DDQ gap: Does the fund engage an independent auditor?
HighThe 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.
90% confidence
Cascade · Distributions
Where each dollar goes
$875K
LP $663K · Fees $213K · GP $0
Gross proceeds at exit
$875K
FFees to Manager
$212,500 · 24.3% of gross
taken before the waterfall→ GP $213K
T1Return of Capital
$500,000 · 57.1% of gross
uncapped — takes what remains→ LP $500K
T2Preferred Return (8%)
$162,500 · 18.6% of gross
uncapped — takes what remains→ LP $163K
Where it lands · of gross proceeds
LP $663K (75.7%)Fees $213K (24.3%)GP $0 (0.0%)
Standard scenario · $500K equity · 5y hold · 1.75× exitRun your own cascade →
Class structure · 2 classes
How MHPI II, LLC divides the cap table
The cascade above models the blended LP view. Click a class below to view per-class economics.
Class A Membership Interests
Manager“The principals of the Managers, along with Academy Fund, LP ... will hold 100% of the Company's Class A Interests.”— PPM p. 8
Class B Membership Interests
LP“members holding the Class B Interests purchased in this offering will hold collectively 50% of the total membership interests of the Company”— PPM p. 8
PPM Review
6/12 key terms · 3 flagsWhat this PPM costs, protects, and pays — every claim links to its source page. Missing items read “not stated,” never “no.”
Load at close
~7.5%
of equity, upfront
Recurring drag
~7.00%
per year, pre-split
LP share of next $
~100¢
at 1.75× base case
Key-term findability
6/12
located in the PPM
Needs attention
flagPreferred return is non-cumulative
flagNo GP clawback
flagFees taken above the waterfallp.9
Offering & eligibilityReg D 506(b) · accredited only▶
Eligibility
Accredited investors onlyA 506(b) offering may not be publicly advertised — being cold-marketed one is a red flag.
Structure
Reg D 506(b)3(c)(1) — up to 100 investors≤ 100 investorsSold via broker-dealer — 7.0% selling commissionUnregistered adviser
p.23“The Company reserves the rights to pay commissions in an amount up to 7% to licensed broker dealers and other finders pursuant to applicable law.”Where your dollar goes~7.5% load · 0.0% GP commit▶
Load at close
~7.5% of your equity is consumed by upfront fees at closing (estimate).
- Acquisition/Administrative Fee: 5.0%p.9“the Company will pay the Class A Members a fee in the total amount of 5% of the purchase price of said property”
- Guaranty Fee: 2.5%p.41“such Member or its Affiliate shall be entitled to a one-time fee equal to two and five tenths percent (2.5%) of the total amount of the obligations of the Company guaranteed”
Recurring drag
~7.00% of your equity per year, before any profit split — comparable to an expense ratio.
LP share of next $
~100¢ of each additional dollar reaches the LP at the 1.75× base case.
Protections & red flags3audit n/s · 3 off-market▶
Independent controls
Off-market (3)
- Preferred return is non-cumulativeA cumulative pref is the market norm
- No GP clawbackA clawback is the market norm
- Fees taken above the waterfallLP-friendly deals subordinate fees to the prefp.9“The Class A Members will be entitled to receive a management fee in the amount of 5% to 7% of gross rental income per annum, from the Company”
Minimum raise
$250K minimum raise
$5M maximumSubscriptions held in escrow until the minimum is metIf the minimum isn't reached, subscriptions are returned in full.p.8“The Company is seeking subscriptions for a minimum of $250,000 and a maximum of $5 million of Class B Membership Interests. All subscription amounts will be held in a non-interest bearing account pending the holding of a closing with respect thereto. ... If an initial Closing is not held on or before the Termination Date, all funds will be returned to the subscribers, without interest.”Not stated
Audited financials
Cash flow & horizonannual distributions · hold n/s▶
Distribution policy
Targets distributions — AnnualBegins within sixty (60) days following the end of each taxable yearTargeted, at manager's discretionDistributions are a target at the manager’s discretion — not a guarantee.p.7“all of the Company's Available Cash from Operations shall be distributed to the Members not less frequently than annually and within sixty (60) days following the end of each taxable year of the Company”
Capital stack
2 share classes — your class's priority in the money line depends on the waterfall.
Not stated
Hold / fund life
Governanceno LP removal▶
Removal & amendments
No LP right to remove the manager
Amendments require an LP supermajority
Key person & life
Extensions: No fund-life extension option; the Company term is perpetual until dissolution. Separately, the Managers may extend the offering period by two 30-day periods in their discretion without notice to investors.
Reporting
Unaudited annual financial statements and tax information necessary for preparing federal/state income tax returns within 90 days after the close of the taxable year; quarterly profit-and-loss/income statements sent on or before the 15th day of the month following each calendar quarter.
Source
p.20“A Manager may only be removed by the unanimous vote of the Class A Members.”
Document quality6/12 findable · 77 pp▶
Key-term findability
6 of 12 key questions answered.
- ✓Preferred return
- ✓Profit split / promote
- ✓Distribution waterfall
- ✓Fee schedule
- ✓GP commitment
- —Audited financials
- ✓Distribution policy
- —Lock-up / liquidity
- —Fund life / hold
- —Leverage cap
- —Minimum investment
- —Conflicts / related-party
Structural complexity
LP classes: 2Cash pools: 4Max tier depth: 8Conditional branches: 0
More moving parts, not necessarily worse — takes longer to understand.Document heft
77 pages
Fee-load figures are modeled estimates from extracted terms, not a guarantee. Peer context is shown to Analyst-tier members.
Deal diligence3 findings · worst high
Automated checks across the fund's extracted PPM. Every finding is shown with the evidence it's based on — proven numbers or a verbatim quote and page.
Diligence gaps
Questions a standard diligence questionnaire would ask that the PPM leaves unanswered.
DDQ gap: Does the fund use a third-party fund administrator?
MediumThe 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.
90% confidence
DDQ gap: Is there a key-person provision?
MediumThe 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.
90% confidence
DDQ readiness
How much of a standard institutional due-diligence questionnaire this fund's offering documents answer out of the box. Gaps are questions an allocator will ask directly.
84%
Coverage
16 answered0 partial3 gaps19 questions
Economics
- What is the preferred return (hurdle) rate offered to LPs?Preferred return of 8%.Answered
- What is the LP/GP carried-interest split above the preferred return?50% LP / 50% GP residual split.Answered
- Is there a GP catch-up, and at what rate?No GP catch-up.Answered
- Does the fund have a GP clawback provision?No clawback provision disclosed.Answered
- What is the GP's capital commitment (skin in the game)?GP commitment of 0%.Answered
Structure
- What distribution-waterfall structure does the fund use?Waterfall type: Pref then 50/50 split (Class B / Class A).Answered
- What is the fund's investment strategy / asset class?Equity · Mobile Home ParksAnswered
- What is the fund's vintage year?Vintage 2011.Answered
- What is the target offering size?Target offering of $5,000,000.Answered
- What is the minimum LP investment?Minimum investment of $50,000.Answered
- Are investor subscriptions protected by a minimum-offering escrow?Subscriptions are held in escrow until a minimum is met.Answered
- Is the securities-offering exemption and investor-eligibility standard disclosed?Offering exemption disclosed (accredited).Answered
Fees & Expenses
- Is the fund's fee schedule disclosed (management fee, etc.)?4 fee line item(s) extracted from the offering documents.Answered
Governance
- Does the fund engage an independent auditor?Gap
- Does the fund use a third-party fund administrator?Gap
- Do investors have the right to remove the manager / general partner?The PPM states investors have NO right to remove the manager.Answered
- Are material amendments to the operating agreement subject to investor consent?Amendments require an investor supermajority.Answered
- Is there a key-person provision?Gap
Distributions
- Is the fund's distribution policy disclosed?Distribution policy stated (annual).Answered
Fee scheduletaken before LP distributions
Modeled load 42.5% of equity over a 5-yr base caseFee
Trigger
Basis
Rate
Acquisition/Administrative Fee
At closing of each property acquisition
Total acquisition cost of property (inclusive of financing)
5.00%
Guaranty Fee
One-time, when Member or Affiliate guarantees Company obligations
Total amount of obligations guaranteed
2.50%
Placement/Referral Fee
Upon investor subscription via referral
Capital Contributions of referred Class B Member
7.00%
Service providers3 gaps
Legal Counsel
Not disclosed
No independent counsel named for investors. Common in small syndications where Manager and Fund share counsel — reduces independence. Verify during diligence.
Auditor
Not disclosed
Audit intent not stated in PPM. Ask the sponsor: will the fund be audited, by whom, and on what frequency?
Fund Administrator
Not disclosed
No third-party fund administrator referenced. Manager likely handles admin internally — common for <$10M raises but reduces independence.
Placement Agent
No placement agent engaged
No placement agent engaged. Direct placement by Manager — no placement fees eat your invested capital.
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