,824	23,824
Buildings and improvements	43,771	43,700
Construction in progress	3	25
Furniture, fixtures and equipment	1,533	1,371
Real estate investment, gross	69,131	68,920
Multifamily Properties | The Verandas at Lake Norman
Real Estate Properties [Line Items]
Land	9,510	9,510
Buildings and improvements	52,800	52,884
Construction in progress	115	6
Furniture, fixtures and equipment	857	650
Real estate investment, gross	63,282	63,050
Multifamily Properties | Bloom
Real Estate Properties [Line Items]
Land	23,805	23,805
Buildings and improvements	82,595	82,545
Construction in progress	19	16
Furniture, fixtures and equipment	3,007	2,697
Real estate investment, gross	109,426	109,063
Multifamily Properties | Creekside At Matthews
Real Estate Properties [Line Items]
Land	11,515	11,515
Buildings and improvements	45,337	45,271
Construction in progress		18
Furniture, fixtures and equipment	1,046	756
Real estate investment, gross	57,898	57,560
Multifamily Properties | Bella Solara
Real Estate Properties [Line Items]
Land	12,605	12,605
Buildings and improvements	53,440	53,415
Construction in progress	22	24
Furniture, fixtures and equipment	2,068	1,854
Real estate investment, gross	68,135	67,898
Multifamily Properties | Six Forks Station
Real Estate Properties [Line Items]
Land	11,357	11,357
Buildings and improvements	61,517	62,129
Intangible lease assets		1,200
Construction in progress	218	195
Furniture, fixtures and equipment	1,045	748
Real estate investment, gross	74,137	75,629
Multifamily Properties | High House at Cary
Real Estate Properties [Line Items]
Land	23,809	23,809
Buildings and improvements	67,656	67,654
Intangible lease assets	1,376	1,376
Construction in progress	19
Furniture, fixtures and equipment	827	768
Real estate investment, gross	93,687	93,607
Multifamily Properties | Operating Properties
Real Estate Properties [Line Items]
Real estate investment, gross	2,254,133	2,248,796
Accumulated depreciation and amortization	(309,002)	(287,096)
Total Net Operating Real Estate Investments	1,945,131	1,961,700
Multifamily Properties | Operating Properties | Intangible Lease Assets
Real Estate Properties [Line Items]
Real estate investment, gross	1,376	2,576
Accumulated depreciation and amortization	(917)	(1,029)
Total Net Operating Real Estate Investments	459	1,547
Multifamily Properties | Operating Properties | Land
Real Estate Properties [Line Items]
Real estate investment, gross	375,857	375,857
Total Net Operating Real Estate Investments	375,857	375,857
Multifamily Properties | Operating Properties | Buildings and Improvements
Real Estate Properties [Line Items]
Real estate investment, gross	1,745,341	1,743,866
Accumulated depreciation and amortization	(218,292)	(203,125)
Total Net Operating Real Estate Investments	1,527,049	1,540,741
Multifamily Properties | Operating Properties | Construction in Progress
Real Estate Properties [Line Items]
Real estate investment, gross	4,529	6,078
Total Net Operating Real Estate Investments	4,529	6,078
Multifamily Properties | Operating Properties | Furniture, Fixtures, and Equipment
Real Estate Properties [Line Items]
Real estate investment, gross	127,030	120,419
Accumulated depreciation and amortization	(89,793)	(82,942)
Total Net Operating Real Estate Investments	$ 37,237	$ 37,477

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Real Estate Investments - Additional Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) Property Units	Mar. 31, 2021 USD ($) Property
Real Estate Properties [Line Items]
Depreciation expense	$ 22,600	$ 19,900
Amortization expense of intangible lease assets	$ 1,100	$ 800
Number of properties acquired | Property	0	0
Number of real estate properties sold | Property	0	0
Casualty gain	$ 128
Casualty Losses
Real Estate Properties [Line Items]
Number of units in real estate property excluded from portfolio | Units	49
Intangible Lease Assets
Real Estate Properties [Line Items]
Amortization expense, remainder of year ended December 31, 2020	$ 500

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Debt - Summary of Mortgage Debt Nonrecourse to Company and Encumbers Multifamily Properties (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Mortgages payable, net	$ 1,276,240	$ 1,276,285
Mortgages Payable | Operating Properties
Debt Instrument [Line Items]
Outstanding Principal	1,280,765
Fair market value adjustment	1,009
Deferred financing costs, net of accumulated amortization	(5,534)
Mortgages payable, net	$ 1,276,240
Mortgages Payable | Arbors on Forest Ridge | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 13,130
Interest Rate	2.13%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Cutter's Point | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 16,640
Interest Rate	2.13%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Silverbrook | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 30,590
Interest Rate	2.13%
Maturity Date	Jul. 01, 2024
Mortgages Payable | The Summit at Sabal Park | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 13,560
Interest Rate	2.07%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Courtney Cove | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 13,680
Interest Rate	2.07%
Maturity Date	Jul. 01, 2024
Mortgages Payable | The Preserve at Terrell Mill | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 42,480
Interest Rate	2.07%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Versailles | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 23,880
Interest Rate	2.07%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Seasons 704 Apartments | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 17,460
Interest Rate	2.07%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Madera Point | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 15,150
Interest Rate	2.07%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Venue at 8651 | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 13,734
Interest Rate	2.23%
Maturity Date	Jul. 01, 2024
Mortgages Payable | The Venue on Camelback | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 28,093
Interest Rate	2.13%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Old Farm | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 52,886
Interest Rate	2.13%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Stone Creek at Old Farm | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 15,274
Interest Rate	2.13%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Timber Creek | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 24,100
Interest Rate	1.71%
Maturity Date	Oct. 01, 2025
Mortgages Payable | Radbourne Lake | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 20,000
Interest Rate	1.74%
Maturity Date	Oct. 01, 2025
Mortgages Payable | Sabal Palm at Lake Buena Vista | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 42,100
Interest Rate	1.75%
Maturity Date	Sep. 01, 2025
Mortgages Payable | Cornerstone | Debt With Fixed Interest Rate
Debt Instrument [Line Items]
Term (months)	120 months
Outstanding Principal	$ 20,672
Interest Rate	4.24%
Maturity Date	Mar. 01, 2023
Mortgages Payable | Parc500 | Debt With Fixed Interest Rate
Debt Instrument [Line Items]
Term (months)	120 months
Outstanding Principal	$ 14,590
Interest Rate	4.49%
Maturity Date	Aug. 01, 2025
Mortgages Payable | Hollister Place | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 14,811
Interest Rate	1.79%
Maturity Date	Oct. 01, 2025
Mortgages Payable | Rockledge Apartments | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 68,100
Interest Rate	2.02%
Maturity Date	Jul. 01, 2024
Mortgages Payable | Atera Apartments | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 29,500
Interest Rate	1.93%
Maturity Date	Nov. 01, 2024
Mortgages Payable | Crestmont Reserve | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 12,061
Interest Rate	1.63%
Maturity Date	Oct. 01, 2025
Mortgages Payable | Brandywine I & II | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 43,835
Interest Rate	1.63%
Maturity Date	Oct. 01, 2025
Mortgages Payable | Bella Vista | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 29,040
Interest Rate	1.77%
Maturity Date	Feb. 01, 2026
Mortgages Payable | The Enclave | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 25,322
Interest Rate	1.77%
Maturity Date	Feb. 01, 2026
Mortgages Payable | The Heritage | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 24,625
Interest Rate	1.77%
Maturity Date	Feb. 01, 2026
Mortgages Payable | Summers Landing | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 10,109
Interest Rate	1.63%
Maturity Date	Oct. 01, 2025
Mortgages Payable | Residences at Glenview Reserve | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 26,270
Interest Rate	1.89%
Maturity Date	Oct. 01, 2025
Mortgages Payable | Residences at West Place | Debt With Fixed Interest Rate
Debt Instrument [Line Items]
Term (months)	120 months
Outstanding Principal	$ 33,817
Interest Rate	4.24%
Maturity Date	Oct. 01, 2028
Mortgages Payable | Avant at Pembroke Pines | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 177,100
Interest Rate	1.88%
Maturity Date	Sep. 01, 2026
Mortgages Payable | Arbors of Brentwood | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 34,237
Interest Rate	1.88%
Maturity Date	Oct. 01, 2026
Mortgages Payable | Torreyana Apartments | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 37,400
Interest Rate	2.15%
Maturity Date	Dec. 01, 2026
Mortgages Payable | Fairways at San Marcos | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 46,464
Interest Rate	2.29%
Maturity Date	Dec. 01, 2027
Mortgages Payable | Bloom | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 58,850
Interest Rate	2.15%
Maturity Date	Dec. 01, 2026
Mortgages Payable | The Verandas at Lake Norman | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 34,925
Interest Rate	2.01%
Maturity Date	Jul. 01, 2028
Mortgages Payable | Bella Solara | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 36,575
Interest Rate	2.15%
Maturity Date	Dec. 01, 2026
Mortgages Payable | Creekside At Matthews | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 31,900
Interest Rate	2.01%
Maturity Date	Jul. 01, 2028
Mortgages Payable | Six Forks Station | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	120 months
Outstanding Principal	$ 41,180
Interest Rate	1.87%
Maturity Date	Oct. 01, 2031
Mortgages Payable | High House at Cary | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	84 months
Outstanding Principal	$ 46,625
Interest Rate	2.17%
Maturity Date	Jan. 01, 2029

XML

Debt - Summary of Mortgage Debt Nonrecourse to Company and Encumbers Multifamily Properties (Parenthetical) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($)
Debt Instrument [Line Items]
Deferred financing costs, accumulated amortization	$ 5,433
Residences at Glenview Reserve and West Place
Debt Instrument [Line Items]
Mortgage loans payable description	Debt was assumed upon acquisition of this property and recorded at approximated fair value. The loan can be prepaid at the greater of par plus 1.00% of the unpaid principal balance or the product obtained by multiplying the present value of the principal being prepaid by the excess of the monthly fixed interest rate of the loan over a daily discount rate. The loan is open to pre-payment in the last three months of the term
Loan prepayment fee as a percentage of unpaid principal balance	1.00%
Debt With Fixed Interest Rate | Cornerstone
Debt Instrument [Line Items]
Interest Rate	4.09%
Fair value of debt assumed upon acquisition	$ 18,000
Debt instrument, payment terms	The assumed debt carries a 4.09% fixed rate, was originally issued in March 2013, and had a term of 120 months with an initial 24 months of interest only.
Blended pay rate	4.24%
13th month through 81st month
Debt Instrument [Line Items]
Mortgage loans payable description	Loan can be pre-paid in the first 12 months of the term at par plus 5.00%. Starting in the 13th month of the term through the 81st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.
Loan prepayment fee as a percentage of unpaid principal balance	1.00%
13th month through 81st month | Debt With Floating Interest Rate | Torreyana, Bloom and Bella Solara
Debt Instrument [Line Items]
Mortgage loans payable description	Loan can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%. Starting in the 13th month of the term through the 81st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.
Loan prepayment fee as a percentage of unpaid principal balance	1.00%
13th month through 81st month | Debt With Floating Interest Rate | Cedar Pointe
Debt Instrument [Line Items]
Mortgage loans payable description	Loan can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%.  Starting in the 13th month of the term through the 81st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.
Loan prepayment fee as a percentage of unpaid principal balance	1.00%
13th month through 81st month | Debt With Floating Interest Rate | Summers Landing
Debt Instrument [Line Items]
Mortgage loans payable description	Debt was assumed upon acquisition of this property and recorded at approximated fair value.  It can be pre-paid in the first 12 months of the term in certain circumstances at par plus 5.00%. Starting in the 13th month of the term through the 81st month of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last three months of the term.
Loan prepayment fee as a percentage of unpaid principal balance	1.00%
First 12 months
Debt Instrument [Line Items]
Loan prepayment fee as a percentage of unpaid principal balance	5.00%
First 12 months | Debt With Floating Interest Rate | Torreyana, Bloom and Bella Solara
Debt Instrument [Line Items]
Loan prepayment fee as a percentage of unpaid principal balance	5.00%
First 12 months | Debt With Floating Interest Rate | Cedar Pointe
Debt Instrument [Line Items]
Loan prepayment fee as a percentage of unpaid principal balance	5.00%
First 12 months | Debt With Floating Interest Rate | Summers Landing
Debt Instrument [Line Items]
Loan prepayment fee as a percentage of unpaid principal balance	5.00%
First Mortgage | Debt With Fixed Interest Rate | Cornerstone
Debt Instrument [Line Items]
Debt instrument, payment terms	At the time of acquisition, the principal balance of the first mortgage remained unchanged and had a remaining term of 98 months with 2 months of interest only. The first mortgage is pre-payable and subject to yield maintenance from the 13th month through August 31, 2022 and is pre-payable at par starting on September 1, 2022 until maturity.
Second Mortgage | Debt With Fixed Interest Rate | Cornerstone
Debt Instrument [Line Items]
Interest Rate	4.70%
Debt instrument, payment terms	The supplemental second mortgage is pre-payable and subject to yield maintenance from the date of issuance through August 31, 2022 and is pre-payable at par starting on September 1, 2022 until maturity.
Acquired property mortgage loan principle amount	$ 5,800
Last Four Months | Parc500
Debt Instrument [Line Items]
Mortgage loans payable description	Debt was assumed upon acquisition of this property and recorded at approximated fair value. The loan is open to pre-payment in the last four months of the term.
25th month through 36th month | Debt With Floating Interest Rate | Summers Landing
Debt Instrument [Line Items]
Mortgage loans payable description	Loan can be pre-paid in the first 24 months of the term in certain circumstances at par plus 5.00%.  Starting in the 25th month of the term through the 36th month of the term, the loan can be pre-paid at par plus 2% of the unpaid principal balance. Starting in the 37th month of the term, the loan can be pre-paid at par plus 1% of the unpaid principal balance. The loan is open to pre-payment in the last three months of the term.
Loan prepayment fee as a percentage of unpaid principal balance	2.00%
First 24 Months
Debt Instrument [Line Items]
Loan prepayment fee as a percentage of unpaid principal balance	5.00%
First 24 Months | Debt With Floating Interest Rate | Summers Landing
Debt Instrument [Line Items]
Loan prepayment fee as a percentage of unpaid principal balance	5.00%
37th month | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Loan prepayment fee as a percentage of unpaid principal balance	1.00%
25th month through 36th month
Debt Instrument [Line Items]
Mortgage loans payable description	Loan can be pre-paid in the first 24 months of the term in certain circumstances at par plus 5.00%. Starting in the 25th month of the term through the 116th of the term, the loan can be pre-paid at par plus 1.00% of the unpaid principal balance and at par during the last four months of the term.
Loan prepayment fee as a percentage of unpaid principal balance	1.00%
One-month LIBOR
Debt Instrument [Line Items]
Interest Rate	0.452%
SOFR
Debt Instrument [Line Items]
Interest Rate	0.15934%

XML

Debt - Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2020	Dec. 31, 2021
Debt Instrument [Line Items]
Line of credit facility, description	(a) the prime rate, (b) the federal funds rate plus 0.50%, (c) Term SOFR plus 1.0% or (d) 0.0% plus a margin of 0.90% to 1.40%, depending on the Company’s total leverage ratio. An unused commitment fee at a rate of 0.15% or 0.25%
Interest expense
Debt Instrument [Line Items]
Amortization of deferred financing fees	$ 600,000	$ 600,000
Corporate Credit Facility
Debt Instrument [Line Items]
Line of credit facility, available borrowing capacity	$ 350,000.0
Corporate Credit Facility | Nex Point Residential Trust Inc
Debt Instrument [Line Items]
Term (months)	1 year
Term loan maturity date	Jun. 30, 2024
Percentage of benchmark replacement adjustment	0.001
Line of credit facility, maximum borrowing capacity		$ 335,000,000.0
Corporate Credit Facility | Nex Point Residential Trust Inc | Accordion Feature | Maximum
Debt Instrument [Line Items]
Line of credit facility, increase in facility amount	$ 150,000,000.0
SOFR | Corporate Credit Facility | Nex Point Residential Trust Inc | Maximum
Debt Instrument [Line Items]
Interest rate	2.40%
SOFR | Corporate Credit Facility | Nex Point Residential Trust Inc | Minimum [Member]
Debt Instrument [Line Items]
Interest rate	1.90%
Mortgages Payable
Debt Instrument [Line Items]
Weighted average interest rate of mortgage indebtedness	2.10%		1.81%
Adjusted weighted average interest rate	2.95%
Weighted average fixed rate	1.2128%
Mortgages Payable | One-month LIBOR
Debt Instrument [Line Items]
Weighted average interest rate of mortgage indebtedness	0.452%		0.10125%
Weighted average increase of spread in basis points	0.35%
Mortgages Payable | Floating Interest Rate Swap
Debt Instrument [Line Items]
Combined notional amount	$ 1,400,000,000
Mortgages Payable | Interest Rate Swap
Debt Instrument [Line Items]
Indebtedness	$ 1,400,000,000

XML

Debt - Summary of the Company's Credit Facility (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Credit facilities, net	$ 332,979	$ 278,215
Corporate Credit Facility
Debt Instrument [Line Items]
Deferred financing costs, net of accumulated amortization	(2,021)
Credit facilities, net	$ 332,979
Corporate Credit Facility | Debt With Floating Interest Rate
Debt Instrument [Line Items]
Term (months)	36 months
Interest Rate	2.80%
Maturity Date	Jun. 30, 2024
Credit facilities	$ 335,000

XML

Debt - Summary of the Company's Credit Facility (Parenthetical) (Details) $ in Thousands	Mar. 31, 2022 USD ($)
Debt Instrument [Line Items]
Deferred financing costs, accumulated amortization	$ 5,433
SOFR
Debt Instrument [Line Items]
Interest Rate	0.15934%
Corporate Credit Facility
Debt Instrument [Line Items]
Deferred financing costs, accumulated amortization	$ 461
Corporate Credit Facility | SOFR
Debt Instrument [Line Items]
Interest Rate	0.3024%

XML

Debt - Schedule of Debt Maturities (Details) $ in Thousands	Mar. 31, 2022 USD ($)
Debt Instrument [Line Items]
2022	$ 1,040
2023	21,047
2024	729,956
2025	205,662
2026	423,149
Thereafter	234,911
Total	1,615,765
Operating Properties
Debt Instrument [Line Items]
2022	1,040
2023	21,047
2024	394,956
2025	205,662
2026	423,149
Thereafter	234,911
Total	1,280,765
Credit Facility
Debt Instrument [Line Items]
2024	335,000
Total	$ 335,000

XML

Fair Value of Derivative and Financial Instruments - Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Derivative financial instruments cap weighted average rate	4.79%
Impairment write down	$ 0	$ 0
Interest Rate Swap
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Combined notional amount	$ 1,400,000,000
Interest rate description	floating interest rate
Weighted average fixed rate	1.2128%
Interest rate caps
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Combined notional amount	$ 458,800,000
Interest rate description	The interest rate cap agreements the Company has entered into effectively cap one-month LIBOR on $458.8 million of the Company’s floating rate mortgage indebtedness at a weighted average rate of 4.79% as of March 31, 2022.
Minimum [Member] | Interest Rate Swap
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Interest rate term range	4 years
Minimum [Member] | Interest rate caps | One-month LIBOR
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Interest rate term range	3 years
Maximum | Interest Rate Swap
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Interest rate term range	5 years
Maximum | Interest rate caps | One-month LIBOR
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Interest rate term range	4 years

XML

Fair Value of Derivative and Financial Instruments - Summary of Company's Outstanding Interest Rate Swaps (Details)	3 Months Ended
	Mar. 31, 2022 USD ($)
Key Bank And Trust Bank
Debt Instrument [Line Items]
Notional Amount	$ 1,417,500,000
Fixed Rate	1.2128%
Interest Rate Swap Transaction One | KeyBank
Debt Instrument [Line Items]
Effective Date	Apr. 01, 2017
Termination Date	Apr. 01, 2022
Notional Amount	$ 100,000,000
Fixed Rate	1.957%
Interest Rate Swap Transaction Two | KeyBank
Debt Instrument [Line Items]
Effective Date	May 01, 2017
Termination Date	Apr. 01, 2022
Notional Amount	$ 50,000,000
Fixed Rate	1.961%
Interest Rate Swap Transaction Three | KeyBank
Debt Instrument [Line Items]
Effective Date	Jul. 01, 2017
Termination Date	Jul. 01, 2022
Notional Amount	$ 100,000,000
Fixed Rate	1.782%
Interest Rate Swap Transaction Four | KeyBank
Debt Instrument [Line Items]
Effective Date	Jun. 01, 2019
Termination Date	Jun. 01, 2024
Notional Amount	$ 50,000,000
Fixed Rate	2.002%
Interest Rate Swap Transaction Five | Truist Bank
Debt Instrument [Line Items]
Effective Date	Jun. 01, 2019
Termination Date	Jun. 01, 2024
Notional Amount	$ 50,000,000
Fixed Rate	2.002%
Interest Rate Swap Transaction Six | KeyBank
Debt Instrument [Line Items]
Effective Date	Sep. 01, 2019
Termination Date	Sep. 01, 2026
Notional Amount	$ 100,000,000
Fixed Rate	1.462%
Interest Rate Swap Transaction Seven | KeyBank
Debt Instrument [Line Items]
Effective Date	Sep. 01, 2019
Termination Date	Sep. 01, 2026
Notional Amount	$ 125,000,000
Fixed Rate	1.302%
Interest Rate Swap Transaction Eight | KeyBank
Debt Instrument [Line Items]
Effective Date	Jan. 03, 2020
Termination Date	Sep. 01, 2026
Notional Amount	$ 92,500,000
Fixed Rate	1.609%
Interest Rate Swap Transaction Nine | Truist Bank
Debt Instrument [Line Items]
Effective Date	Mar. 04, 2020
Termination Date	Jun. 01, 2026
Notional Amount	$ 100,000,000
Fixed Rate	0.82%
Interest Rate Swap Transaction Ten | KeyBank
Debt Instrument [Line Items]
Effective Date	Jun. 01, 2021
Termination Date	Sep. 01, 2026
Notional Amount	$ 200,000,000
Fixed Rate	0.845%
Interest Rate Swap Transaction Eleven | KeyBank
Debt Instrument [Line Items]
Effective Date	Jun. 01, 2021
Termination Date	Sep. 01, 2026
Notional Amount	$ 200,000,000
Fixed Rate	0.953%
Interest Rate Swap Transaction Twelve | Truist Bank
Debt Instrument [Line Items]
Effective Date	Mar. 01, 2022
Termination Date	Mar. 01, 2025
Notional Amount	$ 145,000,000
Fixed Rate	0.573%
Interest Rate Swap Transaction Thirteen | Truist Bank
Debt Instrument [Line Items]
Effective Date	Mar. 01, 2022
Termination Date	Mar. 01, 2025
Notional Amount	$ 105,000,000
Fixed Rate	0.614%
Interest Rate Swap Transaction Fourteen | KeyBank | Future Effective Dates
Debt Instrument [Line Items]
Effective Date	Sep. 01, 2026
Termination Date	Jan. 01, 2027
Notional Amount	$ 92,500,000
Fixed Rate	1.798%

XML

Fair Value of Derivative and Financial Instruments - Summary of Company's Outstanding Interest Rate Swaps (Parenthetical) (Details) - One-month LIBOR	Mar. 31, 2022
Key Bank And Trust Bank
Debt Instrument [Line Items]
LIBOR, interest rate	0.452%
KeyBank | Future Effective Dates
Debt Instrument [Line Items]
LIBOR, interest rate	0.452%

XML

Fair Value of Derivative and Financial Instruments - Outstanding Interest Rate Derivatives Not Designated as Cash Flow Hedges of Interest Rate Risk (Details) - Not Designated as Hedging Instrument	Mar. 31, 2022 USD ($) DerivativeInstrument	Mar. 31, 2021 USD ($) DerivativeInstrument
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Number of Instruments | DerivativeInstrument	15	15
Notional Amount | $	$ 458,846,000	$ 379,406,000

XML

Fair Value of Derivative and Financial Instruments - Summary of Derivative Financial Instruments and Classification on the Consolidated Balance Sheet (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Asset Derivatives	$ 59,803	$ 11,308
Liability Derivatives	246	7,519
Fair Market Value Of Interest Rate Swaps | Interest Rate Swap | Designated as hedging instrument
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Asset Derivatives	58,350	11,045
Liability Derivatives	246	7,519
Prepaid and Other Assets | Interest rate caps | Not Designated as Hedging Instrument
Derivative Instruments And Hedging Activities Disclosures [Line Items]
Asset Derivatives	$ 1,453	$ 263

XML

Fair Value of Derivative and Financial Instruments - Summary of Derivative Financial Instruments on Consolidated Statements of Operations and Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Derivative Instruments Gain Loss [Line Items]
Amount of gain (loss) recognized in OCI	$ 54,579	$ 31,342
Interest rate products | Interest expense
Derivative Instruments Gain Loss [Line Items]
Amount of gain (loss) recognized in OCI	51,017	27,679
Amount of gain (loss) reclassified from OCI into income	(3,562)	(3,663)
Amount of gain (loss) recognized in income	$ 1,184	$ 12

XML

Fair Value of Derivative and Financial Instruments - Schedule of Carrying Value and Estimated Fair Value of Debt Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Fixed Rate Debt
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Carrying Value	$ 69,079	$ 69,285
Estimated Fair Value	68,962	71,141
Floating rate debt
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Carrying Value	1,546,686	1,491,861
Estimated Fair Value	$ 1,635,044	$ 1,525,298

XML

Stockholders' Equity - Additional Information (Details) - USD ($)										3 Months Ended		91 Months Ended
	Feb. 17, 2022	Feb. 18, 2021	May 11, 2020	Mar. 13, 2020	Mar. 04, 2020	Feb. 20, 2020	Feb. 21, 2019	Apr. 30, 2018	Jun. 15, 2016	Mar. 31, 2022	Mar. 31, 2021	Mar. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Class Of Stock [Line Items]
Common stock, shares, issued										25,700,190		25,700,190	25,500,567
Common stock, shares, outstanding										25,700,190		25,700,190	25,500,567
Common stock, par value										$ 0.01		$ 0.01	$ 0.01
Share repurchase program, authorized amount				$ 100,000.0				$ 40,000.0	$ 30,000,000.0
Stock repurchase program period in force								2 years	2 years
Stock repurchase program, expiration date				Mar. 12, 2023				Jun. 15, 2020	Jun. 15, 2018
Share repurchase program, treasury stock shares										0	0	2,382,155
Share repurchase program, treasury stock, value												$ 61,200,000
Share repurchase program, treasury stock, per share												$ 25.70
Common stock, shares, retired										0	0
Treasury stock, shares										0	0	0
Shares issued average price per share					$ 53.70
Proceeds from issuance of common stock					$ 62,310,967,000					$ 4,138,000	$ (176,000)
Common Stock
Class Of Stock [Line Items]
Common stock, shares, issued										25,700,190	25,127,141	25,700,190	25,500,567	25,016,957
Restricted Stock Units
Class Of Stock [Line Items]
Restricted stock units, granted										142,159
At-the-Market Offering
Class Of Stock [Line Items]
Shares, issued										52,091
2020 At-the-Market Offering
Class Of Stock [Line Items]
Shares, issued										52,091
Shares issued average price per share										$ 83.16
Proceeds from issuance of common stock										$ 4,300,000
Stock issuance costs										100,000
Stock Issuance Costs Other										$ 100,000
2020 At-the-Market Offering | Common Stock
Class Of Stock [Line Items]
Common stock, par value					$ 0.01
2020 At-the-Market Offering | Maximum | Common Stock
Class Of Stock [Line Items]
Aggregate sale price of common stock					$ 225,000,000
2016 LTIP
Class Of Stock [Line Items]
Common stock, shares, issued										147,532
Common stock, shares, issued										839,788		839,788
Common stock, par value									$ 0.0001
Number of shares authorized to issue									2,100,000
2016 LTIP | Restricted Stock Units
Class Of Stock [Line Items]
Equity-based compensation expense										$ 1,900,000	$ 1,600,000
Dividends earned on restricted stock units										$ 1,200,000		$ 1,200,000
2016 LTIP | Restricted Stock Units | Director
Class Of Stock [Line Items]
Vesting period description										annually
2016 LTIP | Restricted Stock Units | Directors, Officers, Employees and Certain Key Employees of Adviser
Class Of Stock [Line Items]
Restricted stock units, granted	142,159	204,663	116,852			168,183	186,662
2016 LTIP | Minimum [Member] | Restricted Stock Units | Officers Employees And Certain Key Employees Of Adviser
Class Of Stock [Line Items]
Restricted stock units, vesting period										3 years
2016 LTIP | Maximum | Restricted Stock Units | Officers Employees And Certain Key Employees Of Adviser
Class Of Stock [Line Items]
Restricted stock units, vesting period										5 years

XML

Stockholders' Equity - Summary of Restricted Stock Units (Details) - Restricted Stock Units	3 Months Ended
	Mar. 31, 2022 $ / shares shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of Units, Outstanding at beginning of the period | shares	589,283
Number of Units, Granted | shares	142,159
Number of Units, Vested | shares	(180,497)
Number of Units, Outstanding at ending of the period | shares	550,945
Weighted Average Grant Date Fair Value, Outstanding at beginning of the period | $ / shares	$ 39.17
Weighted Average Grant Date Fair Value, Granted | $ / shares	83.88
Weighted Average Grant Date Fair Value, Vested | $ / shares	35.87
Weighted Average Grant Date Fair Value, Outstanding at ending of the period | $ / shares	$ 51.79

XML

Stockholders' Equity - Summary of Restricted Stock Units (Parenthetical) (Details) - shares	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Common Stock
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock issued upon vesting awards	147,532	110,184

XML

Stockholders' Equity - Summary of Vesting of Restricted Stock Units (Details)	3 Months Ended
	Mar. 31, 2022 shares
Vest in 2022
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	22,022
Vest in 2022 | May
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	22,022
Vest in 2023
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	161,114
Vest in 2023 | February
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	139,095
Vest in 2023 | May
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	22,019
Vest in 2024
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	154,716
Vest in 2024 | February
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	132,699
Vest in 2024 | May
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	22,017
Vest in 2025
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	119,828
Vest in 2025 | February
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	97,811
Vest in 2025 | May
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	22,017
Vest in 2026
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	66,114
Vest in 2026 | February
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	66,114
Vest in 2027
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	27,151
Vest in 2027 | February
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	27,151
Vest in Total Year
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	550,945
Vest in Total Year | February
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	462,870
Vest in Total Year | May
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units	88,075

XML

Stockholders' Equity - Summary Information of 2020 ATM Program (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended
	Mar. 04, 2020	Mar. 31, 2022	Mar. 31, 2021
Stockholders Equity Note [Abstract]
Gross proceeds	$ 62,310,967	$ 4,138	$ (176)
Issuance of common shares, Shares	1,120,910
Gross average sale price per share	$ 55.59
Sales commissions	$ 934,665
Offering costs	1,184,340
Net proceeds	$ 60,191,962
Average price per share, net	$ 53.70

XML

Earnings (Loss) Per Share - Additional Information (Details)	3 Months Ended
	Mar. 31, 2022
Earnings Per Share [Abstract]
Stock conversion ratio	100.00%

XML

Earnings (Loss) Per Share - Schedule of Computation of Basic and Diluted Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		3 Months Ended
		Mar. 31, 2022	Mar. 31, 2021
Numerator for loss per share:
Net loss		$ (4,667)	$ (6,900)
Net loss attributable to redeemable noncontrolling interests in the Operating Partnership		(14)	(21)
Net loss attributable to common stockholders		$ (4,653)	$ (6,879)
Denominator for loss per share:
Weighted average common shares outstanding - basic		25,620	25,068
Weighted average unvested restricted stock units		573	582
Weighted average common shares outstanding - diluted	[1]	25,620	25,068
Loss per weighted average common share:
Basic		$ (0.18)	$ (0.27)
Diluted		$ (0.18)	$ (0.27)

[1] If the Company sustains a net loss for the period presented, unvested restricted stock units are not included in the diluted earnings per share calculation.

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Noncontrolling Interests - Additional Information (Details)		3 Months Ended
	Jun. 30, 2017 USD ($)	Mar. 31, 2022 $ / Property $ / h	Aug. 01, 2017 USD ($) $ / shares shares
Minority Interest [Line Items]
Common units transferred to acquire ownership interest in properties of noncontrolling interest holders, per share | $ / shares			$ 27.31
Amount used for calculation of OP units of net asset value	$ 2,000,000.0
BH Equity Portfolio
Minority Interest [Line Items]
Percentage of noncontrolling interests in joint ventures acquired	100.00%
Consideration transferred to acquire ownership interest in properties of noncontrolling interest holders	$ 51,700,000
Payment to acquire ownership interest in properties of noncontrolling interest holders	$ 49,700,000
Common units transferred to acquire ownership interest in properties of noncontrolling interest holders | shares			73,233
Value of common units transferred to acquire ownership interest in properties of noncontrolling interest holders			$ 2,000,000.0
BH Equity Portfolio | B H Equity
Minority Interest [Line Items]
Percentage of ownership interests in portfolio	8.40%
BH Management Services, LLC
Minority Interest [Line Items]
Property management fee percent		3.00%
Other owner approved fees, per hour | $ / h		55
BH Management Services, LLC | Minimum [Member]
Minority Interest [Line Items]
Inspection of properties fee, per unit | $ / Property		15
Construction supervision fee, percent fee		5.00%
BH Management Services, LLC | Maximum
Minority Interest [Line Items]
Inspection of properties fee, per unit | $ / Property		25
Construction supervision fee, percent fee		6.00%

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Noncontrolling Interests - Schedule of Redeemable Noncontrolling Interests (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Noncontrolling Interest [Abstract]
Redeemable noncontrolling interests in the OP, December 31, 2021	$ 6,139
Net loss attributable to redeemable noncontrolling interests in the OP	(14)
Other comprehensive income attributable to redeemable noncontrolling interests in the OP	164
Distributions to redeemable noncontrolling interests in the OP	(9)
Adjustment to reflect redemption value of redeemable noncontrolling interests in the OP	334	$ 215
Redeemable noncontrolling interests in the OP, March 31, 2022	$ 6,614

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Noncontrolling Interests - Summary of Fees Incurred to BH And Its Affiliates As Well As Reimbursements Paid to BH (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2022	Mar. 31, 2021
Fees incurred
Property management fees	[1]	$ 1,757	$ 1,485
BH Management Services, LLC
Fees incurred
Property management fees	[2]	1,750	1,479
Construction supervision fees	[3]	325	254
Design fees	[3]		54
Aerwave fees	[4]	124
Reimbursements
Payroll and benefits	[4]	5,164	4,238
Other reimbursements	[5]	$ 1,028	$ 825

[1] Fees incurred to an unaffiliated third party that is an affiliate of the noncontrolling limited partner of the Company’s Operating Partnership (see Note 10).

[2] Included in property management fees on the consolidated statements of operations and comprehensive income.

[3] Capitalized on the consolidated balance sheets and reflected in buildings and improvements.

[4] Included in property operating expenses on the consolidated statements of operations and comprehensive income.

[5] Includes property operating expenses such as repairs and maintenance costs and certain property general and administrative expenses, which are included on the consolidated statements of operations and comprehensive income.

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Related Party Transactions - Additional Information (Details)	3 Months Ended
	Mar. 31, 2022 USD ($) subsidiary	Mar. 31, 2021 USD ($)
NexPoint Real Estate Advisors, L.P
Related Party Transaction [Line Items]
Percentage of annual advisory, paid monthly	1.00%
Percentage of annual administrative fee, paid monthly	0.20%
Advisory and administrative fees on contributed assets	$ 5,400,000
Advisory and administrative fees percentage	1.20%
Advisory and administrative fees	$ 1,800,000	$ 1,900,000
Advisory and administrative fees waived	4,900,000	$ 4,000,000.0
NexPoint Real Estate Advisors, L.P | Maximum
Related Party Transaction [Line Items]
Advisory and administrative fees on contributed assets	$ 5,400,000
Corporate general and administrative expenses and advisory and administrative fees percentage	1.50%
NLMF Holdco LLC
Related Party Transaction [Line Items]
Property owning subsidiaries | subsidiary	3
Equity interest owned	10.00%
Amount funded to related party included in prepaid and other assets	$ 300,000
Expenses incurred for fiber internet service included in property operating expenses	$ 100,000

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Commitments and Contingencies - Additional Information (Details) - USD ($)			1 Months Ended	3 Months Ended		12 Months Ended
	Mar. 01, 2022	Mar. 01, 2021	Mar. 31, 2022	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Loss Contingencies [Line Items]
Maximum exposure of potential commitments				$ 4,000,000.0
Environmental liability incurred				0
Self-Insurance Program
Loss Contingencies [Line Items]
Insurance Claim Amount	$ 2,497,500	$ 2,468,750		1,800,000	$ 1,600,000
Amount of reserve for aggregate insurance claim				0		$ 0
Self-Insurance Program | Six Forks Station
Loss Contingencies [Line Items]
Insurance claim funded			$ 600,000
NLMF Holdco LLC
Loss Contingencies [Line Items]
Additional funded amount				$ 300,000
Parent | Self-Insurance Program
Loss Contingencies [Line Items]
Insurance Claim Amount						$ 1,600,000

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Subsequent Events - Additional Information (Details) - Subsequent Events - USD ($) $ / shares in Units, $ in Thousands	Apr. 25, 2022	Apr. 01, 2022
Subsequent Event [Line Items]
Dividends payable, amount per share	$ 0.38
Dividends payable, date declared	Apr. 25, 2022
Dividends payable, date to be paid	Jun. 30, 2022
Dividends payable, date of record	Jun. 15, 2022
Purchase Price		$ 143,400
DST purchase amount, OP Units		26,558
DST purchase amount, OP Units value		$ 2,600
DST purchase amount, cash		$ 71,100
DST purchase amount per share		$ 98.30

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Subsequent Events - Summary of Acquired Properties (Details) $ in Thousands	Apr. 01, 2022 USD ($) Property	Mar. 31, 2022	Dec. 31, 2021
Subsequent Event [Line Items]
Effective ownership percentage, wholly owned subsidiary		100.00%	100.00%
Subsequent Events
Subsequent Event [Line Items]
Purchase Price	$ 143,400
Mortgage Debt	$ 78,272
Number of Units | Property	562
The Adair | Sandy Springs, GA | Subsequent Events
Subsequent Event [Line Items]
Purchase Price	$ 65,500
Mortgage Debt	$ 35,115
Number of Units | Property	232
Effective ownership percentage, wholly owned subsidiary	100.00%
Estates on Maryland | Phoenix, Arizona | Subsequent Events
Subsequent Event [Line Items]
Purchase Price	$ 77,900
Mortgage Debt	$ 43,157
Number of Units | Property	330
Effective ownership percentage, wholly owned subsidiary	100.00%