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Multifamily
Vantage at Tomball
Tomball, TX
Open to Invest
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Vantage at Tomball
Tomball, TX
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Overview
Vantage at Tomball
Vantage at Tomball is a 2022-built, Class A, 288-unit, garden-style multifamily property located in Tomball, TX being sold by a motivated seller. The Property is being purchased by a Dallas-based Sponsor with 5,000+ units under management in Texas and a strong track record.
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Details
For more information, view the Sponsor's Investment Memorandum.
Estimated First Distribution 6/2026
Minimum Investment 35000
Estimated Hold Period 3 Years
Investment Strategy Value-Add
Investment Type Equity
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
Experienced, Repeat Sponsor: ClearWorth Capital is a vertically integrated multifamily owner with over 5,000 units under management in Texas. Its managing partner has acquired and renovated thirty-three (33) multifamily projects with a combined value approaching $1 billion in his career. This is ClearWorth Capital's 3rd offering on the RealtyMogul Platform and the 2nd with RM Securities, LLC. The others were The Carling on Frankford and Lavera at Lake Highlands, value-added properties in Texas.
Motivated Seller: The Sponsor is acquiring the asset from the original developer at a discount to replacement cost. The developer is motivated to sell due to an expiring construction loan.
Rent Comps Indicate Upside: The Property lease-up was undermanaged, leading to rents well below the market. The comp analysis suggests that the Vantage at Tomball, with rents averaging $1,458, is 9% lower than the average rent of $1,600 among 16 nearby comps. With sustained market rent growth and the Sponsor's business plan to bring rents to the midpoint of the market over the hold period, the subject rents will remain discounted compared to market averages of similar projects.
Low Supply with Strong Demand: No units are under construction or proposed within 5 miles, and only 2 projects are under construction within 10 miles. The submarket absorbs 2,937 units annually, ensuring a favorable supply-demand balance during the hold period. (CoStar; ALN)
Quality Demographics: The asset is located in a quiet suburban neighborhood in a rapidly growing suburb North of Houston, and zoned to Klein ISD, a top-ranked school district in the nation. With limited multifamily supply, strong household incomes ($101,372–$126,202 within a 1–10 mile radius), and rising population growth projected by Moody’s Analytics (+393,000 in Houston by 2027), Vantage at Tomball is well-positioned to benefit from market fundamentals and provide an attractive alternative to unaffordable single-family homes.
Newly Constructed, Stabilized Asset: Vantage at Tomball is a Class A garden-style multifamily property built in 2022 and offering a full range of amenities including multiple dog parks, enclosed yards, package lockers, pool with gazebo/TV, custom BBQ grills, and an expansive clubhouse with a business center, meeting rooms, and fitness center. The Property is well-located off Grand Parkway and positioned for stabilization in a high-demand submarket.
Convenient to Retail and Employment Hubs: Located just off Grand Parkway, a major thoroughfare that provides residents access to growing communities of Houston like The Woodlands and Spring, major retail and employment hubs. Fortune 500 companies, ExxonMobil and Hewlett Packard, recently relocated their headquarters to new state-of-the-art campuses 10 minutes from the Property. The area has also seen heavy investment with several new mixed-use developments delivered, including Target, 2 HEB grocery stores, Sprouts Market, Cinemark, Academy Sports & Outdoors, and 20+ restaurants, all within 7 minutes from the Property.
Experienced, Repeat Sponsor: ClearWorth Capital is a vertically integrated multifamily owner with over 5,000 units under management in Texas. Its managing partner has acquired and renovated thirty-three (33) multifamily projects with a combined value approaching $1 billion in his career. This is ClearWorth Capital's 3rd offering on the RealtyMogul Platform and the 2nd with RM Securities, LLC. The others were The Carling on Frankford and Lavera at Lake Highlands, value-added properties in Texas.
Motivated Seller: The Sponsor is acquiring the asset from the original developer at a discount to replacement cost. The developer is motivated to sell due to an expiring construction loan.
Rent Comps Indicate Upside: The Property lease-up was undermanaged, leading to rents well below the market. The comp analysis suggests that the Vantage at Tomball, with rents averaging $1,458, is 9% lower than the average rent of $1,600 among 16 nearby comps. With sustained market rent growth and the Sponsor's business plan to bring rents to the midpoint of the market over the hold period, the subject rents will remain discounted compared to market averages of similar projects.
Low Supply with Strong Demand: No units are under construction or proposed within 5 miles, and only 2 projects are under construction within 10 miles. The submarket absorbs 2,937 units annually, ensuring a favorable supply-demand balance during the hold period. (CoStar; ALN)
Quality Demographics: The asset is located in a quiet suburban neighborhood in a rapidly growing suburb North of Houston, and zoned to Klein ISD, a top-ranked school district in the nation. With limited multifamily supply, strong household incomes ($101,372–$126,202 within a 1–10 mile radius), and rising population growth projected by Moody’s Analytics (+393,000 in Houston by 2027), Vantage at Tomball is well-positioned to benefit from market fundamentals and provide an attractive alternative to unaffordable single-family homes.
Newly Constructed, Stabilized Asset: Vantage at Tomball is a Class A garden-style multifamily property built in 2022 and offering a full range of amenities including multiple dog parks, enclosed yards, package lockers, pool with gazebo/TV, custom BBQ grills, and an expansive clubhouse with a business center, meeting rooms, and fitness center. The Property is well-located off Grand Parkway and positioned for stabilization in a high-demand submarket.
Convenient to Retail and Employment Hubs: Located just off Grand Parkway, a major thoroughfare that provides residents access to growing communities of Houston like The Woodlands and Spring, major retail and employment hubs. Fortune 500 companies, ExxonMobil and Hewlett Packard, recently relocated their headquarters to new state-of-the-art campuses 10 minutes from the Property. The area has also seen heavy investment with several new mixed-use developments delivered, including Target, 2 HEB grocery stores, Sprouts Market, Cinemark, Academy Sports & Outdoors, and 20+ restaurants, all within 7 minutes from the Property.
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Management
For more information, view the Sponsor's Investment Memorandum.
ClearWorth Capital

ClearWorth Capital is a vertically integrated, Texas-based multifamily owner and operator with offices in Dallas and Houston. The company serves as a deal sponsor providing acquisition, investment management, and disposition functions. ClearWorth Residential provides property and construction management services. ClearWorth seeks to maximize returns for investment partners through physical property enhancements and operational improvements. They enhance their business through joint venture partnerships, creative deal structuring, sophisticated approaches to finance, and the implementation of transformative technologies.

ClearWorth has a track record of delivering consistent, superior returns. Its managing partner, Matthew Stone, has been a principal in development and renovation projects totaling over $2 billion in value. Development experience includes thirty-seven (37) projects, twenty-eight (28) of which were multifamily, with 5,000+ multifamily units, as well as senior housing, student housing, townhomes, hotels, condominiums, and office buildings. He has also acquired and renovated thirty-three (33) multifamily projects with a combined value approaching $1 billion.

Sponsor Track Record
Property Name Market Name City, State Status Acq Date Units Purchase Price Sales Price or Estimated Value IRR EM Exit Date Year Built Asset Type
Firewheel Town Village Dallas-Fort Worth Garland, Texas Owned 11/30/2018 154 $24,640,000 $36,960,000 19.50% 1.50X Currently Owned 2018 Senior Independent Living
Woodside Flats Dallas-Fort Worth Dallas, Texas Owned 5/31/2021 311 $20,837,000 $34,210,000 21.00% 1.64X Currently Owned 1982 Multifamily Value-Add
Northwood Dallas-Fort Worth Richardson, Texas Owned 12/20/2021 272 $40,800,000 $61,200,000 19.00% 1.50X Currently Owned 1969 Multifamily Value-Add
Solana Dallas-Fort Worth Garland, Texas Owned 4/30/2022 230 $23,000,000 $36,000,000 22.00% 1.57X Currently Owned 1965 Multifamily Value-Add
The Brooke Apartments Killeen Temple, Texas Owned 4/17/2023 206 $17,350,000 $28,840,000 20.48% 1.66X Currently Owned 1982 Multifamily Value-Add
The Halston College Station-Bryan College Station, Texas Owned 8/10/2022 284 $29,000,000 $49,000,000 22.37% 1.69X Currently Owned 1981 Multifamily Value-Add
Lockwood Heights Dallas-Fort Worth Richardson, Texas Owned 10/6/2022 202 $30,000,000 $44,440,000 19.50% 1.48X Currently Owned 1968 Multifamily Value-Add
Lakeridge Heights Dallas-Fort Worth Dallas, Texas Owned 7/28/2022 178 $21,000,000 $35,000,000 20.50% 1.67X Currently Owned 1969 Multifamily Value-Add
Verlaine on the Parkway Dallas-Fort Worth Dallas, Texas Owned 10/1/2020 294 $40,278,000 $60,270,000 19.75% 1.50X Currently Owned 1971 Multifamily Value-Add
Wimbledon Houston Houston, Texas Owned 1/15/2024 161 $13,846,000 $24,050,000 26.08% 1.95X Currently Owned 1979 Multifamily Value-Add
North Bend Living Houston Houston, Texas Owned 9/9/2021 282 $22,500,000 $35,000,000 27.90% 1.56X Currently Owned 1983 Multifamily Value-Add
The Ambrose Houston Houston, Texas Owned 9/30/2022 408 $53,000,000 $91,500,000 19.00% 1.73X Currently Owned 1999 Multifamily Value-Add
Northside Heights Houston Conroe, Texas Owned 4/12/2022 228 $26,250,000 $38,750,000 19.50% 1.48X Currently Owned 1980 Multifamily Value-Add
Park At Woodmoor Apartments Houston Shenandoah, Texas Owned 3/1/2022 220 $32,760,000 $48,000,000 22.50% 1.47X Currently Owned 2000 Multifamily Value-Add
South Shore Coastal Living Corpus Christi Corpus Christi, Texas Owned 6/9/2021 233 $21,203,000 $32,228,560 18.00% 1.52X Currently Owned 1973 Multifamily Value-Add
The Reston Houston Conroe, Texas Owned 10/10/2018 212 $17,250,000 $25,440,000 21.00% 1.47X Currently Owned 1983 Multifamily Value-Add
The Palm on SPID Corpus Christi Corpus Christi, Texas Owned 8/31/2019 299 $21,300,000 $36,210,000 22.00% 1.70X Currently Owned 1973 Multifamily Value-Add
The Pointe at Victoria Victoria Victoria, Texas Owned 4/28/2022 286 $42,000,000 $60,000,000 21.50% 1.43X Currently Owned 2012 Multifamily Value-Add
Lakeside at Campeche Houston Galveston, Texas Owned 5/17/2023 320 $32,500,000 $55,500,000 25.80% 1.71X Currently Owned 1985 Multifamily Value-Add
Lavera at Lake Highlands Dallas-Fort Worth Lake Highlands, TX Owned 8/28/2023 280 $33,300,000 $55,816,000 24.00% 1.85X Currently Owned 1970 Multifamily Value-Add
The Carling on Frankford Dallas-Fort Worth Carrollton, TX Owned 7/24/2024 274 $37,000,000 $37,000,000 23.10% 1.82X Currently Owned 1983 Multifamily Value-Add
Stoneleigh on the Lake Houston Houston, Texas Sold 12/15/2015 228 $20,145,000 $24,500,000 32.00% 1.96X 4/1/2013 2005 Multifamily Value-Add
Axiom Hub 121 Dallas-Fort Worth McKinney, Texas Sold 8/20/2022 286 $46,600,000 $80,000,000 34.00% 2.95X 3/1/2020 2020 Multifamily New Development
McDermott Park Dallas-Fort Worth Plano, Texas Sold 8/31/2018 144 $23,080,000 $38,293,700 34.00% 2.76X 2/1/2022 2018 Multifamily New Development
McDermott Crossing Dallas-Fort Worth Plano, Texas Sold 3/1/2012 123 $18,000,000 $28,706,300 18.00% 2.34X 8/1/2012 2011 Multifamily New Development
Stoneleigh on Cypress Pointe Houston Houston, Texas Sold 5/1/2016 228 $18,300,000 $23,800,000 32.30% 1.97X 5/1/2016 2007 Multifamily Value-Add
Estates of Coppell Dallas-Fort Worth Coppell, Texas Sold 2/1/2014 56 $9,260,000 $13,700,000 28.00% 1.84X 3/1/2017 2005 Multifamily Value-Add
Stoneleigh Spring Cypress Houston Houston, Texas Sold 4/1/2014 216 $19,986,000 $24,800,000 36.00% 2.26X 12/1/2017 2004 Multifamily Value-Add
The Grand Hampton at Clear Lake Houston Houston, Texas Sold 8/30/2017 347 $25,165,000 $39,011,000 24.10% 2.04X 9/14/2021 1976 Multifamily Value-Add
Champions at Ponderosa Houston Houston, Texas Sold 9/1/2016 177 $10,500,000 $16,700,000 16.20% 1.83X 2/23/2021 1978 Multifamily Value-Add
Huxley at Medical Center Houston Houston, Texas Sold 10/10/2018 284 $24,200,000 $36,000,000 22.60% 1.91X 12/9/2021 1983 Multifamily Value-Add
Creekside Villas at Lake Houston Houston, Texas Sold 8/30/2017 202 $13,215,000 $25,850,000 28.00% 2.25X 6/3/2022 1978 Multifamily Value-Add
Steeplecrest Houston Houston, Texas Sold 10/1/2019 260 $29,400,000 $36,600,999 6.00% 1.15X 2/1/2023 1992 Multifamily Value-Add
Harbor House on Saratoga Corpus Christi Corpus Christi, Texas Sold 3/1/2019 252 $25,704,000 $40,500,000 18.00% 1.73X 6/22/2022 1998 Multifamily Value-Add
Stoneleigh Corpus Christi Corpus Christi Corpus Christi, Texas Sold 8/1/2004 348 $22,620,000 $31,000,000 15.00% 1.90X 4/16/2013 2004 Multifamily Value-Add
Totals         8,211 $868,989,000 $1,347,876,559          

(1) The provided track record represents the experience of the Sponsor, ClearWorth Capital, since its inception.

(2) The above bios and track record were provided by ClearWorth Capital and have not been independently verified by RealtyMogul.

(3) The IRRs and EMx of the owned deals represented above are projections based on initial budgets and underwriting. They do not reflect realized returns and are subject to change.

Management Team
Management
Matthew Stone
Managing Partner and CEO

During his career, Mr. Stone has been part of the Sponsor team for over $1 billion in commercial real estate development and renovation projects. His development experience includes 37 projects, including over 6,000 multifamily units, as well as senior housing, student living, townhomes, condominiums, office buildings, and hotels.

Through ClearWorth Capital and its predecessor companies, Matthew has also acquired and renovated 30 multifamily projects totaling over 7,000 units. During his career, Matthew has held a number of other positions, including:

- President and CEO of Seneca Investments, a real estate development company

- Associate with Oliver Wyman, a global strategy and operations consulting firm

- Loan officer with Bank of America engaged in the origination of construction loans, lines of credit, bridge loans, and mini-perms in excess of $500M.

Matthew earned a BS in Industrial Engineering from Stanford University and an MBA with distinction (Sord Scholar, Dean’s Award, MBA Excellence Fund Scholar, and Endowed Presidential Scholar) from the University of Texas at Austin with a concentration in Real Estate Finance.

Management
Jordan Tabbert
Senior Vice President, Investments

Jordan joined ClearWorth Capital in 2015 and now serves as Senior Vice President of Investments, where he is responsible for deal sourcing, capital structuring, acquisitions underwriting, due diligence, and dispositions. Jordan was the first hire for ClearWorth and has been instrumental in scaling the company's operations and portfolio across multiple Texas markets. Since joining ClearWorth, he has directly sourced and closed over $800 million in multifamily acquisitions and dispositions for the firm.

Prior to ClearWorth, Jordan worked at a top-10 public homebuilder, reporting directly to the CFO as a member of their IPO team, and assisted with the drafting of their S-1 submittal. Additionally, Jordan was responsible for managing all development spend and budgeting across 40+ active land development projects throughout the country.

Jordan earned a B.B.A in Finance from Texas Tech University, graduating Magna Cum Laude.

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

Lease Comparables

Property Construction Style Year Built Occupancy # of Units Avg. SF Asking Rent PSF
Virtuo Spring 4-story mid-rise 2024 32.5% (1) 313 1,058 $1,742 $1.65
Preserve at Spring Creek 3-story garden 2014 96.3% 380 898 $1,405 $1.56
Waterford Trails 3-story garden 2015 92.2% 340 824 $1,531 $1.86
Adley at Gleannloch 4-story mid-rise 2019 94.0% 260 1,060 $1,732 $1.63
Fox Bridge North 3-story garden 2021 92.4% 368 993 $1,553 $1.56
Magnolia at Spring 3-story garden 2020 92.1% 336 976 $1,722 $1.76
Stone Loch 4-story mid-rise 2020 95.3% 384 1,021 $1,525 $1.49
Allora Klein Crossing 3-story garden 2024 47.0% (1) 351 1,113 $1,579 $1.42
Abbey at Spring Town Center 3-story garden 2014 93.9% 396 928 $1,387 $1.49
Savannah Oaks in Spring 4-story mid-rise 2019 93.6% 330 969 $1,643 $1.70
Vale 3-story garden 2020 96.3% 350 1,168 $1,953 $1.67
Territory at 2920 3-story garden 2023 88.0% (1) 276 886 $1,701 $1.92
Aria at Ella 3-story garden 2023 60.0% (1) 136 891 $1,470 $1.65
Willow Creek 3-story garden 2015 96.5% 228 881 $1,468 $1.67
Averages   2019 94.3% 317 976 $1,600 $1.64
Vantage at Tomball - Rents at Close 3-story garden 2022 93.0% 288 847 $1,458 $1.72
Vantage at Tomball - Year 1 Market Rent (Unrenovated)       288 847 $1,470 $1.73
Vantage at Tomball - Renovated Rent       288 847 $1,566 $1.85

(1) In lease-up

 

Sales Comparables (1)

Property Year Built # of Units Sales Price $/Unit Avg. Unit Size $/SF Sale Date Submarket
Anatole at the Pines (2) 2016 304 $48,032,000 $158,000 934 SF $169 Jun-24 Conroe
Prose Cypress Creek 2022 240 $42,000,000 $175,000 900 SF $194 Jun-24 Jersey Village / Cypress 
Prose Copperfield 2022 361 $61,250,000 $169,668 965 SF $176 Jun-24 Bear Cree / Copperfield
Cardiff at Louetta Lakes 2019 168 $26,712,000 $159,000 830 SF $192 Jun-24 Tomball / Spring
Prose Champions 2021 360 $55,500,000 $154,167 935 SF $165 Apr-24 Willowbrook / Champions
Alexis 2017 102 $15,900,000 $155,882 798 SF $195 Mar-24 Tomball / Spring
Mille Miglia 2021 324 $62,500,000 $192,901 970 SF $199 Nov-23 Conroe
Encore Rise 2022 256 $47,100,000 $183,984 922 SF $200 Nov-23 Conroe
Fidelis Grand Central 2022 317 $58,011,000 $183,000 890 SF $206 Oct-23 Conroe
Corland Spring Cypress 2016 253 $50,500,000 $199,605 1,056 SF $189 Mar-23 Tomball / Spring
Fidelis Cypresswood 2022 287 $57,400,000 $200,000 933 SF $214 Dec-22 Tomball / Spring
Ariza Gosling 2020 316 $67,000,000 $212,025 873 SF $243 Oct-22 Tomball / Spring
Ivy Point Klein 2019 132 $29,750,000 $225,379 1,031 SF $219 May-22 Tomball / Spring
Waterstone 2012 276 $64,000,000 $231,884 1,135 SF $204 May-22 Tomball / Spring
Arden Woods 2014 308 $62,100,000 $201,623 938 SF $215 Mar-22 Tomball / Spring
Magnolia by Watermark 2020 336 $70,225,000 $209,003 976 SF $214 Mar-22 Tomball / Spring
The Canopy at Springwoods Village 2020 332 $59,000,000 $177,711 941 SF $189 Dec-21 Tomball / Spring
Average 2019 275 $51,587,059 $187,578 943 SF $199    
Vantage at Tomball 2022 288 $42,500,000 $147,569 847 SF $174 Under Contract Tomball / Spring

(1) All sales within 20 miles of the Property.
(2) HUD Loan Assumption

Financials
For more information, view the Sponsor's Investment Memorandum.
Sources & Uses
Sources of Funds Amount
Senior Loan $33,200,000
LP Equity $14,250,000
GP Equity (1) $750,000
Total Sources of Funds $48,200,000

 

Uses of Funds Amount
Purchase Price $42,500,000
Equity Fees $612,684
Soft Costs $1,768,102
Working Capital / Contingency $707,214
Renovation $1,355,140
Construction Management Fee $94,860
Interest Rate Cap $1,162,000
Total Uses of Funds $48,200,000

(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:

Senior Loan

  • Lender: MF1
  • Loan Amount: $33,200,000
  • Initial Loan Term: 3 Years
  • Extension Options: Two 1-year extension terms.
  • Amortization: Interest only during the Initial Term and first extension, followed by amortization based upon a 30-year schedule for the second and third Extension Terms.
  • Interest Rate: SOFR + 300 bps (all in rate 6.0% with cap)
  • Interest Type: Floating
  • Interest Rate Cap: SOFR capped at 3%
  • Interest-Only Period: Interest only during the Initial Term and first extension (3 Years)
  • Stabilized Loan-to-Value: 57%
  • Loan-to-Cost: 69%

(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 Sponsor's use of debt. 

Distributions

ClearWorth Capital intends to make distributions from CW Tomball RM, LLC as follows:

  1. Pari-passu all cash flow available for distribution to the Equity Investors(1) until the Equity Investors(1) receive a Preferred Return of 9.0% IRR;
  2. 70% / 30% (70% to Equity Investors(1) / 30% to Promoted/Carried Interest) of all cash flow available for distribution thereafter.

ClearWorth Capital 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 June 2026 and are projected to continue on a quarterly basis thereafter. Distributions are at the discretion of ClearWorth Capital, who may decide to delay distributions for any reason, including maintenance or capital reserves.

ClearWorth Capital will receive a promoted/carried interest as indicated above.

(1) Equity Investors include all members of the Limited Partnership and General Partnership, including the Sponsorship Group.

Fees

You will pay certain fees and compensation over the life of the transaction; please refer to Clearworth Capital's materials for details. The following fees and compensation will be paid (2)(3):

One-Time Fees:

Type of Fee Amount of Fee Received By Paid From
Acquisition Fee 1.5% of Purchase Price ClearWorth Capital Capitalized Equity Contribution
Construction Management Fee 7.0% of CapEx Sponsor Affiliate Capitalized Equity Contribution
Due Diligence Fee Flat, One-Time Fee of $440,000 Prevail Real Estate (1) Capitalized Equity Contribution
Platform Fee Flat, One-Time Fee of $15,000 RM Securities, LLC Capitalized Equity Contribution
Placement Fee (3) 4.00% of the Raised Amount up to $2 million, plus 3.50% of the Raised Amount in excess of $2 million. RM Securities, LLC Capitalized Equity Contribution

Recurring Fees:

Type of Fee Amount of Fee Received By Paid From
Asset Management Fee 2.0% of Effective Gross Income ClearWorth Capital / Prevail Alternative Asset, LLC Cash Flow
Property Management Fee 3.0% of Effective Gross Income Sponsor Affiliate Cash Flow
Administration Solution Licensing Fee (3) 1.00% per annum of the aggregate capital contributions of the RM platform investor for whom RM Technologies provides the Administration Solution. RM Securities, LLC Cash Flow / Capitalized Equity Contribution

(1) Prevail has certain shared major decision rights within CW Tomball, LLC as detailed within the operating agreement.

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

(3) For more information on the fees paid to RM Securities and its affiliates 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 CRSRegulation Best Interest Disclosures, and Limited Brokerage Services Agreement.

Sources & Uses
Sources of Funds Amount
Senior Loan $33,200,000
LP Equity $14,250,000
GP Equity (1) $750,000
Total Sources of Funds $48,200,000

 

Uses of Funds Amount
Purchase Price $42,500,000
Equity Fees $612,684
Soft Costs $1,768,102
Working Capital / Contingency $707,214
Renovation $1,355,140
Construction Management Fee $94,860
Interest Rate Cap $1,162,000
Total Uses of Funds $48,200,000

(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:

Senior Loan

  • Lender: MF1
  • Loan Amount: $33,200,000
  • Initial Loan Term: 3 Years
  • Extension Options: Two 1-year extension terms.
  • Amortization: Interest only during the Initial Term and first extension, followed by amortization based upon a 30-year schedule for the second and third Extension Terms.
  • Interest Rate: SOFR + 300 bps (all in rate 6.0% with cap)
  • Interest Type: Floating
  • Interest Rate Cap: SOFR capped at 3%
  • Interest-Only Period: Interest only during the Initial Term and first extension (3 Years)
  • Stabilized Loan-to-Value: 57%
  • Loan-to-Cost: 69%

(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 Sponsor's use of debt. 

Distributions

ClearWorth Capital intends to make distributions from CW Tomball RM, LLC as follows:

  1. Pari-passu all cash flow available for distribution to the Equity Investors(1) until the Equity Investors(1) receive a Preferred Return of 9.0% IRR;
  2. 70% / 30% (70% to Equity Investors(1) / 30% to Promoted/Carried Interest) of all cash flow available for distribution thereafter.

ClearWorth Capital 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 June 2026 and are projected to continue on a quarterly basis thereafter. Distributions are at the discretion of ClearWorth Capital, who may decide to delay distributions for any reason, including maintenance or capital reserves.

ClearWorth Capital will receive a promoted/carried interest as indicated above.

(1) Equity Investors include all members of the Limited Partnership and General Partnership, including the Sponsorship Group.

Fees

You will pay certain fees and compensation over the life of the transaction; please refer to Clearworth Capital's materials for details. The following fees and compensation will be paid (2)(3):

One-Time Fees:

Type of Fee Amount of Fee Received By Paid From
Acquisition Fee 1.5% of Purchase Price ClearWorth Capital Capitalized Equity Contribution
Construction Management Fee 7.0% of CapEx Sponsor Affiliate Capitalized Equity Contribution
Due Diligence Fee Flat, One-Time Fee of $440,000 Prevail Real Estate (1) Capitalized Equity Contribution
Platform Fee Flat, One-Time Fee of $15,000 RM Securities, LLC Capitalized Equity Contribution
Placement Fee (3) 4.00% of the Raised Amount up to $2 million, plus 3.50% of the Raised Amount in excess of $2 million. RM Securities, LLC Capitalized Equity Contribution

Recurring Fees:

Type of Fee Amount of Fee Received By Paid From
Asset Management Fee 2.0% of Effective Gross Income ClearWorth Capital / Prevail Alternative Asset, LLC Cash Flow
Property Management Fee 3.0% of Effective Gross Income Sponsor Affiliate Cash Flow
Administration Solution Licensing Fee (3) 1.00% per annum of the aggregate capital contributions of the RM platform investor for whom RM Technologies provides the Administration Solution. RM Securities, LLC Cash Flow / Capitalized Equity Contribution

(1) Prevail has certain shared major decision rights within CW Tomball, LLC as detailed within the operating agreement.

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

(3) For more information on the fees paid to RM Securities and its affiliates 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 CRSRegulation Best Interest Disclosures, and Limited Brokerage Services Agreement.

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.
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