Ladies and gentlemen, thank you for standing by and welcome to the Next Point Real Estate Financial First Quarter 2025 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star followed by the number one. As a reminder, today's call is being recorded. I will now hand today's call over to Kristen Griffith, Investor Relations. Please go ahead. Thank you. Good day, everyone,

and welcome to Next Point Real Estate Finance Conference Call to review the company's results for the first quarter and in March 31st, 2025. On the call today are Paul Richards, Executive Vice President and Chief Financial Officer, and Matt McGriner, Executive Vice President and Chief Investment Officer. As a reminder, this call is being webcast through the company's website at nrep.nextpoint.com. Before we begin, I would like to remind everyone that this conference call contains forward-looking statements within the meetings of the Private Securities Litigation Reform Act of 1995 that are based on management's current expectations, assumptions, and beliefs. Listeners should not place undue reliance on any forward-looking statements and are encouraged to review the company's annual report on Form 10-K and the company's other filings for the SEC for a more complete discussion of risks and other factors that could affect forward-looking statements. The statements made during this conference call speak only as of today's date and accept as required by law and REF did not undertake any obligation to publicly update or revise any forward-looking statements. The conference call also includes an analysis of non-GAAP financial measures. For a more complete discussion of these non-GAAP financial measures, see the company's presentation that was filed earlier today. I would now like to turn the call

over to Paul Richards. Please go ahead, Paul. Thank you, Kristen, and welcome everyone joining us this morning. I'm going to briefly discuss our quarterly results, move to our balance sheet, and lastly provide guidance for the next quarter before turning it over to Matt for detailed commentary on the portfolio and the macro lending environment. Q1 results are as follows. For the first quarter, we reported net income of $0.70 per diluted share compared to a net loss of $0.83 per diluted share for the first quarter of 2024. The increase in net income for the quarter was due to an increase in interest income between the first quarter of 2025 and the first quarter of 2024. Interest income increased $23.6 million to $22 million in the first quarter of 2025 from a net loss of $1.6 million in the first quarter of 2024. The increase was driven by an uptick in interest income driven by higher rates. Interest expense decreased $0.7 million in the first quarter of 2025 compared to the same period in the prior year from the deleveraging that occurred in the first quarter of 2024. Earnings available for distribution was $0.41 per diluted common share in Q1 compared to negative $0.46 per diluted share in the same period of 2024. Cash available for distribution was $0.45 per diluted common share in Q1 compared to $0.60 per diluted common share in the same period of 2024. The increase in earnings available for distribution was driven by an increase in net income for the quarter. We paid a regular dividend of 50 cents per share in the first quarter, and the board has declared a dividend of 50 cents per share payable for the second quarter of 2025. Our dividend in the first quarter was 0.9 times covered by cash available for distribution. Book value per share increased 1.47 percent from Q4 2024 to $17.22 per diluted common share, with the increase being primarily due to unrealized gain on our preferred stock investments. During the quarter, we funded $55 million on a life science preferred, and we purchased a $15 million CMBS IO strip with a bond equivalent yield of 7.22%. During the first quarter, we sold 1.8 million shares of our Series B cumulative redeemable preferred for net proceeds of $44.7 million. Moving to our portfolio and balance sheet. Our portfolio is comprised of 85 investments with a total outstanding balance of $1.2 billion. Our investments are allocated across the sectors as follows. 49.4 multifamily, 31.9% life sciences, 15.6% single family rental, 1.6% storage, 0.9% specialty manufacturing, and 0.6% marina. Our portfolio is allocated across investments as follows. 28.4% CMBSBPs, 24.7% mezzanine loans, 19% preferred equity investments, 12.9% revolving credit facilities, 10.4% senior loans, 4.2% IO strips, and 0.3% promissory notes. The assets collateralizing our investments are allocated geographically as follows. 26% Massachusetts, 16% Texas, 7% California, 6% Georgia, 5% Maryland, 4% Florida, with the remaining across states with less than 4% exposure. Reflecting our heavy preference for sunbelt markets with the Massachusetts and California exposure heavily weighted towards life science. The collateral on our portfolio is 75.2 stabilized with 58.7% loan-to-value and a weighted average DSDR of 1.46 times. We have $831.5 million of debt outstanding. Of this, $433.6 million, or 52.1% of short-term debt. Our weighted average cost of debt is 6% and has a weighted average maturity of 1.2 years. Our debt is collateralized by $862.8 million of collateral with a weighted average maturity of four years. Our debt-to-equity ratio is 1.33 times. Moving on to guidance for the second quarter, we are guiding earnings available for distribution and cash available for distribution as follows. Earnings available for distribution of $0.43 per diluted common share at the midpoint with a range of $0.38 on the low end and $0.48 on the high end. Cash available for distribution of $0.48 per diluted common share at the midpoint, with a range of $0.43 on the low end and $0.53 on the high end. Now I'd like to turn it over to Matt for a detailed discussion of the portfolio and markets.

Thank you, Paul. And as he just mentioned, we're pleased to report another strong quarter amidst a challenging macro backdrop. I'd like to spend a few minutes this morning here discussing our verticals and what we're seeing. On the life science front, lab leasing generally continues to be challenging, charging, particularly given the tariff and NIH funding uncertainty under the new administration. This uncertainty has, in our view, delayed capital allocation decisions temporarily, but we do expect those decisions to eventually be made in the near term. Even amidst this uncertainty, we still see green shoots, including at our own projects, most notably our Alewife project. The sponsor is negotiating leases now on two-thirds of the project, which they're optimistic will be inked in the second quarter. These leases would result in a 10-plus percent debt yield for, again, just two-thirds of the project. We also remain bullish on CGMP and advanced manufacturing assets as the reshoring of supply chain wave accelerates. Indeed, contrary to what has happened in the lab market, the new administration and its policies have catalyzed many high-profile announcements to build manufacturing plants on U.S. soil, most recently by Apple, Roche, Novartis, Intel, and Lilly, to name a few. We are seeing an uptick in build-to-suit requirements across the board from semiconductors, nutrition, and pharmaceutical manufacturing, and expect this trend to continue over the near term. On the resi front, after a record year of absorption in 2024 of 667,000 multifamily units, we saw continued strong demand in the first quarter. Nationally, over 138,000 units were absorbed, another record first quarter of leasing and demand performance. There is strength across the board, with even Sunbelt markets capturing a vast majority of the top 10 markets for Q1 absorption. And with tepid new starts and a worsening housing affordability picture, we believe the rental resi sector has bottomed and believe there's optimism for rental growth and increased transaction volume in the coming quarters. Indeed, in our own owned rental portfolio, we have seen positive new lease growth across 40% of our portfolio, and that's up from just 5% in Q4 of 2024. Prospective purchasers can now underwrite positive rental growth again for the first time in many quarters, which in our view will lead to increased liquidity and stable, if not increasing, valuations. Again, our goal is to do as much as we can in the resi sector this year. As we said last quarter on the self-storage front, we've been able to source, underwrite, and commit to four very attractive self-storage development opportunities. These projects range from an 8.1% to 8.5% yield on cost, are geographically diversified and sponsored by a developer that we've successfully completed over $250 million of deals with. After utilizing reasonable A-note leverage, we expect our returns on these assets to be approximately 18.5%. In addition, we are actively marketing several equity investments to monetize this quarter and hopefully throughout the rest of the year, which would generate approximately $75 million of new equity to re-lever and deploy into income-producing assets. Given these assets do not earn a yield today, the potential for CAD accretion resulting from our efforts is quite promising. Again, we're very pleased with the quarter, the progress on the life sciences side, and the backdrop for residential assets over the near and intermediate term. We remain active and open for business across our key verticals and look forward to continued growth in the coming quarters. As always, I want to thank the team here for their hard work, and now we'd like to turn the call over to the operator for questions.

At this time, if you'd like to ask a question, press star followed by the number one on your telephone keypad. If your question hasn't been answered and you would like to remove yourself from the queue, press star followed by the number one. We'll pause for just a moment to compile the Q&A roster. Your first question is from the line of Jay Ramani with KBW.

Thank you very much. Can you comment as to what you're seeing on the credit side? There was a notable credit loss provision. Wondering if that pertains to specific assets. And more broadly, have you seen any impact from macro uncertainty?

Hey, Jay. Yeah, great question. This is Paul. So for the last quarter, we implemented a weighted average base case and downside scenario for a CISL reserve. That was part of it. And then there was also a private preferred that we've had our eye on that we decided to be proactive and apply a reserve for. So that's where you see the uptick. Overall, still, a very, very low CISL reserve amongst our peers, just given our credit profile and multifamily SFR and storage and our life science. But overall, you know, I'll let Matt speak after me, but it's been a very sturdy portfolio with, you know, we've seen great performance overall.

On the broader question, Jay, I think, as I said in the prepared remarks, the life science sector and other, I would say, tariff-based portions of the economy are seeing, I think, a temporary halt. We don't expect that to continue beyond, I think, the latest resolutions are planned June or July, but there is liquidity for most assets or most property types, including and especially on the residential front. We've seen probably only increased interest tariffs aren't really pausing anything on the residential sector. In fact, they're just making housing affordability decisions either be delayed, causing the rental sector to be stronger. And we do really believe this setup for residential assets over the next two, three years is going to be pretty special. So, yeah, short-term blip, but overall no real impact.

And what was the breakout between the weighted average base case downside scenario and the private preferred? Was it evenly split between the two, or was it more weighted to one or the other?

It was about 50-50.

Okay. And then in terms of the life science, after the leasing, the positive leasing momentum, you cited what percentage leased will that project be, or pre-leased will it be? Is it a multi-tenant project, or is it single-tenant? Can you give any more color on that?

Yeah, it'll be two-thirds leased, and then that income from the two, you know, those leases for the two-thirds of the project would be, result in a 10, almost 11% debt yield, and it's across two tenants.

And how much is there left to be funded?

Left to be funded on that project? About $40 million.

Okay. That's NRF's commitment.

Yes, correct.

Wow. So that's really good news because Life Science leasing has been extremely weak, including in that market. So it sounds like it's a pretty special asset.

It is. Yeah, we agree.

And then just broadly in the environment, what are you seeing in terms of interesting opportunities? Are you going to be focused on the residential space doing preferreds or will you be ramping up CMBSB pieces?

you know, what's going to be the plan going forward? I think the latter two, you know, we're going to participate and have been actively participating in the K deals with Freddie. And then on the, you know, some of this uncertainty and delay has caused some stretch senior opportunities in what I would describe as the, you know, the CFO or the multifamily pre-leasing deals that have, you know, come out of the ground. They've gotten a certificate of occupancy, but they're not, you know, prime for, you know, for agency financing, but they're past their, you know, bank life, so to speak, or their construction loan life. So we think there's a lot of interesting opportunities that we're underwriting in that kind of shorter term stretch senior to get these assets stabilized and to facilitate the lease up on the resi front. We think that you can earn a, you know, a 250 to 350 spread on those assets at a reasonable detachment point. So spending a lot of time there and hope to transact on, like I said, after re-leverage $150-ish million of those opportunities, along with those four developments of self-storage, which will take longer to materialize, but they're still really good

investments. Thanks very much. Thanks, Jay.

As a reminder to ask a question, press star followed by the number one on your telephone keypad. At this time, there are no further questions. I will now hand the call back over

to the management for closing remarks. Thank you very much. I appreciate everyone's time this morning and look forward to speaking to you next quarter. Thanks again. Goodbye.

This concludes today's call. Thank you for joining. You may now disconnect your lines.