RM Notes
RM Notes is a sister company to RealtyMogul, one of the leading online platforms for real estate investing. RM Notes acquires participations in loans backed by commercial real estate and offers them to accredited investors through fixed-income Borrower Payment Dependent Notes (BPDNs). The firm partners with experienced real estate lenders who originate and asset manage loans throughout their lifecycle—emphasizing disciplined underwriting, strong borrower relationships, and real estate-backed structures that prioritize investor protections. RM Notes is led by a management team with over 25 years of experience and has been involved in over $8 billion of real estate transactions.
Urban Standard Capital
Urban Standard Capital ("USC") is a credit manager focused on real estate debt and structured equity that specializes in middle-market loans under $50mm. Their differentiated approach of having their loan originators also focus on asset management throughout the life of the loan allows for better performance tracking/risk mitigation as well as stronger borrower/lender relationships. USC has made approximately 190 debt investments, amounting to roughly $1.4 billion invested in real estate lending.
Lease Comparables
| 50 Prospect Street | 10 Inner Belt Road | 9 Central Street | 346 Somerville Avenue | Averages | Subject Property (1) | |
|---|---|---|---|---|---|---|
| Year Built | 2023 | 2023 | 2024 | 2024 | 2024 | 2026 |
| Units | 450 | 205 | 40 | 94 | 197 | 50 |
| $/Unit (Studio) | $3,090 | $2,870 | $2,865 | N/A | $2,942 | $3,117 |
| Avg. SF (Studio) | 460 SF | 516 SF | 573 SF | N/A | 516 SF | 484 SF |
| $/SF (Studio) | $6.72 | $5.56 | $5.00 | N/A | $5.76 | $6.44 |
| $/Unit (1x1) | $3,480 | $3,570 | N/A | $3,550 | $3,533 | $3,708 |
| Avg. SF (1x1) | 544 SF | 941 SF | N/A | 724 SF | 736 SF | 693 SF |
| $/SF (1x1) | $6.40 | $3.79 | N/A | $4.90 | $5.03 | $5.35 |
| $/Unit (2x1) | N/A | N/A | $3,650 | N/A | $3,650 | $4,375 |
| Avg. SF (2x1) | N/A | N/A | 693 SF | N/A | 693 SF | 807 SF |
| $/SF (2x1) | N/A | N/A | $5.27 | N/A | $5.27 | $5.42 |
| $/Unit (2x2) | $4,510 | $4,515 | N/A | N/A | $4,513 | $4,688 |
| Avg. SF (2x2) | 932 SF | 1,124 SF | N/A | N/A | 1,028 SF | 1,014 SF |
| S/SF (2x2) | $4.84 | $4.02 | N/A | N/A | $4.43 | $4.62 |
(1) Rental rates reflective of market rate units.
Sales Comparables
| Address | Submarket | Class | Units | SF | Sales Price | $/SF | $/Unit | Sale Date |
|---|---|---|---|---|---|---|---|---|
| 333 Broadway | Somerville | B | 50 | 46,270 | $11,000,000 | $237 | $220,000 | Mar-24 |
| 1 India Street | Downtown | A | 94 | 99,400 | $62,000,000 | $624 | $659,574 | Jan-24 |
| 14 Wendell Street | Cambridge | B | 17 | 6,888 | $5,600,000 | $813 | $329,412 | Nov-23 |
| 290 Revolution Drive | Somerville | A | 329 | 335,356 | $188,000,000 | $561 | $571,429 | Jun-23 |
| 1284 Beacon Street | Brookline | A | 148 | 134,756 | $70,000,000 | $519 | $472,973 | Jun-23 |
| 81-91 Winter Street | Cambridge | B | 13 | 16,130 | $7,200,000 | $446 | $553,846 | Jun-23 |
| 281 Highland Avenue | Somerville | B | 14 | 18,750 | $6,050,000 | $323 | $432,143 | Feb-23 |
| 9 Miner Street | Fenway | A | 49 | 47,164 | $31,940,000 | $677 | $651,837 | Aug-22 |
| Averages | 89 | 88,089 | $47,723,750 | $525 | $486,402 | |||
| Subject Property (1) | Somerville | 50 | 54,517 | $31,800,000 | $583 | $636,000 | 4Q 2026 |
(1) Illustrative Sale in Q4 2026 based on pro forma underwriting.
| Sources of Funds | Amount |
|---|---|
| Secondary Loan | $16,450,000 |
| Urban Standard Capital Co-Investment | $4,050,000 |
| RM Notes Co-Investment | $3,000,000 |
| Total Sources of Funds | $23,500,000 |
| Uses of Funds | Amount |
|---|---|
| Senior Underlying Construction Loan | $23,500,000 |
| Total Uses of Funds | $23,500,000 |
The expected terms of the debt financing are as follows(1):
Construction Loan
- Loan Amount: $23,500,000
- Initial Loan Term: 24 Months (17 Months Remaining)
- Appraised Loan-to-Value (LTV): 72.30%
- Loan-to-Development Cost: 74.70%
- Interest Rate: WSJ Prime Rate + 2.90% (10.00% Floor)
- Interest Reserve: $2,250,000 to be kept at a minimum of 3 months' interest at all times
- Borrower Guarantees: Interest, completion, and carry guarantee in addition to $3,525,000 of principal recourse. Standard bad boy guarantee with carveouts are in place that if triggered would result in full recourse.
Secondary Loan
- Loan Amount: $16,450,000
- Loan Term: 17 Months
- Interest Rate: SOFR + 4.00%
(1) A substantial portion of the transaction will be paid with borrowed funds, i.e., debt. Please carefully review the Risk Factors section of the Note Subscription Agreement for additional information concerning the underlying lender's use of debt.
The following reflects the distribution waterfalls for the Borrower Payment Dependent Notes and the underlying joint venture:
Distribution Waterfall to RealtyMogul Platform Investors:
- First, payment of all expenses of RM Notes special purpose vehicle;
- Second, an 11.5% annualized rate of return to all noteholders;
- Thereafter, all remaining proceeds to RM Notes.
JV Distribution Waterfall:
- First, a 15% annualized rate of return to RM Notes single-purpose entity in accordance with its ownership interest;
- Second, return of capital pro rata per ownership percentages to Urban Standard Capital and RM Notes single-purpose entity, inclusive of all prior distributions;
- Thereafter, after all payments are made pursuant to Steps 1 & 2, all remaining proceeds are to be paid to Urban Standard Capital.
Distributions pursuant to the above waterfalls are only made after the payment of the respective company's liabilities (loan payments, operating expenses, and other fees as more specifically set forth in the LLC agreements).
Distributions are expected to start in August 2025 and are projected to continue to be paid on a monthly basis thereafter.
RM Notes will be the sole equity holder of RM Notes SPE and will receive any net cash remaining in RM Notes SPE after the noteholders' principal and interest are repaid in full.
You will pay certain fees and compensation over the life of the transaction; please refer to RM Notes' 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 |
|---|---|---|---|
| Leverage Placement Fee | 1.00% of the Secondary Loan Amount | Urban Standard Capital | Capitalized Equity Contribution |
| Origination Fee (1) | 1.50% of the Underlying Loan Amount; paid at underlying loan closing | Urban Standard Capital | Underlying Borrower |
| Exit Fee | 0.15% of the Underlying Loan Amount; paid at underlying loan expiration | Urban Standard Capital | Underlying Borrower Sale Proceeds |
| Placement Fee (3) | 0.50% of the Invested Amount | RM Securities, LLC | Capitalized BPDN Contribution |
Recurring Fees:
| Type of Fee | Amount of Fee | Received By | Paid From |
|---|---|---|---|
| Equity Interest | Entitled to cash remaining in the LLC after full repayment of BPDN holders | RM Notes | 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 Technologies, LLC | Cash Flow / Capitalized BPDN Contribution |
(1) This fee has already been paid.
(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 CRS, Regulation Best Interest Disclosures, and Limited Brokerage Services Agreement.
Important Risk Disclosures
BPDNs are unsecured debt offerings. The proceeds from the BPDNs will be used to acquire underlying asset(s). The underlying asset(s) may be an interest in an LLC which holds a real estate loan or real estate investment, a real estate loan participation, or a direct interest in a real estate loan. Payments to BPDN investors will be made, when available, from the underlying asset. BPDN investors will have no direct interest in or ownership of real estate and therefore limited to no recourse in the event of a default of the underlying asset.
Investments in BPDNs are speculative, highly illiquid, and involve substantial risk and you should not invest unless you can risk losing all your capital. All information about any deal is qualified in its entirety by the offering documents that must be reviewed prior to investing, including risk factors, investment objectives, business plan, charges, expenses, and other important information. Advice from a financial, legal, tax, or other professional advisor is highly recommended.
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.