The content on this detail page was provided by the Sponsor or an affiliate thereof. The Sponsor is under no obligation to update this detail page. None of the opinions expressed on this detail page are the opinions of RealtyMogul and they are not endorsed by RealtyMogul. Assumptions and projections included in this detail page are not reflective of the position of RealtyMogul or any other person or entity other than the Target (“Investment Entity” or "Company") or its affiliates.

The preceding summary of principal terms of the offering is qualified in its entirety by reference to the more complete information about the offering contained in the offering documents, including, without limitation, the Equity Presentation, Private Placement Memorandum, Operating Agreement, Subscription Agreement and all exhibits and other documents attached thereto or referenced therein (collectively, the "Investment Documents"). This summary is not complete, and each prospective investor should carefully read all of the Investment Documents and any supplements thereto, copies of which are available by clicking the links above or upon request, before deciding whether to make an investment. In the event of an inconsistency between the preceding summary and the Investment Documents, investors should rely on the content of the Investment Documents.

There can be no assurance that the methodology used for calculating targeted IRR is appropriate or adequate. Target IRR is presented solely for the purpose of providing insight into the Investment Entity’s investment objectives, detailing its anticipated risk and reward characteristics and for establishing a benchmark for future evaluation of the Investment Entity’s performance. Targeted IRR is not a predictor, projection or guarantee of future performance. There can be no assurance that the Investment Entity’s targets will be met or that the Investment Entity will be successful in identifying and investing in investment opportunities that would allow the Investment Entity to meet these return parameters. Target returns should not be used as a primary basis for an investor’s decision to invest in the Investment Entity. Please see the applicable Investment Documents for disclosure relating to forward-looking statements.

All forward–looking statements attributable to the Sponsor or persons acting on its behalf apply only as of the date of the offering and are expressly qualified in their entirety by the cautionary statements included elsewhere in this summary and the Investment Documents. Any financial projections are preliminary and subject to change; the Sponsor undertakes no obligation to update or revise these forward–looking statements to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Inevitably, some assumptions will not materialize, and unanticipated events and circumstances may affect the ultimate financial results. Projections are inherently subject to substantial and numerous uncertainties and to a wide variety of significant business, economic and competitive risks, and the assumptions underlying the projections may be inaccurate in any material respect. Therefore, the actual results achieved may vary significantly from the forecasts, and the variations may be material.

The interests in the Investment Entity will not be registered under the Securities Act of 1933, as amended (the “Securities Act”) in reliance upon exemptions contained in Rule 506(b) or 506(c) of Regulation D as promulgated under the Securities Act. In addition, the interests will not be registered under any state securities laws in reliance on exemptions from registration. Such interests are subject to restrictions on transferability and resale and may not be transferred or resold except as permitted under applicable state and federal securities laws pursuant to registration or an available exemption.

All investing activities risk the loss of capital. There can be no assurance that investors will not suffer significant losses. No guarantee or representation is made that investment objectives of the Investment Entity will be achieved. You should not subscribe to purchase interests in the Investment Entity unless you can readily bear the consequences of such loss.

Interests in the Investment Entity are listed on the RealtyMogul Platform. RealtyMogul receives fees from the Sponsor or the Investment Entity partially based on the number of investors investing in such Investment Entity through the RealtyMogul Platform. This arrangement could create a conflict of interest between RealtyMogul and investors.

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.

Lack of Operating History

The Company only has acquired the Property and has had limited operations with respect to the Property and construction of improvements thereon prior to this offering has been raised. The likelihood of success of the Company’s investment must be considered in light of the risks, expenses and difficulties frequently encountered in connection with the acquisition, ownership, development, construction of improvements on, and operation of real properties similar to the Property.

No Diversification in Company Investments

The Company intends invest solely in the Property and improvements to be constructed thereon.  As a result, investors will have a concentration of risk in a single asset class which has, by its nature, certain characteristics not present in other property types.  By only investing in the Property and its improvements, the Company will not have the opportunity to spread its investment risk across multiple property types or other asset classes.  Thus, should events occur which negatively impact the Property, the Company will have no ability to offset those events through investments in other assets or asset classes, and your investment would materially and adversely be affected.

Increased Construction of Similar Multifamily Construction and Development Projects 

The Property is located in an area that may experience increases in construction of properties that compete with the Property. This increased competition and construction could make it more difficult for to find residents to lease units in the multifamily construction and development project and/or force a decrease in rental rates in order to lease units in the Property, which could substantially reduce  revenues and could have a material adverse effect on the  Company. In addition, overbuilding of multifamily construction and development projects may occur.

Environmental Concerns

California is subject to frequent and sometimes debilitating natural disasters, including but not limited to severe drought, earthquakes, and fires. The Property may be located in an earthquake fault zone, and as such, there is increased risk of damage to, or total destruction of, the Property from an earthquake. There can be no assurance that  the Company will be  properly insured for any such damage caused to the Property or its business operations. As a result, the business and financial condition of the Company and its investors, may be materially advers

Development and Construction Risks

The business plan is to develop the Property as a multifamily construction and development project. These activities can include long planning and entitlement timelines and can involve complex and costly activities, including significant environmental remediation or construction work. These activities may be exposed to the following risks:

• the development may be abandoned for a number of reasons, including changes in local market conditions or increases in construction or financing costs, and, as a result, we may fail to recover expenses already incurred in exploring the  development of the Property;
• occupancy rates and rents at a community may fail to meet original expectations for a number of reasons, including changes in market and economic conditions beyond our control and the development by competitors of competing communities;
• inability to obtain, or experience delays in obtaining, necessary zoning, occupancy, or other required governmental or third party permits and authorizations, which could result in increased costs or the delay or abandonment of development of the Property;
• incurring costs that exceed original estimates due to increased material, labor or other costs;
• the inability to obtain needed permits or approvals, or to complete construction and lease-up of improvements on schedule, resulting in increased construction and financing costs and a decrease in expected rental revenues;
• the inability to obtain financing with favorable terms, or at all, for the proposed development of the Property, which may cause delay or abandonment of the development of the Property;
• incurring liabilities to third parties during the development process, for example, in connection with managing existing improvements on the site prior to demolition (such as commercial space) or in connection with providing services to third parties (such as the construction of shared infrastructure or other improvements); and
• incurring liability if the Property is not developed and operated in compliance with the accessibility provisions of the Americans with Disabilities Acts, the Fair Housing Act or other federal, state or local requirements. Noncompliance could result in imposition of fines, an award of damages to private litigants, and a requirement that we undertake structural modifications to remedy the noncompliance.

Permitting and Construction Risk

The Company has received approval of entitlements from the Los Angeles Planning Commission to build the subject 57-unit multi-family apartment project. However, there have been numerous appeals by nearby neighbors and there can be no assurance that the Company will be able to successfully obtain the final entitlement approval or that the approval will be obtained in a timely manner. Any unplanned delays and/or the Company’s inability to obtain the final entitlement approval to complete the planned construction could materially and adversely affect the value of the Property and thus could materially and adversely affect the value of the Company’s investment.

Lease-Up Risks

The Company’s revenues from the Property will be dependent upon the creditworthiness of the Property’s tenants and would be adversely affected by the loss of, or default by, lessees.  Lease payment defaults by tenants could indirectly cause the Company to reduce the amount of distributions to the Members and force the Company to find an alternative source of revenue to pay any mortgage loan on the Property.

Risks Related to the Property’s Mortgage

While the Company has procured a construction loan commitment from Cathay Bank which, if funded as and in the amount currently contemplated by the Manager, would provide the net loan proceeds as indicated in the Project Economics at the rate and terms shown therein, there can be no assurance that Cathay Bank will actually fund its committed loan, or that the amount of the loan to which it has committed will not be reduced based on underwriting or other factors. As such, the final terms of the construction loan that the Manager is able to procure on behalf of the Company, and in connection with the Property may not be exactly as assumed and any material change in such terms could have a detrimental impact on the ability of the Company to achieve the projected returns.

COVID-19 Risk

On March 11, 2020, the World Health Organization declared the COVID-19 coronavirus outbreak a worldwide pandemic (the “Pandemic”).  On March 13, 2020, President Trump declared a national emergency in the United States.  Various cities and states have also declared emergencies.  The Pandemic and the reactions of various governments and citizens is causing (and any future outbreaks of the coronavirus disease may cause) massive disruptions in economies, financial markets, supply chains, businesses and daily life on a worldwide scale never seen in recent history.  Such disruption may continue for an extended period or indefinitely, may lead to a recession or depression in the United States and/or globally, and may adversely impact the Company.  As of August 2020, the Pandemic has caused a near total cessation of all non-essential economic activities in many U.S. cities and states.  Many businesses have temporarily suspended operations and laid off employees.  In the United States, persons have been diagnosed with COVID-19 in each of the 50 states.  While the Company may have a business continuity plan, it may be materially affected by the Pandemic.  The Pandemic and reactions by governments and citizens, and the impact of the Pandemic and such reactions on businesses and the economy, are creating and are likely to continue to create various issues for the economy that are impossible to fully predict or list here but all or many could, and are likely to be, material, with such likelihood of materiality increasing the longer the duration of the Pandemic (and whether or not there is a recurrence of coronavirus even after the current Pandemic improves).  The Pandemic may worsen substantially before it improves, and the entirety of the United States will continue to be impacted. There is little certainty as to when the Pandemic will abate, or to what extent the Unites States economy will recover from the disruption caused by the Pandemic.  In addition to the severe impact of the Pandemic on financial markets and economies, other things that may impact the Company in connection with the Pandemic include the closure of courts and state governments, which among other things, can directly affect the ability to complete or enforce evictions, and the lack of in-person walk-throughs of the Property (both for the Manager and appraisers).  The closure of certain businesses or limitations in the ability of certain businesses to function, as well as declarations of states of emergency, and “shelter at home” measures in certain areas, have and could affect the ability of the staff of the Manager and/or applicable property managers to function properly.  A reduction in liquidity and increase in volatility in financial markets could affect the valuation of real estate, the health of the Company’s financing partners or other persons necessary for the Company to implement its strategy and the ability to find third party financing.  Also, the Principals and staff members of the Manager could become infected with COVID-19, develop symptoms, and not be able to work, or not be able to work effectively. Of course, this crisis may also create opportunities for the Manager for targeted investments and the Company will endeavor to position itself well to take advantage of these opportunities and mitigate the risks above inasmuch as they can be mitigated.

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 Admin, LLC, The Target, 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.