Pick how composites are weighted for you. Affects every score across the app.
Sponsored by RealyInvest·
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.
Drafting defects found in the PPM prose — numeric inconsistencies, broken cross-references, unfilled placeholders, and defined-term problems. Each is shown with the offending quote and its page.
REIT election described as commencing with a short taxable year ending December 31, 2015 — impossible for an entity formed March 17, 2020, and contradicts the December 31, 2021 election year stated elsewhere.
“The NNN-1 Series intends to elect and qualify to be taxed as a REIT under the Internal Revenue Code, commencing with its short taxable year ending December 31, 2015.”
The $20.00 per-share derivation uses a property purchase price of 1,570,851 and 78,543 Shares, contradicting the $1,971,200 purchase price and 98,560 Total Maximum Shares used throughout the rest of the circular.
“the purchase price of the NNN-1 Property of 1,570,851 (ii) Offering Expenses and (iii) the Acquisition Expenses divided by ... the number of the 78,543 Shares sold in each Offering.”
Same REIT election year stated two different ways: 'taxable year ending December 31, 2015' (tax section) versus 'taxable year ending December 31, 2021' on the cover/summary.
“commencing with its short taxable year ending December 31, 2015. || We intend for the NNN-1 Series to elect and qualify to be taxed as a REIT under the Internal Revenue Code commencing with its taxable year ending December 31, 2021.”
Tax-treatment discussion again references electing REIT status 'beginning with our 2015 taxable year', impossible for a March 2020 entity and inconsistent with the December 31, 2021 election year.
“the NNN-1 Series intends to elect to be taxed as a REIT beginning with our 2015 taxable year, and to adopt December 31 as its taxable year-end and thereby satisfy this requirement.”
Cover description places the NNN-1 Property in La Porte, IN with a stray closing bracket after 'Starbucks Corporation', contradicting the Marietta, Ohio location used throughout — apparent leftover from a different deal template.
“subject to a double net lease with Starbucks Corporation], located in La Porte, IN, (the 'NNN-1 Property').”
Forecasted balance sheet shows a Credit Facility / total liabilities of $1,973,200, but footnote (5) and the purchase price state the Credit Facility is $1,971,200.
“Credit Facility from related party $ 1,973,200 ... Total liabilities $ 1,973,200(4) || Interest expense on $1,971,200 Credit Facility presumes no principal reduction.”
Lease/agreement expiration date is stated as November 31, 2030 — an impossible date, as November has only 30 days.
“Expiration Date of Agreement November 31, 2030”
The Company's formation is stated as 'December 2019' in the management discussion, but as 'March 17, 2020' on the cover, in the summary, and in the audited financial statements.
“The Company and each Series were recently formed in December 2019 and have not generated any revenues || We were formed as a Delaware series limited liability company on March 17, 2020.”
Misspelling of 'ACCOUNTING' as 'ACCOOUNTING' in the financial-statement note heading.
“NOTE 2: SUMMARY OF SIGNIFICANT ACCOOUNTING POLICIES”
Misspelling of 'business' as 'businesss' (triple s) in a REIT tax risk factor.
“Legislative or regulatory tax changes related to REITs could materially and adversely affect our businesss.”
Misspelling of 'daily' as 'dailyu' in the offering-period mechanics describing how Closings are conducted.
“the Manager shall conduct dailyu Closings on the until the Offering of such Series is terminated”
The defined term 'FATCA' is misspelled 'FACTA' within the same FATCA withholding paragraph that elsewhere spells it correctly.
“are not subject to FACTA withholding, however.”
'in whole or in part' mis-rendered as 'in whole or in party' in the Credit Facility prepayment bullet.
“The Series may prepay the Credit Facility, in whole or in party, at any time.”
'lessees' misspelled as 'lessess' (twice) in the risk-factor text on tenant/guarantor financials.
“many of the lessess and/or corporate guarantors(as applicable) are publicly traded companies. In such cases, the financial information of such lessess is more important”
Broken word — 'made in' rendered as 'mad ein' in the compulsory-redemption provision.
“Any such redemption shall be mad ein accordance with the Company's Repurchase Plan”
Questions a standard diligence questionnaire would ask that the PPM leaves unanswered.
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.
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.
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.
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.
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.
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.
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.
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.
What allocators are saying. Diligence notes, open questions, attached scenarios.
Be the first allocator to leave a take.