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Self-storage
LA/TX Self-Storage Portfolio
Multiple Locations
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LA/TX Self-Storage Portfolio
Multiple Locations
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Overview
LA/TX Self-Storage Portfolio
The LA/TX Self-Storage Portfolio consists of two recently constructed, fully climate-controlled class-A self-storage assets; one in Houston, TX, and one in Metairie, LA.
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Details
For more information, view the Sponsor's Investment Memorandum.
Estimated First Distribution 9/2022
Minimum Investment 35000
Estimated Hold Period 3.6 Years
Investment Strategy Core Plus
Investment Type Equity
# of Units (Houston) 819
# of Units (Metairie) 1,050
Year Built (Houston) 2018
Year Built (Metairie) 2019
Gross SF (Houston) 77,969
Gross SF (Metairie) 97,000
Sponsor Documents
The offering documents above have been prepared and are being delivered by the Sponsor of this investment opportunity, and not by RM Securities, LLC. RM Securities, LLC and its associated persons did not assist in preparing, do not explicitly or implicitly adopt or endorse, and are not otherwise responsible for, the Sponsors offering documents posted below or any content therein.
Deal Highlights
Investment Highlights
The Sponsor has closed on the acquisition of the assets and secured a loan with Trustmark Bank.
The exit strategy is to sell the Property after a 3.6-year hold at a 5.15% exit cap rate.
Each property is located in affluent submarkets with high usage of self-storage product.
This 2-property portfolio is moderately levered (~60% LTC) at a very cost-effective loan carrying a 3.3% all-in rate.
Each property is best-in-class within each submarket and offers renters cutting-edge security technology, which renters in each submarket highly value.
Opportunity to finalize lease-up and mark rents to market yields high return metrics for all investors.
An increase in appetite for self-storage product among investors is projected to further compress cap rates, therefore the exit cap rate may result in between 25 to 50 bps lower than the underwritten 5.15%.
The Sponsor has closed on the acquisition of the assets and secured a loan with Trustmark Bank.
The exit strategy is to sell the Property after a 3.6-year hold at a 5.15% exit cap rate.
Each property is located in affluent submarkets with high usage of self-storage product.
This 2-property portfolio is moderately levered (~60% LTC) at a very cost-effective loan carrying a 3.3% all-in rate.
Each property is best-in-class within each submarket and offers renters cutting-edge security technology, which renters in each submarket highly value.
Opportunity to finalize lease-up and mark rents to market yields high return metrics for all investors.
An increase in appetite for self-storage product among investors is projected to further compress cap rates, therefore the exit cap rate may result in between 25 to 50 bps lower than the underwritten 5.15%.
Contact Us
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Speak with our Investor Relations team.
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Management
For more information, view the Sponsor's Investment Memorandum.
Prescott Group and Hickory Capital Group

Prescott Group

Prescott Group is in Dallas, TX and was founded in 1996 by Judson (“Jud”) Pankey and Vance Detwiler. Both founding partners are still currently active executives at the firm. Prescott has three (3) separate but cohesive verticals of the business; Prescott Realty Group, the internal operations and management of our real estate; Prescott Advisors an SEC-registered entity and co-mingled fund manager with a current AUM of $152MM and Dyck O’Neal the in-house debt restructuring and servicing platform. The firm currently has 90+ employees and managed or owned over $685MM in real estate since inception. Prescott has leased over 25MM in commercial square feet. The firm currently focuses its investment efforts through their co-mingled fund mandates. Prescott Strategies Fund II has a debt/equity focus and is asset type agnostic in an effort to create a risk-adjusted portfolio. 

https://prescottgroup.com/

Hickory Capital Group

Hickory Capital Group, LLC (“HCG”) is a private real estate investment and property management company focused on the development and acquisition of self-storage properties. The firm currently has a portfolio of assets with a stabilized market value of approximately $130 million spread across the Southeast, Southwest, and Midwest.  Founded in 2014, HCG has offices in Cincinnati, Ohio; Nashville, Tennessee; and New Orleans, Louisiana. 

http://www.hickorycapitalgroup.com/

 

Sponsor Track Record

Prescott Track Record

Property Asset Type City, State Acq Date Sale Date Total Capitalization
7515 Greenville Ave Office Dallas, TX Jan-97 Mar-03  
6300 Ridgelea Blvd Office Ft. Worth, TX Jan-97 Feb-03  
Franklin Motor Bank Office Ft. Worth, TX Jan-97 Feb-99  
Two Mission Office Ft. Worth, TX Mar-97 Aug-97  
Oaklawn Residential For-Rent Residential Dallas, TX Mar-97 Aug-98  
Walnut Glen Tower Office Dallas, TX Aug-06 Aug-16  
Church Road (3) Land Dallas, TX Nov-06 Apr-13  
Manhattan I-III (3) For-Rent Residential Dallas, TX Aug-07 Oct-07  
Summit Office Park Office Ft. Worth, TX Oct-07 Jul-14  
Crestwood Apartments For-Rent Residential Dallas, TX Nov-07 Dec-12  
6060/6080 North Central Exwy Office Dallas, TX Jun-10 Jun-15  
BLVD Apartments For-Rent Residential Dallas, TX Dec-10 Apr-16  
Johnson Square Office Dallas, TX Aug-12 Sep-12  
110 West 7th (4) Office Tulsa, OK Dec-12 Aug-15  
Houston Tech Center (5 and 6) Office Houston, TX Dec-12 May-18  
Harbour Pointe (5) Office Seattle, WA Dec-12 May-18  
Northrock Apartments For-Rent Residential Dallas, TX Jan-13 Jan-17  
Greensheet Building Commercial Debt Houston, TX Dec-16 Aug-17  
Republic Tower/Turtle Creek Blvd Mixed-use Development Dallas, TX Jan-15 N/A  
Stoneleigh TIF TIF Receivable/Historic Hotel Dallas, TX Jul-17 N/A  
Westview Office Austin, TX Mar-16 N/A  
3100 Monticello Avenue Office Dallas, TX Aug-17 N/A  
Cle Elum Commercial Debt Cle Elum, WA Sep-17 Jun-19  
County Line Office Columbus, OH Jul-19 Dec-20  
San Marco East Plaza Office Jacksonville, FL Jan-19 N/A  
5959 Corporate Drive Office Houston, TX May-18 N/A  
Knoll Trail Office Dallas, TX Jun-19 N/A  
Greenbriar Office Fairfax, VA Nov-19 N/A  
Commercial Debt Commercial Debt Various Apr-19 N/A  
SFR Debt SFR Debt Various Jan-20 N/A  
CB-15 (2) CMBS Trust Bonds Various Dec-20 N/A  
Hickory Self-Storage Portfolio Self-Storage Various Jun-21 N/A  
Total          $680,467,038

Hickory Capital Group Track Record

Property City, State Asset Type Acq Date Units SF Sale Date Total Capitalization
Overland Park Overland Park, KS SS May 2019 612 71,160 August 2021  
Midrivers Mall St. Louis, MO SS April 2018 674 69,358 November 2021  
Eastgate Mall Cincinnati, OH SS December 2017 623 67,679 November 2021  
New Market Center Columbus, OH SS December 2020 732 113,075 December 2021  
Hamilton Place Mall Chatanooga, TN SS September 2019 612 69,573 November 2021  
Parkdale Mall Beaumont, YX SS May 2019 652 72,694 November 2021  
Seventh Street Cincinnati, OH SS September 2017 312 24,626    
Montgomery Crossing Cincinnati, OH SS June 2018 580 75,666    
Thibodaux Thibodaux, LA SS June 2021 186 41,740    
Junction City Junction City, KS SS June 2021 522 105,410    
Reading Road Cincinnati, OH SS September 2017 285 22,858    
Total             $85,700,304

(1) The above biography and track record were provided by the Sponsor and have not been independently verified by RM Technologies, LLC or its affiliates. Past performance is not indicative of future results. Please carefully review the Disclaimers section below.

Management Team
Management
Judson Pankey
CEO, Prescott Group

Judson "Jud" Pankey founded Prescott Group in 1996.  As the chief executive officer, he is responsible for directing operating growth strategy, acquisitions and assisting with client and investor relations.  Jud is also the CEO of the firm's debt company, Dyck O’Neal, and is a voting member of Prescott Advisors' investment committee. 

Prior to Prescott, Jud was an executive vice president at SCI-ROEV Real Estate and responsible for the asset management of a $120 million investment portfolio comprising 1.8 million square feet plus several undeveloped sites in Dallas, Fort Worth, and Houston which was acquired in 1991 from Bank of America predecessor NationsBank.   

Prior to SCI, Jud was a fiduciary manager and the youngest Vice President for a bank holding company with asset management duties for two co-mingled funds and separate accounts.  He was also instrumental in the creation/ participation of several special public and private ventures such as the Uptown Dallas, Inc (UDI), Transit-Oriented Development (TOD) Tax Increment Finance (TIF) District, City Center TIF District, Thanks-Giving Square Foundation, and University Crossing Public Improvement District. 

Jud earned a bachelor’s of arts degree in both business and economics from Vanderbilt University.  Jud has completed professional education courses at London Business School and Harvard Graduate School of Design.  Additionally, he is a recipient of the Corning World Trade Council Fellowship and a finalist for the Eisenhower Fellowship. 

Management
Vance Detwiler
President, Prescott Group

Vance is a co-founder and the current President of Prescott Group.  Vance is a principal in Prescott Advisors, Prescott Realty Group, and Dyck- O’Neal.  As the President, Vance leads strategic strategy and oversight of operating efforts across the firm.  He is responsible for the tactical direction of asset management, property management, investor relations, and capital raising.  Vance is a voting member of the Prescott Advisors investment committee. 

Prior to Prescott, Vance spent several years working at Sarofim Realty Advisors.  His primary responsibility was identifying and purchasing assets on behalf of the firm’s pension fund clients.  During his tenure, Sarofim purchased over three million square feet with a capitalization of more than $500 million.  Before Sarofim, Vance worked for LaSalle Partners (now Jones Lang LaSalle). 
Vance earned a Bachelor of Arts (concentration in finance and real estate) at the University of Texas at Austin.

Management
Adam J. Ellsworth
Principal, HCG

Mr. Ellsworth is an accomplished commercial real estate professional with over 20 years of extensive experience in the valuation, acquisition, sales, leasing, and analysis of real estate investments across self-storage, multi-family, office, retail, and industrial property types.  Throughout his career, he has sourced, underwritten, and closed over $1 Billion in assets across a variety of different markets including the Southeast, Mideast, Mid-Atlantic, and Texas.  Mr. Ellsworth received a Master of Business Administration degree (M.B.A.) from Vanderbilt University and a Bachelor of Arts (B.A.) degree from Lafayette College.

Property
For more information, view the Sponsor's Investment Memorandum.

The portfolio is comprised of a total of 1,869 units of which 819 (77,969 SF) are in Houston, TX and 1,050 (97,000 SF) in Metairie, LA.  All units in both Properties are climate-controlled. Both facilities are among the largest, best quality, and most visible within their respective submarkets. In the Metairie asset, there is also 3,500 SF of rentable retail space that is planned to be leased within two years. The main thesis in the business plan is to mark rents to market as both properties are currently rented at rates materially below market. 

Property Units Total SF Current Eff. Rent PSF Proforma Rent (Year Four)
Houston 819 77,969 $1.30 $1.90
Metairie 1,050 97,000 $1.37 $1.90
Total/Averages 1,869 174,969 $1.34 $1.90
Comparables
For more information, view the Sponsor's Investment Memorandum.

TX Lease Comparables

LA Lease Comparables

Sales Comparables

Financials
For more information, view the Sponsor's Investment Memorandum.
Sources & Uses

Total Capitalization

Sources of Funds $ Amount $/Unit $/SF
Debt $24,000,000 $12,841 $137
LP Equity(2) $11,500,000 $6,153 $66
Prescott Group Equity $3,499,410 $1,872 $20
Hickory Capital Group Equity $874,853 $468 $5
Total Sources of Funds $39,874,263 $21,335 $228
       
Uses of Funds(3) $ Amount $/Unit $/SF
Purchase Price $37,500,000 $20,064 $214
Pre-Paid OPEX $215,924 $116 $1
CAPEX $235,100 $126 $1
Loan Origination & App. Fees $220,000 $118 $1
HCG Transaction Fee $377,200 $202 $2
Working Capital $275,201 $147 $2
Legal Fees $128,831 $69 $1
RealtyMogul Fees & Costs(1) $500,000 $268 $3
Title Insurance & Recording Fees $178,996 $96 $1
Credit Line Interest Carry $150,000 $80 $1
Other Closing Costs $93,012 $50 $1
Total Uses of Funds $39,874,263 $21,335 $228

(1) The Sponsor’s equity contribution may consist of friends and family equity and equity from funds controlled by the Sponsor.

(2)(3) Please see PPM and LPA for more details. A guaranteed payment totaling $11MM was used originally to facilitate the acquisition of the property, which guaranteed payment will be paid down with the subject offering.

Debt Assumptions

The terms of the debt financing are as follows:

  • Lender: Trustmark Bank
  • Term: 3 Years
  • Loan-to-Cost: 60.2%
  • Estimated Proceeds: $24,000,000
  • Interest Type: Fixed
  • Annual Interest Rate: 3.30%
  • Interest-Only Period: 3 Years
  • Amortization: 25 Years
  • Prepayment Terms: The loan can be prepaid at any time without penalty
  • Extension Options(2)1 two-year extension option, no fee.
  • Extension Requirements: 1.3 DSCR, no event of default, written notice within 30 to 120 days prior to maturity date

(1) A substantial portion of the total acquisition for the Property will be paid with borrowed funds, i.e., debt.  Please carefully review the Disclaimers section below for additional information concerning the Sponsors use of debt. 

(2) At the option of the Borrower, the interest rate for the extension above can be (1) fixed at the then current "two year swap rate" plus 2.05% (the "Swap Rate") or (2) a floating rate equal to the Swap Rate. 

Distributions

Prescott Group and Hickory Capital Group intend to make distributions as follows:

  1. To the Investors, pari passu, all operating cash flows to an 8.0% IRR;
  2. 80% / 20% (80% to Investors / 20% to Promote/Carried Interest) of excess cash flow to a 14.0% IRR;
  3. 60% / 40% (60% to Investors / 40% to Promote/Carried Interest) of excess cash flow thereafter.

Prescott Group and Hickory Capital Group intend to make distributions to investors after the payment of the company's liabilities (loan payments, operating expenses, and other fees as more specifically set forth in the LLC agreements, in addition to any member loans or returns due on member loan).

Distributions are expected to start in September 2022 and are projected to continue on a quarterly basis thereafter. Distributions are at the discretion of Prescott Group and Hickory Capital Group, who may decide to delay distributions for any reason, including maintenance or capital reserves.

Cash Flow Summary
      Year 1 Year 2 Year 3 Year 4
Effective Gross Revenue   $3,293,669 $3,783,769 $3,955,758 $4,073,540
Total Operating Expenses   $1,299,683 $1,365,383 $1,414,597 $1,464,856
Net Operating Income   $1,993,985 $2,418,387 $2,541,161 $2,608,684
             
Project-Level Cash Flows
    Year 0 Year 1 Year 2 Year 3 Year 4 (1)
Net Cash Flow ($15,874,263) $1,337,151 $1,630,511 $1,465,565 $26,942,867
             
Investor-Level Cash Flows (2)
    Year 0 Year 1 Year 2 Year 3 Year 4 (1)
Net Cash Flow ($11,500,000) $840,912 $1,053,435 $933,940 $16,886,888
             
Investor-Level Cash Flows - Hypothetical $50,000 Investment (2)
    Year 0 Year 1 Year 2 Year 3 Year 4 (1)
Net Cash Flow ($50,000) $3,656 $4,580 $4,061 $73,421

(1) stub year of seven months

(2) RM Technologies, LLC and its affiliates do not provide any assurance of returns.  Returns presented are net of all fees.  Please carefully review the Fees and Disclaimers sections below for additional information concerning Sponsor’s use or projected returns and fees paid to Sponsor and RM Technologies, LLC.

 

Fees

Certain fees and compensation will be paid over the life of the transaction; please refer to the Sponsors' materials for details. The following fees and compensation will be paid:

One-Time Fees:
Type of Fee Amount of Fee Received By Paid From
Acquisition Fee 1.0% of Purchase Price Hickory Capital Group Capitalization
Technology Solution Licensing Fee(2) Flat one-time licensing fees of $15,000 plus $1,500 per each prospective investor onboarded by Sponsor through its license and use of RM Technologies’ Technology Solution RM Technologies, LLC Capitalization
       
Recurring Fees:
Type of Fee Amount of Fee Received By Paid From
Asset Management Fee 1.5% of EGI Prescott Group Cash Flow
Property Management Fee 5.0% of EGI Hickory Capital Group Cash Flow
Administrative Solution Fee flat quarterly fee of $125 per investor serviced through the Administration Solution RM Technologies, LLC Cash Flow

(1) Fees may be deferred to reduce impact to investor distributions.

(2) Please see the Fees and Disclaimers sections below for additional information concerning fees paid to RM Technologies, LLC.

.

Sources & Uses

Total Capitalization

Sources of Funds $ Amount $/Unit $/SF
Debt $24,000,000 $12,841 $137
LP Equity(2) $11,500,000 $6,153 $66
Prescott Group Equity $3,499,410 $1,872 $20
Hickory Capital Group Equity $874,853 $468 $5
Total Sources of Funds $39,874,263 $21,335 $228
       
Uses of Funds(3) $ Amount $/Unit $/SF
Purchase Price $37,500,000 $20,064 $214
Pre-Paid OPEX $215,924 $116 $1
CAPEX $235,100 $126 $1
Loan Origination & App. Fees $220,000 $118 $1
HCG Transaction Fee $377,200 $202 $2
Working Capital $275,201 $147 $2
Legal Fees $128,831 $69 $1
RealtyMogul Fees & Costs(1) $500,000 $268 $3
Title Insurance & Recording Fees $178,996 $96 $1
Credit Line Interest Carry $150,000 $80 $1
Other Closing Costs $93,012 $50 $1
Total Uses of Funds $39,874,263 $21,335 $228

(1) The Sponsor’s equity contribution may consist of friends and family equity and equity from funds controlled by the Sponsor.

(2)(3) Please see PPM and LPA for more details. A guaranteed payment totaling $11MM was used originally to facilitate the acquisition of the property, which guaranteed payment will be paid down with the subject offering.

Debt Assumptions

The terms of the debt financing are as follows:

  • Lender: Trustmark Bank
  • Term: 3 Years
  • Loan-to-Cost: 60.2%
  • Estimated Proceeds: $24,000,000
  • Interest Type: Fixed
  • Annual Interest Rate: 3.30%
  • Interest-Only Period: 3 Years
  • Amortization: 25 Years
  • Prepayment Terms: The loan can be prepaid at any time without penalty
  • Extension Options(2)1 two-year extension option, no fee.
  • Extension Requirements: 1.3 DSCR, no event of default, written notice within 30 to 120 days prior to maturity date

(1) A substantial portion of the total acquisition for the Property will be paid with borrowed funds, i.e., debt.  Please carefully review the Disclaimers section below for additional information concerning the Sponsors use of debt. 

(2) At the option of the Borrower, the interest rate for the extension above can be (1) fixed at the then current "two year swap rate" plus 2.05% (the "Swap Rate") or (2) a floating rate equal to the Swap Rate. 

Distributions

Prescott Group and Hickory Capital Group intend to make distributions as follows:

  1. To the Investors, pari passu, all operating cash flows to an 8.0% IRR;
  2. 80% / 20% (80% to Investors / 20% to Promote/Carried Interest) of excess cash flow to a 14.0% IRR;
  3. 60% / 40% (60% to Investors / 40% to Promote/Carried Interest) of excess cash flow thereafter.

Prescott Group and Hickory Capital Group intend to make distributions to investors after the payment of the company's liabilities (loan payments, operating expenses, and other fees as more specifically set forth in the LLC agreements, in addition to any member loans or returns due on member loan).

Distributions are expected to start in September 2022 and are projected to continue on a quarterly basis thereafter. Distributions are at the discretion of Prescott Group and Hickory Capital Group, who may decide to delay distributions for any reason, including maintenance or capital reserves.

Cash Flow Summary
      Year 1 Year 2 Year 3 Year 4
Effective Gross Revenue   $3,293,669 $3,783,769 $3,955,758 $4,073,540
Total Operating Expenses   $1,299,683 $1,365,383 $1,414,597 $1,464,856
Net Operating Income   $1,993,985 $2,418,387 $2,541,161 $2,608,684
             
Project-Level Cash Flows
    Year 0 Year 1 Year 2 Year 3 Year 4 (1)
Net Cash Flow ($15,874,263) $1,337,151 $1,630,511 $1,465,565 $26,942,867
             
Investor-Level Cash Flows (2)
    Year 0 Year 1 Year 2 Year 3 Year 4 (1)
Net Cash Flow ($11,500,000) $840,912 $1,053,435 $933,940 $16,886,888
             
Investor-Level Cash Flows - Hypothetical $50,000 Investment (2)
    Year 0 Year 1 Year 2 Year 3 Year 4 (1)
Net Cash Flow ($50,000) $3,656 $4,580 $4,061 $73,421

(1) stub year of seven months

(2) RM Technologies, LLC and its affiliates do not provide any assurance of returns.  Returns presented are net of all fees.  Please carefully review the Fees and Disclaimers sections below for additional information concerning Sponsor’s use or projected returns and fees paid to Sponsor and RM Technologies, LLC.

 

Fees

Certain fees and compensation will be paid over the life of the transaction; please refer to the Sponsors' materials for details. The following fees and compensation will be paid:

One-Time Fees:
Type of Fee Amount of Fee Received By Paid From
Acquisition Fee 1.0% of Purchase Price Hickory Capital Group Capitalization
Technology Solution Licensing Fee(2) Flat one-time licensing fees of $15,000 plus $1,500 per each prospective investor onboarded by Sponsor through its license and use of RM Technologies’ Technology Solution RM Technologies, LLC Capitalization
       
Recurring Fees:
Type of Fee Amount of Fee Received By Paid From
Asset Management Fee 1.5% of EGI Prescott Group Cash Flow
Property Management Fee 5.0% of EGI Hickory Capital Group Cash Flow
Administrative Solution Fee flat quarterly fee of $125 per investor serviced through the Administration Solution RM Technologies, LLC Cash Flow

(1) Fees may be deferred to reduce impact to investor distributions.

(2) Please see the Fees and Disclaimers sections below for additional information concerning fees paid to RM Technologies, LLC.

.

Disclosures
RM Securities, LLC and its Affiliates Compensation

RM Securities, LLC, its registered representatives, affiliates, associated persons, and personnel of its affiliates who may also be associated with it, including our associated persons and personnel of our affiliates who are also be associated with RM Securities, LLC (it (“RM Securities,” “we,” “our,” or “us”) will receive fees, expense reimbursements, and other compensation (“Fees”) from the issuer of this investment offering, its sponsor, or an affiliate thereof (“Sponsor”), or otherwise in connection with Sponsor’s offering. The Fees paid to us are in addition to other fees you will pay to Sponsor or in connection with Sponsor’s investment offering. You will pay Fees to Sponsor, either directly or indirectly as an investor in the Sponsor’s offering. Sponsor will use the Fees you pay, as well as funds you invest in the relevant offering, to compensate us. The Fees paid to us will directly or indirectly be borne by you as the investor (typically, but not always, in the form of an expense of the Sponsor’s offering in which you invest) because such Fees will reduce the proceeds available for distribution to you and reduce the amount you earn over time.

For more information on the Fees paid to us, or any other Fees you will pay in connection with Sponsor’s offering, please carefully review the Sponsor’s Investment Documents. Please also carefully review RM Securities’ Form CRS, Regulation Best Interest Disclosures, and Limited Brokerage Services Agreement.

No Approval, Opinion or Representation, or Warranty by RM Securities, LLC

Sponsor has provided, approved, and is solely responsible in all aspects for the information on this webpage (“Page”), including Sponsor’s offering documentation, which may include without limitation the Private Placement Memorandum, Operating or Limited Partnership Agreement, Subscription Agreement, the Project Summary and all exhibits and other documents attached thereto or referenced therein (collectively, the “Investment Documents”). The Investment Documents linked on this page have been prepared and posted by Sponsor, and not by RM Securities. We did not assist in preparing, do not adopt or endorse, and we are not otherwise responsible for, the Sponsor’s Investment Documents. We make no representations or warranties as to the accuracy of information on this Page or in the Sponsor’s Investment Documents and we accept no liability therefor. No part of the information on this Page or in the Sponsor’s Investment Documents is intended to be binding on us.

Sponsor’s Information Qualified by Investment Documents

The information on this Page is qualified in its entirety by reference to the more complete information about the offering contained in the Sponsor’s Investment Documents. The information on this Page is not complete and subject to change at the Sponsor’s discretion at any time up to the closing date. The Sponsor’s Investment Documents and supplements thereto contain important information about the Sponsor’s offering including relevant investment objectives, the business plan, risks, charges, expenses, and other information, which you should consider carefully before investing. The information on this Page should not be used as a basis for an investor’s decision to invest.

Risk of Investment

This investment is speculative, highly illiquid, and involves substantial risk. There can be no assurances that all or any of Sponsor’s assumptions, expectations, estimates, goals, hypothetical illustrations, or other aspects of Sponsor’s business plans (“Assumptions”) will be true or that actual performance will bear any relation to Sponsor’s Assumptions, and no guarantee or representation is made that Sponsor’s Assumptions will be achieved. If Sponsor does not achieve its Assumptions, your investment could be materially and adversely affected. A loss of part or all of the principal value of your investment may occur. You should not invest unless you can readily bear the consequences of such loss. Sponsor’s Assumptions should not be relied upon as the primary basis for your decision to invest.

No Reliance on Forward-Looking Statements; Sponsor Assumptions

Sponsor is solely responsible for statements made concerning forward-looking statements and Assumptions, which apply only as of the date made, are preliminary and subject to change, and are expressly qualified in their entirety by the disclosures and cautionary statements included in Sponsor’s Investment Documents, which you should carefully review. Neither RM Securities nor Sponsor are obligated to update or revise such forward-looking statements or Assumptions to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Sponsor’s forward-looking statements and Assumptions are hypothetical, not based on actual investment achievements or events, and are presented solely for purposes of providing insight into the Sponsor’s investment objectives, detailing Sponsor’s anticipated risk and reward characteristics, and establishing a benchmark for future evaluation of actual results; therefore, they are not a predictor, projection, or guarantee of future results. You should not rely on Sponsor’s forward-looking statements as a basis to invest.

Importantly, we do not adopt, endorse, or provide any assurance of returns or as to the accuracy or reasonableness of Sponsor’s Assumptions or forward-looking statements.

No Reliance on Past Performance

Any description of past performance is not a reliable indicator of future performance and should not be relied upon as the primary basis to invest.

Sponsor’s Use of Debt

A substantial portion of the total cost of the real estate asset acquired by the Sponsor with investor funds (“Property”) will be paid with borrowed funds, i.e., debt. Sponsor’s estimated rates and terms of the debt financing are subject to lender approval, and there is no assurance that the Sponsor will secure debt at the rates and terms presented on this Page or in the Sponsor’s Investment Documents, or at all. The use of borrowed money to acquire real estate is referred to as leveraging, which can amplify losses and could result in lender foreclosure. In addition, if the debt includes a variable (or “floating”) interest rate, the total amount of interest paid over the term of the debt will fluctuate and can increase. As a result, Sponsor’s use of debt can result in a loss of some or all of your investment.

Sponsor’s Offering is Not Registered

Sponsor’s securities offering will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon the exemptions from registration pursuant to Rule 506(c) of Regulation D as promulgated under the Securities Act (“Private Placement”). In addition, the offering will not be registered under any state securities laws in reliance on exemptions from state registration. Such securities (your ownership 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 Private Placements on the Platform are intended solely for “Accredited Investors,” as that term is defined in Rule 501(a) under the Securities Act.

No Investment Advice

Nothing on this Page should be regarded as investment advice (either with respect to a particular security or regarding an overall investment strategy), a recommendation, an offer to sell, or a solicitation of or an offer to buy any security. Advice from a securities professional is strongly advised to understand and assess the risks associated with real estate or private placement investments. For additional information on RM Securities’ involvement in this offering, please carefully review the Sponsor’s Investment Documents, and RM Securities’ Form CRS, Regulation Best Interest Disclosures, and Limited Brokerage Services Agreement.

1031 Exchange Risk

Internal Revenue Code Section 1031 (“Section 1031”) contains complex tax concepts and certain tax consequences may vary depending on the individual circumstances of each investor. RM Securities and its affiliates make no representation or warranty of any kind with respect to the tax consequences of your investment or that the IRS will not challenge any such treatment. You should consult with and rely on your own tax advisor about the tax aspects with respect to your particular circumstances.

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