NexPoint Small Bay II DST

An investment in NexPoint Small Bay II DST is highly speculative, illiquid and involves substantial risk including the potential loss of your entire investment. The photos presented in this brochure are of the actual Properties that are part of the Offering.

There are substantial risks in any investment program. See “Risk Factors” on page 20 of the accompanying PPM for a discussion of the risks relevant to this Offering. Distributions are not guaranteed. Please review the entire PPM prior to investing. Reference is made to the PPM for a statement of risks and terms of the Offering. The information set forth herein is qualified in its entirety by the PPM. All prospective Purchasers must read the PPM and no person may invest without acknowledging receipt and complete review of the PPM.

• An investment in an Interest is highly speculative and involves substantial risks including, but not limited to:
• this is a “best-efforts” offering with no minimum raise or minimum escrow requirements;
• the lack of liquidity and/or public market for the Interests;
• the holding of a beneficial interest in the Parent Trust with no voting rights with respect to the management or operations of the Trusts or in connection with the sale of the Properties;
• risks associated with owning, financing, operating and leasing small bay properties, and real estate generally, in Florida, and more specifically the Tampa – St. Petersburg – Clearwater Metropolitan Statistical Area (the “Tampa MSA”) and the Orlando – Kissimmee – Sanford Metropolitan Statistical Area (the “Orlando MSA”);
• the Properties are located in a “Hurricane Susceptible Region,” which increases the risk of damage to the Properties;
• risks associated with small bay properties, such as occupancy rate or rent fluctuations, sensitivity to local economic activity and population shifts;
• risks associated with general market fluctuations such as recessions (global or local), the impact of pandemics (including the COVID-19 pandemic), and other systemic market or economic fluctuations of the communities in which the Properties exist;
• the Trusts depend on the Master Tenants for revenue, and the Master Tenants depend on the Tenants for revenue and thus any default by the Master Tenants or the Tenants will adversely affect the Trusts’ operations;
• performance of the Master Tenants under their respective Master Leases, including the potential for the Master Tenants to defer a portion of rent payable under such Master Leases;
• reliance on the Master Tenants and the Property Manager engaged by the Master Tenants, to manage each of the Properties;
• risks associated with the Sponsor (“NexPoint Real Estate Advisors IV, L.P.”) funding the Demand Notes (as defined herein) that capitalize each of the Master Tenants;
• risks relating to the terms of the financing for the Properties, including the use of leverage;
• the existence of various conflicts of interest among the Sponsor, the Trusts, the Master Tenants, the Asset Manager, the Property Manager, and their affiliates;
• material tax risks, including treatment of the Interests for purposes of Code Section 1031 and the use of exchange funds to pay acquisition costs, which may result in taxable boot;
• the lack of a public market for the Interests;
• the Interests not being registered with the Securities and Exchange Commission (the “SEC”) or any state securities commissions;
• risks relating to the costs of compliance with laws, rules and regulations applicable to the Properties;
  lack of diversity of investment;
• risks related to competition from properties similar to and near the Properties; and
• the possibility of environmental risks related to the Properties.

NexPoint Securities, Inc., an entity under common control with the Sponsor, serves as the Managing Broker-Dealer
of the Offering. The Managing Broker-Dealer was formed in November 2013 and is registered as a broker-dealer
with the SEC and is a member of FINRA/SIPC.

PLEASE CONTACT YOUR ADVISOR WITH ANY QUESTIONS ABOUT THIS OFFERING.