NexPoint Waterford is a 1997-vintage, 240-unit garden multifamily community in Greensboro, NC (Piedmont Triad), 90.0% leased and held subject to a master lease to a sponsor-affiliated master tenant. The asset was acquired for $49.5M and capitalized at $61.06M ($31.36M equity + $29.7M Freddie Mac loan fixed at 4.86%, full-term interest-only, 48.64% LTV), supported by an unusually large $4.55M trust reserve (7.46% of capitalization). The Core-Plus value-add plan funds interior and capital improvements to drive a steep projected cash-on-cash ramp from 4.51% in Year 1 to 7.64% in Year 10.
0% leased as of March 9, 2026. The Trust holds the asset subject to a Master Lease dated January 16, 2026 to NexPoint Waterford Leaseco, LLC, a Sponsor-affiliated Master Tenant capitalized by a Sponsor-funded Demand Note. 64% in Year 10.
86% with full-term interest-only payments to a March 1, 2036 maturity. 46% of capitalization, to fund interior and capital improvements and drive rent growth, with a contemplated disposition within approximately five to ten years.
| Lender | Walker & Dunlop, LLC |
| Interest Rate | 4.86% (Fixed) |
| Loan Term | 10 years |
| Interest-Only Period | 10 years |
| Total Debt | $29.7M ($29,700,000) |
| In-Place LTV | 48.64% |
| Year 1 DSCR | 2.01x |
The $29,700,000 first mortgage is a Freddie Mac Capital Markets Execution loan originated through Walker & Dunlop at a 4.86% fixed coupon with full-term interest-only payments across the entire 10-year term to March 1, 2036, eliminating amortization and reset risk while holding leverage to a conservative 48.64% loan-to-capitalization, among the lowest in the recent NexPoint multifamily DST cohort.
The Greensboro/Piedmont Triad location supports an entry yield meaningfully wider than coastal-market multifamily DSTs, providing positive leverage against the fixed 4.86% coupon and a higher in-place yield basis from which the value-add plan operates.
Investor cash flow is structured as a fixed 4.00% Additional Rent floor plus a performance-based Supplemental Rent capturing 90% of cash flow above escalating breakpoints; the Supplemental component is projected to grow from 0.59% to 3.72%, lifting total cash-on-cash from 4.51% to 7.64% and to a 6.04% average—the highest projected average of the recent NexPoint DST cohort.
An unusually large $4,552,427 Trust Reserve, equal to 7.46% of total capitalization, is funded at closing to underwrite interior renovations and capital improvements at a 1997-vintage asset still stabilizing at 90% leased, providing a substantial funded runway for the value-add and lease-up program beyond the roughly 3.0% organic rent-growth assumption.
Distributions carry depreciation shelter, and the structure preserves an Exchange Right under which the Sponsor's Exchange Entity may call Holders' Interests for operating-partnership units in a transaction intended to qualify under Code Section 721 or 351, affording a potential UPREIT continuation path exercisable at the Sponsor's rather than the investor's election.
The offering combines conservative 48.64% loan-to-capitalization leverage with agency-quality Freddie Mac financing fixed at 4.86% and interest-only for the full 10-year term, removing amortization and reset risk while producing positive leverage against the in-place yield that is wider than coastal multifamily comparables. The income structure provides a fixed 4.00% Additional Rent floor plus performance-based Supplemental Rent participation, the projected 6.04% average cash-on-cash is the highest of the recent NexPoint DST cohort, and a large $4,552,427 funded Trust Reserve underwrites a value-add capital program with rent-growth upside. Distributions benefit from depreciation shelter, the $51,000,000 as-is appraisal exceeds the $49,500,000 acquisition price, the unit mix is diversified across one-, two-, and three-bedroom plans, and the structure preserves an optional Section 721/351 exchange continuation path.
The projected total cash-on-cash ramp from 4.51% to 7.64% is steep and almost entirely performance-contingent: only the 4.00% Additional Rent is contractual, while the Supplemental Rent that nearly doubles the distribution by Year 10 depends on net operating income—forecast to grow roughly 48% over the hold—clearing escalating breakpoints, an aggressive trajectory for a 1997-vintage asset in the tertiary Greensboro market that is only 90% leased at acquisition. The Greensboro/Piedmont Triad submarket is smaller and less liquid than the Sunbelt gateway markets of comparable offerings, raising disposition and exit-cap uncertainty. The Master Tenant, NexPoint Waterford Leaseco, LLC, is a Sponsor affiliate capitalized solely by a Sponsor-funded Demand Note, concentrating master-lease performance and conflict-of-interest risk within the Sponsor's organization. The capitalization carries a heavy reserve and cost load—a $4,552,427 Trust Reserve plus roughly $2.93 million of offering load and a $742,500 affiliate Contribution Fee—such that total capitalization of $61,060,817 substantially exceeds both the $51,000,000 appraisal and the $49,500,000 purchase price, a roughly 20% premium that disposition pricing must overcome. The 1997 vintage implies ongoing capital intensity, and the March 2036 balloon coincides with the planned exit, creating refinance-or-sell convergence risk.
The analysis below is Baker 1031's educational opinion — not investment, tax, or legal advice, a recommendation, or a guarantee, and it does not replace the offering's Private Placement Memorandum (PPM), which governs in all respects. Read the PPM and consult your own CPA and attorney before investing.
The risk-adjusted profile is that of a value-add, 1997-vintage garden-apartment asset in a tertiary North Carolina market, financed conservatively with full-term fixed-rate agency debt, where the capital stack is genuinely de-risked but the distribution projection is the most aggressive of the recent NexPoint DST cohort. The conservative 48.64% leverage, fixed 4.86% interest-only financing, a wider in-place yield, and a large funded reserve are real supports for the business plan, and the depreciation shelter and optional 721 path are structurally favorable. The central tension is the steep 4.51%-to-7.64% return ramp, which rests on a roughly 48% NOI increase and a performance-contingent Supplemental Rent rather than contractual escalators - an outcome dependent on successfully executing interior renovations, lifting a 90%-leased asset to stabilization, and pushing rents in a smaller, less liquid submarket. The entry basis roughly 20% above appraised value, driven by the unusually heavy reserve and fee load, is the chief structural friction and raises the disposition hurdle, while the affiliated and Sponsor-funded Master Tenant and the exit-coincident loan maturity round out the principal risks. Net, conservative financing offsets an income architecture and basis that demand strong execution to realize the marketed returns.
The analysis below is Baker 1031's educational opinion — not investment, tax, or legal advice, a recommendation, or a guarantee, and it does not replace the offering's Private Placement Memorandum (PPM), which governs in all respects. Read the PPM and consult your own CPA and attorney before investing.
| Metric | This Offering | Market Avg. | Assessment |
|---|---|---|---|
| Avg. Income | 6.04% | 5.04% | Above Average |
| Income Growth | 69.40% | 33.66% | Above Average |
| Peak Income | 7.64% | 5.95% | Above Average |
NexPoint
NexPoint is a Dallas alternative manager—an affiliate of the former Highland Capital complex—overseeing roughly $15 billion across listed and non-listed REITs, DSTs, 1031 exchanges, interval funds and a BDC. Its breadth across real estate and credit, paired with significant own-capital co-investment, gives it institutional heft in the exchange channel, and its concentrated Dallas/Uptown asset base reflects conviction in its home market. For exchangers, the platform offers a diversified menu backed by a sizable alternatives manager.
Learn More About NexPoint →Documents for this offering. Available to signed-in investors.
Securities offered through Aurora Securities, Inc. (CRD #46147 / SEC #8-51322), member FINRA / SIPC; Baker 1031 Investments, LLC is independent of Aurora Securities, Inc. and is not a registered broker-dealer or investment adviser. This is not an offer to sell or a solicitation of an offer to buy any security; any offer is made solely by the confidential private placement memorandum (PPM), which qualifies all information herein in its entirety. Delaware Statutory Trust interests are speculative, illiquid securities offered under Rule 506(c) of Regulation D and sold only to investors whose accredited-investor status has been verified; offering documents and subscription materials are provided only after that verification. They involve substantial risk, including possible loss of the entire investment.
Distributions, yields, the cap-rate equivalent, DSCR, occupancy, and benchmark figures are sponsor estimates or projections, are not guaranteed, and may differ materially from actual results. Any tax-adjusted yield assumes a 40% effective rate for non-1031 cash investors and is not tax advice. No tax, legal, or investment advice is provided — consult your own CPA and attorney. Past performance does not guarantee future results.