Staff Menu (IO ID#: 561521):
EDIT IO DOCUMENTS
Funded
Multifamily
CF STAR Multifamily Portfolio, DST
Multiple Locations
INVESTMENT STRATEGY
INVESTMENT TYPE
Equity
Add to Watchlist
100% funded
Offered By Cantor-Fitzgerald Investors, LLC & STAR
%* TARGET IRR %-%
5.2%* TARGET AVG CASH ON CASH
* TARGET EQUITY MULTIPLE
Estimated Hold Period 7-10 years
Estimated First Distribution 7/2018
*Please carefully review the Disclaimers section below, including regarding Sponsor’s assumptions and target returns
Project Webinar
View The Webinar
Project Summary
current
current
current
current
current
current
Explore this Project
Overview
1031 eligible DST offering featuring 2 multifamily Properties in Florida and Louisiana. Properties were built in 2005 and 1990 ('90 property revovated in 2017) with a combined average occupancy of 96.3%.
Property At A Glance
Year Built Promenade: 1990 / Remodeled in 2017 Stockwell Landing: 2005 
Number of Units 441
March 2018 Occupancy 96.3%
Leverage 53.12% Loan-to-Offering/ 60% Loan-to-Cost
Parking Ratio Promenade: 1.9/ unit Stockwell Landing: 2.12/ unit
Acquisition Price

$52,315,673

Investment Highlights
Joint Venture between Cantor Fitzgerald, an Institutional Real Estate Company, and STAR, a vertically integrated real estate company that currently operates 40 multifamily apartment communities totaling approximately 10,555 apartment units or 10.4 million square feet across 9 states
Low leveraged Properties (53.1% Loan-to-Offering) with 2.01x debt service coverage ratio based on the Year One proforma
STAR is retaining a 20% equity interest in the Properties representing significant “skin in the game”
Properties are located in markets with strong demographics: Orlando, FL is the second fastest growing city in the United States and Bossier City, LA boasts an average household income of over $100,000 within a 1-miles radius of the Property
Geographic diversification among Properties in portfolio
Management
Cumulative Distributions

Cantor-Fitzgerald Investors, LLC & STAR

The Sponsor is a joint venture between Cantor Fitzgerald, an institutional real estate company, and STAR, a vertically integrated real estate company with a portfolio of 40 multifamily apartment communities, 10,966 units, and a market value of approximatley $1.25 billiion.  

Cantor Fitzgerald

Cantor Sponsor is an indirect subsidiary of Cantor Fitzgerald. Cantor Fitzgerald is a diversified organization specializing in financial services and real estate services and finance for institutional customers operating in the global financial and commercial real estate markets. As of December 31, 2017, Cantor Fitzgerald had over 11,000 employees operating in most major financial centers throughout the world. As of the date of this Memorandum, Cantor Fitzgerald maintained credit ratings of ‘BBB-’ from Standard & Poor’s and ‘BBB-’ from Fitch.

Cantor Fitzgerald operate through four business lines: Capital Markets and Investment Banking; Inter-Dealer Brokerage; Real Estate Brokerage and Finance; and Private Equity. The Real Estate Brokerage and Finance business principally consists of commercial real estate services, conducted by Newmark Grubb Knight Frank (“NGKF”) and commerical real estate finance activity, conducted by Berkely Point and Cantor Commercial Real Estate (“CCRE”).

Cantor Fitzgerald is a preeminent capital markets investment bank, recognized for its strengths in the equity and fixed income capital markets, its global distribution model, and for its expanding presence as the leading independent middle market investment bank serving the marketplace with investment banking services, prime brokerage, and commercial real estate financing. Affiliates of Cantor Fitzgerald have been involved with nine (9) real estate programs with similar investment objectives since November 2014. These prior real estate programs involved the purchase of 99 properties for an aggregate purchase price of approximately $511 million. As of February 1, 2018, these prior programs have raised more than $215 million from over 750 investors.*

STAR

STAR is a multifamily real estate company focused on the Southwest and Midwest United States. STAR is vertically integrated with in-house acquisitions, accounting, asset management, and property management teams. STAR’s business and operations model allows for direct control of the entire real estate investment process. Since the 1970’s, STAR’s principals have been involved in the acquisition, management, financing and disposition of over $10 billion worth of multifamily real estate both domestically and abroad.

Since 2005, STAR and its predecessor organization have acquired and managed a leading portfolio of multifamily real estate communities. As of June 30, 2017, STAR’s Portfolio represents 40 multifamily apartment communities in 9 different states, 10,555 apartment units, approximately 10.4 million square feet of residential real estate, and a market value of $1.25 billion.*

*Per the Sponsors 

http://www.cantor.com
  • Shawn Matthews
    CEO
  • Kenneth Carpenter
    Managing Director
  • Aaron Wessner
    Managing Director
  • Issac Hera
    CEO
  • Karen Katsoff
    CFO
Shawn Matthews
CEO

Matthews has served as the Chief Executive Officer of Cantor Fitzgerald & Co. since 2009. He joined Cantor Fitzgerald & Co. in 2005 and served in senior management roles prior to becoming Chief Executive Officer. He has played a significant role in the substantial growth of the company. Mr. Matthews started his career at Wertheim Schroeder & Co in 1990, and since that point has spent the last 25 years in a senior management role having run both desks and departments at several firms. He has also been the managing member of a broker-dealer, West Side Capital, as well as the managing partner of Alchemist Capital Management, a hedge fund. Mr. Matthews is on the board of several entities and is a former board member of the Securities Industry and Finance Markets Association.

Kenneth Carpenter
Managing Director

Mr. Carpenter joined Cantor Fitzgerald in January 2013 with an initial focus on the acquisition, management and financing of net lease properties after being affiliated with a commercial real estate advisory, financing and asset management firm. Immediately prior, Mr. Carpenter was the Head of Americas for Deutsche Bank’s Asset Finance and Leasing group where he had overall responsibility for the strategy and execution of the group’s financing, advisory and principal investing activities (debt and equity) across various asset classes. Prior to joining Deutsche Bank, Mr. Carpenter spent nine years at Wachovia (later Wells Fargo) rising to Managing Director, Global Head of Structured Asset Finance where he led a team in the United States and Europe investing both debt and equity capital in various hard asset classes including commercial real estate. Mr. Carpenter’s commercial real estate acquisition and finance experience spans most property types including office, industrial, retail and healthcare. Prior to joining First Union (later Wachovia), he was a Vice President with Deutsche Bank in their real estate finance group where he originated sale/leaseback and other real estate financing transactions. Prior to Deutsche Bank, Mr. Carpenter worked at Nations Bank providing strategic advisory and financing solutions, including commercial loans, syndicated bank debt, subordinated debt, and mergers and acquisitions, to middle market corporations.

Aaron Wessner
Managing Director

Mr. Wessner has more than 14 years of institutional commercial real estate investment, capital markets and advisory experience. Mr. Wessner joined Cantor Fitzgerald in 2011 to assist with the development of Cantor Commercial Real Estate, where he held senior positions on the Capital Markets and Corporate Finance teams. Mr. Wessner also was a senior member of the Real Estate Acquisitions team, focused on net lease transactions in the United States. Prior to joining Cantor Fitzgerald, Mr. Wessner was a co-founder of Park Bridge Financial, a privately-held commercial real estate debt and equity advisory firm headquartered in New York, where he provided strategic advisory services to real estate owners and lenders on distressed debt and equity matters. Prior to Park Bridge, Mr. Wessner was a member of Merrill Lynch’s Global Commercial Real Estate Group, where he was an offering manager on a team responsible for issuing commercial real estate debt securities. While at Merrill Lynch, Mr. Wessner also focused on the distribution of commercial real estate debt via the sale of whole-loans, B-notes and mezzanine positions. Prior to Merrill Lynch, Mr. Wessner was a credit analyst within the CMBS group at Fitch Ratings and worked within Ernst & Young LLP’s Structured Finance Advisory practice.

Issac Hera
CEO

Mr. Hera serves as Chief Executive Officer of STAR. Prior to joining STAR, Mr. Hera served as CEO of Brack Capital Real Estate USA, the United States subsidiary of a publicly traded international real estate development firm. During his 16 years at Brack Capital, Mr. Hera was responsible for Brack Capital’s overall business and operations in the United States. Mr. Hera oversaw real estate transactions with an aggregate value of over $5 billion, and was responsible for real estate acquisitions, asset and Property management, debt financing, sales, and development functions of a real estate portfolio of over 8 million square feet. Issac is a Certified Public Accountant and holds a B.A. in Law from Tel Aviv University.

Karen Katsoff
CFO

Ms. Katsoff serves as Chief Financial Officer of STAR. Ms. Katsoff joined STAR from Tishman Speyer Properties, an international owner, developer, operator and fund manager of real estate. While there she served for eight years as Regional Finance Director and Asset Manager and oversaw iconic assets such as Rockefeller Center. Ms. Katsoff began her career in Public Accounting at Richard A. Eisner & Co. and Arthur Andersen, and subsequently worked at DRA Advisors and Morgan Stanley. Ms. Katsoff holds a B.S. in Accounting from the University of Delaware and an M.B.A. from New York University Stern School of Business. Ms. Katsoff is a Certified Public Accountant.

Track Record

Currently Owned DST Portfolio - Cantor Fitzgerald
Program Locations Property Type Property Count % Equity Financed % Debt Financed
WG DST 1 AR, IA, KS & OH Single Tenant 8 34% 66%
WG DST 2 IN, MO & TN Single Tenant 9 34% 66%
WG DST 3 KY, MO & WI Single Tenant 8 34% 66%
WG DST 4 AL, AR, TN & WI Single Tenant 8 35% 65%
WG DST 5  MI, MS, MT, OK, SD & WV Single Tenant 8 35% 65%
CF Retail Properties DST VI CT, OH, OK, PA & SD Single Tenant 12 40% 60%
CF Net Lease Portfolio DST 7 FL, KY, LA, MN, NE, SD & TN Single Tenant 19 42% 58%
CF Net Lease Portfolio DST 8 AZ, CO, TX, WI & WY Single Tenant 17 42% 58%
CF Net Lease Portfolio DST 9 IN, IA, KS, LA & WI Single Tenant 10 42% 58%
CF Norterra Canyon Multifamily DST Nevada Multifamily 1 56% 44%
Total     100    

 

Current STAR Portfolio
Property Name Acquisition Date Location Square Feet Apartment Units
Arbor of Battle Creek I Jun-08 Battle Creek, MI 523,298 550
Arbor of Battle Creek II Jun-08 Battle Creek, MI 69,720 76
Audubon Lake May-17 Lafayette, LA 192,656 208
Autumn Woods Jun-08 Jackson, MI 114,030 112
Avalon at Northbrook Feb-06 Fort Wayne, IN 230,940 256
Briarcliff Jun-08 Lansing, MI 364,640 308
Camino Real Mar-06 Boca Raton, FL 269,950 235
Champion Lake Dec-16 Shreveport, LA 217,664 256
Chateau Des Lions Mar-17 Lafayette, LA 184,260 180
Chateau Mirage Mar-17 Lafayette, LA 299,314 280
Glenwood Jun-08 Jackson, MI 111,036 144
Grand Seasons Jul-07 North Dallas, TX 126,090 144
Grove at Stonebrook Jun-08 Norcross, GA 176,200 188
Harborside Mar-17 Slidell, LA 151,296 168
Hiddentree Jun-08 Lansing, MI 230,249 261
Hills of Aberdeen Jun-06 Valparaiso, IN 185,602 173
Keswick Village Jun-10 Conyers, GA 338,094 284
Lake Pointe Oct-07 Portage, IN 207,664 192
Legacy at Cedar Hill Jun-11 Cedar Hill, TX 572,636 600
Manchester at Wesleyan Jul-07 Macon, GA 383,989 328
Melrose on the Bay Aug-07 Clearwater, FL 316,300 358
Park at Lake Magdalene Jul-07 Tampa, FL 431,658 504
Park at Northside Jul-07 Macon, GA 202,592 192
Pavilion Court Jun-06 Novi, MI 439,230 377
Peppertree Dec-16 Lafayette, LA 231,968 304
Pointe Sienna Aug-07 Jacksonville, FL 231,283 260
Reserve at Lake Pointe Sep-07 St. Petersburg, FL 710,522 806
River Walk May-17 Shreveport, LA 192,656 208
Rivoli Run May-11 Macon, GA 205,030 188
Savannah Place Dec-05 Boca Raton, FL 177,864 191
Somerset Place Dec-05 Boca Raton, FL 99,874 106
Summerlin at Concord Jul-07 Concord, NC 135,132 160
Traditions at Augusta Jul-07 Augusta, GA 254,189 256
Tuscany Pointe Dec-05 Boca Raton, FL 170,032 180
Tuscany Pointe II Sep-07 Tampa, FL 255,596 304
Verandas on the Green Jul-07 Aiken, SC 216,450 222
Villa Du Lac May-17 Slidell, LA 198,678 234
Windsor Lakes Aug-05 Woodridge, IL 549,570 762
Total     9,967,952 10,555

*The above was provided by the Sponsor and has not been verified by Realty Mogul.

 
Business Plan

CF Star Multifamily Portfolio DST (the “Trust”) was formed as a joint venture between affiliates of Cantor Fitzgerald Investors LLC (“Cantor”) and Star Real Estate Ventures LLC (“STAR”) (collectively the “Sponsor” or “Sponsors”). Prior to the formation of the Trust, STAR owned 100% of the Properties. On March 27, 2018 the Properties were contributed to the Trust by STAR at their appraised values, with STAR retaining 20% of the equity interests in the Properties. The Properties are master leased to affiliates of the Sponsor (the “Master Tenants”) who sub-lease the apartment units to the end-user tenants pursuant to residential leases. The Trust is a passive owner of the Properties and will not be involved in any manner in the active management of the Properties. Affiliates of the Sponsor will manage the Trust pursuant to the Trust Agreement.

The Trust intends to hold the Properties for cash flow, increase rents over time, and sell the Properties in approximately 7-10 years.

The Trust expects to provide the Beneficial Owners a return on their investment in two primary ways: (i) in the form of monthly cash distributions to the Beneficial Owners; and (ii) upon any disposition of the Properties. The Trust intends to dispose of all of the assets in the Trust in a single sale of the Properties. This strategy is anticipated to provide investors with the opportunity to perform a 1031 exchange following the disposition.

  

 

Property
Property Details

The Promenade

Promenade is a Class B multifamily apartment complex located in the Orlando-Kissimmee-Sanford, FL Metro Area where the median price for existing single family homes was $250,000 in 4Q17, according to the National Association of Realtors, 9.8% more than the previous year. The Property is comprised of a one-story leasing office/clubhouse, 25 two-story residential buildings, and ancillary buildings. The residential buildings contain 200 rentable units, each unit averaging approximately 843 square feet. Amenities include a swimming pool/spa, tennis courts, racquetball, basketball and sand volleyball courts, a fitness center, business center, and picnic area.

Unit Mix
Unit Type # of Units Avg SF/Unit Avg Rent/Unit Avg Rent/SF
1 BR / 1 BA  24 600 $1,156 $1.93
1 BR / 1 BA  24 701 $1,180 $1.68
2 BR / 2 BA  64 800 $1,250 $1.56
2 BR / 2 BA  64 916 $1,130 $1.45
3 BR / 2 BA  24 1,150 $1,550 $1.35
Total 200 843 $1,292 $1.53

Stockwell Landing

Stockwell Landing is a Class A multifamily residential complex located in Bossier City, LA. The Property is comprised of a one-story leasing office, ten two-story residential buildings, and four three-story residential buildings. The residential buildings contain 241 rentable units, each unit averaging approximately 1,080 square feet. Amenities include a swimming pool, playground, fitness facility, business center, and clubhouse.

Unit Mix
Unit Type # of Units Avg SF/Unit Avg Rent/Unit Avg Rent/SF
1 BR / 1 BA  48 845 $869 $1.03
2 BR / 2 BA  145 1,083 $911 $0.84
3 BR / 2 BA  47 1,299 $1,094 $0.84
3 BR / 2 BA  1 1,401 $2,038 $1.45
Total 241 1,079 $943 $0.87

Property information above was obtained from the PPM

Comparables

The Promenade

Rental Comparables
  Advenir at the Oaks Landmark at West Place Hawthorne Groves Park at Milano Averages Subject
# of Units 408 342 328 194 318 200
Year Built 1989 2002 2001 1989 1995 1990
Occupancy 96% 93% 99% 96% 96% 99%
Average Rental Rate (Per Unit) $1,166 $1,289 $1,160 $1,130 1186 $1,144
Distance from Subject 4 miles 6 miles 5 miles 6 miles 5.25 miles -

Source: CBRE Appraisal dated December, 2017

Sales Comparables
  Central Park Terraces at Lake Mary Lake Tivoli Highpoint Club Averages Subject
Date Nov-17 Aug-17 Aug-17 May-17 - Mar-18
# of Units 362 284 384 348 345 200
Year Built 1991 1997 1990 1994 1993 1990
Occupancy 96% 96% 96% 92% 95% 95%
Purchase Price $52,750,000 $44,100,000 $49,500,000 $48,500,000 $48,712,500 $28,700,000
$/Unit $145,718 $155,282 $128,906 $139,368 $142,319 $143,500
Cap Rate 5.01% 5.26% 5.78% 5.72% 5.44% 5.75%

Source: CBRE Appraisal dated December, 2017

 

Stockwell Landing

Rental Comparables
  Coats Bluff at Wright Island Cypress Pointe Landing at Willow Bayou Villaggio Averages Subject
# of Units 252 240 224 239 238 241
Year Built 2014 1997 2010 2016 2009 2005
Occupancy 94% 95% 93% 96% 94% 93%
Average Rental Rate (Per Unit) $1,217 $911 $1,036 $1,026 $1,047 $943
Distance from Subject 6.0 miles 5.0 miles 5.0 miles 2.0 miles 4.5 miles -

Source: Axiometrics and the CBRE Appraisal dated February 15, 2018

Sales Comparables
  Village at Juban Lakes West M Chateau Mirage The Gates at Citiplace Averages Subject
Date Aug-16 Sep-16 Mar-16 Jul-17 - Mar-18
# of Units 144 366 280 369 290 241
Year Built 2010 2012 2011 1996 2007 2005
Occupancy 95% 93% 97% 96% 95% 93%
Purchase Price $16,680,000 $59,109,000 $40,960,000 $59,645,000 $35,098,500 $29,190,000
$/Unit $115,833 $161,500 $146,286 $161,640 $146,315 $121,120
Cap Rate 6.75% 6.0% 6.26% 5.79% 6.2% 5.7%

Source: CBRE Appraisal dated January, 2018

 

Properties Appraisal available upon request. Please email investor-help@realtymogul.com.

Location

Market Overview

Promenade

Promenade is located in the Winter Garden section of the Orlando MSA, which Forbes ranked as the #2 Fastest Growing City in 2017. As of January 2018, the Orlando MSA has an unemployment rate of 3.7%, which is lower than United States’ national average of 4.1%. In 2017, the average household income within a one-mile radius of the property was estimated to be over $68,000, while the local submarket has an occupancy of approximately 96% and asking rents are expected to increase over the next three years.​

Promenade Demographics
Distance from Property 1 Mile 3 Miles 5 Miles
Population      
2022 Total Population 13,582 56,723 120,852
2017 Total Population 12,257 50,742 106,798
2010 Total Population 10,904 43,124 87,335
2000 Total Population 6,608 21,656 50,555
Annual Growth 2017 - 2022 2.07% 2.25% 2.50%
Annual Growth 2010 - 2017 1.69% 2.35% 2.92%
Annual Growth 2000 - 2010 5.14% 7.13% 5.62%
Households      
2022 Total Households 4,984 19,291 40,791
2017 Total Households 4,512 17,305 36,188
2010 Total Households 4,052 14,775 29,841
2000 Total Households 2,594 7,763 17,629
Annual Growth 2017 - 2022 2.01% 2.20% 2.42%
Annual Growth 2010 - 2017 1.55% 2.28% 2.79%
Annual Growth 2000 - 2010 4.56% 6.65% 5.40%
Income      
2017 Median Household Income $47,364 $62,283 $67,742
2017 Average Household Income $68,043 $90,824 $95,727
2017 Per Capita Income $23,652 $31,068 $32,584
2017 Pop 25+ College Graduates 2,173 12,522 27,920
Age 25+ Percent College Graduates - 2017 27.1% 37.6% 39.6%
 

 

Stockwell Landing

Stockwell Landing is located in the Bossier City section of the Shreveport/Bossier City MSA, which ranked as the Best Place to Live in Louisiana, according to Money magazine in 2018, and has one of the lowest manufacturing costs in the country. In 2017, the average household income within a one-mile radius of the property was estimated to be over $100,000, while the 2017 median household income for Shreveport/Bossier City MSA is estimated to be $44,828. Therefore, the subject neighborhood currently has an upper-income demographic profile. Generally, the neighborhood is expected to remain stable with moderate growth in the foreseeable future. As a result, the demand for existing developments is expected to be generally favorable with local multifamily submarket occupancy levels of approximately 96% and upward trending rental rates.

Stockwell Landing Demographics
  1 Mile 3 Miles  5 Miles
Population       
2022 Total Population 4,863 22,736 53,745
2017 Total Population 4,394 20,903 49,978
2010 Total Population 3,755 18,271 45,741
2000 Total Population 2,158 14,879 39,507
Annual Growth 2017 - 2022 2.05% 1.70% 1.46%
Annual Growth 2010 - 2017 2.27% 1.94% 1.27%
Annual Growth 2000 - 2010 5.70% 2.07% 1.48%
Households      
2022 Total Households 1,748 8,416 20,658
2017 Total Households 1,570 7,708 19,172
2010 Total Households 1,341 6,687 17,452
2000 Total Households 723 5,255 14,492
Annual Growth 2017 - 2022 2.17% 1.77% 1.50%
Annual Growth 2010 - 2017 2.28% 2.05% 1.35%
Annual Growth 2000 - 2010 6.37% 2.44% 1.88%
Income      
2017 Median Household Income $85,102 $64,764 $56,896
2017 Average Household Income $102,889 $84,316 $75,399
2017 Per Capita Income $36,981 $31,723 $29,850
2017 Pop 25+ College Graduates 1,330 4,507 9,252
Age 25+ Percent College Graduates - 2017 47.6% 33.0% 28.4%

Demographic and Market Overview information above was obtained from the PPM

This content does not constitute an offer to sell or a solicitation of an offer to buy any securities. RealtyMogul.com and North Capital Private Securities are in the process of screening, performing due diligence, and verifying information for the offering. The content is presented to gauge interest only and is subject to change without notice.

 

Photos
Financials
Sources & Uses

Total Capitalization
Sources of Funds Cost
Debt $27,790,673
Equity $24,525,000
Total Sources of Funds $52,315,673
Uses of Funds Cost
Contribution of Real Estate (1) $46,317,789
Closing Costs (1) $141,213
Lender and Loan Expenses (1) $462,303
Reserves (1) $1,749,139
One Year Asset Management Fee $60,000
Structuring Fee $1,157,945
Selling Commissions (2) $1,471,500
Marketing and Due Diligence (3) $245,250
Placement Fee (4) $367,875
Organizational & Offering Costs $267,658
Due Diligence Expenses $75,000
Total Uses of Funds $52,315,673

 

(1) Does not reflect the approximately 19.99% attributable to the retained interest.

(2) Selling Commissions in an amount up to 6.0% of the Total Sales will be paid to the Managing Broker-Dealer, which the Managing Broker-Dealer will re-allow to the Selling Group Members.

(3) The Managing Broker-Dealer will receive a non-accountable marketing and due diligence allowance of up to 1.0% of Total Sales, which may be re-allowed, in whole or in part, to the Selling Group Members. 

(4) The Managing Broker-Dealer will receive a managing broker-dealer fee of up to 1.5% of the Total Sales. 

Debt Assumptions

The Promenade: 

  • Lender: Freddie Mac via Berkeley Point Capitol
  • Loan Proceeds: $17,220,000
  • Loan to Cost: 60%
  • Interest Rate: 4.73% Fixed
  • Interest Only: 5 Years
  • Amortization: 30 Years
  • Recourse: Non-recourse to investors, but recourse to the Trust and principals of the Sponsor for certain (i) "bad acts", (ii) environmental indemnification, and (iii) springing recourse events
  • Term: 10 years
  • Defeasance: The Loan may be defeased at any time after the Permitted Release Date and prior to January 6, 2028

 

Stockwell Landing: 

  • Lender: Freddie Mac via Berkeley Point Capitol
  • Loan Proceeds: $17,514,000
  • Loan to Cost: 60%
  • Interest Rate: 4.73% Fixed
  • Interest Only: 5 Years 
  • Amortization: 30 Years
  • Recourse: Non-recourse to investors, but recourse to the Trust and principals of the Sponsor for certain (i) "bad acts", (ii) environmental indemnification, and (iii) springing recourse events
  • Term: 10 years
  • Defeasance: The Loan may be defeased at any time after the Permitted Release Date and prior to January 6, 2028
Distributions

The Sponsor is to make distributions directly to investors who own a beneficial interest in the DST on a pro-rata basis.

Distributions are expected to start for each investor within 45 days of the completion of that investors purchase of beneficial interest in the DST. Distributions are targeted to continue on a monthly basis thereafter. These distributions are at the discretion of the Sponsor and made directly by the Sponsor, neither Realty Mogul Co. nor any of its affiliates have any control or discretion on the timing or amount of distributions.

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
Selling Commission 6.00% of offering proceeds Broker Dealers Capitalized Equity Contribution Paid to North Capital (1) or other licensed broker-dealers that are Selling Group Members based on the amount of equity capital raised. An Affiliate of the Real Estate Company is also a broker-dealer who is eligible to get paid this fee.
Marketing and Due Diligence Fee 1.00% of offering proceeds Broker Dealers Capitalized Equity Contribution 1.00% based on the amount of equity invested by investors through RealtyMogul.com, third-party Broker Dealers (including North Capital(1)) are entitled to additional fees based on equity they originate. Surplus fees retained by the Real Estate Company.
Placement Fee 1.50% of offering proceeds Broker Dealers Capitalized Equity Contribution Managing Broker-Dealer will receive a fee up to 1.50% of the Total Sales, which it may at its sole discretion partially re-allow to Selling Group Members for non-accountable marketing expenses in addition to any other allowances.
Organization and Offering Expenses $267,658 Sponsor Capitalized Equity Contribution The Sponsor and its affiliates will be entitled to reimbursement for Organization and Offering Expenses estimated at $267,658. 
Structuring Fee $1,157,945 Sponsor Capitalized Equity Contribution  The Sponsor will receive a structuring fee for the services they rendered in connection with the structuring of the Offering. 
Disposition Fee 2.50% Sponsor Sale Proceeds 2.50% of Sales Price 
Recurring Fees:
Type of Fee Amount of Fee Received By Paid From Notes
Asset Management Fee $60,000 annually Sponsor Net Cash Flow $36,000 paid annually to Star Asset Management and $24,000 paid annually to Cantor Asset Manager.
Property Management Fee 3.0% of Effective Gross Income Property Manager Operating Cash Flow Property Manager is an affiliate of the Sponsor.
Property Revenues in Excess of Rent N/A Master Lessee Operating Cash Flow The Master Tenant will retain revenues from the Property that exceed the total rent payable to the Trust under the Master Lease.

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.

The above presentation is based upon information supplied by the Sponsor or others.  Realty Mogul, Co. along with its 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.

This content does not constitute an offer to sell or a solicitation of an offer to buy any securities. RealtyMogul.com and North Capital Private Securities are in the process of screening, performing due diligence, and verifying information for the offering. The content is presented to gauge interest only and is subject to change without notice.

Disclaimers/FAQs
Disclaimers

Review of PPM

Before making any investment decision, potential investors should carefully review the Private Placement Memorandum prepared by Sponsor (the "PPM"), including but not limited to, the Risk Factor section of the PPM and all exhibits of the PPM. The PPM contains additional risk factors and information regarding the DST that are not contained herein.  


Real Estate Investment Risk

Any investment in real estate carries certain inherent risks, and there is no guaranty as to the future occupancy of the Properties or operating results.  Factors which might influence outcome include:

  • Changes in national or local economic conditions
  • Changes in the local market, including the entry of new competitors
  • Changes in the financial condition of the major tenant or tenants
  • The occurrence of casualties or natural disasters
  • The enactment of unfavorable laws

1031 Risk

Although it is intended that interests will be acquired on a tax-deferred basis under Code Section 1031, each investor must satisfy a number of technical requirements to qualify for tax deferral under Section 1031. Also, no assurance can be given that investors will be able to complete a qualifying Section 1031 exchange in the future when the Properties are sold.


DST Risk

IRS established seven prohibitions over the powers of the DST Trustee, which include the following:

  • Once the offering is closed, there can be no future equity contribution to the DST by either current or new co-investors or beneficiaries
  • The DST Trustee cannot renegotiate the terms of the existing loans, nor can it borrow any new funds from any other lender or party
  • The DST Trustee cannot reinvest the proceeds from the sale of its investment real estate
  • The DST Trustee is limited to making capital expenditures with respect to the property to those for a) normal repair and maintenance, (b) minor non-structural capital improvements, and (c) those required by law
  • Any liquid cash held in the DST between distribution dates can only be invested in short-term debt obligations
  • All cash, other than necessary reserves, must be distributed to the co-investors or beneficiaries on a current basis, and
  • The Trustee cannot enter into new leases or renegotiate the current leases

Risks of Investing in Multifamily Rental Properties; Competition

The rental of multifamily residential space is a highly competitive business. Ownership of the Properties could be adversely affected by competitive properties in the real estate market, which could affect the operations of the Properties and the ultimate value of the Properties. Success in owning the Properties, therefore, will depend in part upon the ability of the Master Tenant, the Property Manager and the Property Sub-Manager (i) to retain current tenants at favorable rental rates; (ii) to attract other quality tenants upon the termination of existing leases if the existing tenants fail to renew or as otherwise needed; and (iii) to provide an attractive and convenient living environment for the tenants.


Competition from Apartment Communities in the Surrounding Geographic Area

A number of apartment communities of similar size and amenities are located in the Properties' immediate apartment sub-market. See “Risk Factors - Real Estate Risks - Competition” in the PPM. There are a number of Class A apartment communities in the surrounding region that may be more attractive to renters. Competing apartment communities may reduce demand for the Properties, increase vacancy rates, decrease rental rates and impact the value of the Properties themselves. There may also be additional real property available in the general vicinity of the Properties that could support additional multifamily properties. If newer housing is built, it may siphon demand away from the Properties, as newer housing tends to be more attractive to prospective tenants. It is possible that tenants from the Properties will move to existing or new apartment communities in the surrounding area, which could adversely affect the financial performance of the Properties. Competition from nearby apartment communities could make it more difficult to attract new tenants and ultimately sell the Properties on a profitable basis. The Properties could also experience competition for real property investments from individuals, corporations and other entities engaged in real estate investment activities. Other properties and real estate investments may be more attractive than the Properties. There is no assurance that the property managers will be able to attract residents to the Properties given these facts.


The Properties are Subject to Risks Relating to its Local Real Estate Market

Weakness or declines in the local economy and real estate market could cause vacancy rates at the Properties to increase and could adversely affect the Trust’s ability to sell the Properties under favorable terms. The factors which could affect economic conditions in the market generally include business layoffs, industry slowdowns, relocations of businesses, changing demographics, infrastructure quality and any oversupply of or reduced demand for real estate. Declines in the condition of the market could diminish your investment in and value of the Properties.


Interest-Only Loans

The loans used to acquire the Properties are expected to have an interest-only period for the initial 60 months of the loan term, which means there will be no reduction in the principal balance during this period.


Performance of the Master Tenant Under the Master Lease

The ability of the Trust to meet its obligations is dependent upon the performance of the Master Tenant and its payment of Rent and other payments required under the Master Lease. ​


Conflict of Interest Risk

There are various potential conflicts of interest among the Sponsor, the Trust, the Managers, the Master Tenant, the Property Managers, and others engaged in the management and operation of the Properties, one or more of whom may be affiliated with the others. 


Forward-Looking Statements

The PPM has based these forward-looking statements on its current expectations and predictions about future events. These forward-looking statements are subject to risks, uncertainties and assumptions about the Properties, including, among other things, factors discussed below:

  • General economic performance of the local and national economy;
  • Required capital expenditures at the Properties
  • Competition from properties similar to and near the Properties
  • Adverse changes in local population trends, market conditions, neighborhood values, and local economic and social conditions
  • Supply and demand similar Properties
  • Interest rates and real estate tax rates
  • Governmental rules, regulations and fiscal policies
  • The enactment of unfavorable real estate, rent control, environmental, zoning or hazardous material laws
  • Uninsured losses
  • Anticipated market capitalization rates at the time of sale

Limited Transferability of Securities

Each Beneficial Owner will be required to represent that he is acquiring the Interests for investment and not with a view to distribution or resale, that such Beneficial Owner understands the Interests are not freely transferable and, in any event, that such Beneficial Owner must bear the economic risk of investment in the Interests for an indefinite period of time because: (i) the Interests have not been registered under the Act or applicable state “Blue Sky” or securities laws; and (ii) the Interests cannot be sold unless they are subsequently registered or an exemption from such registration is available. There will be no market for the Interests and the Beneficial Owner cannot expect to be able to liquidate their investment in case of an emergency. See “Restrictions on Transferability” in the PPM. Finally, the sale of the Interests may have adverse federal income tax consequences. See “Federal Income Tax Consequences” in the PPM.


Sale of the Properties

The proceeds realized from the sale of the Properties will be distributed among the Beneficial Owners, but only after satisfaction of the claims of other third-party creditors and Affiliates of the Sponsor. The ability of a Beneficial Owner to recover all or any portion of its investment, accordingly, will depend on the amount of net proceeds realized from such sale and the amount of claims to be satisfied therefrom. There can be no assurance that the Beneficial Owners will realize gains on sale of the Properties.


No Representation of Beneficial Owners

Each Beneficial Owner acknowledges and agrees in the Purchase Agreement and Escrow Instructions that legal counsel representing the Trust, the Sponsor, the Manager, the Master Tenant, the Depositor and their Affiliates do not represent, and shall not be deemed under the applicable codes of professional responsibility to have represented or to be representing, any or all of the Beneficial Owners.​


 

Performance of the Master Tenant Under the Master Lease

The ability of the Trust to meet its obligations is dependent upon the performance of the Master Tenant and its payment of Rent and other payments required under the Master Lease. ​


Trustee and the Manager Have Limited Duties to Beneficial Owners

The Trustee of the Trust and the Manager will not owe any duties to the Beneficial Owners other than those duties set forth in the Trust Agreement. In performing its duties under the Trust Agreement, the Trustee will only be liable to the Beneficial Owners for its own willful misconduct, bad faith, fraud or gross negligence. Similarly, the Manager will only be liable to the Beneficial Owners for its own fraud or gross negligence.

Hurricane Risk

The Properties are located near the Atlantic Ocean and Gulf of Mexico, which are subject to frequest and sometimes destructive hurricanes. There can be no assurance that a sizable hurricane will not cause significant damage to the Properties, in which case the business and financial condition of the Trust would be materially adversely affected. There is no guarantee that the Trust will have adequate inaurance for the Properties at the time of potential hurricane damage.


No Realty Mogul Site Visit

The Property has not been physically inspected by a representative of Realty Mogul or any of its affiliates.


The above is not intended to be a full discussion of all the risks of this investment. Please see the Risk Factors in the Private Placement Memorandum for a discussion of additional risks. To receive a copy of the Private Placement Memorandum please contact your Investor Relations Representative.

The above presentation is based upon information supplied by the Sponsor and others. Realty Mogul, Co., along with its 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.

This content does not constitute an offer to sell or a solicitation of an offer to buy any securities. RealtyMogul.com and North Capital Private Securities are in the process of screening, performing due diligence, and verifying information for the offering. The content is presented to gauge interest only and is subject to change without notice.

INVEST TODAY

Questions?

(877) 781-7062

Contact Investor Relations
Join RealtyMogul
Gain access to commercial real estate deals across the country
Easily review, compare and invest in deals that meet your criteria
Build the real estate portfolio that’s right for you
Potential benefits include diversification, growth and passive income
ARE YOU AN ACCREDITED INVESTOR?
Password should be at least 8 characters, contain an uppercase character, a lowercase character, a number and a symbol.
Sign In
Don’t have an account yet? Join RealtyMogul
Please enter your email and password below.

Forgot Password?

Forgot Password
Enter your email address to receive a code to reset your password.
Enter the code sent to your email address below and your new password.

Resend Code