FORMALIZED DUE DILIGENCE PROCESS 
Sponsors

The team at our affiliated broker-dealer, RM Securities, conducts diligence on of the issuer, including detailed background checks, criminal checks, bad actor checks, and reference checks on sponsors. In addition to screening for any criminal background, we may also turn down sponsors due to poor reference checks, even if the background and criminal checks are satisfactory.

Escrow accounts

We require unaffiliated sponsors to use an unaffiliated third-party escrow agent.* When an investor makes an investment with such sponsors using the RealtyMogul platform, the investor’s money is transferred directly into a third-party escrow account. All closing conditions in connection with a sponsor’s contingency offering need to be met before the third-party escrow agent will approve releasing investor funds to the issuer or general partner. For example, if an issuer or general partner plans to use funds for a real estate acquisition that does not ultimately transact, the third-party escrow agent will not transfer investor funds to the issuer or general partner, and funds will be returned to investors.

* Unless otherwise disclosed, escrow accounts are not required for some investments that accommodate 1031 investments where the property is already acquired.

Boots on the ground

Our processes typically includes visiting certain properties (or a subset of properties if it's a fund) to confirm the real estate is what and where the real estate is supposed to be. For certain properties that accommodate 1031 exchange investments, the team will review third-party prepared due diligence reports in lieu of a site visit.

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NexPoint Life Sciences III DST
Offered By
NexPoint Real Estate Advisors
Investment Strategy Core Plus
Investment Type Equity
Minimum Investment 100000
Overview
11200 Hudson Road is a state-of-the-art medical device research and development facility located in Minneapolis metropolitan statistical area (“MSA”), a leading life sciences hub. The Property was built in 2021 for the Kindeva Drug Delivery Headquarters, a premier contract development and manufacturing organization.
Investment Highlights
Institutional Quality Sponsor. Sponsored by NexPoint Real Estate Advisors, who have ~$17.1 billion in AUM and have completed over $19 billion in gross real estate acquisitions since 2012. NexPoint’s management team has extensive experience in acquiring, owning, and operating real estate assets with favorable demographic trends and opportunities for improved performance.
High-Quality Asset with Robust Infrastructure. The tenant, Kindeva Drug Delivery, is a leading specialty CDMO and global provider of combination drug delivery products, specializing in inhalable, injectable, transdermal, and biologic technologies. Kindeva does drug and delivery device development, from inception to commercial manufacturing and has handled 20+ drug master files, over 20 new drug applications, and 30+ abbreviated new drug applications.
Asset is Fundamental for the Tenant’s Business.The Property houses Kindeva's corporate headquarters and most of its manufacturing and manufacturing employees. The Property is a mission-critical Kindeva facility and a Class-A industrial space constructed specifically for distribution, manufacturing, research, and development.
Attractive, Long-Term Lease Structure. Kindeva's lease structure provides for an attractive passive investment opportunity, supported by a 15-year initial term, contractual rental escalation every year, and net lease structure with the Tenant responsible for property tax, insurance, maintenance, and repair throughout the entire lease term.
Well-Located Life Science Manufacturing Asset. The Property is located in Woodbury, Minnesota, the fastest-growing submarket within the Minneapolis MSA, the 16th largest MSA in the United States, and an extremely robust industrial market, with rents doubling in the last five years. The Minneapolis MSA has received over $6.7 billion of National Institutes of Health and venture capital funding since 2015, is home to 16 Fortune 500 companies, and boasts a diverse and growing economy.
The Minneapolis MSA is a Growing Life Sciences Hub The Minneapolis MSA is home to the University of Minnesota, ranked ninth among public research universities, and the Mayo Clinic, a leading hospital in the United States. Overall, Minnesota’s employment in medical device manufacturing is four times more concentrated than the national average, leading the state to be a hub for research and development in medical technology. Additionally, the Minneapolis MSA is a top 10 MSA in the United States in total life science employment.
Life Science Real Estate as a Top-Performing Asset Class. Tenants of life sciences properties invest significantly into the property to install their own research, manufacturing, and production capabilities, which creates a significant barrier to vacate. Life science property owners benefit from mission-critical properties that are critical to generating revenue with the tenants’ patented products. Accordingly, as evidenced by publicly traded life science REIT performance over the past 20 years, life science real estate has dramatically outperformed other asset classes. Over the past 20 years, life science REITs have outperformed broader REIT indices (i.e., MSCI US REIT Total Return – RMZ) by 45.1%.5 Strong performance can, in part, be credited to strong and consistent life science capitalization rate compression, with approximately 300 basis points of compression since 2010. (Data as of June 17, 2005, to February 28, 2023, per Bloomberg).
Strong Life Science Tailwinds. Attractive life science real estate fundamentals are driven by demographic tailwinds and a requirement for continued innovation to solve evolving societal healthcare needs. Life science real estate plays a critical role, as specialized space is required to support scientific research, development and ultimately the manufacturing of novel drugs and therapeutics.
Management
Cumulative Distributions

NexPoint Real Estate Advisors

Founded in 2012, NexPoint has been revolutionizing the alternative investment industry for over a decade. At its core, NexPoint utilizes innovation, expertise, alignment, and commitment to bring investment strategies to retail channels. NexPoint’s competencies include real estate, capital markets, credit, and insurance and retirement solutions, among others.

Though the platform operates on a global level, NexPoint remains committed to improving the communities surrounding the Dallas, Texas, area where it is headquartered. Historically, NexPoint has provided charitable contributions to organizations dedicated to making meaningful advancements in education and offer continued access to learning opportunities. The George W. Bush Presidential Center and Southern Methodist University are two of the many beneficiaries of NexPoint’s support.

The real estate investment team at NexPoint have significant experience in corporate credit, private equity, public equities, structured finance, risk management and sector-specific verticals, including; multifamily, single-family rentals, storage, industrial, hospitality, office, and retail, among others.  The real estate investment group has deep industry relationships and a strong network of vendors, professional service providers, property managers, and other strategic partners, which creates efficiencies in NexPoint’s real estate operations, adding value across our real estate portfolio.

  • Matthew McGraner
    President
  • Brian Mitts
    Chief Financial Officer
  • Paul Richards
    Director, Real Estate
  • Taylor Colbert
    Director, Real Estate
Matthew McGraner
President

Matthew McGraner is a member of the investment committee for the Sponsor and serves in numerous roles across the NexPoint platform. With over ten years of real estate, private equity, and legal experience, his primary responsibilities are to lead the strategic direction and operations of the real estate platform at NexPoint. McGraner has led the acquisition and financing of approximately $18.4 billion of real estate investments.

Brian Mitts
Chief Financial Officer

Brian Mitts is a member of the investment committee for the Sponsor and serves in numerous roles across the NexPoint platform. Currently, Mitts leads NexPoint’s financial reporting and accounting teams and is integral in financing and capital allocation decisions. Mitts was also a co-founder of NREA, as well as NXRT and NexPoint Advisors, L.P., the parent of NREA. He has worked for NREA or one of its affiliates since 2007.

Paul Richards
Director, Real Estate

Paul Richards is a director for real estate at NexPoint. His primary responsibilities are to research and conduct due diligence on new investment ideas, perform valuation and benchmarking analysis, monitor and manage investments in the existing real estate portfolio, and provide industry support for NexPoint’s Real Estate Team. He was previously a Product Strategy Associate and was responsible for evaluating and optimizing the registered product lineup.

Taylor Colbert
Director, Real Estate

Taylor Colbert is a director for real estate at NexPoint. He conducts due diligence and research on new investment ideas, performs valuation and benchmarking analysis, and manages investments in the existing real estate portfolio, providing support for NexPoint’s real estate team. Before joining NexPoint, he was an associate in private equity and senior fund analyst with a former NexPoint affiliate. Prior to this, he was employed by KPMG LLP as a senior audit associate in the Alternative Investment Group. He is a licensed CPA and a CFA charterholder.

Track Record

Please see the following link for NexPoint's Track Record 

Property Information

The Tenant - Kindeva Drug Delivery L.P.

Kindeva is a contract development and manufacturing organization (CDMO) that guides complex drug and delivery device development from inception to commercial manufacturing. Kindeva is an industry leader in combination drug delivery and manufacturing and provides expertise at every stage of pulmonary and nasal, injectable, and transdermal therapy development and manufacturing. The Tenant’s offerings span early-stage feasibility through commercial-scale drug product fill-finish, container closure system manufacturing, and drug-device product assembly. Kindeva serves a global client base from its nine manufacturing, research, and development facilities located in the United States and the United Kingdom. With a rich history dating back to 1946, Kindeva has handled 20+ drug master files, over 20 new drug applications, and 30+ abbreviated new drug applications. Kindeva has successfully navigated challenging projects like metered-dose inhalers and seven-day drug delivery patches through formulation, clinical trials, and regulatory approvals.

 

Debt Assumptions

Summary of Loan Terms

  • Amount: $31,300,000
  • Term; Maturity Date: 120 months; November 1, 2032
  • Interest Rate: 4.50%, then adjusted to the 2029 Rate in November 2029.
  • Amortization: Amortization begins on December 2025 under an assumed amortization schedule of 300 months.
  • Fees: For any payment not made by the due date, the Trust shall pay to the Lender a late charge of $2,500.
  • Repayment: The Loan requires interest-only payments for 36 months at a fixed interest rate of 4.50% per annum. Beginning on November 2029, interest rate will be adjusted to equal 2.00% plus the Three Year US Treasury Constant. The Sponsor estimates, based on current projected forward curves, that the Three Year US Treasury Constant on November 2029 will be 4.25%, yielding a projected 2029 Rate of 6.25%. Finally, starting on December 2025, the Loan Documents provide that monthly installment of principal and interest are payable each month under an assumed amortization schedule of 300 months. The debt service payments are expected to be approximately $2.08 million per year over the next 10 years. Payments under the Loan will first be applied toward any costs of collection, then to late charges, then to accrued interest and then to principal balance.
  • Assumption: Except for certain Permitted Transfers (as defined in the Loan Documents), Beneficial Owners may not sell, transfer, or encumber, or pledge their interests in the Trust.
  • Collateral: The Loan is secured by (i) a first priority lien or deed of trust (the “Mortgage”) and other security instruments in or related to the Property, and (ii) a valid and perfected security interest in all personal property owned by the Trust located on or used in connection with the Property and any improvements thereon. The Master Tenant has entered into separate Tenant/Landlord Subordination and Assignment Agreement (the “Subordination Agreements”) pursuant to which the Master Lease will be subordinated to the Loan and the Master Tenant’s interest in the Property and the Tenant Lease has been assigned to the Lender as additional collateral.
  • Prepayment: Generally no more than 10% of the outstanding principal balance on the Loan is pre-payable within a 12-month period. However, the Trust can pay the Lender a prepayment fee to make prepayments (between 1-3% of the principal balance depending on the term). There is no prepayment fee for any prepayment made after the 26th month of the Loan.

For additional information on the financing terms, please refer to the Life Sciences III DST—Private Placement Memorandum in the Documents section.

Distributions

Please refer to the NexPoint Life Sciences III DST - Private Placement Memorandum in the Documents section for details regarding distributions and fees.

The following offering documents 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.
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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