Property Income Trust LLC

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 (13 · 5 high/critical)

• critical
  Numeric inconsistency — Note 4 capital-transaction distribution splitWithin a single sentence of audited Note 4, ordinary-operations distributions are stated 90% to Investors / 10% to Manager, but capital-transaction distributions are stated 90% to Management Shares / 10% to Investor Shares — an inverted split that contradicts the 90% Investors / 10% Manager economics used throughout the body and reverses who receives capital-event proceeds.
• 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.
• 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 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.
• medium
  Disposition Fee (1%) is taken above the waterfallA performance- or transaction-linked fee paid above the waterfall reaches the GP before the LP's distribution priorities run, eroding the pool the pref + return-of-capital draw from. Routine asset-management fees above the line are normal; a disposition/promote-flavored fee there is a leak worth pricing.
• medium
  Numeric inconsistency — 5,000,0000 Management SharesThe Management Share count is written as '5,000,0000' (eight digits, an extra zero) in multiple balance-sheet and equity captions, contradicting the '5,000,000' figure stated in Note 4 and the equity statements — a malformed number that overstates authorized/issued shares tenfold as written.
• low
  Numeric inconsistency — Member's Equity balance at September 30, 2016In the Statement of Changes in Member's Equity, the 'Balance at September 30, 2016' row shows Accumulated Deficit of $(1,140) but a Member's Equity total of $(1,040) on the same line, a $100 internal mismatch (the opening 1/1/2016 balance correctly shows $(1,140)/$(1,140)).
• low
  Numeric inconsistency — Total Liabilities (audited 12/31/2016)The audited balance sheet (F-15) reports Total Liabilities of 51,660 (10,379 + 41,281), but the unaudited comparative balance sheet (F-25) restates the same 12/31/2016 Total Liabilities as 51,650, a $10 discrepancy that does not foot to its own components.
• info
  Spelling / typo — ACTIIVITIESThe cash-flow statement header misspells 'ACTIVITIES' as 'ACTIIVITIES' (doubled I) in substantive financial-statement text.

DDQ readiness — 38% covered

5 answered · 1 partial · 7 gaps of 13 standard questions.