We run extensive background checks, criminal checks, bad actor checks, and reference checks on sponsors. In addition to never allowing a sponsor with a criminal history / any securities related issue to use the platform, we may also turn down sponsors due to poor reference checks even if background and criminal checks come back clear.
We require unaffiliated sponsors to use an unaffiliated third-party escrow agent. When an investor makes an investment with unaffiliated sponsors using the RealtyMogul platform, the investor’s money is transferred directly into a third-party escrow account. All closing conditions in connection with a sponsor’s offering need to be met before the third-party escrow agent will approve releasing investor funds to the issuer or general partner. For example, if an issuer or general partner plans to use funds for a real estate acquisition that does not ultimately transact, the third-party escrow agent will not transfer investor funds to the issuer or general partner, and funds will be returned to investors.
Our controls include visiting every property (or a subset of properties if it’s a fund) to confirm the real estate is what and where the real estate is supposed to be.
We have robust quality controls with detailed checklists and a review of third-party reports.
The investment is expected to produce double-digit cash yield to RealtyMogul investors, with annual cash flow ranging from 12.2% to 17.5% and expected average cash-on-cash of 15.3%.
The Real Estate Company is an experienced office operator, as well as a repeat partner of RealtyMogul. It has owned and operated real estate properties with a total basis exceeding $346 million.
The Columbus office market is one of the healthiest in the country thanks to significant employment gains and years of conservative construction (according to CoStar). Over the past five years, the market has experienced average annual rent growth of 5.6% and an average vacancy rate of 5.1%.

Ravinia Capital Group
Ravinia Capital Group (the "Real Estate Company"), founded in 2013, is a Chicago-based real estate investment and ownership firm. Founded by seasoned real estate professionals with 50 years of combined investment, asset management and redevelopment experience, the Ravinia team has owned over $346 million of commercial real estate. Ravinia focuses exclusively on middle market transactions with asset values ranging between $10 million and $100 million in targeted US submarkets. It seeks to acquire properties at prices below replacement cost with in-place cash flow and value-add upside. This approach is based upon the principals' real estate experience through various economic cycles.
RealtyMogul investors previously invested alongside Ravinia Capital Group in the acquisition of 544 Lakeview Parkway in Vernon Hills, IL in Q4 2018. In Q2 2019, Ravinia executed a lease with a technology company to move into suite 204 (3,512 SF) after completing the build-out of the space as a speculative suite, and is currently renovating the building common areas.
http://www.raviniagroup.com/Address | Location | Asset Type | Date Acquired | Total SF | Purchase Price | $/SF | Date Sold | Sale Price | ||
---|---|---|---|---|---|---|---|---|---|---|
Kramer Place Apartments | Columbus, OH | Multifamily | Sep'15 | 50,258 | $5,500,000 | $109 | ||||
DFW Airport Office Portfolio | Dallas, TX | Office | Sep'15 | 188,595 | $14,000,000 | $74 | ||||
Grocery Anchored Portf. | TX, FL, CA | Retail | Mar'16 | 1,014,802 | $195,200,000 | $192 | ||||
Mansell III | Alpharetta, GA | Office | Feb'17 | 126,717 | $16,600,000 | $131 | ||||
Meridian 589 | Tampa, FL | Office | Mar'17 | 252,235 | $18,500,000 | $73 | ||||
One Hartsfield Centre | Atlanta, GA | Office | May'18 | 150,835 | $20,100,000 | $133 | ||||
544 Lakeview | Vernon Hills, CA | Office | Jun'18 | 139,324 | $14,200,000 | $102 | ||||
Parkside Terrace | Alpharetta, GA | Office | Apr' 19 | 254,435 | $48,100,000 | $189 | ||||
Gresham Lakes (540 North) | Raleigh, NC | Industrial | Nov'13 | 235,308 | $9,000,000 | $38 | Jan '16 | $16,000,000 | ||
Meridian Crescent Center | Tampa, FL | Office | Jun'16 | 89,440 | $5,100,000 | $57 | Aug '18 | $12,200,000 | ||
Total | -- | -- | -- | 2,501,949 | $346,300,000 | -- | -- | -- |
Real Estate Company's bio and track record were provided by the Real Estate Company and have not been independently verified by RealtyMogul or NCPS.
In this transaction, RealtyMogul investors are to invest in RealtyMogul 141, LLC (the "Company"), which is subsequently to invest in Columbus Office Portfolio, LLC (the "Target"), a limited liability company that will indirectly own interest in the Properties. Ravinia Capital Group (the "Real Estate Company") is under contract on the Properties for $37.8 million ($117 per square foot for the office and industrial space, and $14,092 per space for the parking garage). The total project cost is to be $46.1 million ($111 per square foot).
The Real Estate Company (Ravinia) will implement a mark-to-market and lease-up strategy at both properties to further enhance cash flow, with $2.5 million earmarked for improvements. These include replacing the roof at Brewery Tower and implementing common area improvements at both properties. At 855 Grandview, the Real Estate Company intends to raise the warehouse rent to market and facilitate the expansion of one of the major tenants into vacant contiguous space. At Brewery Tower, the Real Estate Company intends to relocate several tenants to maximize revenue and facilitate the expansion of tenants that will likely require more space. Amenities will also be improved at both buildings.
855 Grandview is currently achieving average triple net (NNN) office rents of $13.39, and the Real Estate Company is targeting rents of $14.00 NNN on new leases for underwriting purposes. Brewery Tower is currently achieving average rents of $12.21 NNN, and the Real Estate Company is targeting rents of $13.50 NNN. Each building is already achieving proforma rent on at least one lease. The business plan calls for a five year hold, at which point the Portfolio is to be sold at an expected exit cap rate of 8.25%. Below is a summary of the CapEx budget.
Capital Expenditures Budget
CapEx Item | $ Amount |
---|---|
Parking Lot & Loading Dock (855 Grandview) | $200,000 |
Grab & Go Food Service (Brewery Tower) | $25,900 |
New Parking Lot Signage (Brewery Tower) | $18,000 |
HVAC (Brewery Tower) | $150,000 |
Elevators (Brewery Tower) | $750,000 |
Roof (Brewery Tower) | $775,000 |
Bathrooms (Brewery Tower) | $320,000 |
Contingency (10.5%) | $235,000 |
Grand Total | $2,473,900 |
Brewery Tower (500 S. Front St.)
Brewery Tower is a 12 story, 94% leased, Class A office tower situated on approximately one acre totaling 142,315 square feet, and is connected to the 579 space, four-story Brewery Garage (4.1/1,000 rentable square feet). The Property is located at 500 South Front Street in Columbus, OH, within the Brewery District submarket of the Columbus Central Business District (“CBD”). The glass lobby and outdoor patio seating area of Brewery Tower were completed in 2018. Brewery Tower is within the immediate proximity of the Courthouse District and walking distance to neighborhood restaurants and bars. Another notable neighborhood feature is the new $70 million mixed-use redevelopment occurring across the street from Brewery Tower, featuring a 140-room boutique hotel, retail, office, and condominium residences.
855 Grandview Ave.
Located approximately three miles west of downtown Columbus, 855 Grandview is a Class B, 100% leased creative office complex of 84,832 square feet with an attached warehouse of 25,559 square feet. The Property is situated on 5.9 acres with 369 surface parking spaces (4.5/1,000 rentable square feet). It is comprised of two connected sections. The "Tower" is a three story all-glass office building of 44,712 square feet, built in 2004. 'Quonset Hut' contains 40,125 square feet and 22 foot ceilings, and was built in 1947 and renovated in 2016. The contiguous warehouse measures 25,554 square feet with 37.5 foot clear heights (at its center) and a loading dock. 855 Grandview boasts easy access to downtown and suburban Columbus via I-670 (0.25 miles away) and Dublin Road (0.1 miles away). The complex is also directly across the street from Wagenbrenner’s $300 million Grandview Crossing development, planned to be 56 acres of mixed use development, including 800 multifamily units, retail, a hotel, and two office buildings. Construction has already commenced.
Major Tenants
Woda Cooper Companies is an experienced developer, general contractor, and property manager, which specializes in the design, construction and management of affordable multi-family apartments, senior communities and single-family homes. Since 1990 Woda has created over 12,000 housing units in rural, suburban and urban settings across 15 states and manages/maintains over 300 properties. In 2018, Woda was ranked as the sixth largest affordable housing developer in the country and the twenty-ninth largest affordable housing owner by Affordable Housing Finance. Woda is headquartered in the building with six US offices, employing over 550 employees. This is Woda's original lease, which was signed in June 2017.
Crabbe, Brown & James, LLP is a law firm that has served Ohio and surrounding states for nearly a century. Clients include Fortune 500 corporations, privately held businesses, nonprofit institutions (including The Ohio State University), governmental entities, and individuals. The company's main practice areas are litigation, business/corporate, employment, class action, and sports law. Crabbe, Brown & James has been in the building since 1991, when the company signed for the same space it occupies today.
ScriptDrop provides prescription delivery by connecting pharmacies to their network of couriers across the Country. It is the first medication delivery program that integrates directly into the pharmacist’s existing workflow—making the delivery process more efficient for the pharmacy and leading to a seamless delivery solution for patients. ScriptDrop is in its original lease term, which commenced in November 2018.
Founded in 1997 in Columbus, Ohio, Dynamix Engineering is a full-service mechanical, electrical, plumbing, fire protection, and technology engineering firm with a focus in design engineering and systems assessments. The Dynamix team provides consulting engineering services for building and infrastructure systems used in a broad range of facilities across several markets and industries across the nation. It is a minority-owned business and is now one of the top 100 engineering firms in the United States, undertaking some of the largest projects in the nation. Dynamix signed its original lease in September 2010, and has undergone a series of amendments since to expand the company's space.
The Drug Enforcement Administration is a United States federal law enforcement agency under the United States Department of Justice, tasked with combating drug trafficking and distribution within the United States. The DEA signed its original lease in the building March of 2010. Since then, it has gone through a number of amendments. The Real Estate Company expressed confidence that the DEA would renew their existing term, given that Brewery Tower is the only known building in the area that offers direct-access parking for their team.
Founded in 1891, and with offices in Columbus and Cincinnati, Loth designs "smarter spaces" for corporate, education, and healthcare markets. Loth's solutions incorporate furniture, walls, flooring, and technology configured in a way that facilitates workflow and enhances collaboration. LOTH will design existing or new space, manage projects from start to finish, install furniture and fixtures, and maintain and replace throughout the life of the space. Per the Real Estate Company, LOTH has a strong pipeline, including providing a portion of the furniture for the new $2 billion Ohio State Hospital project. Loth signed its original office lease in April 2008, and has expanded since through a series of amendments. The company signed for the warehouse space in March 2008.
Major Tenants Summary
Tenant | Square Feet | % of Property | % of Portfolio | Rent per square foot | Lease Expiration | Lease Type |
---|---|---|---|---|---|---|
Brewery Tower | ||||||
Woda Copper Co. | 26,145 | 18.4% | 10.3% | $11.12 | Aug '28 | NNN |
Crabble, Brown & James | 22,513 | 15.8% | 8.9% | $12.25 | Oct '22 | NNN |
DEA | 17,372 | 12.2% | 6.9% | $17.73** | Aug '20 | NNN |
Other Tenants | 67,896 | 47.7% | 26.9% | $11.20 | Various | NNN |
Subtotal | 133,926 | 94.1% | 53.0% | $12.21 | ||
855 Grandview | ||||||
ScriptDrop | 21,950 | 19.9% | 8.7% | $12.75 | Feb '26 | NNN |
Dynamix Engineering, Ltd. | 20,744 | 18.8% | 8.2% | $13.00 | Sep '28 | NNN |
Loth, Inc. | 15,124 | 13.7% | 6.0% | $14.05 | Jul '25 | NNN |
Other Office Tenants | 27,019 | 24.5% | 10.7% | $13.85 | Various | NNN |
Loth, Inc. (warehouse) | 25,554 | 23.1% | 10.1% | $2.58 | Dec '20 | NNN |
Subtotal | 110,391 | 100.0% | 53.7% | $13.39* | ||
Grand Total | 244,317 | $12.67* |
*Average rent does not include warehouse space currently occupied by Loth, Inc.
**DEA rent includes parking.
1201 Dublin Rd. | 1123 Goodale Blvd | 1166 Dublin Rd. | 855 Grandview Ave. | Total/Averages | Subject | |
---|---|---|---|---|---|---|
Building SF | 47,000 | 102,956 | 22,000 | 110,391 | 70,587 | 110,391 |
Year Built | 1970 | 2017 | 1952 | 1947/2004 | 1980 | 1947/2004 |
Year Renovated | 2000 | N/A | N/A | 2004/2016 | 2004/2016 | |
Rental Rate (NNN) | $13.95 | $16.50 | $14.50 | $14.05 | $14.75 | $14.00 |
Leased SF | 3,931 | 11,331 | 11,673 | 15,124 | 10,515 | |
Tenant | N/A | U-Haul | N/A | Loth, Inc. | ||
Date Signed | Aug '19 | Dec '18 | May '19 | Jan '19 | ||
Lease Term (years) | N/A | N/A | 7.0 | 6.0 | 6.5 | |
Parking Ratio (per 1,000 sf) | 3.5 | 0.0 | 4.0 | 4.5 | 3.0 | 4.5 |
Distance from Subject (mi.) | 0.4 | 0.7 | 0.4 | 0.0 | 0.4 |
495 S. High St. | 2 Miranova Place | 10 W Broad St. | 500 S. Front St. | Total/Averages | Subject | |
---|---|---|---|---|---|---|
Building SF | 80,063 | 243,527 | 407,472 | 142,315 | 218,344 | 142,315 |
Year Built | 2001 | 2001 | 1985 | 1989 | 1994 | 1989 |
Year Renovated | N/A | N/A | N/A | 2018 | 2018 | |
Rental Rate (NNN) | $14.00 | $14.50 | $16.25 | $13.96 | $14.68 | $13.50 |
Leased SF | 2,401 | 6,884 | 17,241 | 5,059 | 7,027 | |
Tenant | N/A | N/A | N/A | Lendeavor | ||
Date Signed | Jul '19 | Aug '19 | Apr '19 | Apr '19 | ||
Lease Term (years) | 5.0 | N/A | 3.0 | 2.7 | 3.6 | |
Parking Ratio (per 1,000 sf) | 3.0 | 3.0 | 4.0 | 4.1 | 3.5 | 4.1 |
Distance from Subject (mi.) | 0.1 | 0.4 | 0.7 | 0.0 | 0.3 |
500 Olde Worthington | 1400 & 1404 Goodale Blvd. | 495 S. High St. | Total/Averages | Subject | |
---|---|---|---|---|---|
Date Sold | Sep '18 | Sep '17 | May '17 | Nov '19 | |
Building SF | 97,000 | 80,491 | 69,188 | 82,226 | 252,706 |
Occupancy at Purchase | 100% | 100% | 100% | 100% | 96.7% |
Year Built | 2000 | 1955 | 2001 | 1985 | 1947/1989/2004 |
Purchase Price | $15,100,000 | $12,714,518 | $10,000,000 | $12,604,839 | $37,800,000 |
$/SF | $156 | $158 | $145 | $152 | $117* |
Cap Rate | 8.10% | 8.00% | 7.50% | 7.87% | 8.72% |
Parking Ratio (per 1,000 sf) | 4.5 | 4.3 | 3.0 | 3.9 | 4.2 |
Distance from Portfolio Center | 12.9 miles | 1.3 miles | 1.5 miles | 5.2 miles |
*Per square foot adjusted for office and industrial space only
Lease and sale comparables were obtained from CoStar
Market Overview
According to CoStar, Government, finance, and logistics entities continue expanding their footprints in Columbus, further strengthening fundamentals in one of the country’s healthiest office markets. The market’s employment gains are keeping vacancies tight, and years of conservative construction have all but eliminated the risk of office building oversaturation. The tight vacancy has fostered years of healthy rent gains, and Columbus is easily Ohio’s strongest-performing office market.
The vacancy rate in the market stands at 7.1% and gross asking rent is $19.65 per square foot. The past 12 months have seen net absorption of 320,000 square feet, with 961,000 square feet delivered. In the past 12 months, the vacancy rate has risen 0.5% and rent has grown at a rate of 2.8%. In the past five years, the market has averaged annual rent growth of 3.2%. Current job growth for Columbus is 1.4%, just below the national average of 1.5%.
Downtown Columbus Submarket Overview
According to CoStar, the Downtown Columbus submarket has maintained rock-solid fundamentals thanks to the metro’s diverse economy. While office construction has not been explosive, developers are confident enough to bring speculative office-space back into the market. Vacancies remain below the historical average, prompting rent gains. With city planners and developers hoping to remake downtown into a trendy live/work/play district, there are plenty of reasons for optimism about the future of office space in downtown. Rent growth has been some of the metro’s strongest.
The vacancy rate in the Downtown Columbus submarket stands at 7.0% and gross asking rent is $21.32 per square foot, with Class A rents as high as $23.86 on average. The past 12 months have seen net absorption of 37,800 square feet, with 160,000 square feet delivered. In the past 12 months, the vacancy rate has risen 0.4% and rent has grown at a rate of 2.6%. In the past five years, the submarket has averaged annual rent growth of 3.7%.
Grandview Submarket Overview
According to CoStar, fundamentals are healthy in the Grandview submarket, bolstered by the overall health of the Columbus economy and Nationwide Insurance’s Grandview Yards project. Recent construction has been largely build-to-suit projects and has hardly affected fundamentals. Healthy demand outside of Nationwide has vacancies at record lows, and this has prompted strong rent growth over the course of the cycle.
The vacancy rate in the Grandview submarket stands at 4.0% and gross asking rent is $19.94 per square foot, with Class A gross rents as high as $24.37 on average. The past 12 months have seen net absorption of 149,000 square feet, with 135,000 square feet delivered. In the past 12 months, the vacancy rate has fallen 0.3% and rent has grown at a rate of 3.2%. In the past five years, the submarket has averaged annual rent growth of 5.7% per year.
Demographic Information - Brewery Tower
Demographic Information (2019) | 1 Mile Radius | 3 Mile Radius | 5 Mile Radius |
---|---|---|---|
Population | 14,136 | 143,596 | 362,863 |
Population Projection (2024) | 15,245 | 155,492 | 387,013 |
Average Age | 39 | 35 | 34 |
Median Household Income | $67,233 | $42,195 | $43,119 |
Average Household Size | 1.5 | 2.1 | 2.2 |
Median Home Value | $356,651 | $136,255 | $130,781 |
Population Growth 2019-2024 | 7.9% | 8.3% | 6.7% |
Demographic Information - 855 Grandview Ave.
Demographic Information (2019) | 1 Mile Radius | 3 Mile Radius | 5 Mile Radius |
---|---|---|---|
Population | 10,765 | 148,954 | 355,716 |
Population Projection (2024) | 11,613 | 158,629 | 378,650 |
Average Age | 36 | 33 | 34 |
Median Household Income | $83,956 | $48,924 | $48,290 |
Average Household Size | 1.9 | 2.2 | 2.2 |
Median Home Value | $333,355 | $199,466 | $168,590 |
Population Growth 2019-2024 | 7.9% | 6.5% | 6.5% |
Demographic information sourced from CoStar

Sources of Funds | $ Amount | Per Square Foot |
Debt | $33,739,635 | $81 |
Equity | $12,372,188 | $30 |
Total Sources of Funds | $46,111,823 | $111 |
Purchase Price | $37,800,000 | $91 |
Loan Fee | $84,349 | $0 |
Real Estate Company Acquisition Fee | $546,698 | $1 |
Broker Dealer Fee | $120,000 | $0 |
MogulREIT I Origination Fee | $280,000 | $1 |
CapEx Budget | $2,473,900 | $7 |
Closing Costs | $465,894 | $1 |
Tenant Improvements & Leasing Commissions | $4,040,982 | $10 |
Working Capital | $300,000 | $1 |
Total Uses of Funds | $46,111,823 | $111 |
The expected terms of the debt financing are as follows:
- Estimated Initial Proceeds: $27,924,753
- Estimated Future Funding: $5,909,618
- Interest Rate: LIBOR + 2.15% (an interest rate swap is required, and estimated to be 3.73%)
- Interest Only Period: Five years
- Loan Term: Four years
- Extension Options: One (1) one-year extension option (0.1% fee), subject to minimum debt yield of 8.75%
- Prepayment Penalty: N/A
There can be no assurance that a lender will provide debt on the rates and terms noted above, or at all. All rates and terms of the debt financing are subject to lender approval, including but not limited to possible increases in capital reserve requirements for funds to be held in a lender controlled capital reserve account.
The Real Estate Company intends to make distributions of all available cash and capital proceeds to investors (The Company and Real Estate Company, collectively, the "Members") as follows:
- To the Members, pari passu, all excess operating cash flows to an 8.0% IRR to the Members;
- 80% / 20% (80% to the Members / 20% to the Real Estate Company) of all excess operating cash flows to an 11% IRR;
- 70% / 30% (70% to the Members / 30% to the Real Estate Company) of excess cash flow and appreciation thereafter.
Note that these distributions will occur after the payment of The Company's liabilities (loan payments, operating expenses and other fees as set forth in the operating agreement, in addition to any member loans or returns due on member loans).
The Company will distribute 100% of its share of excess cash flow (after expenses and fees) to the members of The Company (the RealtyMogul investors).
Distributions are expected to start in March 2020 and are expected to continue on a quarterly basis thereafter. These distributions are at the discretion of the Real Estate Company, who may decide to delay distributions for any reason, including maintenance or capital reserves.
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
---|---|---|---|---|---|
Effective Gross Revenue | $5,648,805 | $6,328,860 | $6,402,209 | $6,713,760 | $6,882,439 |
Total Operating Expenses | $2,688,089 | $2,874,320 | $2,940,749 | $3,020,760 | $3,096,312 |
Net Operating Income | $2,960,716 | $3,454,540 | $3,461,460 | $3,693,000 | $3,786,127 |
Year 0 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
---|---|---|---|---|---|---|---|
Distributions to RealtyMogul 141, LLC Investors | ($3,030,000) | $65,643 | $369,819 | $469,276 | $449,976 | $513,376 | $2,993,221 |
Net Earnings to Investor - Hypothetical $50,000 Investment | ($50,000) | $1,083 | $6,103 | $7,744 | $7,425 | $8,472 | $49,393 |
Certain fees and compensation will be paid over the life of the transaction. The following fees and compensation will be paid:
Type of Fee | Amount of Fee | Received By | Paid From | Notes |
---|---|---|---|---|
Acquisition Fee | $546,698 | Real Estate Company | Capitalized Equity Contribution | 1.45% of the Purchase Price |
Broker-Dealer Fee | $120,000 | North Capital (1) | Capitalized Equity Contribution | 4.0% of the equity raised by RealtyMogul 141, LCC |
Origination Fee | $280,000 | RM Adviser, LLC | Capitalized Equity Contribution | 0.74% of Purchase Price |
Disposition Fee | 0.41% of gross sale price | RM Adviser, LLC | Distributable Cash |
Type of Fee | Amount of Fee | Received By | Paid From | Notes |
---|---|---|---|---|
Asset Management Fee | 0.25% of Purchase Price | Real Estate Company | Distributable Cash |
Subject to annual inflation adjustments |
Management and Administrative Fee | 1.0% of amount invested in RealtyMogul 141, LLC | RM Manager, LLC | Distributable Cash | RM Manager, LLC is the Manager of The Company and a wholly-owned subsidiary of Realty Mogul, Co. (2) |
Property Management Fee | 3.0% of Effective Gross Income | Colliers | Distributable Cash |
(1) North Capital Private Securities Corporation (“NCPS”), a registered broker-dealer who will act as placement agent for interests in the Company will be paid a fee as outlined above. NCPS will pay a referral fee to Mogul Securities, LLC (“MS”), an affiliate of the Manager and RealtyMogul, Co., for referring the transaction pursuant to a referral agreement between NCPS and MS. Certain employees of Realty Mogul, Co., an affiliate of Manager are registered representatives of, and are paid commissions by, NCPS.
(2) Fees may be deferred to reduce impact to investor distributions.
The above presentation is based upon information supplied by the Real Estate Company or others. Realty Mogul, Co., RM Manager, LLC, and The Company, along with their respective affiliates, officers, directors or representatives (the "RM Parties") hereby advise you that none of them has independently confirmed or verified any of the information contained herein. The RM Parties further make no representations as to the accuracy or completeness of any such information and undertake no obligation now or in the future to update or correct this presentation or any information contained herein.
Forward-Looking Statements
Investors should not rely on any forward-looking statements made regarding this opportunity, because such statements are inherently uncertain and involve risks. We use words such as “anticipated”, “projected”, “forecasted”, “estimated”, “prospective”, “believes”, “expects”, “plans”, “future”, “intends”, “should”, “can”, “could”, “might”, “potential”, “continue”, “may”, “will” and similar expressions to identify these forward-looking statements.
Non-Transferability of Securities
The transferability of membership interests in The Company are restricted both by the operating agreement for that entity and by U.S. federal and state securities laws. In general, investors will not be able to sell or transfer their interests. There is also no public market for the investment interests and none is expected to be available in the future. Moreover, the estimated investment holding period described herein is only a projection, and there can be no assurance when or if an investment may be liquidated. Persons should not invest if they require any of their investment to be liquid. This is particularly important for persons of retirement age, who should plan carefully to assure that their assets last throughout retirement.
Capital Call Risk
The amount of capital that may be required by the Target from the Company is unknown, and although the Target does not require that the Company and its members contribute additional capital to it, it may from time to time request additional funds in the form of loans or sell additional equity. The Company does not intend to participate in a capital call if one is requested by the Target, and in such event the manager of the Target may accept additional contributions from other members of Target or from new members. In the event that the manager of Target advances any capital on behalf of the Company, it will be deemed to be a manager loan at an interest rate that cannot be determined at this time. Amounts that are contributed by existing or new members will be deemed to be additional capital contributions, in which case the Company's interest in Target will potentially suffer a proportionate amount of dilution.
Escrow Contingency
All funds from investors will be held in a non-interest-bearing escrow account with Broker-Dealer as escrow agent for the benefit of the investors in accordance with Rule 15c2-4 under the Exchange Act. All investor funds will be transmitted directly by wire or electronic funds transfer via ACH to the escrow account maintained by the escrow agent per the instructions in the Subscription Agreement. Upon certification by Broker-Dealer and acceptance by the Company that all contingencies have been met, the investor’s funds will be promptly transmitted to the Company. If the contingencies fail to be satisfied during the offering period, we will instruct the Broker-Dealer to return all funds to the investors without interest, deduction, or setoff, and all of the obligations of the investor hereunder shall terminate.
Environmental Risk
The phase 1 environmental assessment obtained by the Sponsor discloses several potential recognized environmental conditions at the Property, including staining on the floor near the trash compactor in the warehouse portion of the Property. In the event that the Sponsor Entity is required to expend material funds remediating the environmental condition of the Property, it could have a material adverse effect on the business and financial condition of the Sponsor Entity.
Renovation Risks
As of September 2019, the Property had a 96.7% occupancy level (based on a 100% occupancy level at the Grandview Property and a 94.1% occupancy level at the Brewery Tower Property), and the Sponsor intends to implement a capital improvement plan involving the interior and exterior renovation of the Property, and a leasing program in its effort to add value to the Property. The Sponsor intends to renovate all or some of the space within the Property and increase the current rental rates of such renovated space. There can be no assurance that, (i) the renovations will be consummated on a timely basis, (ii) the renovations will be completed satisfactorily, (iii) such work will not materially adversely affect other aspects of the operation of the Property, and (iv) the planned rental rate increase will have favorable results to meet the goals the Sponsor projected. Any delays or negative results of the renovation work or rental increase efforts could adversely affect the Property’s financial results or occupancy levels, including its business operations and thus the value of the Company’s investment.
Office Building Competition Risk
Office buildings are subject to market forces affecting supply and demand just like other types of commercial space, but the economic drivers for office space are sometimes different than those for other real estate investments. Rents and valuations for offices are primarily influenced not just by employment growth but also by a region’s economic focus. Office properties are especially influenced by specific types of employment -- namely, sectors with very high proportions of office use. These economic segments are generally those that utilize service and professional employees such as attorneys, accountants, engineers, insurance personnel, real estate brokers and related service providers (like title and escrow providers), and people working in banking, financial services, consulting, medical, dental, and pharmaceutical fields. Office space tends to be leased for relatively long periods, with tenants often having the option to renew leases for additional terms. This means that office properties often have leases that can lag current market lease rates, and an appropriate “step-up” of rental rates may not be able to be imposed until a lease expires. Economic downturns can affect office buildings more than residential buildings, since businesses can go bankrupt even while people continue to need housing. Re-leases of office space can often require significant lead time to consummate.
Flood Risk
A portion of the Property is located in a designated Flood Zone. It is possible that all or a portion of the Property could experience significant damage due to flooding, in which case the business and financial condition of the Sponsor Entity, and thus the Company, would be materially adversely affected. There is no guarantee that the Sponsor Entity has or will obtain adequate flood insurance for the Property.
*The above is not intended to be a full discussion of all the risks of this investment. Please see the Risk Factors in the Issuer Document Package for a discussion of additional risks. The above presentation is based upon information supplied by the Real Estate Company and others. Realty Mogul, Co., RM Manager, LLC, and The Company, along with their respective affiliates, officers, directors or representatives (the "RM Parties") hereby advise you that none of them has independently confirmed or verified any of the information contained herein. The RM Parties further make no representations as to the accuracy or completeness of any such information and undertake no obligation now or in the future to update or correct this presentation or any information contained herein.