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.
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.
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.
We have formalized processes and checklists for every private placement deal listed on the platform.
Inception Investors
Inception Investors is a private real estate investment and operating company that was founded in 2012. The company is headquartered in New York City and has offices in Brooklyn and Manhattan.
The Sponsor’s investment strategy is to acquire properties with attractive growth potential through either a combination of active property and asset management and market growth. They generally target cash flowing Class-B multifamily properties and give key consideration to the following criteria:
- Gentrifying Tri-state area markets with high population density and strong market fundamentals.
- Capitalize on shifts in demographic trends and property investments that include an increased preference for urban living by baby boomers, millennials, and young professionals as well as assets that are in close proximity to transit or places of employment.
The Sponsor is an affiliated entity to The Clairmont Group – the same sponsor who transacted on the 23-Unit New Jersey Multifamily deal with RealtyMogul.com in March 2016. Two of the three principals with Inception are also principals of the Clairmont Group. The two companies share asset management, accounting, and back office operations and invest together as principals, so it truly is one company at this time. They have maintained their respective names due to legacy and relationship reasons.
Sponsor Track Record (includes transactions the management team completed as Principals of other firms prior to joining Clairmont and Inception Investors)
http://www.inceptioninvestors.com-
Ryan Colbert, Managing Partner -
Chesky Engel, Managing Partner
Mr. Colbert has over a decade of institutional real estate equity investment experience in both domestic & international markets and has acquired over $1 billion worth of commercial real estate. His experience includes investments in distressed real estate & note purchases, recapitalizations, JV partner buy-outs and direct secondary investing across all major asset classes.
Mr. Colbert was a Director at Madison Marquette and formerly a Vice President at the Lightstone Group, one of the nation’s largest real estate investment firms. While at Madison Marquette, he closed over $400 million of multifamily, office and retailacquisitions. While at the Lightstone Group, he was responsible for rebuilding the firm’s hospitality portfolio as well as expanding its existing multifamily portfolio, closing over $100 million of acquisitions during his tenure. Prior to joining Lightstone Group, Mr. Colbert was a member of the investment team at Madison International Realty, a real estate private equity firm focused on the acquisition of direct secondary’s and structured equity investments. While at Madison International Realty he was involved in the recapitalization of over $200 million of real estate.
Mr. Colbert holds a Series 7 & 63 license and completed his dual-undergraduate degree in Political Science & Finance with minors in German Studies & Law at Cornell University.
Mr. Engel is Co-Founder & Managing Member of Inception Investors with primary responsibility for operational excellence, transaction sourcing, construction and development. Mr. Engel is responsible for daily operations, transaction sourcing, construction and development of Inception Investor's transactions in the Tri-state area. Mr. Engel brings 20 year's investing experience in New York City real estate and is a Brooklyn native. Mr. Engel has been involved in numerous high-profile re-development and re-positioning projects which have been featured in the Real Deal, Brownstoner, and Crain's New York Business. Mr. Engel has also completed over $1 billion of transactions in the New York City area including investments in distressed real estate & note purchases, recapitalizations and JV partner buy-outs across all asset classes. Mr. Engel holds a Bachelor's Degree from Gateshead Talmudical College in Gateshead, United Kingdom.
| Inception Investors Track Record | |||||||
| Expected Investment Performance | |||||||
| April 1, 2016 | |||||||
| Investment | Date of Initial Investment |
Date of Liquidation |
Property Type | Property Location | Market Value (a) | Invested & Committed Capital (b) |
|
| Fairfield Inn | Jul-10 | TBD | Hotel | East Rutherford, NJ | $18,700,000 | $3,940,983 | |
| Everson Pointe(c) | Dec-10 | Jan-15 | Retail | Atlanta, GA | 9,000,000 | 4,664,000 | |
| TownePlace Suites | Jan-11 | TBD | Hotel | Metairie, LA | 15,300,000 | 6,055,449 | |
| Rego Park(c) | Mar-11 | TBD | Multifamily | Queens, NY | 19,000,000 | 15,132,500 | |
| Crowne Plaza Boston North Shore | Mar-11 | TBD | Hotel | Danvers, MA | 27,000,000 | 23,590,184 | |
| Holiday Inn Express(c) | Jun-11 | TBD | Hotel | East Brunswick, NJ | 9,000,000 | 6,196,498 | |
| Crowe's Crossing | Oct-11 | TBD | Retail | Atlanta, GA | 12,000,000 | 2,069,210 | |
| Marriott Courtyard(c) | Nov-11 | TBD | Hotel | Parsippany, NJ | 10,000,000 | 11,925,000 | |
| DePaul Plaza Shopping Center | Nov-11 | TBD | Retail | St. Louis, MO | 20,000,000 | 8,745,154 | |
| Shasta Crossroads | Dec-11 | Dec-14 | Retail | Redding, CA | 9,000,000 | 6,954,373 | |
| Hampton Inn | Mar-12 | TBD | Hotel | Woodbridge, VA | 10,500,000 | 4,021,019 | |
| Meridian Village | Apr-12 | TBD | Retail | Bellingham, WA | 15,000,000 | 4,225,100 | |
| Washington Business Park | Sep-12 | Dec-12 | Office | Lanham, MD | 45,000,000 | 11,000,000 | |
| The Center Building | Dec-12 | Mar-15 | Office | Queens, NY | 84,500,000 | 18,947,840 | |
| Cotton Exchange Hotel | Mar-13 | Jun-13 | Hotel | New Orleans, LA | 30,000,000 | 13,600,130 | |
| 331 Carroll Street | Aug-13 | TBD | Multifamily | Orange, NJ | 1,250,000 | 725,000 | |
| 7000 Central Park | Sep-13 | TBD | Office | Atlanta, GA | 75,000,000 | 13,264,192 | |
| The Edge | Dec-13 | TBD | Retail | Brooklyn, NY | 45,500,000 | 19,445,772 | |
| Free Market Portfolio | Dec-13 | TBD | Multifamily | Brooklyn, NY | 5,000,000 | 916,187 | |
| Paces Village Apartments | Dec-13 | TBD | Multifamily | Greensboro, NC | 15,000,000 | 4,379,994 | |
| Marina Shores Apartments | Mar-14 | TBD | Multifamily | Virginia Beach, VA | 54,000,000 | 18,292,593 | |
| 23 Harvard Street | Jul-14 | TBD | Multifamily | East Orange, NJ | 1,000,000 | 500,000 | |
| Broad Street Apartments | Sep-14 | TBD | Multifamily | Richmond, VA | 11,000,000 | 3,144,136 | |
| BankNote Building | Sep-14 | TBD | Office | Bronx, NY | 120,000,000 | 28,204,512 | |
| Eastern Parkway Portfolio | Oct-14 | TBD | Multifamily | Brooklyn, NY | 10,000,000 | 2,287,600 | |
| Brooklyn 9 Portfolio | Aug-15 | TBD | Multifamily | Brooklyn, NY | 30,000,000 | 7,137,217 | |
| Park Avenue Apartments | Mar-16 | TBD | Multifamily | Plainfield, NJ | 3,000,000 | 1,100,000 | |
| 330 E. 22nd St. | Jul-16 | TBD | Multifamily | Brooklyn, NY | 4,750,000 | 1,859,504 | |
| Total Portfolio | $709,500,000 | $242,324,147 | |||||
(a) Purchase price, UPB, or appraised value, whichever is greater at time of acquisition.
(b) Includes capitalized expenses allocated to each investment and co-investments made by third parties.
(c) Invested & committed capital represents Day 1 equity investment. Performance expectations include assumed refinancing distribution upon asset stabilization.
Note: The management overview and track record detailed above was provided by the Sponsor and has not been verified by RealtyMogul.com or NCPS.
In this transaction, RealtyMogul.com investors are to invest in Realty Mogul 84, LLC, which is to subsequently invest in 497 Dean Street LLC, a limited liability company that will hold title to the Property. The Sponsor (Inception Investors) is currently under contract to purchase the Property for $2,875,000 ($359,375/unit).
Upon acquisition, the Sponsor intends to negotiate buyouts with tenants currently occupying the five units subject to rent stabilization(1). The Sponsor has budgeted $30,000 per unit to perform these buyouts, in line with the amounts they have offered at their other rent stabilized properties. The Sponsor has already begun conversations with tenants about the business plan and reported that two tenants have already expressed willingness to accept a buyout. Once those units are vacated, the Sponsor intends on implementing a capital improvement program of $30,000/unit in order to renovate the units and capture the maximum allowed rental increases upon completion. The rent guidelines limit rent increases to 1/40th of the cost of construction(2).
Planned renovations include a full kitchen renovation including new appliances, stove and counter tops as well as bathroom renovations with new shower heads and toilets. The Sponsor will also replace the dated flooring, improve the lighting, and will install new video intercoms for the tenants.
| CapEx Item | $ Amount* | Per Unit |
|---|---|---|
| General Interiors (5 units) | ||
| Sheetrock | $20,000 | $4,000 |
| Moldings | $10,000 | $2,000 |
| Electric | $19,500 | $3,900 |
| General Plumbing | $15,000 | $3,000 |
| Closet | $12,500 | $2,500 |
| Intercom | $5,000 | $1,000 |
| Paint | $10,000 | $2,000 |
| Kitchen | ||
| Cabinets | $5,000 | $1,000 |
| Sink | $2,500 | $500 |
| Faucet | $2,000 | $400 |
| Bathroom | ||
| Tub & Plumbing | $22,500 | $4,500 |
| Toilets | $2,250 | $450 |
| Vanity | $1,750 | $350 |
| Medicine Chest | $750 | $150 |
| Faucet | $750 | $150 |
| Floors | $16,000 | $3,200 |
| Light Fixtures | $3,250 | $650 |
| Smoke and Carbon Monoxide Alarms | $1,250 | $250 |
| Total | $150,000 | $30,000 |
*Includes 10% Construction Management Fee
The Sponsor plans to engage EPP Management to manage the asset. EPP Management is a wholly owned subsidiary of Inception Investors and they currently manage over 400 units in the New York market. The management company is run by Chesky Engel, one of the principals of the Sponsor. Inception engages EPP Management for all of its assets. The Sponsor intends to sell the Property in five (5) years, however the hold period could potentially be shorter or longer.
RM has invested in two prior transactions with the Sponsor (New Jersey Multifamily & Brooklyn Multifamily), both of which are performing well. As of Q1 2017: NOI since inception (March 2016) at New Jersey Multifamily is trending at 43.7% above proforma. At Brooklyn Multifamily (closed July 2016), the Sponsor has completed renovations and leases on four rent stabilized units (with one more in process), ahead of proforma projections of three units in the first year (for informational purposes only, past performance is not indicative of future results).
(1) Per the New York State Division of Housing and Community Renewal Office of Rent Administration, the Rent Guidelines Board sets rent increases in stabilized apartments. These guidelines are set once a year and are effective for leases beginning on or after October 1st of each year. Rents can be increased during the lease period in any one of three ways as described here.
(2) - Rents for renovated units are subject to the Individual Apartment Improvement (IAI) rules which limit rent increases to 1/40th of the cost of construction (for properties with 35 units or less) as described here. Vacant units are subject to 20% increases over the last legal rent per the Board guidelines as described here.
RealtyMogul.com, along with Inception Investors (the "Sponsor"), is providing the opportunity to invest in the acquisition of 497 Dean Street, an eight-unit multifamily Property located in a gentrifying neighborhood of Brooklyn, NY the "Property".
The primary objective of this investment is to acquire the Property, remove existing rent stabilization restrictions through tenant buy outs, perform interior renovations to capture rental increases, then sell the Property within approximately five (5) years. The Sponsor sees this investment as an opportunity to capitalize on a well located asset in a gentrifying neighborhood that can be improved through the removal of rent stabilization restrictions and implementing a targeted renovation plan.
Built in 1930, the Property is comprised of one building containing eight units and is currently 100% occupied. Unit types are all four bedroom/two bathroom units averaging 894 SF across four stories. There are no parking spaces and amenities/common areas at the Property are limited, as is typical for smaller walk up multifamily properties in New York, however one of the ground floor units has access to a private backyard which is a rarity in the market. Five of the units are subject to rent stabilization restrictions while the remaining three units are free market and were previously renovated by the seller.
| Unit Type | # of Units | Avg SF/Unit | In-Place Rent | Rent/SF | Stabilized Rent | Rent/SF |
|---|---|---|---|---|---|---|
| 4 Bed, 2 Bath - Free Market | 3 | 894 | $3,217 | $3.60 | $3,600 | $4.03 |
| 4 Bed, 2 Bath - Rent Stabilized | 5 | 894 | $1,005 | $1.12 | $2,023 | $2.26 |
| Total | 8 | 894 | $1,834 | $2.05 | $2,614 | $2.92 |
Above: the Property in the foreground with 461 Dean Street, the tallest modular building in the world, under construction in the background.
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| Subject | 150 4th Ave | 148 5th Ave | 170 Ashland Pl | 79 Adelphi Street | 435 Grand Ave | Total / Averages | |
|---|---|---|---|---|---|---|---|
| Average Rental Rate | $3,600 | $3,995 | $3,995 | $4,400 | $3,600 | $3,600 | $3,918 |
| Baths | 2.0 | 1.0 | 1.0 | 2.0 | 2.0 | 1.5 | 1.5 |
| Distance | N/A | 0.6 mi | 0.5 mi | 0.7 mi | 1.2 mi | 1.0 mi | 0.8 mi |
| 340 Clinton Ave | 336 Clinton Ave | 155 Prospect Pl | 76 Douglass St | 372 St. Johns Pl | Total / Averages | Subject | |
|---|---|---|---|---|---|---|---|
| Date | October-16 | November-16 | October-16 | July-16 | June-16 | July-17 | |
| # of Units | 7 | 9 | 8 | 7 | 16 | 9 | 8 |
| Year Built | 1905 | 1905 | 1931 | 1920 | N/A | 1915 | 1930 |
| Purchase Price | $2,850,000 | $2,500,000 | $2,440,000 | $2,950,000 | $7,750,000 | $4,396,170 | $2,875,000 |
| $/Unit | $407,143 | $277,778 | $305,000 | $421,429 | $484,375 | $379,145 | $359,375 |
| Cap Rate | 3.14% | 4.20% | 3.86% | 4.50% | 4.04% | 3.95% | 4.53% |
| Distance | 0.9 mi | 0.9 mi | 0.3 mi | 1.5 mi | 0.9 mi | 0.9 mi |
The Property is located in the Prospect Heights/Park Slope neighborhood of Brooklyn, home to historic buildings, tree lined streets, top-rated restaurants, bars, and shops. The Property is located near the intersection of Flatbush Avenue and Atlantic Avenue within one mile of Prospect Park, one of the highest rated parks in New York, Brooklyn Heights, the Atlantic Mall, Atlantic Terminal, which is the nexus of public transportation in Brooklyn, as well as being located across the street from Barclays Center, home to the New York Nets, a community park and fire station. The Property also lies within the Pacific Park Brooklyn project, a $4.9 billion mixed use redevelopment project.
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Pacific Park Brooklyn
Pacific Park Brooklyn is a 22 acre, $4.9 billion mixed use development project that when completed, will include approximately six million square feet of residential space (6,430 units of affordable and market-rate housing), a state of the art sports and entertainment arena, the Barclays Center, 247,000 square feet of retail use, approximately 336,000 square feet of office space and eight acres of publicly accessible open space. The project plan permits a program variation which could allow for up to 1.6 million square feet of commercial space. The project also includes major transportation improvements, including a new storage and maintenance facility for the LIRR and a new subway entrance to the Atlantic Terminal Transit Hub, the third largest hub in the city. The Master Plan was designed by Frank Gehry and the development was renamed Pacific Park Brooklyn in July 2014. 461 Dean Street, part of the Pacific Park Brooklyn development and the tallest modular building in the world, sits across the street from the Property. More information about Pacific Park Brooklyn can be found at: http://pacificparkbrooklyn.com/.
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Market Overview
Per the Bureau of Labor Statistics, job growth in the New York-Jersey City-White Plains, NY-NJ Metro Division was 1.4% in March 2017, slightly below the national figure of 1.5%, reflecting 93,700 jobs added over a one year period. Axiometrics forecasts New York-Jersey City-White Plains, NY-NJ Metro Division's job growth to be 1.3% in 2018, with 89,639 jobs added. Job growth is expected to average 1.3% from 2019 to 2021, with an average of 90,446 jobs added each year. The largest job sectors in the market are Education and Health Services (20.8%) and Trade, Transportation and Utilities (16.9%).
Market occupancy as of 1Q 2017 was 96.5%, up slightly from 96.4% the year prior, and well above the national average of 94.5%. The market has averaged an occupancy rate of 96.4% since 1999. The market saw effective rents decrease slightly by 0.2%, but is forecast to be 2.9% in 2018 and average 3.8% from 2019 to 2021. As of May 7, 2017, Axiometrics has identified 28,370 apartment units scheduled for delivery in 2017, of which, 3,361 have been delivered. This is a substantial decrease from 2016 which saw 14,268 apartment units delivered. (Source: Axiometrics)
Submarket Overview - Kings County
As of Q1 2017, occupancy in the submarket was 95.9%, down slightly from 96.1% in Q4 2016. Effective rent decreased from $3,664 in Q4 2016 to $3,644, a decrease of 0.5%. The submarket saw an annual decrease in effective rent of 0.6%, below the market average of -0.2%. Forecasted growth for 2017 is expected to be 0.2%, and average 2.6% from 2017-2019. Effective rent growth has averaged 3.4% per year since mid-2012. Based on Axiometrics' identified supply of properties under construction, the submarket is expected to deliver 6,697 units in 2017, of which, 669 have been delivered. Overall market deliveries increased from 14,277 units in 2016 to 26,464 in 2017, and the total is expected to lower to 22,397 units in 2018. (Source: Axiometrics)
| Axiometrics Market Performance Summary Report - Kings County Submarket | |||||
| 2016 | 2017 | 2018 | 2019 | ||
| Submarket Vacancy | 3.9% | 4.4% | 4.3% | 4.0% | |
| Avg. Rent Growth | 0.5% | 0.2% | 3.1% | 4.5% | |
Demographic Information
| Distance from Property | 1 Mile | 3 Miles | 5 Miles |
| Population (2017) | 163,519 | 1,273,974 | 2,805,384 |
| Expected Growth (2017-2022) | 4.9% | 4.4% | 3.6% |
| Median Household Income (2017) | $91,359 | $58,369 | $64,188 |
| Median Household Value (2017) | $1,015,014 | $798,301 | $731,161 |
*Demographic information was obtained from CoStar.
| Sources of Funds | Cost |
|---|---|
| Debt | $1,760,000 |
| Equity | $1,645,500 |
| Total Sources of Funds | $3,405,500 |
| Uses of Funds | Cost |
| Purchase Price | $2,875,000 |
| CapEx/Buyout Reserve | $300,000 |
| Broker Dealer Fee | $40,000 |
| Acquisition Fee | $30,000 |
| Working Capital | $20,000 |
| Closing Costs | $140,500 |
| Total Uses of Funds | $3,405,500 |
The projected terms of the debt financing are as follows:
- Lender: New York Community Bank
- Estimated Proceeds: $1,760,000
- Rate: 3.50% fixed years 1-5. Floating at Federal Home Loan Bank of New York Prime rate +275 bps years 6-10, with an option to fix at Prime +300 bps subject to a 1.0% extension fee.
- Amortization: 12 months Interest Only, 30 years thereafter
- Term: 10 Years
- Prepayment Penalty: 4, 3, 2, 1, 1% years 1-5. Open to prepayment years 6-10 unless the Sponsor elects to fix the rate in years 6-10, in which case the prepayment penalties in those years will be 5, 4, 3, 2, 1%.
There can be no assurance that a lender will provide debt on the rates and terms noted above, or at all. All rates and terms of the debt financing are subject to lender approval, including but not limited to possible increases in capital reserve requirements for funds to be held in a lender controlled capital reserve account.
497 Dean Street LLC intends to make distributions to investors (Realty Mogul 84, LLC and Sponsor, collectively, the "Members") as follows:
Operating Cash Flow
- First, to Members for any accumulated unpaid 7% preferred return
- Second, a cumulative quarterly-compounded 7% annual preferred return
- Then, any excess balance will be split 75% to Members pari passu and 25% to Sponsor.
Capital Events (sale, refinance)
- First, to Members for any accumulated unpaid 7% preferred return
- Second, return of capital
- Then, any excess balance will be split 75% to Members pari passu and 25% to Sponsor to an 18% IRR Hurdle
- Then, any excess balance will be split 60% to members pari passu and 40% to Sponsor.
Note that these distributions will occur after the payment of the Company's liabilities (loan payments, operating expenses and other fees as set forth in the LLC agreement, in addition to any member loans or returns due on member loans).
Realty Mogul 84, LLC will distribute 100% of its share of excess cash flow (after expenses and fees) to the members of Realty Mogul 84, LLC (the RealtyMogul.com investors).
Distributions are expected to start in March 2018 and are expected to continue on a quarterly basis thereafter. These distributions are at the discretion of the Sponsor, who may decide to delay distributions for any reason, including maintenance or capital reserves.
| 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|---|
| Effective Gross Revenue | $91,652 | $212,902 | $251,062 | $267,103 | $280,588 | $293,466 |
| Total Operating Expenses | $23,890 | $49,675 | $52,535 | $54,434 | $56,253 | $58,081 |
| Net Operating Income | $67,762 | $163,227 | $198,528 | $212,669 | $224,335 | $235,385 |
| Debt Service | $30,800 | $78,219 | $94,838 | $94,838 | $94,838 | $94,838 |
| Asset Management Fee | $5,000 | $10,000 | $10,000 | $10,000 | $10,000 | $10,000 |
|
Distributions to Realty |
$7,869 | $24,545 | $33,684 | $95,681 | $46,309 | $1,435,895 |
Certain fees and compensation will be paid over the life of the transaction. The following fees and compensation will be paid:
| Type of Fee | Amount of Fee | Received By | Paid From | Notes |
| One-Time Fees | ||||
|---|---|---|---|---|
| Acquisition Fee | $30,000 | Sponsor | Capitalized Equity Contribution | |
| Broker-Dealer Fee | $40,000 | North Capital (1) | Capitalized Equity Contribution | |
| Recurring Fees | ||||
| Property Management Fee | 4.5% of Effective Gross Income | EPP Management, a wholly owned subsidiary of the Sponsor | Operating Cash Flow | |
| Construction Management Fee | 10.0% of Construction Costs | EPP Management, a wholly owned subsidiary of the Sponsor | Capitalized CapEx Budget | |
| Asset Management Fee | $10,000/year | Sponsor | Operating Cash Flow | |
| Management and Administrative Fee | 1.0% of amount invested in Realty Mogul 84, LLC | RM Manager, LLC | Distributable Cash | RM Manager, LLC is the Manager of Realty Mogul 84, LLC and a wholly-owned subsidiary of Realty Mogul, Co. (2) |
Notes:
(1) Certain employees of Realty Mogul, Co. are registered representatives of, and are paid commissions by, North Capital Private Securities Corp., a Delaware corporation ("North Capital"). In addition, North Capital pays a technology provider services fee to Realty Mogul, Co. for licensing and access to certain technology, reporting, communications, branding, entity formation and administrative services performed from time to time by Realty Mogul, Co., and North Capital and Realty Mogul, Co. are parties to a profit sharing arrangement.
(2) Fees may be deferred to reduce impact to investor distributions.
The above presentation is based upon information supplied by the Sponsor or others. Realty Mogul, Co., RM Manager, LLC, and Realty Mogul 84, LLC, along with their respective affiliates, officers, directors or representatives (the "RM Parties") hereby advise you that none of them has independently confirmed or verified any of the information contained herein. The RM Parties further make no representations as to the accuracy or completeness of any such information and undertake no obligation now or in the future to update or correct this presentation or any information contained herein.
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, LLCSponsor 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 DocumentsThe 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 InvestmentThis 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 AssumptionsSponsor 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 PerformanceAny 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 DebtA 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 RegisteredSponsor’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 AdviceNothing 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 RiskInternal 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.