Founded in April 2014, RSN Property Group is a multi-real estate investment firm owned by Australian investors living in the U.S. They specialize in acquiring and operating properties with significant value-add components within strong MSAs throughout the U.S. The key principal, Reed Goossens, has been the lead operator on over 24 multifamily value-add syndications acquiring assets worth more than $883MM today.
Pre-Renovated Lease Comparables
| Property | Year Built | Asking Rent (1x1) | Asking Rent (2x2) | Asking Rent (3x2) |
|---|---|---|---|---|
| Eagle Creek Landing | 1982 | $1,127 | $1,355 | $1,509 |
| Desoto Ranch | 2002 | $1,591 | $1,573 | $2,254 |
| Rolling Hills Place | 1985 | $1,245 | $1,545 | $1,850 |
| Pleasant Creek Apartments | 1983 | $1,154 | $1,284 | $1,643 |
| Thorn Manor | 1985 | $1,135 | $1,370 | $1,666 |
| The Corners Apartments | 1983 | $1,168 | $1,336 | N/A |
| Creekwood Apartments | 1983 | $1,085 | $1,304 | $1,585 |
| Totals (weighted avg) | $1,273 | $1,438 | $1,913 | |
| Difference | $146 (-11.50%) | $83 (-5.80%) | $404 (-21.13%) |
Sales Comparables
| Property | Year Built | Units | Sales Price | $/Unit | Avg. Unit Size | Sale Date |
|---|---|---|---|---|---|---|
| Eagle Creek Landing | 1982 | 226 | $21,750,000 | $96,239 | 754 SF | Pending |
| South Crest Apartments | 1972 | 150 | $18,500,000 | $123,333 | 1,137 SF | Jun 24 |
| 6500 South | 1985 | 536 | $58,500,000 | $109,142 | 745 SF | Nov 22 |
| 1117 Franklin | 1963 | 21 | $2,350,000 | $111,905 | 972 SF | Nov 22 |
| Bella Ruscello | 2007 | 216 | $32,964,442 | $152,613 | 836 SF | Oct 22 |
| Desoto Ranch | 2002 | 249 | $49,337,034 | $198,141 | 976 SF | Sep 22 |
| Pleasant Creek Apartments | 1983 | 159 | $24,250,000 | $152,516 | 818 SF | Aug 22 |
| Lancaster Urban Village | 2013 | 193 | $20,800,000 | $107,772 | 989 SF | Nov 21 |
| The Abigail | 2007 | 198 | $38,160,328 | $192,729 | 1,148 SF | Nov 21 |
| Totals (weighted avg) | 1992 | 215 | $30,607,726 | $143,519 | 953 SF | |
| Difference (%) | -49.12% |
| Sources of Funds | Amount |
|---|---|
| Preferred Equity | $1,243,328 |
| LP Investor Equity | $6,680,527 |
| GP Investor Equity (1)(2) | $365,000 |
| Debt | $17,006,282 |
| Seller Financing (1% Interest) | $1,000,000 |
| Total Sources of Funds | $26,295,137 |
| Uses of Funds | Amount |
|---|---|
| Purchase Price | $21,750,000 |
| CapEx | $2,375,043 |
| Closing Costs | $239,250 |
| Rate Cap | $932,000 |
| Acquisition Fees (3) | $543,750 |
| Loan Fees | $255,094 |
| Working Capital | $200,000 |
| Total Uses of Funds | $26,295,137 |
(1) The lender and partners agreed to a 5% GP co-investment, resulting in a minimum investment of $365K. However, the Sponsor anticipates a $650K investment.
(2) The Sponsor’s equity contribution may consist of friends and family equity and equity from funds controlled by the Sponsor.
(3) Includes fees paid to RM Securities, LLC and RM Technologies, LLC. For more information, please see the Fees and Disclosures sections.
The expected terms of the debt financing are as follows:
Senior and Renovation Loan
- Lender: Bancorp
- Loan Amount: $17,006,282
- Initial Loan Term: 3 Years
- Extension Options: Two 1-Year Extensions
- Interest Rate: SOFR + 3.55% (capped at 6.25% for the first 3 years)
- Interest-Only Period (2): Full term (Initial 3 years plus 2 one-year extensions)
- Amortization: 30 Years
- Prepayment: 0.5% Exit Fee
- Stabilized Loan-to-Value: 47%
- Loan-to-Cost: 65%
Refinance (3)
- Loan Amount: $18,603,028
- Initial Loan Term: 5 Years
- Interest Rate: 5.5% Fixed
- Interest-Only Period: 2 Years
- Amortization: 30 Years
- Stabilized Loan-to-Value: 52%
- Loan-to-Cost: 71%
(1) A substantial portion of the total acquisition for the Property will be paid with borrowed funds, i.e., debt. Please carefully review the Disclosures section below for additional information concerning the Sponsor's use of debt.
(2) The loan will be Interest-Only for the initial three (3) year term, followed by monthly principal and interest payments based upon a 30-year amortization schedule during the extension terms. Interest payments on the Loan will be computed based on the actual number of days elapsed and a 360-day year. However, the loan will continue to be Interest-Only in the first extension if (a) the Debt Yield is 9.75% (as determined by Lender) and (b) the DSCR (based on the Outstanding Loan Balance, and a 30-year amortization schedule) is greater than 1.25x, and for the second extension if (a) the Debt Yield is 10.25% (as determined by Lender) and (b) the DSCR (based on Outstanding Loan Balance, and a 30-year amortization schedule) is greater than 1.30x. Based on the underwriting, the Interest-Only conditions will be met for the first and second extensions.
(3) The Sponsor plans to secure a refinance at the end of Year 3 to repay the senior and renovation loans.
RSN Property Group intends to make distributions from RSNPG Eagle Creek RM, LLC to investors on a pro rata basis, based on distributions received as the holder of a Class C interest from RSNPG Eagle Creek Partners, LLC. RSNPG Eagle Creek Partners, LLC will make distributions as follows:
Operating Cash Flow:
- To the Class A Investors, until they receive a 10% annualized preferred equity return;
- Pari-passu all cash flow available for distribution to the Class C Investors(1) until the Class C Investors receive an 8.0% IRR;
- 80% / 20% (80% to Class C Investors / 20% to GP as Promoted/Carried Interest) of excess cash flow thereafter.
Capital Event:
- To the Class A Investors, until they receive a 10% annualized preferred equity return;
- Return of capital to Class A Investors;
- Pari-passu all cash flow available for distribution to the Class C Investors(1) until the Class C Investors receive an 8.0% IRR;
- 80% / 20% (80% to Class C Investors / 20% to GP as Promoted/Carried Interest) of excess cash flow thereafter.
RSN Property 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 loans). As set forth in the operating agreement, Class C Investors are subordinate to the Class A Investors, who receive a 10% annualized preferred equity return. After payments of amounts to the Class A Investors, Class C Investors will recieve their pro rata share of the amount remaining which will be distributed as provided above.
Distributions are expected to start in December 2025 and are projected to continue on a quarterly basis thereafter. Distributions are at the discretion of RSN Property Group, who may decide to delay distributions for any reason, including maintenance or capital reserves.
RSN Property Group will receive a promoted/carried interest as indicated above.
(1) Class C Investors include the Sponsor and investors who invest via the RealtyMogul platform. Please refer to the Project Summary p.7 for the delineation of different share classes.
You will pay certain fees and compensation over the life of the transaction; please refer to RSN Property Group's materials for details. The following fees and compensation will be paid(1)(3):
One-Time Fees:
| Type of Fee | Amount of Fee | Received By | Paid From |
|---|---|---|---|
| Acquisition Fee | 2.5% of Purchase Price (2) | RSN Property Group | 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 | RSN Property Group | Cash Flow |
| Property Management Fee | 3.0% of Effective Gross Income | Third-Party Property Manager | Cash Flow |
| Construction Management Fee | 5.0% of CapEx Budget | RSN Property Group | Construction Expenditure Budget |
| 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) Fees may be deferred to reduce impact to investor distributions.
(2) Of which 1.5% will be paid to the Sponsor and 1% will be used to pay a portion of the equity placement and deal-related fees.
(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 CRS, Regulation Best Interest Disclosures, and Limited Brokerage Services Agreement.
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.