Highland Floating Rate Opportunities Fund Discloses New Real Estate REIT Subsidiary Strategy
The fund disclosed that during the second quarter of 2018 it entered real estate and real estate-related investments through a wholly owned REIT subsidiary, NFRO REIT Sub, LLC, formed April 1, 2018. The fund expects these investments to become material over time and plans to gain exposure by investing up to 20% of its total assets in the subsidiary once fully invested, with added risks including REIT tax qualification and real estate valuation.
- REIT Subsidiary NFRO REIT Sub, LLC was formed on April 1, 2018, with the fund as sole common shareholder
- The fund anticipates investing up to 20% of its total assets in the REIT Subsidiary once fully invested
- Leverage is intended to not exceed 50% of total assets (200% asset coverage), less any direct REIT Subsidiary debt
- The REIT Subsidiary is advised by NexPoint Advisors, L.P., with no management fee charged by the Adviser