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Funded
Multifamily
Bay Island
Dallas MSA, TX
INVESTMENT STRATEGY
Value-Add
INVESTMENT TYPE
Equity
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100% funded
Offered By ParaWest Group
20.1%* TARGET IRR 19.1%-21.1%
1.74X* TARGET EQUITY MULTIPLE
Estimated Hold Period 3 Years
Estimated First Distribution 2/2023
Minimum Investment 35000
*Please carefully review the Disclaimers section below, including regarding Sponsor’s assumptions and target returns
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Project Summary
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Explore this Project
Overview
Bay Island is a 120-unit lakeside multifamily property located in Garland, Texas, a suburb within the DFW Metroplex, with value-add potential.
Basis

Favorable financing due to the Sponsor Principal’s Personal Guarantee, resulting in a fixed rate loan that achieves a projected IRR of 160 basis points higher than non-recourse debt available in today’s market.

Value-Add

Bay Island's location, size, design, and upgrade enhancements all combine to present an outstanding value-add opportunity projected to achieve $160 rent increases on post renovated units.

Location

Outstanding suburban Dallas location within the Dallas Fort Worth Metroplex, one of the fastest-growing SMSA's in the nation in population and employment growth. Immediate surrounding area median HH Incomes exceed $98,000.

Property At A Glance
# of Units 120
# of Buildings 10
Year Built 1972
Current Occupancy 97.0%
Exit Cap Rate 5.0%
Acquisition Price

$19,750,000

Investment Highlights
Fixed interest rate, personal guaranteed financing which improves the projected IRR ~160bp to the underwritten IRR compared with non-recourse debt and reduces the risk of interest rate increases over the hold period.
ParaWest Group is a four-time repeat sponsor on the RealtyMogul Platform. PWG has gone full cycle on its first transaction with RM, having closed in June and generating an Investor IRR of 27%, with the second deal currently in escrow and scheduled to close during the third quarter with a projected Investor IRR of 24%.
Purchase price of $19,750,000 with a going-in cap of 5.9%
Strong submarket statistics with 97% average occupancy and 15%+ annual rent growth.
Unique value-add opportunity to improve interiors and amenities to generate enhanced revenue growth
Lakeside location steps away from Lake Ray Hubbard within the Dallas Fort Worth Metroplex
Close proximity to a billion-dollar mixed development project slated to become a unique waterfront destination
Ideal unit mix of 1, 2 and 3 bedrooms with townhome options available
A-Rated Garland School District
Management
Cumulative Distributions

ParaWest Group

ParaWest Group (PWG)(1) brings together the collective experience of Curtis Haines, Michael Salkeld, Delane Salkeld, and CRSC Residential, Inc. through its President and CEO, Bryan Krizek. These principals bring to the table decades of experience in multi-family investments and operations both individually and collectively resulting in in-depth knowledge and experience that is unsurpassed in the industry. PWG focuses solely on multi-family properties in select markets. As an investment arm of these principals, PWG is an investment platform that includes ParaWest Management(2), thus creating a fully integrated platform for multi-family investments. This platform extends from sourcing and acquisitions to financing and equity structuring, renovation and operations, and ultimately disposition. ParaWest Group, through its principals, has created a strategic advantage in sourcing, underwriting, and closing opportunistic value-add multi-family properties and since its inception in 2012, has participated in the acquisition and investment in twenty-three properties totaling more than 4,000 units.

As a repeat Sponsor on the RealtyMogul Platform, Bay Island at Lake Ray Hubbard will be ParaWest Group’s fifth transaction with Realty Mogul. The first two deals have now gone full cycle (i.e. through sale) with the first having closed in June 2022, and generated an IRR to Investors of 27%, and the second, currently in escrow and scheduled to close during the third quarter, generating a projected Investor IRR of 24%. Both deals had proforma returns of 15.9% each.

Notes:
1) ParaWest Group, LLC  is a pass-through entity and its principals invest as individuals in single ownership entities on each transaction. 
2) ParaWest Management has been in business since 2003 and is solely owned by Michael and Delane Salkeld.         

http://www.parawestgroup.com/
  • Michael Salkeld
    Co-Founder / Managing Partner
  • Delane Salkeld
    Co-Founder / Partner
  • Curtis Haines
    Partner
  • CRSC Residential, Inc.
    Principal
Michael Salkeld
Co-Founder / Managing Partner

Prior to cofounding ParaWest in 2003, Mr. Salkeld served as Regional Vice President of Pinnacle Realty Management's Arizona Office between 1990 and 2001, where he developed and supervised a fee management portfolio of more than 6,000 units in Arizona, Nevada, California, and New Mexico.  Before that (1982-1989) he served as Executive V.P. of Property Management and Development for Urban Investment Corporation.

Delane Salkeld
Co-Founder / Partner

Prior to serving as principal for ParaWest, Mrs. Salkeld served as Senior Investment Manager for Pinnacle Realty Management, Inc. (1990-2000).  Mrs. Salkeld is certified as a Licensed Real Estate Broker in AZ, and as a Property Manager (CPM).  She is also a member of the Arizona Multi-Housing Associate Board of Directors.

Curtis Haines
Partner

As of January 2021, Mr. Haines is invested in more than 100 multifamily properties as Key Principal with an aggregate value of more than $1.9 billion. Prior to engaging in multifamily investing, Mr. Haines founded, developed, and sold one of Houston's largest Permanent Placement Firms designated by Inc. Magazine as one of the "Fastest-Growing Private Companies in the U.S." before moving into Apartment Investment and applying the same diligence, fortitude, and insightfulness that has made him one of Houston's most prodigious apartment owner-operators.

CRSC Residential, Inc.
Principal

CRSC Residential, Inc. as an affiliate of CRS, Inc. owns and operates multi-family properties in Virginia, Kansas, and Arizona, and has investment interests in properties in Texas. Total wholly-owned properties together with Investments in Property Operating interests exceed $100 million.

Track Record

ParaWest Group's Track Record

ParaWest Group Principals - Managing Members - Current SREO
Property Units Location Built  Value   Value/Unit   Debt   Total Equity  Lender Date Acquired MMR2
Idlewood Park1 268 Houston, Texas 1984  $24,460,000  $91,269  $16,710,000  $7,750,000 Berkeley Point Capital (FNMA) Nov-13 MS
Fountain Park 176 Stafford, Texas 1969  $14,960,000  $85,000  $7,100,000  $7,860,000 Berkeley Point Capital (FNMA) Oct-13 CH
Plantation at Quail Valley 124 Missouri City, Texas 2004  $16,415,886  $132,386  $8,118,612  $8,297,274 Keybank Nov-13 CH
Springfield 100 Missouri City, Texas 1977  $8,846,615  $88,466  $2,553,573  $6,293,042 Arbor (FNMA) Sep-14 CH
Briar Court 201 Houston, Texas 1973  $28,200,000  $140,299  $15,200,000  $13,000,000 MF1 Jun-19 MS
Lexington at Champions 89 Houston, Texas 2003  $13,500,000  $151,685  $10,878,750  $2,621,250 Arbor Sep-21 MS
Total/Avg 958      $106,382,501  $689,105  $60,560,935  $45,821,566      
 
ParaWest Group Principals - Managing Members - Exited Deals
Property Units Location Built  Sales Price   Price/Unit   Date Sold  Date Acquired MMR2    
Mirabella Galleria 160 Houston, Texas 1965  $14,700,000  $91,875 Aug-18 Jun-12 CH    
Beverly Palms 362 Houston, Texas 1968  $31,338,000  $86,569 May-18 Aug-12 MS    
Stoney Brook 113 Houston, Texas 1966  $11,550,000  $102,212 Apr-18 Jan-10 CH    
Legacy at Westchase 324 Houston, Texas 1977  $25,000,000  $77,160 Aug-17 Jun-14 MS    
Idlewood Park1 268 Houston, Texas 1981  $22,258,000  $83,052 Jun-17 Oct-13 MS    
Jacinto Palms 128 Houston, Texas 1972  $6,765,000  $52,852 Jan-16 Jun-14 CH    
Barcelona 118 Houston, Texas 1963  $6,500,000  $55,085 Dec-13 Jul-09 CH    
Carrington Court 111 Houston, Texas 1963  $11,000,000  $99,099 Apr-19 Mar-11 CH    
Watermill 192 Houston, Texas 1970  $17,477,000  $91,026 Apr-19 Aug-11 CH    
Quail Valley 176 Missouri City, Texas 1978  $16,192,000  $92,000 Aug-19 Sep-14 CH    
Colonade 192 Grand Prairie, Texas 2001  $22,000,000  $114,583 Dec-18 Oct-15 Other    
Somerset 264 Fort Worth, Texas 1985  $24,245,000  $91,837 Jan-22 Oct-16 Other    
Stratton Park 264 Fort Worth, Texas 1985  $24,245,000  $91,837 Jan-22 Oct-16 Other    
Valencia 263 Fort Worth, Texas 263  $22,345,000  $84,962 Jan-22 Jul-17 Other    
Corners 242 Dallas, Texas 242  $21,250,000  $87,810 Jan-22 Nov-17 Other    
Landmark at Laurel Heights 286 Mesquite, Texas 286  $37,915,000  $132,570 Jan-22 Dec-17 Other    
Briarstone2 97 Rosenberg, Texas 1997  $12,500,000  $128,866 Mar-21 Oct-18 MS    
Tiffany Square 84 Houston, Texas 1971  $7,896,000  $94,000 Feb-22 Dec-12 CH    
Residences 2727 171 Houston, Texas 1995  $23,350,000  $136,550 May-21 Oct-17 CH    
Palms on Westheimer 798 Houston, Texas 1974  $70,224,000  $88,000 Dec-21 Jul-15 CH    
Montclair Estates 113 Garland, Texas 1983  $17,050,000  $150,885 June-22 Oct-19 MS    
Total/Avg 4,726      $445,800,000  $244,982          
 
ParaWest Group Principals -  Co-Managing Member Investors - Current SREO
Property Units Location Built  Value   Value/Unit   Debt   Total Equity  Lender Date Acquired MMR2
Park on Spring Creek 278 Plano, Texas 1983  $45,935,467  $       165,235  $    32,500,000  $13,435,467 NXT Capital Dec-17 Other
Total/Avg 278      $45,935,467  $       165,235  $    32,500,000  $13,435,467      
 
ParaWest Group Principals -  Investors - Current SREO3
Property Units Location Built  Value   Value/Unit   Debt   Total Equity  Lender Date Acquired MMR2
Forest Oaks 164 Arlington, Texas 1980  $24,600,000  $150,000  $8,925,000  $15,675,000 Berkadia (Freddie Mac) Aug-16 Other
Braesridge 542 Houston, Texas 1982  $70,460,000  $130,000  $23,280,000  $47,180,000 Freddie Mac Jun-15 Other
Summer Cove 376 Houston, Texas 1983  $43,240,000  $115,000  $18,160,000  $25,080,000 Holliday Fenoglio Fowler Sep-15 Other
Highland Bluffs 357 Dallas, Texas 1984  $30,345,000  $85,000  $7,631,000  $22,714,000 FNMA Dec-14 Other
Total/Avg 1,439      $168,645,000  $120,000  $57,996,000  $110,649,000      

Notes

1) Idlewood Park was restructured in 2021.

2)"MMR" denotes Managing Member.  CH - Curtis Haines; MS - Michael Salkeld; Other - Non ParaWest Group Managing Member.

3) Individual Principals SREO's (attached) may include properties invested in separately from ParaWest Group.

4) Values are derived from estimated market-based capitalization rates applied to net operating income. Actual values as determined by any future appraisal or sale may vary.

The bio and track record reflect those of ParaWest Group Principals, and were provided by the Sponsor and have not been verified by RealtyMogul

Business Plan

Improving on existing features and amenities, the Sponsor’s value-add improvements will include further upgrades to the swimming pool area, office/clubhouse, and garden areas as well as introducing interior features such as a hi-tech “Smart Home Package” including learning thermostats, wifi door lock hardware, wifi light switches, and home hub, in addition to upgraded six-panel doors, resurfaced cabinet fronts, and two-tone paint throughout. 

Emphasizing the Lakeshore Lifestyle, the property will offer recreational lake toys for checkout by residents including paddle boards and kayaks as well as lakeshore picnic accessories such as portable shade canopies, cornhole, lawn bowling and giant pong games, all for checkout and use by residents of Bay Island. Additionally, Bay Island at Lake Ray Hubbard community activities will include Lakefront bbq’s, volleyball and other events focused on Lakeside Living!

These combined value-add components will result in placing Bay Island at Lake Ray Hubbard in a superior competitive position in its submarket. Our investment strategy is to take advantage of this positioning by achieving significant rent increases (averaging $150 over current rates while still pricing at a tier under the top of the market to secure the highest levels of occupancy and stability.

Investors will further benefit from the negotiated financing we have obtained due to Sponsor Principal Personal Guarantee, resulting in a fixed rate loan that achieves a projected IRR of 160 Basis Points higher than non-recourse debt available in today’s market. Fixed-rate financing will reduce risk as interest rates rise in the near term, and provides a higher overall return to investors than would be achievable with variable-rate bridge financing utilized on most value-add transactions in today’s market.

CapEx Breakdown

  $ Amount before CM Fee CM Fee (5%) Total Per Unit
Interior Renovations        
   Interior Fixtures $50,000 $2,500 $52,500 $438
   In-house Renovation Labor $40,000 $2,000 $42,000 $350
   Black-on-black Appliances $104,000 $5,200 $109,200 $910
   Flooring $112,000 $5,600 $117,600 $980
   Two-Tone Paint $60,000 $3,000 $63,000 $525
   Smart Package $77,543 $3,877 $81,420 $679
   Interior Doors 6 Panel $69,600 $3,480 $73,080 $609
   Cabinet Resurface $72,000 $3,600 $75,600 $630
Total Interior Renovation Costs $585,143 $29,257 $614,400 $5,120
         
Exterior Renovations        
   Exterior Carpentry/Stucco $90,000 $4,500 $94,500 $788
   Gutter/Downspout Repairs $12,000 $600 $12,600 $105
   Exterior Paint $90,000 $4,500 $94,500 $788
   Drivelane/Trip Hazards $30,000 $1,500 $31,500 $263
   Amenity Enhancement $50,000 $2,500 $52,500 $438
Total Exterior Renovation Costs $272,000 $13,600 $285,600 $2,380
         
Contingency (11%) $95,238 $4,762 $100,000 $833
         
Grand Total $952,381 $47,619 $1,000,000 $8,333
Property
Property Details

Rare value-add opportunity located steps away from Lake Ray Hubbard in one of the hottest markets in the country.

Unit Type # of Units Avg SF/Unit Avg Rent (In-Place) Avg Rent (Post-Reno) Avg Rent Per SF (In-Place) Avg Rent Per SF (Post-Reno)
Studio 8 564 $835 $940 $1.48 $1.67
A1 (1x1) 32 660 $940 $1,150 $1.42 $1.74
B1 TH (1x1.5) 8 870 $1,114 $1,275 $1.28 $1.47
A2 (2x1) 21 910 $1,025 $1,375 $1.13 $1.51
B2 (2x2) 8 922 $1,203 $1,425 $1.31 $1.55
B4 TH (2x2) 14 1,084 $1,346 $1,560 $1.24 $1.44
B3 TH (2x1.5) 21 1,004 $1,263 $1,485 $1.26 $1.48
C1 (3x2) 8 1,184 $1,494 $1,950 $1.26 $1.65
Total/Averages 120 873 SF $1,118 $1,362 $1.28/SF $1.55/SF
Comparables

Lease Comparables

  Hubbard's Ridge Boulders Apartments Newport Apartments Averages Subject (Post-Reno)
Year Built 1983 1984 1983 1983 1972
Class C B B   C
# of Units 196 348 152 232 120
Average Unit Size 783 SF 771 SF 754 SF 769 SF 873 SF
Levels 3 3 2 3 2
Occupancy 97.5% 93.0% 100.0% 96.8% 97.0%
Distance from subject 0.6 mi 4.9 mi 6.4 mi 3.9 mi  
           
$/Unit (Studio) - $1,161 - $1,161 $940
SF (Studio) - 507 SF - 507 SF 564 SF
$/SF (Studio) - $2.29/SF - $2.29/SF $1.67/SF
           
$/Unit (1x1) $1,208 $1,177 $1,193 $1,193 $1,150
SF (1x1) 657 SF 663 SF 694 SF 671 SF 660 SF
$/SF (1x1) $1.84/SF $1.77/SF $1.72/SF $1.78/SF $1.74/SF
           
$/Unit (2x1) - $1,385 $1,338 $1,362 $1,375
SF (2x1) - 827 SF 921 SF 874 SF 910 SF
$/SF (2x1) - $1.67/SF $1.45/SF $1.56/SF $1.51/SF
           
$/Unit (2x2) $1,916 $1,495 - $1,705 $1,511
SF (2x2) 1,145 SF 888 SF - 1,017 SF 1,025 SF
$/SF (2x2) $1.67/SF $1.68/SF - $1.68/SF $1.47/SF
           
$/Unit (3x2) - $2,204 - $2,204 $1,950
SF (3x2) - 1,024 SF - 1,024 SF 1,184 SF
$/SF (3x2) - $2.15/SF - $2.15/SF $1.65/SF

Sales Comparables

  Boulders Apartments Saddletree Apartments Gateway Place Nova Park Averages Subject (Going-in)
Date Sold Feb-22 Sep-21 Feb-22 Nov-21    
Year Built 1984 1983 1983 1983 1983 1972
# of Units 348 224 142 198 228 120
Average Unit Size 771 SF 812 SF 857 SF 888 SF 832 SF 873 SF
Sale Price $54,805,000 $34,800,000 $22,195,000 $33,000,000 $36,200,000 $19,750,000
$/Unit $157,486 $155,357 $156,303 $166,667 $158,953 $164,583
$/SF $204/SF $191/SF $182/SF $188/SF $191/SF $188/SF
Distance from subject 4.9 mi 5.1 mi 5.5 mi 14.4 mi 7.5 mi  
Location

Market Overview

Located within the Dallas Fort Worth Metroplex (DFW), one of the most desirable and fastest-growing metro areas in the nation with a population exceeding 7.5 million residents and projected to exceed 10 million residents by 2030. DFW ranked third in employment growth over the past year, having added 650,000 jobs over the past 5 years, and is home to over 1,500 corporate headquarters including 25 Fortune 500 companies.

Submarket Overview

Located just 19 miles northeast of Downtown Dallas, Garland is one of the state’s most populous and inviting cities. It has a suburban feel, strong employment base with more than 300 manufacturing companies, a highly rated school system, and recreational and entertainment opportunities galore.

Residents of Bay Island at Lake Ray Hubbard benefit from close and direct access to major freeways as well as numerous economic and employment drivers which include Texas Instruments’ headquarters, The “Telecom Corridor”, Park Central Business Park, Town East Mall, and Downtown Dallas.

Lake Ray Hubbard, bordering Garland to the southeast, has been described by one Dallas Real Estate Professional as "so gorgeous it’s absurd!" As one of the largest lakes in north Texas at 22,000 acres, the lake is known for its abundant parks, beaches, and recreational opportunities including windsurfing, skiing, kayaking, boating, fishing and just plain relaxing on or by its tranquil waters. As testimony to Lake Ray Hubbard’s appeal and real estate value, two new, multi-use developments, Bayside (with residences under construction) and the billion-dollar Saphire Bay, anchored by a Hyatt Hotel, are currently underway on its western shores.

Photos
Financials
Sources & Uses

Total Capitalization

Sources of Funds $ Amount $/Unit
Debt $14,340,000 $119,500
GP Investor Equity(1) $804,968 $6,708
LP Investor Equity $6,500,000 $54,167
Total Sources of Funds $21,644,968 $180,375
     
Uses of Funds $ Amount $/Unit
Purchase Price $19,750,000 $164,583
Acquisition Fee $296,250 $2,469
Loan Fee $71,700 $598
Closing Costs $427,018 $3,558
CapEx $1,000,000 $8,333
Working Capital $100,000 $833
Total Uses of Funds $21,644,968 $180,375

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

Debt Assumptions

The expected terms of the debt financing are as follows:

  • Lender: MidFirst Bank
  • Term: 5 Years
  • Loan-to-Cost: 66.3%
  • Estimated Proceeds: $14,340,000
  • Interest Type: Fixed
  • Annual Interest Rate: 5.95%
  • Interest-Only Period: 24 Months
  • Amortization: 25 Years
  • Prepayment Terms: Clear after 3 years
  • Extension Requirements: N/A

(2) 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. 

Distributions

ParaWest Group intends to make distributions as follows:

  1. To the Investors, pari passu, all operating cash flows to a 10.0% IRR;
  2. 70% / 30% (70% to Investors / 30% to Promoted/Carried Interest) of excess cash flow to a 14.0% IRR;
  3. 50% / 50% (50% to Investors / 50% to Promote/Carried Interest) of excess cash flow thereafter.

ParaWest Group intends 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 February 2023 and are projected to continue on a quarterly basis thereafter. Distributions are at the discretion of ParaWest Group, who may decide to delay distributions for any reason, including maintenance or capital reserves.

ParaWest Group will receive a promoted/carried interest as indicated above.

Cash Flow Summary
    Year 1 Year 2 Year 3
Effective Gross Revenue   $2,091,066 $2,316,027 $2,496,320
Total Operating Expenses   $925,957 $1,009,147 $1,103,793
Net Operating Income   $1,165,109 $1,306,880 $1,392,527
             
Project-Level Cash Flows
  Year 0 Year 1 Year 2 Year 3
Net Cash Flow ($7,304,968) $290,968 $430,489 $13,560,002
             
Investor-Level Cash Flows(3)
  Year 0 Year 1 Year 2 Year 3
Net Cash Flow ($6,500,000) $193,905 $318,052 $10,595,019
             
Investor-Level Cash Flows - Hypothetical $50,000 Investment(3)
  Year 0 Year 1 Year 2 Year 3
Net Cash Flow ($50,000) $1,492 $2,447 $81,500

(3) 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 ParaWest Group's materials for details. The following fees and compensation will be paid(4)(5):

One-Time Fees:
Type of Fee Amount of Fee Received By Paid From
Acquisition Fee 1.5% of purchase price ParaWest Group Equity at Closing
Technology Solution Licensing Fee(5) 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 (at Sponsor’s discretion)

       
Recurring Fees:
Type of Fee Amount of Fee Received By Paid From
Property Management Fee 3.5% of effective gross income ParaWest Group Cash Flow
Asset Management Fee 1.0% of effective gross income ParaWest Group Cash Flow
Construction Management Fee 5.0% of hard costs ParaWest Group Cash Flow
Administration Solution Licensing Fee(5) Flat quarterly licensing fee of $125 per investor serviced by Sponsor through the license and use of  RM Technologies’ Administration Solution RM Technologies, LLC Cash Flow

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

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

.

Disclaimers/FAQs
Disclaimers

Sponsor’s Projections and Targets

*Assumptions and projections included in the information on this Page, including pro forma projections (collectively “Projections”) were provided by the Sponsor or an affiliate thereof and are not reflective of the position or opinions of, nor are they endorsed by, RM Technologies, LLC or its affiliates, or any other person or entity other than the Sponsor or its affiliates.  RM Technologies, LLC and its affiliates do not provide any assurance of returns or the accuracy or reasonableness of the Projections provided by the Sponsor or its affiliates.   There can be no assurance that the Sponsor’s methodology used for calculating any Projections, including Target IRR, Target Annualized Cash-on-Cash Return, and Target Equity Multiple (“Targets”), are appropriate or adequate.  The Sponsor’s Projections and Targets are hypothetical, are not based on actual investment results, and are presented solely for the purpose of providing insight into the Sponsor’s investment objectives, detailing its anticipated risk and reward characteristics and for establishing a benchmark for future evaluation of the Sponsor’s performance. The Sponsor’s Projections and Targets are not a predictor, projection or guarantee of future performance.  There can be no assurance that the Sponsor’s Projections or Targets will be met or that the Sponsor will be successful in meeting these Projections and Targets.  Projections and Target returns should not be used as a primary basis for an investor’s decision to invest.

No Approval, Opinion or Representation, or Warranty by RM Technologies, LLC or it Affiliates

The information on this Page, including the 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”) was provided by the Sponsor or an affiliate thereof.  RM Technologies, LLC makes no representations or warranties as to the accuracy of such information and accepts no liability therefor.  No part of the information on this Page is intended to be binding on RM Technologies, LLC or its affiliates, or to supersede any of the Sponsor’s Investment Documents.  The opinions expressed on this page are solely the opinions of the Sponsor and its affiliates and none of the opinions expressed on this Page are the opinions of, nor are they endorsed by, RM Technologies, LLC or its affiliates.

Sponsor’s Information Qualified by Investment Documents

The Information on this Page, including of the principal terms of the Sponsor’s offering, 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 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.  The information on this page should not be used as a primary basis for an investor’s decision to invest.  In the event of an inconsistency between the information on this Page and the Investment Documents, investors should rely on the information contained in the Investment Documents.  The information on this Page and the information in the Investment Documents are subject to last minute changes up to the closing date at the sole discretion of the Sponsor and its affiliates.

Risk of Investment

This real estate investment is speculative and involves substantial risk.  There can be no assurances that all or any of the assumptions will be true or that actual performance will bear any relation to the hypothetical illustrations herein, and no guarantee or representation is made that investment objectives of the Sponsor will be achieved.  In the event that actual performance is below the Sponsor’s Targets, your investment could be materially and adversely affected, and there can be no assurance that investors will not suffer significant losses.  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.  Please see the Sponsor’s Investment Documents for additional information, including the Sponsor’s discussion concerning risk factors.

Risk of Forward-Looking Statements

Forward-looking statements are found here and in the applicable Investment Documents and may include words like “expects,” “intends,” “anticipates,” “estimates” and other similar words. These statements are intended to convey the Project Sponsor’s projections or expectations as of the date made. These statements are inherently subject to a variety of risks and uncertainties. Please see the applicable Investment Documents for disclosure relating to forward-looking statements.  All forward-looking statements attributable to the Sponsor or its affiliates apply only as of the date of the offering and are expressly qualified in their entirety by the cautionary statements included elsewhere in 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.

Sponsor’s use of Debt

A substantial portion of the total acquisition for the Property will be paid with borrowed funds, i.e., debt.  There can be no assurance that the Sponsor will secure debt on the rates and terms noted above, or at all.  All of the Sponsor’s estimated rates and terms of the debt financing are subject to lender approval, including but not limited to the annual interest rate and possible increases in capital reserve requirements for funds to be held in a lender-controlled capital reserve account. The use of borrowed money to acquire real estate is referred to as leveraging.  Leveraging increases the risk of loss.  If the Sponsor were unable to pay the payments on the borrowed funds (called a "default"), the lender might foreclose, and the Sponsor could lose its investment in its property.

In addition, unless the debt provides for a fixed rate of interest during the term of the loan and/or any subsequent extensions, the total amount of interest paid over the term of the debt will increase by the same amount as the related index. For example, if the index rate increases by 0.50% (50 basis points) the interest rate on the loan will increase by the same amount. The amount of such interest rate increases may be capped either by its terms or as the result of the Sponsor entering into an arrangement that caps the interest rate with respect to the debt at a particular rate.

Sponsor’s Offering is Not Registered

The interests offered by the Sponsor 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 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 Private Placements on the RealtyMogul Platform are intended solely for “Accredited Investors,” as that term is defined Rule 501(a) of the Securities Act.  Prospective investors must certify that they are Accredited Investors and provide either certain supporting documents or third party verification, and must acknowledge that they have received and read all investment materials.

RM Technologies, LLC Fees and Conflicts

RM Technologies, LLC, an affiliate of RealtyMogul, operates the RealtyMogul Platform.  RM Technologies, LLC charges a fixed, non-percentage-based licensing fee for real estate companies and their sponsors to license and use the RM Technologies LLC’s proprietary Platform, including one-time flat licensing fees for its Technology Solution and an ongoing quarterly flat licensing fees for its Administration Solution.  An estimate of the Technology Solution licensing fee is included in the Closing Costs above and is intended to be capitalized into the transaction at the discretion of the Sponsor.  The licensing fees received by RM Technologies, LLC are disclosed in the relevant operating agreement(s). Additionally, from time to time, employees of RM Technologies, LL C and its affiliates invest in Sponsor’s offering.  RM Technologies LLC’s receipt of licensing fees and its employee’s investments in Sponsor’s offering creates a conflict of interest between RealtyMogul and its affiliates, and investors or prospective investors.

No Investment Advice

RealtyMogul and RM Technologies, LLC are not a registered broker-dealer, investment adviser or crowdfunding portal.  Nothing on this Page should not be regarded as investment advice, either on behalf of 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, and we recommend that you consult with a financial advisor, attorney, accountant, and any other professional that can help you to understand and assess the risks associated with any real estate investment.

For additional information on risks and disclosures visit https://www.realtymogul.com/investment-disclosure.

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