Aggregate value of properties owned by the Income REIT based on the most recent internal valuations as of the end of the fiscal quarter upon which our most recently announced NAV per share is based pursuant to our valuation policies; provided, however, the value of the properties underlying investments acquired since the most recent NAV per share was announced are based on the most recent purchase prices. The aggregate value of the properties underlying loans made by the Income REIT is based on independent appraisals dated within six months of the original acquisition dates by RM Adviser, LLC, Realty Mogul, Co. or Realty Mogul Commercial Capital, Co., as applicable. As with any methodology used to estimate value, the methodology employed by our affiliates’ internal accountants or asset managers is based upon a number of estimates and assumptions about future events that may not be accurate or complete. For more information, see the section of our Offering Circular captioned “Description of Our Common Shares – Valuation Policies.”
Return shown reflect the percent change in the NAV per share from the beginning of the applicable period, plus the amount of any distribution per share declared in the period. All returns shown assume reinvestment of distributions pursuant to the Income REIT's distribution reinvestment plan, are derived from unaudited financial information and are net of all Income REIT expenses, including management fees. An individual shareholder's total return may vary from the total return, and there is no assurance that shareholders will be able to realize the estimated NAV per share upon attempting to sell their shares. Past performance is historical and not a guarantee of future results. Inception to Date Return is annualized utilizing a compounding method and consistent with the IPA Practice Guideline 2018, as reported in the IPA/Stanger Monitor (initial issuance in Q1’19). The inception date is August 12, 2016.
There is no guarantee that shareholders will receive a distribution, and distributions have been paid from sources other than cash flow from operations, including net proceeds from our offering, cash advances by RM Adviser, LLC, manager of the Income REIT (the "Manager"), cash resulting from a waiver of fees or reimbursements due to our Manager, borrowing and the issuance of additional securities. The Manager may in the future declare lower distributions or no distributions at all for any given period.
The Income REIT's primary focus is to provide monthly income to investors by rigorously evaluating numerous investment opportunities to find those that can support the Income REIT's distribution target.
RealtyMogul's Income REIT has a minimum investment of just $5,000.
The Income REIT has:
- Paid investors an annualized cash distribution of at least 6% net of fees for ${mogulReit1DistributionDuration} consecutive months.
- Distributed a total of ${mogulReit1DistributionAmount} to investors to date.
- ${reitTotalAssetValue} in assets purchased by approximately 7,600 unique investors.2
REITs are legally required to distribute 90% of all taxable income to investors annually.
Generally, REITs have historically outperformed the broad stock market more often than not when returns are measured in years.** REITs have also historically been positively correlated with inflation, which may make them a possible hedge for inflation.***
**. https://www.reit.com/news/blog/market-commentary/reit-average--historical-returns-vs-us-stocks
***. https://www.reit.com/news/blog/market-commentary/how-reits-provide-protection-against-inflation
In short, the RealtyMogul Apartment Growth REIT is focused on growth investments while the RealtyMogul Income REIT is more focused on income-producing investments.
To learn more about the RealtyMogul REITs, click here.
Existing Income REIT and Apartment Growth REIT investors can click on the “Auto Invest” tab on their investor Dashboard to begin the Auto Invest enrollment process. Once an enrollment form is submitted, the Auto Invest enrollment request will need to be processed before it will become active on your Dashboard. Please visit the “Auto Invest” tab on your investor Dashboard to get started and for more information.
Once your auto investment enrollment is active, you will have the option to either pause, edit, or cancel your enrollment right from the “Auto Invest” tab on your investor Dashboard. For more information, please refer to our full offering circular.
The following third-party expense reimbursements will be paid from proceeds of the sale of the Income REIT shares:
TYPE OF FEE | AMOUNT | NOTES |
---|---|---|
Organization, Offering and Other Operating Expenses including, but not limited to, actually incurred third-party legal, accounting, and marketing expenses† | Up to 3% of equity contribution | Net Asset Value (NAV), at any given time, is net of Organization, Offering and Other Operating Expenses. |
The following fees will be paid by the Income REIT to our Manager, RM Adviser, LLC, and/or its affiliates for services related to the offering, and the investment and management of our assets††:
TYPE OF FEE | AMOUNT | NOTES |
---|---|---|
Asset Management Fee paid to our Manager, RM Adviser, LLC, and/or its affiliates | 1% annualized based on the “total equity value”. | For purposes of this fee, total equity value equals (a) our then-current NAV per share, multiplied by (b) the number of our common shares then outstanding. Actual amounts are dependent upon the offering proceeds we raise (and any leverage we employ) and the results of our operations and changes to our NAV. |
Reimbursement of Other Operating Expenses paid to our Manager, RM Adviser, LLC | Variable – dependent upon operations | Includes, but not limited to, license fees, auditing fees, fees associated with SEC reporting requirements, insurance costs, tax return preparation fees, taxes and filing fees, administration fees, fees for the services of an Independent Representative or Advisory Board, and third-party costs associated with the aforementioned expenses. |
Fees Paid with Respect to Loans and Preferred Equity Only:
TYPE OF FEE | AMOUNT | NOTES |
---|---|---|
Servicing Fee (Performing Loans and Preferred Equity Investments) - RM Originator, an affiliate of our Manager, RM Adviser, LLC | 0.5% of the principal balance plus accrued interest of each loan or preferred equity investments to RM Originator for the servicing and administration of certain loans and investments held by us. Servicing fees payable by us may be waived at RM Originator’s sole discretion. | Actual amounts are dependent upon the principal amount of the loans or preferred equity investments. We cannot determine these amounts at the present time. |
Special Servicing Fee (Non-Performing Loans and Preferred Equity Investments) - RM Originator, an affiliate of our Manager, RM Adviser, LLC | 1% of the original value of a non-performing debt or preferred equity investment serviced by such RM Originator. Whether an investment is deemed to be non-performing is at the sole discretion of our Manager. | Actual amounts are dependent upon the occurrence of a debt or preferred equity investment becoming non-performing and the original value of such assets. We cannot determine these amounts at the present time. |
††There are other fees not paid by the Income REIT itself that may be paid to affiliates that originate or manage investments on behalf of the Income REIT. To learn more about our fees, estimated use of proceeds, and the Income REIT's estimated expenses, please refer to our full offering circular. Additionally, unaffiliated and affiliated third-parties will pay our Manager or affiliates of our Manager substantial fees related to the origination, investment, and management of our equity, preferred equity, debt, and fixed income assets. A portion of these fees may be paid to personnel affiliated with our Manager, including officers of our Manager, Jilliene Helman and Eric Levy. These fees reduce the amount of funds that are invested in the underlying equity, preferred equity, debt, and fixed income assets, or the amount of funds available to pay distributions to the Company, thereby reducing returns on that investment. Please carefully review the “Management Compensation” section of the Company’s Offering Circular for more information on these fees.
As is more thoroughly discussed in the Share Repurchase Program section of RealtyMogul Income REIT’s Offering Circular, after 12 months of ownership, you may request up to 25% of your eligible shares to be repurchased on a quarterly basis at the most recently announced NAV per share multiplied by the Effective Repurchase Rate, which may discount the amount you receive for your repurchased shares based on how long the shares have been held.
The Effective Repurchase Rate is based on the stock purchase anniversary as follows:
Share Repurchase Anniversary (Year) | Effective Repurchase Rate(1) |
---|---|
Less than 1 year | No Repurchase Allowed |
1 year until 2 years | 98% |
2 years until 3 years | 99% |
3 or more years | 100% |
We intend to limit the number of shares to be repurchased during any calendar year to 5.0% of the weighted average number of common shares outstanding during the prior calendar year (or 1.25% per quarter, with excess capacity carried over to later quarters in the calendar year). In the event that share repurchase requests exceed the 5.0% annual limit of allowable repurchases, pending requests will be honored on a pro rata basis.
As of December 31, 2023, we are receiving requests for the repurchase of our shares in excess of the repurchase limit set forth in our share repurchase program. In accordance with our share repurchase program, such share repurchase requests are honored on a pro rata basis. For more information regarding our share repurchase program, see the section of our Offering Circular captioned “Description of Our Common Shares – Quarterly Share Repurchase Program."
Our REIT Manager may in its sole discretion, amend, suspend, or terminate the share repurchase program at any time. Reasons we may amend, suspend or terminate the share repurchase program include (i) to protect our operations and our remaining shareholders, (ii) to prevent an undue burden on our liquidity, (iii) to preserve our status as a REIT, (iv) following any material decrease in our NAV, or (v) for any other reason.
To learn more about the Income REIT's Share Repurchase Plan, please refer to the section of our full offering circular captioned “Description of Our Common Shares – Quarterly Share Repurchase Program."
Because each investor’s tax considerations are different, it is recommended that you consult with your tax advisor. You also should review the section of the offering circular entitled “U.S. Federal Income Tax Considerations,” including for a discussion of the special rules applicable to distributions in repurchase of shares and liquidating distributions.
Your annual detailed tax information will be reported on Form 1099-DIV, if required, and will be provided to you in electronic form by January 31 of the year following each taxable year.
A liquidity transaction could consist of a sale of all assets, a roll-off to maturity of all assets, a sale or merger of the Company, consolidation with other REITs managed by our Manager, a listing of the Company on an exchange, or any other similar transaction.
The Income REIT does not have a stated term. The Income REIT's Manager has the discretion to consider and execute a liquidity transaction at any time if it determines it is in the best interest of the Company.
Accredited Investors include individuals who meet the following criteria:
- Have a net worth over $1 million, excluding primary residence (individually or with spouse or partner)
- Income over $200,000 (individually) or $300,000 (with spouse or partner) in each of the prior two years, and reasonably expects the same for the current year
All Other Investors may invest so long as their investment in our common shares does not represent more than 10% of the greater of their annual income or net worth (for natural persons), or 10% of the greater of annual revenue or net assets at fiscal year-end (for non-natural persons)
The Income REIT focuses on investing in the following types of assets: commercial real estate loan and equity assets, including, without limitation, senior debt, mezzanine debt, junior debt participation, equity interests, including joint ventures and limited partnerships, preferred equity, and other real estate-related assets. We intend to hold at least 55% of the total value of our assets in commercial mortgage-related instruments that are closely tied to one or more underlying commercial real estate projects, such as mortgage loans, subordinated mortgage loans, mezzanine debt and participations, as well as direct interests in real estate that meet certain criteria set by the staff of the SEC.
CUMULATIVE DISTRIBUTIONS
Return shown reflect the percent change in the NAV per share from the beginning of the applicable period, plus the amount of any distribution per share declared in the period. All returns shown assume reinvestment of distributions pursuant to the Income REIT's distribution reinvestment plan, are derived from unaudited financial information and are net of all Income REIT expenses, including management fees. An individual shareholder's total return may vary from the total return, and there is no assurance that shareholders will be able to realize the estimated NAV per share upon attempting to sell their shares. Past performance is historical and not a guarantee of future results. 1-Year Return represents the most recent consecutive twelve-month period immediately preceding such date and is consistent with the IPA Practice Guideline 2018, as reported in the IPA/Stanger Monitor (initial issuance in Q1’19). The inception date is August 12, 2016.
Return shown reflect the percent change in the NAV per share from the beginning of the applicable period, plus the amount of any distribution per share declared in the period. All returns shown assume reinvestment of distributions pursuant to the Income REIT's distribution reinvestment plan, are derived from unaudited financial information and are net of all Income REIT expenses, including management fees. An individual shareholder's total return may vary from the total return, and there is no assurance that shareholders will be able to realize the estimated NAV per share upon attempting to sell their shares. Past performance is historical and not a guarantee of future results. 3-Year Return is annualized utilizing a compounding method and consistent with the IPA Practice Guideline 2018, as reported in the IPA/Stanger Monitor (initial issuance in Q1’19). The inception date is August 12, 2016.
Return shown reflect the percent change in the NAV per share from the beginning of the applicable period, plus the amount of any distribution per share declared in the period. All returns shown assume reinvestment of distributions pursuant to the Income REIT's distribution reinvestment plan, are derived from unaudited financial information and are net of all Income REIT expenses, including management fees. An individual shareholder's total return may vary from the total return, and there is no assurance that shareholders will be able to realize the estimated NAV per share upon attempting to sell their shares. Past performance is historical and not a guarantee of future results. 5-Year Return is annualized utilizing a compounding method and consistent with the IPA Practice Guideline 2018, as reported in the IPA/Stanger Monitor (initial issuance in Q1’19). The inception date is August 12, 2016.
Return shown reflect the percent change in the NAV per share from the beginning of the applicable period, plus the amount of any distribution per share declared in the period. All returns shown assume reinvestment of distributions pursuant to the Income REIT's distribution reinvestment plan, are derived from unaudited financial information and are net of all Income REIT expenses, including management fees. An individual shareholder's total return may vary from the total return, and there is no assurance that shareholders will be able to realize the estimated NAV per share upon attempting to sell their shares. Past performance is historical and not a guarantee of future results. Inception to Date Return is annualized utilizing a compounding method and consistent with the IPA Practice Guideline 2018, as reported in the IPA/Stanger Monitor (initial issuance in Q1’19). The inception date is August 12, 2016.
- Multi-FamilyProperties that have five or more residential units in a single building and may be further classified as garden style, low-rise, or high-rise.
- OfficeMid-rise or high-rise, downtown or suburban.
- RetailGrocery-anchored centers, shopping centers, power centers and strip malls.
- Joint Venture EquityInvestors in Joint Venture Equity own an interest in an entity (usually an LLC) that invests in the equity portion of a property. After all debt is paid, and any Preferred Equity distributions are made, the Joint Venture Equity investor receives a pro rata portion of a preferred return, cash flow, and any profits upon sale. Joint Venture Equity is the riskiest investment as it has the lowest priority of distributions, although it has the greatest upside potential.
- Mezzanine DebtSecond in line for repayment are investors in Mezzanine Debt and B Notes. Mezzanine Debt is structured as a loan secured by a pledge of interest in the entity owning the property. In the event of loan default, investors may have the right to foreclose on the interests of the entity and step into ownership of the property, subject to any senior debt. B Notes are secondary tranches of senior loans with an A/B structure, and are secured by the property itself. In the event of loan default, the investors in a B Note may participate in the right to foreclose on the property and receive sale proceeds to repay principal, unpaid interest and any fees, subject to the A Note investor.
- Preferred EquityInvestors in Preferred Equity investments own an interest in the property and have a priority over the other equity investors to receive distributions of cash flow and capital invested. In the event of loan default, Preferred Equity investors may have the right to take over control and management of the property.
Investment | Location | Property Type | Investment Type | Weight |
---|---|---|---|---|
Multiple Cities, TX | Retail | Preferred Equity | 0% | |
El Paso, TX | Multi-family | Joint Venture Equity | 0% | |
Virginia Beach, VA | Multi-family | Joint Venture Equity | 0% | |
Columbus, OH | Office | Joint Venture Equity | 0% | |
Richmond, VA | Multi-family | Joint Venture Equity | 0% | |
Lubbock, TX | Office | Joint Venture Equity | 0% | |
Fenton, MO | Multi-family | Joint Venture Equity | 0% | |
Creve Coeur, MO | Multi-family | Joint Venture Equity | 0% | |
Vancouver, WA | Multi-family | Joint Venture Equity | 0% | |
Vancouver, WA | Multi-family | Joint Venture Equity | 0% | |
Grove City, OH | Multi-family | Joint Venture Equity | 0% | |
Georgetown, KY | Multi-family | Joint Venture Equity | 0% | |
Gresham, OR | Multi-family | Joint Venture Equity | 0% | |
Cincinnati, OH | Mixed-Use | Joint Venture Equity | 0% | |
Beavercreek, OH | Office | Joint Venture Equity | 0% | |
Columbus, OH | Multi-family | Joint Venture Equity | 0% |
Investment | Location | Property Type | Investment Type | Invested |
---|---|---|---|---|
Canton, OH | Office | Preferred Equity | 2000000.00 | |
San Antonio, TX | Office | Mezzanine Debt | 3400000.00 | |
Centennial, CO | Office | Mezzanine Debt | 2300000.00 | |
Pensacola, FL | Retail | Mezzanine Debt | 1125000.00 | |
Suwanee, GA | Office | Senior Debt | 1500000.00 | |
Jonesboro, GA | Retail | Preferred Equity | 1250000.00 | |
Corona, CA | Retail | Mezzanine Debt | 3549300.00 | |
Chula Vista, CA | Multi-family | Senior Debt | 4490000.00 | |
San Francisco, CA | Mixed-Use | Senior Debt | 4750000.00 | |
La Habra, CA | Retail | Preferred Equity | 1900000.00 | |
Tucson, AZ | Multi-family | Preferred Equity | 2275000.00 | |
Virginia Beach, VA | Office | Preferred Equity | 1700000.00 | |
Hanford, CA | Retail | Senior Debt | 1900000.00 | |
Garden Grove, CA | Self-storage | Mezzanine Debt | 3915000.00 | |
Brooklyn, NY | Mixed-Use | Senior Debt | 1350000.00 | |
Waterbury, CT | Retail | Preferred Equity | 3000000.00 | |
Riverside, CA | Office | Mezzanine Debt | 2500000.00 | |
West Chester, PA | Flex | Preferred Equity | 1450128.00 | |
Fresno, CA | Retail | Senior Debt | 3600000.00 | |
Portland, OR | Office | Senior Debt | 3950000.00 | |
Syracuse, NY | Flex | Preferred Equity | 1500000.00 | |
Las Vegas, NV | Office | Joint Venture Equity | 6000000.00 | |
Plano, TX | Multi-family | Preferred Equity | 2323030.00 |
The NAV per share calculation reflects the total value of our assets minus the total value of our liabilities, divided by the number of shares outstanding. As with any methodology used to estimate value, the methodology employed calculating our NAV per share is based upon a number of estimates and assumptions about future events that may not be accurate or complete. Further, different parties using different assumptions and estimates could derive a different NAV per share, which could be significantly different from our calculated NAV per share. Our NAV will fluctuate over time and does not represent: (i) the price at which our shares would trade on a national securities exchange, (ii) the amount per share a shareholder would obtain if he, she or it tried to sell his, her or its shares or (iii) the amount per share shareholders would receive if we liquidated our assets and distributed the proceeds after paying all our expenses and liabilities.
You should carefully review the “Risk Factors” section of this offering circular, which contains a detailed discussion of the material risks that you should consider before you invest in our common shares. These risks include the following:
- The RealtyMogul Income REIT has a limited operating history.
- Because no public trading market for shares of our common stock currently exists, it will be difficult for an investor to sell their shares and, if an investor is able to sell their shares, they will likely sell them at a substantial discount to the public offering price.
- We may be unable to pay or maintain cash distributions or increase distributions over time.
- The REIT's ability to implement its investment strategy is dependent, in part, upon its ability to successfully conduct this offering through the Realty Mogul Platform, which makes an investment in it more speculative.
- Future disruptions in the financial markets or deteriorating economic conditions could adversely impact the commercial real estate market as well as the market for debt-related investments generally, which could hinder our ability to implement our business strategy and generate returns to you.
- This is a blind pool offering, and the REIT is not committed to acquiring any particular investments with the net proceeds of this offering.
- There are conflicts of interest between the REIT, its Manager and its affiliates.
- Our investments may be concentrated and will be subject to the risk of default.
- We are dependent on our Manager and Realty Mogul, Co.’s key personnel for our success.
- Failure to qualify as a REIT would cause the Company to be taxed as a regular corporation, which would substantially reduce funds available for distributions to our shareholders.
- The REIT may allocate the net proceeds from this offering to investments with which you may not agree.
- Number of unique investors, consecutive distribution periods, and amount distributed to investors as of April, 2024.
2. Aggregate value of properties owned by the Income REIT based on the most recent internal valuations as of the end of the fiscal quarter upon which our most recently announced NAV per share is based pursuant to our valuation policies; provided; however, the value of the properties underlying investments acquired since the most recent NAV per share was announced are based on the most recent purchase prices. The aggregate value of the properties underlying loans made by the Income REIT is based on independent appraisals dated within six months of the original acquisition dates by RM Adviser, LLC, Realty Mogul, Co. or Realty Mogul Commercial Capital, Co., as applicable. As with any methodology used to estimate value, the methodology employed by our affiliates’ internal accountants or asset managers is based upon a number of estimates and assumptions about future events that may not be accurate or complete. For more information, see the section of our Offering Circular captioned “Description of Our Common Shares – Valuation Policies.”
3. These hypothetical case studies are provided for illustrative purposes only and do not represent an actual investor or an actual investor's experience, but rather are meant to provide an example of the Income REIT's process and methodology. An individual's experience may vary based on his or her individual circumstances. There can be no assurance that the Income REIT will be able to achieve similar results in comparable situations. Hypothetical returns are net of advisory fees and transaction costs; all dividends are assumed to be reinvested monthly. Actual returns may differ materially from hypothetical returns. Hypothetical returns are from the Income REIT's inception date through April 15, 2024. There is no substitute for actual returns. Past hypothetical performance is not a guarantee of future returns.