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Completed Equity
Multifamily
Lake Shore Village
Columbia, SC
INVESTMENT STRATEGY
Value-Add
INVESTMENT TYPE
Equity
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100% funded
Offered By Crown Bay Group
17.8%* TARGET IRR 16.8%-18.8%
8.0%* TARGET AVG CASH ON CASH
2.10* TARGET EQUITY MULTIPLE
Estimated Hold Period 5 years
Estimated First Distribution 6/2018
*Please carefully review the Disclaimers section below, including regarding Sponsor’s assumptions and target returns
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Project Summary
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Explore this Project
Overview
Off-market acquisition of a value-add multifamily asset with an experienced Real Estate Company
Property At A Glance
Year Built 1974
Number of Units 280
Current Occupancy 90%
Parking Ratio 2.0 spaces/unit
Amenities Lakefront swimming pool, dog park, grilling areas, fitness center, large clubhouse and a 33-acre lake.
Acquisition Price

$11,450,000

Investment Highlights
Well-maintained asset with room for management and operational efficiencies
Proven potential rent increases with previously renovated units
Property was recently annexed into the City of Columbia providing significant water cost savings
Off-market transaction
Management

Crown Bay Group

Crown Bay Group ("Crown Bay"), founded in 2013 is actively involved in the acquisition, asset management, renovation, repositioning and disposition of value-add apartment assets. Their primary investment strategy is to seek out properties that can be bought at a discount and then expeditiously resolve problem issues with the purpose of increasing net cash flow and in turn increasing the market value to the subject property.

The Real Estate Company will employ their related entity Crown Bay Management, LLC (“CBM”) as the property manager. CBM is managed by Director of Property Management, Michelle Fischer, Regional Property Manager, Jarrett Turner and Regional Maintenance Director/Project Manager, Dion Varner. Both Ms. Fischer and Mr. Turner have previous experience managing similar properties in the Columbia-area. Mr. Turner previously managed the 300-unit Arbors at Windsor Lake from September 2009 to March 2011, the 420-unit Greenbrier Apartments from September 2009 to March 2011, the 280-unit Lullwater at Saluda from June 2010 to December 2016 and the 300-unit Paddock Club from June 2010 to May 2011. Ms. Fischer and Mr. Varner were also involved with Lullwater at Saluda and Paddock Club. First Communities, a large national multifamily management company, will handle the back-office components.

https://www.crownbaygroup.com/
  • Steve Firestone
    Principal
Steve Firestone
Principal

Steve  Firestone has been in the real estate industry since 1995. He currently oversees a portfolio approaching $50 million in over 1,300 units.

Mr. Firestone became involved in real estate in 1995 and has since been directly involved in many aspects of the industry. He started out buying and rehabbing, and managing his own residential portfolio in London. Soon after, he moved into property development running multiple LLCs, redeveloping outdated and commercial properties, and some new build housing. He was responsible for managing his company’s property acquisitions, funding, building, and dispositions. 

Track Record

Currently Owned Assets
Investment Name City State Units Acquisition Date Purchase Price
Parkside Crossing Apartments Forest Park GA 250 Dec-2015 $7,150,000
Greenbrier Mill Atlanta GA 79 Feb-2016 $3,020,000
Hairston Woods Apartments Stone Mountain GA 240 Mar-2016 $9,400,000
Flint River Crossing Jonesboro GA 200 Nov-2016 $8,000,000
Waterford Manor Apartments Decatur GA 118 Dec-2016 $3,150,000
Park at Greenbrier Atlanta GA 209 May-2017 $8,650,000
Kenilworth Manor Macon GA 237 May-2017 $4,400,000
Total     1,333   $43,770,000

The Real Estate Company's bio and track record were provided by the Real Estate Company and have not been verified by RealtyMogul.com or NCPS

Business Plan

In this transaction, RealtyMogul.com investors are to invest in Realty Mogul 80, LLC, which is to subsequently invest in LVA Holdings, LLC, a limited liability company that will hold title to the Property. The Real Estate Company is purchasing the Property for $11,450,000 ($40,893/unit), and the total project cost is $13,393,829 ($47,835/unit).

Crown Bay Group (the "Real Estate Company") believes this investment offers a rare opportunity to participate in an off-market, value-add acquisition of a stabilized Property that can achieve upside value creation through a targeted capital improvement plan and intensive hands on management. The current owners have maintained the buildings well, but have not aggressively targeted operations to increase value.

Rents are currently well below market and the sellers have already renovated a handful of units which are achieving $70 to $100 rental premiums over current rents (the Real Estate Company is underwriting an average renovation premium of $69). The Real Estate Company intends to continue this renovation program as units vacate, which will include resurfaced countertops, brushed nickel fixtures, hardware, flooring, lighting and new cabinet doors. The Real Estate Company intends to renovate an average of six units per month. Planned exterior renovations include creation of a new amenity space next to the leasing office with a playground, picnic/grilling area, and a pavilion, as well as re-plastering and upgrading the pool in year two.

Operational improvements the Real Estate Company intends to target include implementation of a RUBS program to recapture water expenses from the tenants and leasing of washer/dryer units. The Property was recently annexed into the City of Columbia, which when coupled with the implementation of a RUBS program, should result in lower Property expenses. There are over 200 units which have existing washer/dryer connections which the Real Estate Company plans to leverage by offering their washer/dryer rental program which has proven successful at their other communities. Lastly, the Real Estate Company has already identified various other expenses that they plan on reducing starting day one, while working with their management company to identify where further costs savings can be had.

The Real Estate Company plans to create a new amenity space next to the office with a playground, picnic/grilling area, and a pavilion as well as re-plastering and upgrading the pool in year two. Additionally, upon the recent annexation, the water charges are expected to be reduced by 36.8% per the appraiser and by comparing the city and county water charges. The annexation is also anticipated to increase property taxes but the net impact of the annexation is expected to increase net cash flow by about $78,000.

CapEx Budget
Exteriors/Common Areas Cost Cost/Unit
Landscaping/Purchase of 140 Washer/Dryer Units $185,000 $661
Roof Replacement $200,000 $714
New Amenity Area $80,000 $286
Other Amenities​​ $20,000 $71
Mechanical Reserve $50,000 $179
Pool Renewal $40,000 $143
Deferred Maintenance $100,000 $357
Unit Interiors Cost Cost/Renovated Unit
Counters, fixtures, hardware, flooring, lighting, cabinets $411,429 $2,857
Total $1,086,429  
Property

RealtyMogul.com, along with Crown Bay Group (the "Real Estate Company"), is providing the opportunity to invest in the acquisition of Lake Shore Village, a 280-unit multifamily Property located in Columbia, SC (the "Property").

The primary objective of this investment is to acquire the Property, perform common area upgrades, interior renovations, and improve management efficiencies, then sell the Property within approximately five (5) years.

The Real Estate Company sees this investment as an opportunity to capitalize on a well-occupied, well-located asset in an expanding market that can be improved through targeted capital improvements and improved management and leasing efforts.

Property Details

Lake Shore Village, located on almost 23 acres, enjoys some of the larger floorplans in the submarket, offers a well-appointed amenity package and attractive unit features. Amenities include a lakefront swimming pool, dog park, grilling areas, fitness center, large clubhouse and a 33-acre lake. The Property’s units, which average 959 SF, feature walk-in closets, fully-equipped kitchens, large patios and balconies, outside storage and washer/dryer connections in select units.

The Property was originally developed in 1974 as a 296-unit apartment community. In April 2016, a fire destroyed an entire building at the Property next to the office. A total of 16 units were destroyed in the fire and are not planned to be reconstructed. The footprint of the burnt down building will become the new community amenity area.

The Property enjoys an amenity rich location with with easy access to popular retail destinations, including East Point Plaza and Garners Ferry Marketplace are within walking distance of Lake Shore Village and boast numerous national retailers and restaurants including Walmart, Aldi, Lowe’s and Chick-fil-A. Per Multi Housing Advisors, the Columbia MSA population of 800,495 (2013) is expected to grow by approximately 7% through 2017, adding 55,000 new residents. The City of Columbia is a “population magnet” for the surrounding area and within a 30-mile commute of a the entire MSA​.

In-Place Unit Mix
Unit Type # of Units % of Total Unit (SF) Total SF Rent/Unit Rent/SF
Studio 32 11% 480 15,360 $530 $1.10
1 Bed, 1 Bath 72 26% 763 54,936 $610 $0.80
2 Bed, 1 Bath 32 11% 768 24,576 $609 $0.79
2 Bed, 2 Bath 64 23% 1,090 69,760 $643 $0.59
2 Bed, 1.5 Bath 48 17% 1,248 59,904 $679 $0.54
3 Bed, 3 Bath 32 11% 1,375 44,000 $758 $0.55
Totals/Averages 280 100% 959 268,536 $637 $0.71

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Comparables

Pre-Renovation Lease Comps
  Harbour Landing Mallard Pointe Shandon Crossing Subject - In-Place Comp Set Averages
# of Units 208 120 152 280 160
Year Built 1969 1973 1974 1974 1972
Miles from Subject 0.2 0.9 3.8 - -
Studio
# of Units - - - 32 -
Average Rent - - - $530 -
Average $/SF - - - $1.10 -
1 Bedroom
# of Units 32 24 24 72 27
Average Rent $659 $644 $680 $610 $661
Average $/SF $0.84 $0.76 $0.81 $0.80 $0.81
2 Bedroom
# of Units 120 72 120 144 104
Average Rent $736 $724 $728 $647 $730
Average $/SF $0.68 $0.69 $0.78 $0.60 $0.72
3 Bedroom
# of Units 56 24 8 32 29
Average Rent $885 $804 $900 $758 $864
Average $/SF $0.64 $0.64 $0.85 $0.55 $0.66
Source: Axiometrics

 

Post-Renovation Lease Comps
  Garners Crossing Wellington Farms Deer Meadow Village Huntington Place Subject - Post-Renovation Units Comp Set Averages
# of Units 210 236 304 192 144 236
Year Built 1998 2000 2005 1998 1974 2000
Miles from Subject 0.1 0.8 1.4 2.0 - -
Studio
# of Units 18 - - - 16 18
Average Rent $525 - - - $570 $525
Average $/SF $1.62 - - - $1.19 $1.62
1 Bedroom
# of Units 60 88 68 - 37 72
Average Rent $734 $768 $798 - $667 $768
Average $/SF $1.37 $0.96 $1.10 - $0.87 $1.12
2 Bedroom
# of Units 108 96 180 160 75 136
Average Rent $850 $887 $841 $890 $739 $865
Average $/SF $0.86 $0.80 $0.88 $0.73 $0.64 $0.82
3 Bedroom
# of Units 24 52 86 32 16 41
Average Rent $850 $972 $1,021 $1,060 $858 $988
Average $/SF $0.77 $0.80 $0.70 $0.73 $0.62 $0.75
Source: Axiometrics

 

Sales Comps
 

Austin Woods

Harbour Landing Forestbrook Apartments Hunters Ridge Subject Comp Set Total / Averages
Date June-17 March-17 June-16 May-17 - -
# of Units 240 208 180 205 280 208
Year Built 1975 1969 1984 1972 1974 1975
Purchase Price $10,277,000 $8,550,000 $9,825,000 $11,363,825 $11,450,000 $10,015,563
$/Unit $42,821 $41,106 $54,586 $55,433 $40,893 $48,094
Cap Rate - - 5.7% 7.0% 6.8% 6.4%
Miles from Subject 0.2 0.2 9.0 11.0 - -
Source RCA RCA Appraisal Appraisal - -
Location

The Property enjoys a highly accessible location with frontage on Garners Ferry Road (34,507 VPD) and just minutes from I-77 (1.25 miles). Positioned 5.5 miles southeast of downtown Columbia (state capital of South Carolina), the community’s residents enjoy a short 10-minute commute to the CBD. Downtown Columbia, home of the University of South Carolina in addition to numerous government entities, has an employee base of over 85,000. The University of South Carolina (6,773 jobs), Fort Jackson (3,500 civilian jobs) and Wm. Jennings Bryan Dorn VA Medical Center (1,500 jobs) are all located within six miles of the Property. Per CoStar, the immediate area is expecting a 6.0% annual population growth after realizing a 10.9% average growth rate since 2010. Average HHI within the area is $46,000, $70,000 and $74,000 within one, three and five miles according to CoStar.

Popular retail destinations, including East Point Plaza and Garners Ferry Marketplace are within walking distance of Lake Shore Village and boast numerous national retailers and restaurants including Walmart, Aldi, Lowe’s and Chick-fil-A.

Amazon.com employs over 1,500 full-time employees in Columbia and recently announced the addition of 500 jobs at its 1.25 million SF distribution center in Lexington County. It’s estimated that Amazon.com will now have a $125 million economic impact on the Midlands region according to the State of South Carolina.

According to the Department of Defense, Fort Jackson is the US Army’s largest and most active Initial Entry Training Center, training 50 percent of the Army’s Basic Combat Training load and 60 percent of the women entering the Army each year. The 52,000-acre campus, located less than two miles from the Property, consists of over 1,260 buildings, ranges and training sites. Each year, Fort Jackson graduates more than 44,000 soldiers from basic and advanced training. Fort Jackson employs almost 3,500 civilians and provides services for more than 46,000 retirees and their family members. An additional 10,000 students attend courses at the Soldier Support Institute, Armed Forces Chaplaincy Center, National Center for Credibility Assessment and Drill Sergeant School annually.

Market Overview

A range of economic drivers such as low business and living costs, generous state and local tax incentives, and a central location have attracted businesses to the Columbia area. Development has ramped up over the past year, and these units have absorbed well. Columbia added more than 1,100 units in 2016, and over 1,000 units are under construction as of third quarter of 2017. Yearly rent growth reached 4.2% in the third quarter of 2015 but has decreased slightly since. Sales volume reached over $700 million in 2016, by far the highest volume the metro has ever seen according to Multi Housing Advisors (Cushman & Wakefield).

The South multifamily submarket of Columbia, SC saw rents increase 1.8% in the first quarter of 2017 which ranked 2nd in the market. Additionally, the occupancy rate increased from 92.4% to 94.5% in the second quarter of 2017 and is expected to remain around 93% over the hold per AXIO.

Per Multi Housing Advisors (Cushman & Wakefield), the Columbia MSA population of 800,495 (2013) is expected to grow by approximately 7% through 2017, adding 55,000 new residents. The City of Columbia is a “population magnet” for the surrounding area and within a 30-mile commute of a the entire MSA. The population is heavily weighted towards the prime renter demographic with approximately 45% of the population between the ages of 20 and 44. Median household incomes in Columbia are on the rise. Approximately 38% of households make above $50,000 annually (2012), roughly 12% above the state average of $41,457. The number of households expected to eclipse $50,000 is anticipated to grow by an additional 6% by 2017.

Demographic Information

Demographics 1 Mile 3 Miles 5 Miles
Population (2017) 6,589 33,248 88,143
Population Growth (2010-2017) 10.9% 4.6% 5.6%
Population Growth (2017-2022) 6.0% 5.0% 4.8%
Average Household Income (2017) $46,328 $69,972 $74,128

Source: CoStar

Photos
Financials
Sources & Uses

Total Capitalization
Sources of Funds Cost
Debt $9,100,000
Equity $4,293,829
Total Sources of Funds $13,393,829
Uses of Funds Cost
Purchase Price $11,450,000
Real Estate Company Acquisition Fee $171,750
Broker Dealer Fee $80,000
Capital Expenditures $1,086,429
Closing Costs & Fees $605,650
Total Uses of Funds $13,393,829
Debt Assumptions

The terms of the debt financing are as follows:

  • Lender: Fannie Mae - Hunt Mortgage Group
  • Loan Type: Agency (7/6 ARM)
  • Proceeds: $9,100,000
  • Loan to Purchase: 80.0%
  • Term: Seven (7) years
  • Rate: One-Month LIBOR + 233 bps floating*
  • Amortization: 30 years
  • Interest-Only Period: N/A
  • Extensions: None
  • Prepayment: 12-month lockout then 1.0% until the last three months of the term
  • Recourse: Non-recourse

*The interest rate has the option to be fixed at the beginning of month 13. 

 

Distributions

LVA Holdings, LLC intends to make distributions of all available cash and capital proceeds to investors (Realty Mogul 80, LLC, Other LP investors and Real Estate Company, collectively, the "Members") as follows:

  1. Pro rata share of cash flow to a 15% Internal Rate of Return ("IRR") hurdle;
  2. Excess balances will be split pro rata 70% to Members and 30% to Real Estate Company to a 20% IRR;
  3. Excess balances will be split pro rata 60% to Members and 40% to Real Estate Company

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 80, LLC will distribute 100% of its share of excess cash flow (after expenses and fees) to the members of Realty Mogul 80, LLC (the RealtyMogul.com investors). The manager of Realty Mogul 80, LLC will receive a portion (up to 10%) of the Real Estate Company's promote interest.

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 Real Estate Company, who may decide to delay distributions for any reason, including maintenance or capital reserves.

Targeted Cash Flows

  Year 1 Year 2 Year 3 Year 4 Year 5
Effective Gross Revenue $2,168,368 $2,343,300 $2,473,306 $2,548,579 $2,625,464
Total Operating Expenses $1,391,528 $1,432,505 $1,472,651 $1,511,603 $1,551,642
Net Operating Income $776,840 $910,795 $1,000,655 $1,036,976 $1,073,822
Distributions to Realty Mogul 80, LLC Investors $88,129 $143,674 $177,847 $189,177 $3,641,292

Sample Targeted Cash Flows - $50,000 Investment

  Year 0 Year 1 Year 2 Year 3 Year 4 Year 5
Net Earnings to Investor ($50,000) $2,181 $3,556 $4,402 $4,683 $90,131

 

Fees

Certain fees and compensation will be paid over the life of the transaction. The following fees and compensation will be paid:

One-Time Fees
Type of Fee Amount of Fee Received By Paid From Notes
Acquisition Fee $171,750 Real Estate Company Capitalized Equity Contribution 1.5% of the property purchase price
Broker-Dealer Fee $80,000 North Capital (1) Capitalized Equity Contribution 4.0% of equity raised by RealtyMogul.com ($50,000 minimum)
Recurring Fees
Type of Fee Amount of Fee Received By Paid From Notes
Property Management Fee 4.0% of Effective Gross Income Crown Bay Management Distributable Cash Real Estate Company Affiliate
Asset Management Fee 1.0% of Effective Gross Income Real Estate Company Distributable Cash  
Construction Management Fee 3.0%/5.0% of hard costs Crown Bay Management Construction Hard Costs Real Estate Company Affiliate; 3.0% on projects up to $10,000 and 5.0% of projects over $10,000
Management and Administrative Fee 1.0% of amount invested in Realty Mogul 80, LLC RM Manager, LLC Distributable Cash  RM Manager, LLC is the Manager of Realty Mogul 80, LLC and a wholly-owned subsidiary of Realty Mogul, Co.2

(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 Real Estate Company or others. Realty Mogul, Co., RM Manager, LLC, and Realty Mogul 80, 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.

Disclaimers/FAQs
Disclaimers

Forward-Looking Statements

Investors should not rely on any forward-looking statements made regarding this opportunity, because such statements are inherently uncertain and involve risks. We use words such as “anticipated”, “projected”, “forecasted”, “estimated”, “prospective”, “believes”, “expects”, “plans”, “future”, “intends”, “should”, “can”, “could”, “might”, “potential”, “continue”, “may”, “will” and similar expressions to identify these forward-looking statements.


Non-Transferability of Securities

The transferability of membership interests in Realty Mogul 80, LLC are restricted both by the operating agreement for that entity and by U.S. federal and state securities laws. In general, investors will not be able to sell or transfer their interests. There is also no public market for the investment interests and none is expected to be available in the future. Moreover, the estimated investment holding period described herein is only a projection, and there can be no assurance when or if an investment may be liquidated. Persons should not invest if they require any of their investment to be liquid. This is particularly important for persons of retirement age, who should plan carefully to assure that their assets last throughout retirement.


Credit Risk

Realty Mogul 80, LLC's investment in LVA Holdings, LLC will relate to a Property that will undergo some degree of renovation, a situation that does not always meet the financing criteria for conventional financing from institutional sources. Credit risk is inherent in the real estate financing industry, and there can be no assurance that the credit worthiness of the Real Estate Company will be sufficient to assure the full repayment of the Realty Mogul 80, LLC's common equity investment and thus Realty Mogul 80, LLC's ability to provide returns (or even repayment of principal) to investors.


Mortgage Risk

The Real Estate Company has a signed term sheet with a lender to provide the debt financing for the acquisition of the Property, but there can be no assurance that the lender will complete financing on the rates and terms included in the underwriting being presented in the model for this investment opportunity. All rates and terms of the debt financing are subject to final lender committee approval, including but not limited to a modification in lender held capital reserve requirements that may result in a corresponding movement of certain funds currently projected as being held in a Real Estate Company controlled capital escrow account.


Management Risk

Investors will be relying solely on the Real Estate Company for the execution of its business plan. The Real Estate Company may in turn rely on other key personnel with relevant experience and knowledge, including contractors and consultants. Members of LVA Holdings, LLC (including Realty Mogul 80, LLC) will agree to indemnify the manager in certain circumstances, which may result in a financial burden if any litigation results from the execution of the business plan. While the Real Estate Company has significant operating experience, LVA Holdings, LLC is a newly formed company and has no operating history or record of performance. Realty Mogul 80, LLC is pursuing a venture capital strategy through its investment in LVA Holdings, LLC, and the manager of Realty Mogul 80, LLC is expected to be treated as an investment adviser exempt from federal or state registration under this strategy.


Manager of Realty Mogul 80, LLC Will Participate in Real Estate Company's Promote Interest

The manager of Realty Mogul 80, LLC will be entitled to a participation in the value of any excess distributable cash flow and any appreciation of the Property realized upon its sale. This could lead to a potential conflict of interest between the manager and Realty Mogul 80, LLC. Investors must recognize and agree to waive and bear the risk of this conflict of interest.


Capital Call Risk

The amount of capital that may be required by LVA Holdings, LLC from Realty Mogul 80, LLC is unknown, and although LVA Holdings, LLC does not require that its members contribute additional capital to it, it may from time to time request additional funds in the form of loans or additional capital. Realty Mogul 80, LLC does not intend to participate in a capital call if one is requested by LVA Holdings, LLC, and in such event the manager of LVA Holdings, LLC may accept additional contributions from other members of LVA Holdings, LLC. Amounts that the manager of LVA Holdings, LLC advances on behalf of Realty Mogul 80, LLC will be deemed to be a manager loan at an expected interest rate of 10%. Amounts that are contributed by existing or new members will be deemed to be additional capital contributions, in which case Realty Mogul 80, LLC's interest in LVA Holdings, LLC will suffer a proportionate amount of dilution.


Real Estate Market Risk

LVA Holdings, LLC's economic performance and value, and thus the value of investors’ investment in Realty Mogul 80, LLC, is subject to various risks associated with the Property. Real estate markets are affected by many factors, such as general economic conditions, supply and demand for real estate investments, interest rates, the availability of financing, and other factors. Investments related to real estate are also subject to market valuation risks that may be caused by changing economic and local market conditions such as local real estate market conditions. The Property’s economic performance and value, and thus the value of investors’ investment in Realty Mogul 80, LLC, is subject to such risks, all of which are beyond the control of both Realty Mogul 80, LLC and LVA Holdings, LLC.


Apartment Complex - Competition

Competition in the Property’s local market area is significant and may affect the Property’s occupancy levels, rental rates and operating expenses. The Property will compete with other residential alternatives to attract tenants, including but not limited to other apartment units that are currently available for rent, new apartments that are built and condominiums/houses that are for rent or sale. If development of apartment complexes by other operators were to increase, due to increases in availability of funds for investment or other reasons, then competition with the Property could intensify. If the Property is not able to successfully compete with the competitive residential alternatives in the local or regional area this could adversely affect the ability of Real Estate Company Entity to sell the Property, rent its units as necessary to maintain occupancy, and/or to increase or maintain unit rental rates.


Lease-up Risks

The Property currently has a 90% occupancy level, and the Real Estate Company intends to implement a capital improvement plan in its effort to maintain and/or increase that occupancy level. There can be no assurance that such renovations will be consummated on a timely basis, that such work will not materially adversely affect other aspects of the operation of the Property, or that the plan will result in the Property maintaining its occupancy level at rental rates in line with those projected. Any delays or adverse effects of such work could adversely affect the Property’s financial results or business operations and thus the value of the Company’s investment. Although the Real Estate Company believes that comparable properties are currently achieving rental rates that are in line with those expected from the Property, there can be no assurance that such rental rates will be achieved. Failure to realize such increased rental rates could adversely affect the Property’s financial results or business operations and thus the value of the Company’s investment.


The above is not intended to be a full discussion of all the risks of this investment. Please see the Risk Factors in the Issuer Document Package for a discussion of additional risks.

The above presentation is based upon information supplied by the Real Estate Company and others. Realty Mogul, Co., RM Manager, LLC, and Realty Mogul 80, 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.

 

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