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.

Illiquid Investment - Transfer Restrictions & No Public Market

The transferability of membership interests in Realty Mogul 61, LLC 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. 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.

Uncertainty Surrounding Future Sales Price

There is risk associated with the Sponsor being unable to sell the Property as projected.

Interest-Only Loan Periods

The mortgage loan and mezzanine loan being used to acquire the Property are expected to have interest-only periods during the first 36 months of the loan terms, which means that there will be no reduction in the principal balance during those interest-only periods.

Interest Rate Risk

The Federal Reserve has methodically reduced the amount of stimulus it was earlier injecting into the U.S. economy, and has signaled that increases in the federal funds rate may be forthcoming. This could potentially lead to rising interest rates offered by other lenders and could have a negative effect on the future value of the Property (since higher loan interest rates might mean that potential buyers would face proportionately higher debt service expenses).

Mezzanine Loan

A mezzanine loan is expected to exist on the Property. The mezzanine loan is intended to be subordinate to the senior mortgage loan and senior to any other interests in the Property, including the interests of Sponsor Entity. Therefore the Company, which has an equity interest in the Sponsor entity, shall have its interests to the cash flows from the Property be subordinate to the mezzanine lender. The mezzanine loan will be secured by a pledge of 100% of the Sponsor Entity’s ownership interests in the Property, which will include the Company’s interest in the Sponsor Entity. In the event of a default under the terms of the mezzanine loan the mezzanine lender may foreclose on their interest in the Sponsor Entity to take full ownership and control of the Property, which would result in the Company losing all of its interest in the Sponsor Entity and investors in the Company losing all of their investment in the Company. The mezzanine loan is anticipated to have a floating interest rate tied to 30-Day LIBOR. Interest rates may be significantly affected by economic downturns or general economic conditions beyond the Company’s control and beyond the control of the Sponsors. In particular, loss rates on loans may increase due to factors such as (among other things) local real estate market conditions, prevailing interest rates, the rate of unemployment, the level of consumer confidence, the value of the U.S. dollar, energy prices, changes in consumer spending, the number of personal bankruptcies, disruptions in the credit markets and other factors. Any change in interest rates may drastically affect the value of your investment in the Company. Financing risk is inherent in the lending industry, and there can be no assurance that the mezzanine lender will complete financing on the rates and terms included in the underwriting being presented in the model for this investment opportunity. Should the terms of the mezzanine loan change materially and adversely, investors will be notified. If the mezzanine loan does not occur as anticipated and the Sponsor needs an extension on the purchase contract, the seller of the Property may not so extend and the transaction may be cancelled. The mezzanine loan is expected to involve a prepayment penalty. The Sponsor Entity may therefore be unable to take advantage of more favorable financing terms that may become available to it during the term of any the mezzanine loan. If the Sponsor Entity seeks alternative mezzanine financing, there can be no assurance that the Sponsor Entity will be able to obtain such financing on a timely or favorable basis.

Co-Terminus Debt Risk

The loans on the Property have a term of three (3) years plus two one (1) year extensions, potentially creating a refinancing risk should market conditions deteriorate over the next five years.

Local Market Conditions May Impact Rental Rates

Local conditions may significantly affect occupancy, rental rates, and the operating performance of a property. Such risks include (but are not limited to): (i) plant closings, industry slowdowns and other facts that affect the local economy; (ii) an oversupply of, or a reduced demand for, similar properties; (iii) a decline in household formation or employment or lack of employment growth, (iv) laws that could inhibit the ability to raise rents or to sell a property; and (v) other economic conditions that might cause an increase in operating expenses, such as increases in property taxes, utilities, compensation of on-site personnel and routine maintenance.

Management Risk

Investors will be relying solely on the Sponsor for the execution of its business plan. The Sponsor may in turn rely on other key personnel with relevant experience and knowledge, including contractors and consultants. Members of  6807 N. Sheridan Investor, LLC (including Realty Mogul 61, LLC) will agree to indemnify the manager in certain circumstances, which may result in a financial burden if any litigation results from the execution of the business plan. While the Sponsor has significant operating experience, 6807 N. Sheridan Investor, LLC​ is a newly formed company and has no operating history or record of performance. Realty Mogul 61, LLC is pursuing a venture capital strategy through its investment in 6807 N. Sheridan Investor, LLC​, and the manager of Realty Mogul 61, LLC is expected to be treated as an investment adviser exempt from federal or state registration under this strategy.

Manager of Realty Mogul 61, LLC Will Participate in Sponsors' Promote Interest

The manager of Realty Mogul 61, LLC will be entitled to a participation in the value of any excess distributable cash flow and any appreciation of the Property realized upon its sale. This could lead to a potential conflict of interest between the manager and Realty Mogul 61, LLC. Investors must recognize and agree to waive and bear the risk of this conflict of interest. 

No Assurance of Cash Distributions or Liquidation of Interest

Cash flow distributions will only be available to the extent that there is distributable cash flow from rentals and other operations of the Property. Additionally, even if there is available cash flow from the Property’s operations, the manager of Sponsor Entity may, in its discretion, cause Sponsor Entity to retain some or all of such funds for working capital purposes, additional renovation, and other purposes. There can be no assurance as to when or whether there will be any cash distributions from Sponsor Entity to its members (including the Company), and thus no assurance that the Company will be able to make any distributions to owners of Membership Interests.

Risk of Interest Charges for Sponsor Capital Calls

The amount of capital that may be required by 6807 N. Sheridan Investor, LLC​ from Realty Mogul 61, LLC is unknown, and although 6807 N. Sheridan Investor, LLC does not require that its members contribute additional capital to it, it may from time to time request additional funds in the form of loans or additional capital. Realty Mogul 61, LLC does not intend to participate in a capital call if one is requested by 6807 N. Sheridan Investor, LLC​, and in such event the manager of 6807 N. Sheridan Investor, LLC may accept additional contributions from other members of 6807 N. Sheridan Investor, LLC​. Amounts that the manager of 6807 N. Sheridan Investor, LLC​ advances on behalf of Realty Mogul 61, LLC will be deemed to be a manager loan at an expected interest rate of 10%. Amounts that are contributed by existing or new members will be deemed to be additional capital contributions, in which case Realty Mogul 61, LLC's interest in 6807 N. Sheridan Investor, LLC​ will suffer a proportionate amount of dilution.

Uncertain Exit Timing

Although it is anticipated that the Property will be sold at the end of the expected four (4) year hold period, Realty Mogul 61, LLC will not have full control over the timing of the sale of the Property, and therefore we cannot offer assurances of when the exit will occur.  

General Economic and Market Risks

While the Sponsor has conducted significant research to justify the intended rental rates and sales price relative to comparable properties in the market, its best efforts to forecast economic conditions cannot state for certain whether or not rental rates will be achieved or investor sentiment and the capital markets will be favorable to the Property at the intended disposition date. The real estate market is affected by many factors, such as general economic conditions, the availability of financing, interest rates and other factors, including supply and demand for real estate investments, all of which are beyond the control of the Sponsor​​.

Apartment Complex Competition Risks

Competition in the Property’s local market area is significant and may affect the Property’s occupancy levels, rental rates and operating expenses.  The Property will compete with other residential alternatives to attract tenants, including other apartment units that are available for rent, as well as new and existing apartment residences. If development of apartment complexes by other operators were to increase, due to increases in availability of funds for investment or other reasons, then competition with the Property could intensify.  Competitive apartment residences in a particular area could adversely affect the ability of Sponsor Entity to sell the property, rent its units as necessary to maintain occupancy, and/or to increase or maintain unit rental rates.

Renovation Risk

The sponsor intends to renovate the Property in order to be able to demand the significantly higher rents it is projecting to receive at the Property following such renovations. Such renovations are expected to cost approximately $59,869 per unit and are projected to take around 36 months to complete.  There can be no assurance that such renovations will be consummated on a timely basis or that such work will not materially adversely affect other aspects of the operation of the Property.  Any delays or adverse effects of such renovation work could adversely affect the Property’s financial results or business operations and thus the value of the Company’s investment.  

Following the renovations, the sponsor expects to be able to rent the apartment units at average rates that would represent an increase over the existing rental rates. Although the sponsor believes that comparable properties are currently achieving rental rates that are greater than the future rental rates expected from the Property, there can be no assurance that such increased rental rates will be achieved.  Failure to realize such increased rental rates could adversely affect the Property’s financial results or business operations and thus the value of the Company’s investment.

Lease-up Risks

The Property currently has a 98.8% occupancy level, and the sponsor intends to implement a capital improvement plan involving the renovations of certain units and a leasing program in its effort to maintain that occupancy level.  There can be no assurance that such renovations will be consummated on a timely basis, that such work will not materially adversely affect other aspects of the operation of the Property, or that the planned lease-up program will result in the Property maintaining its occupancy level at rental rates in line with those projected.  Any delays or adverse effects of such renovation work or lease-up efforts could adversely affect the Property’s financial results or business operations and thus the value of the Company’s investment.

Although the sponsor believes that comparable properties are currently achieving rental rates that are in line with those expected from the Property, there can be no assurance that such increased occupancy levels or rental rates will be achieved.  Failure to realize such increased rental rates could adversely affect the Property’s financial results or business operations and thus the value of the Company’s investment.

Equity Invested

The manager of the Sponsor Entity (“Sponsor Manager”) is expected to invest certain equity in the Sponsor Entity.   However, the principals of the Sponsor Manager may have raised some of this equity from third parties and the principals of the Sponsor Manager may be permitted to sell a portion of their equity interest at a later time.  Thus, either at closing or at a later time, the principals of the Sponsor Manager may not have a significant portion of their own personal funds invested in this transaction.

No Operating Agreement Changes

Although the Company may prefer to have certain provisions inserted in the existing operating agreement of the Sponsor Entity, the operating agreement for the Sponsor Entity is likely to remain unchanged (except to reflect a change in ownership).  All potential investors should review the operating agreement of the Sponsor Entity to determine if it is acceptable to them.

Sponsor’s Agreements with Affiliates

The Company’s operating agreement does not prohibit, nor require member consent for, agreements between the Sponsor and its affiliates. This could result in such agreements having non-market terms, which may negatively impact the investment’s performance and the returns to investors.

Sponsor’s Prior Transactions

One of the principal investors in the managing member has sponsored one or more prior transactions that have been foreclosed upon and/or involved loss of principal to investors. Investors should consider the track record of Sponsor and its investors prior to making an investment decision. Past results may not be indicative of future performance.

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 Sponsor and others. Realty Mogul, Co., RM Manager, LLC, and Realty Mogul 61, LLC, 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.