COMPOUND REAL ESTATE BONDS II INC.

Key economics

Preferred return

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Hurdle rate

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LP / GP split

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GP catch-up

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GP clawback

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GP commitment

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Diligence findings (15 · 5 high/critical)

• high
  DDQ gap: Does the fund engage an independent auditor?The offering documents don't answer a standard institutional DDQ question (Governance). An allocator will ask this directly — the GP should be ready with an answer.
• high
  DDQ gap: Does the fund have a GP clawback provision?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• high
  DDQ gap: What is the LP/GP carried-interest split above the preferred return?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• high
  DDQ gap: What is the preferred return (hurdle) rate offered to LPs?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• high
  Numeric inconsistency — Net loss for the periodMD&A states net loss of $1,500 for the period but the audited financial statements show net loss of $22,125.
• medium
  DDQ gap: Does the fund use a third-party fund administrator?The offering documents don't answer a standard institutional DDQ question (Governance). An allocator will ask this directly — the GP should be ready with an answer.
• medium
  DDQ gap: Is there a GP catch-up, and at what rate?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• medium
  DDQ gap: What distribution-waterfall structure does the fund use?The offering documents don't answer a standard institutional DDQ question (Structure). An allocator will ask this directly — the GP should be ready with an answer.
• medium
  DDQ gap: What is the GP's capital commitment (skin in the game)?The offering documents don't answer a standard institutional DDQ question (Economics). An allocator will ask this directly — the GP should be ready with an answer.
• low
  Defined-term defect — the SharesThe document refers to 'the offer and sale of the Shares under this Offering Circular' but this is a bond offering with no equity shares being offered; 'the Shares' appears to be a wrong-term substitution from a template.
• low
  Document-quality defect — Administrative Services Agreement date inconsistencyThe body of the circular states the Administrative Services Agreement was entered into on 'July 11, 2025' but the exhibit index identifies it as 'Administrative Services Agreement dated July 16, 2025', a five-day discrepancy.
• low
  Spelling / typo — duplicate bullet pointThe bullet 'Bear interest at 8.5% per annum, compounded daily;' appears verbatim twice in the bond summary section on the same page.
• info
  Spelling / typo — broken sentence — missing wordSentence 'Inderjit Tuli & Michael Burmi have very little direct with making real estate investments' is missing a word (presumably 'experience'), rendering it grammatically broken in substantive risk disclosure.
• info
  Spelling / typo — Exist Strategy'Exist Strategy' is a misspelling of 'Exit Strategy' in the multi-family investment criteria section.
• info
  Spelling / typo — repeated word in offering expenses'marketing' appears twice consecutively in the list of offering expenses, indicating a copy-paste drafting error.

DDQ readiness — 38% covered

5 answered · 0 partial · 8 gaps of 13 standard questions.