The members of the Manager, and their Affiliates, have significant prior experience in acquiring and managing both self storage facilities and manufactured housing communities having amassed, through Prior Funds, a portfolio of more than 280 assets representing in excess of 40,000 units in more than 30 states.
The members of the Manager, and their Affiliates, have significant prior experience in acquiring and managing self storage facilities and is estimated to be a Top 50 operator. Senior management of the Dahn Corporation, an affiliated company, (“Storage Team”) has almost 150 years of combined self storage experience. The Storage Team has worked together for over 25 years. During this time, the Storage Team has built or purchased over 5 million square feet of self storage properties located throughout the United States. Since inception, the Dahn Corporation has acted as the property manager to over 95 self storage facilities and the total number of units it has owned and/or operated has exceeded 55,000. Over that time, the Storage Team has rented over 500,000 units.
In addition to self storage facilities, the members of the Manager, and their Affiliates, have significant prior experience in acquiring and managing manufactured housing communities. They are estimated to own and/or operate the 5th largest number of MHCs, with an excess of 250 MHCs containing over 25,000 lots under management in 29 states.
As of July 27, 2017, the Fund has acquired three SSFs, the details of which are outlined in the table below.
| Property Name | City | State | Purchase Price | Total # of Units | Total Square Footage |
|---|---|---|---|---|---|
| Melbourne Mini U Storage | Melbourne | FL | $14,650,000 | 1,049 | 128,000 |
| Palm Bay Mini U Storage | Palm Bay | FL | $5,600,000 | 490 | 64,000 |
| Virginia Beach Mini U Storage | Virginia Beach | VA | $6,800,000 | 380 | 62,000 |
| Total | $27,050,000 | 1,919 | 254,000 | ||
Not available for nationwide fund.
| Sources of Funds | |
| Debt (2) | $92,857,143 |
| Equity | $50.000.000 |
| Total Sources of Funds | $142,857,143 |
| Uses of Funds | |
| Purchase Prices | $135,714,286 |
| Acquisition Fees | $1,357,143 |
| Placement Fees, Organizational and Offering Expenses, and FundAmerica Fees | $5,428,571 |
| Total Uses of Funds | $142,857,143 |
(1) - Note the above is only a representation of the possible capitalization based on the fund maximum offering total of $50M. The capitalized costs and structure is a reflection of the fees and allocations as laid forth by the Fund Manager detailed herein. Realty Mogul has assumed an allocation of $2M.
(2) - The Fund manager anticipates bank or seller financing will generally account for 60%-70% of the gross fair market value of each asset, with a maximum portfolio LTV of 75%.
The Manager anticipates that proposed loans for individual Properties will have an average loan to value ratio of between approximately sixty percent (60%) and seventy percent (70%) of the gross fair market value of each Property, with a maximum loan to value ratio of seventy-five percent (75%) of the Company’s Property portfolio
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.
MHPI Manager, LLC (the "Fund Manager") intends to make distributions to Realty Mogul 92, LLC (the "Company") as follows:
Order of Distributions to the Company (Net Operating Cash Flow)
- First, to the Company until a cumulative, preferred annualized return is received. This cumulative, preferred annualized return will vary depending on the respective year of the hold as follows:*
- Year 1: 8%
- Year 2: 9%
- Year 3 - 10 +: 10%
- Any excess balance will be split 60% to the Company, based on its ownership of the Fund, and 40% to the Fund Manager
Order of Distributions to the Company (Refinance Proceeds) **
- 70% to the Company, based on its ownership of the Fund, and 30% to the Fund Manager
Order of Distributions to the Company (Sales Proceeds) **
- First, to the Company until a return of one hundred percent (100%) of its initial capital contribution is received;
- Second, to the Company until any unpaid, accrued cumulative, preferred annualized return is received.
- Third, to the Fund Manager for any deferred and accrued asset management fees earned
- Any excess balance will be split 60% the Company, based on its ownership of the Fund, and 40% to the Fund Manager
* Investments made into the Fund are subject to a 30 day waiting period until the preferred return begins to accrue.
** The Fund Manager may decide to use some or all of the proceeds from a capital event (i.e., refinance or sale): a) to purchase additional properties; or b) to increase reserves, improve existing properties, or pay down debt owed by the Fund. Proceeds from a capital event may only be used for additional acquisitions within the first five (5) years of the Fund. Distributions of all or any portion of Refinance or Sales Proceeds shall be made within 45 days after the end of a fiscal year.
The manager of the Company will distribute 100% of its share of excess cash flow (after expenses and fees) to its members (the Realty Mogul 92, LLC investors). Upon the sale or exchange of the last Property, the Fund Manager shall contribute prior distributions of Net Operating Cash Flow and Refinancing Proceeds it has received from the Company to the extent that all distributions to the Fund Manager, determined on a cumulative basis, exceed the amount that would have been distributed to the Fund Manager if all distributions had been made treated as Sales Proceeds. Any such excess amounts contributed by the Fund Manager shall be distributed to the Company as Sales Proceeds.
Distributions to Realty Mogul 92, LLC investors are expected to start in June 2018 and are expected to continue on a quarterly basis thereafter. Distributions will be evaluated on a monthly basis by the Fund Manager. The Fund Manager will strive to make monthly distributions, although the Fund Manager shall, at a minimum, make annual distributions. These distributions are at the discretion of the Sponsor, who may decide to delay distributions for any reason, including maintenance or capital reserves.
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 | Up to 1.0% of total acquisition cost | Fund Manager | Capitalized Equity Contribution | Paid at the closing of each respective property acquisition |
| Loan Fees (if required by lender) |
Loan Guarantee Fee - Up to 2.5% of loan amount Limited-Recourse Guarantee Fee - Up to 0.75% of loan amount |
Any party providing a personal guarantee | Capitalized Equity Contribution and/or Operating Cash Flow | The Loan Guarantee Fee will be paid in equal installments over the term of the loan. If the loan is refinanced prior to maturity, the remaining scheduled payments associated with that loan will no longer be due. |
| Placement Fees | Up to 6.0% of gross proceeds from capital raised | Various broker-dealers | Capitalized Equity Contribution | This fee is an estimate of what will be paid to broker-dealers for equity placement. 4.0% of the amount invested by the Company into the Fund will be paid to North Capital(1). |
| Fund Offering Fees | 5.0% of gross proceeds from capital raise (including Placement Fees described above) | FundAmerica, various broker-dealers | Capitalized Equity Contribution | In addition to the Placement Fees above, these fees include FundAmerica fees, Organizational and Offering Expenses, and Selling Commissions. |
| Recurring Fees: | ||||
| Property Management Fee | 5.0% of the gross revenues generated by each property | Dahn Corporation, an affiliate of the Fund Manager | Operating Cash Flow | |
| Construction Management Fee | 5.0% of any amount expended for construction or repair projects up to $50,000, 4.0% for projects $50,000-100,000, and 3.0% for projects over $100,000 | Dahn Corporation, an affiliate of the Fund Manager | Operating Cash Flow | No construction management fees will be paid for construction related to the development of a property |
| Asset Management Fee | Up to 1.0% of the real estate asset value | Fund Manager | Operating Cash Flow | Fee based on total acquisition costs of all assets in the fund. If an appraisal is completed on any of the assets, the greater of the two values will then be used for this calculation. |
| Management and Administrative Fee |
1.0% of amount invested in Realty Mogul 92, LLC |
RM Manager, LLC | Distributable Cash | Fee based on amount invested in the Company. RM Manager, LLC is the manager of the Company and a wholly-owned subsidiary of Realty Mogul, Co. (2) |
|
Disposition Fee |
Up to 1.0% of sale price | Fund Manager | Upon sale of property(ies) | May only be earned on a sale that would be profitable to the Fund after such fee was paid |
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 Fund Manager or others. Realty Mogul, Co., RM Manager, LLC, and Realty Mogul 92, 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.