# EDGAR Filing Document

**Accession Number:** 0001699573
**File Stem:** 0001493152-23-006704
**Filing Date:** 2023-3
**Character Count:** 22919
**Document Hash:** c73050aa408b9874ebf76dca5dbeeb21
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-23-006704.hdr.sgml**: 20230303

**ACCESSION NUMBER**: 0001493152-23-006704

**CONFORMED SUBMISSION TYPE**: 1-U

**PUBLIC DOCUMENT COUNT**: 8

**CONFORMED PERIOD OF REPORT**: 20230303

**ITEM INFORMATION**: Other Events

**FILED AS OF DATE**: 20230303

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** RealtyMogul Apartment Growth REIT, Inc.
- **CENTRAL INDEX KEY:** 0001699573
- **STANDARD INDUSTRIAL CLASSIFICATION:** REAL ESTATE INVESTMENT TRUSTS [6798]
- **IRS NUMBER:** 815263630
- **STATE OF INCORPORATION:** MD
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 1-U
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 24R-00097
- **FILM NUMBER:** 23705874

**BUSINESS ADDRESS:**
- **STREET 1:** 10573 W PICO BLVD
- **STREET 2:** PMB #603
- **CITY:** LOS ANGELES
- **STATE:** CA
- **ZIP:** 90064
- **BUSINESS PHONE:** (877) 781-7153

**MAIL ADDRESS:**
- **STREET 1:** 10573 W PICO BLVD
- **STREET 2:** PMB #603
- **CITY:** LOS ANGELES
- **STATE:** CA
- **ZIP:** 90064

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** MogulREIT II, Inc.
- **DATE OF NAME CHANGE:** 20170303

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 1-U**

**CURRENT REPORT**

**Pursuant to Regulation A of the Securities Act of 1933**

**March 3, 2023**

(Date of Report (Date of earliest event reported))

**RealtyMogul Apartment Growth REIT, Inc.**

(Exact name of issue as specified in its charter)

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| | |
|:---|:---|
| **Maryland** | **81-5263630** |
| (State or other jurisdiction | (I.R.S. Employer |
| of incorporation or organization) | Identification No.) |

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**10573 W Pico Blvd, PMB #603**

**Los Angeles, CA, 90064**

(Full mailing address of

principal executive offices)

**(877) 781-7153**

(Issuer's telephone number, including area code)

**Common Stock**

(Title of each class of securities issued pursuant to Regulation A)

**Item 9. Other Events.**

On March 3, 2023, RealtyMogul Apartment Growth REIT, Inc. issued an investor communication relating to the quarter ended December 31, 2022. The text of the investor communication is set forth below.

Q4 2022\*

To discuss your REIT holdings, schedule a Call with Investor Relations at:

https://calendly.com/realtymogul-investor-relations or call 877-781-7062

REALTYMOGUL APARTMENT GROWTH REIT

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| | | |
|:---|:---|:---|
| OFFERING OVERVIEW | TOTAL ASSET VALUE<sup>1</sup> | $208000000 |
|  | NUMBER OF INVESTMENTS<sup>2</sup> | 6 |
| RealtyMogul Apartment Growth REIT is a non-traded REIT, investing in value-add multifamily apartment buildings with both preferred and joint venture equity, with a focus on providing capital appreciation to investors. | TOTAL NUMBER OF MULTIFAMILY UNITS<sup>2</sup> | 1149 |
|  | LAST TWELVE MONTHS TOTAL RETURN<sup>3</sup> | 12.0% |
|  | Q4 ANNUALIZED DISTRIBUTION RATE<sup>4</sup> | 4.5% |
|  | DISTRIBUTION FREQUENCY | Quarterly |
|  | TAX REPORTING FORM | 1099-DIV |
|  | CONSECUTIVE DISTRIBUTIONS<sup>4</sup> | 20 Quarters |

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**KEY OBJECTIVES**

● To realize capital appreciation
 in the value of our investments over the long term

● To pay attractive and stable cash distributions.

**PORTFOLIO STATISTICS<sup>5</sup>**

![](form1-u_001.jpg)

\*All data as of December 31, 2022 unless otherwise specified.

<sup>1</sup> Aggregate value of all underlying properties in RealtyMogul Apartment Growth REIT, Inc. based on the most recent internal valuations as of the end of the fiscal quarter upon which our most recently announced net asset value ("NAV") per share is based pursuant to our valuation policies; provided, however, the value of properties underlying investments acquired since the effective date of the most recently announced NAV per share is based on the most recent purchase price of such properties. 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 *"Description of Our Common Stock – Valuation Policies"* section of our offering circular**.**

<sup>2</sup> Based on the current outstanding investments as of March 3, 2023.

<sup>3</sup> Returns 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 RealtyMogul Apartment Growth REIT's distribution reinvestment plan, are derived from unaudited financial information and are net of all RealtyMogul Apartment Growth REIT expenses, including management fees. An individual stockholder's total return may vary from the total return, and there is no assurance that stockholders 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. Additional return metrics can be found at the RealtyMogul website.

<sup>4</sup> There is no guarantee that stockholders will receive a distribution, and distributions have been paid from net proceeds from our offering, cash advances by our Manager, cash resulting from a waiver of fees or reimbursements due to our Manager, borrowings in anticipation of future operating cash flow and the issuance of additional securities.

<sup>5</sup> Based on the original real estate investment amounts as of March 3, 2023.

MARKET UPDATES

VIEWS FROM MANAGEMENT

Dear Investor,

Thank you for your continued support of RealtyMogul Apartment Growth REIT. We have now provided ***<u>20 consecutive quarters of distributions</u>***, totaling over $9,400,000. To date, over 3,400 investors have invested, and RealtyMogul Apartment Growth REIT holds investments in over $208 million<sup>6</sup> of real estate. We are also happy to share that as of January 2023, approximately 70% of investors have enrolled in the distribution reinvestment plan (the "DRIP"), allowing for their distributions to compound over time. If you would like to participate in the DRIP, simply log into your account and then select "Reinvest Distributions."

We are proud to share that the RealtyMogul Apartment Growth REIT achieved a total return of 12.0% over the last twelve months, with average daily distributions over the last twelve months equating to 4.8%.<sup>7</sup> Total return consists of two components: change in NAV per share and distributions. For Q4 2022, NAV per share decreased from $11.36 to $11.18, reflecting a 1.6% decrease quarter over quarter. Distributions for Q4 2022 reflected an approximately 4.50% annual distribution rate based on a $11.36 NAV per share. NAV per share decreased largely due to softness in the multifamily sector during the second half of 2022 as the cost of debt capital (increase in interest rates) has put downward pressure on property valuations. As we head into 2023, we believe multifamily fundamentals are still strong, and we are hopeful that the decreased pricing will provide us more buying opportunities this year.

We continue to seek a diversified portfolio of multifamily real estate investments to provide stockholders exposure to the multifamily real estate market through their investment in RealtyMogul Apartment Growth REIT.<sup>8</sup> As of March 2023, RealtyMogul Apartment Growth REIT has six investments spread across five markets. Since 4Q21, we have sold three investments that were consolidated on our balance sheet and two investments in which we had minority positions, which sales resulted in an aggregate of $138,325,000 of property value upon exit.<sup>9</sup>

<sup>6</sup> Aggregate value of all underlying properties in RealtyMogul Apartment Growth REIT, Inc. 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 properties underlying investments acquired since the effective date of the most recently announced NAV per share is based on the most recent purchase price of such properties. 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 *"Description of Our Common Stock – Valuation Policies"* section of our offering circular.

<sup>7</sup> Returns 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 RealtyMogul Apartment Growth REIT's distribution reinvestment plan, are derived from unaudited financial information and are net of all RealtyMogul Apartment Growth REIT expenses, including management fees. An individual stockholder's total return may vary from the total return, and there is no assurance that stockholders 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. Additional return metrics can be found at the RealtyMogul website.

<sup>8</sup> An investment in RealtyMogul Apartment Growth REIT, Inc. is not a direct investment in commercial real estate.

<sup>9</sup> Certain fees were paid to RM Adviser and its affiliates in connection with such sales. Such fees were paid by the special purpose entities in which we invested and not by us; we are not entitled to these fees.

During Q4 2022, rent collections for the properties in RealtyMogul Apartment Growth REIT's portfolio averaged 93%, a 1% decrease quarter over quarter.<sup>10</sup> Our portfolio consists entirely of multifamily properties, which we believe is an economically resilient asset type that offers optimal risk-adjusted returns.

In 2022, 100% of our distributions were classified as capital gains income.<sup>11</sup> Distributions were classified as such because the REIT sold properties which resulted in capital gains. As a REIT investor, you are entitled to capital gains treatment and tax rate on asset sales done by the REIT.

During Q4 2022, the U.S. Bureau of Economic Analysis estimated that U.S. seasonally adjusted real GDP decreased 0.3% quarter over quarter. The Federal Reserve updated its forecast for 2023 growth in the nation's GDP from the 1.2% it projected in September 2022 to 0.5% as well as projected a 4.6% unemployment rate for 2023, up from the September 2022 estimate of 4.4%. The unemployment rate ended 2022 at 3.7%. Average hourly earnings for employees increased 7.4% year over year according to the U.S. Bureau of Labor Statistics. In addition, the Consumer Price Index ("CPI") rose year over year 7.7% in October, 7.1% in November, and 5.6% in December according to the U.S. Bureau of Labor Statistics. Shelter costs, which comprise approximately one-third of CPI, increased 7.0% year over year. Given the economic inflation, the Federal Reserve has taken steps to cool off the economy by increasing the Federal Funds Rate, the rate at which commercial banks borrow and lend their excess reserves to each other overnight, seven times in 2022 and one time in 2023 from a target rate of 0.00% to 0.25% to the current target rate of 4.50% to 4.75%. The Federal Reserve is reducing their balance sheet through quantitative tightening, allowing bonds to mature without reinvestment of the principal. As it relates to real estate purchases, the cost to finance a real estate investment with a mortgage has increased in each quarter of 2022, stabilizing in Q4 2022; however, we believe that real estate is positively correlated with inflation as property prices and rental income tend to rise as inflation rises. We like multifamily investments in an inflationary environment as the typical one-year lease term allows an owner to mark rents to market on an annual basis. We believe that RealtyMogul Apartment Growth REIT is well positioned as it continues to seek a diversified portfolio of multifamily real estate, which has a low or negative correlation to other major asset classes and over time has exhibited less volatility than other asset classes.<sup>12</sup>

<sup>10</sup> Data as of March 3, 2023.

<sup>11</sup> 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 our Manager, cash resulting from a waiver of fees or reimbursements due to our Manager, borrowings and the issuance of additional securities.

<sup>12</sup> Commercial real estate performs differently than other asset classes, such as stocks or bonds, and lacks liquidity. An investment in RealtyMogul Apartment Growth REIT, Inc. is not a direct investment in commercial real estate.

INVESTMENT UPDATES

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| | |
|:---|:---|
| BROOKLYN PORTFOLIO | VILLAS DEL SOL I & II (FKA PLANO<br> MULTIFAMILY PORTFOLIO)<br>|
| ![](form1-u_002.jpg)<br>| ![](form1-u_003.jpg)<br>|
| <br> **Location:** Brooklyn, NY<br>**Equity Investment:** $3,000,000<br>**Business Plan:** Acquire nine rent-stabilized properties, maximize occupancy and increase rents as allowed.<br>**Investment Type:** Joint Venture Equity<br>**Acquisition Date:** 11/30/2017<br>**Asset Management Update:** Portfolio occupancy was static quarter over quarter, ending Q4 at 98%, with two vacant units in the 112-unit portfolio. The real estate company has been leasing, and will continue to lease, units according to the legal rents set by the New York Rent Guidelines Board. The property averaged 95% rent collection for Q4 2022. | <br> **Location:** Plano, TX<br>**Equity Investment:** $1,000,000<br>**Business Plan:** Acquire and renovate a portfolio of garden-style apartment buildings.<br>**Investment Type:** Joint Venture Equity<br>**Acquisition Date:** 01/09/2018<br>**Asset Management Update:** Portfolio occupancy was static quarter over quarter, ending Q4 at 95% occupied. 63 of the 156 units have been upgraded with new flooring, appliances, backsplash, and lighting packages. Exterior and common area improvements are complete, and the property is amenitized with an improved leasing office, gazebos, BBQ grills, an upgraded laundry room and soccer court. The property averaged 97% rent collection for Q4 2022. |

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| | |
|:---|:---|
| NINETY-NINE44 APARTMENTS<br>![](form1-u_004.jpg)<br>**Location**: Dallas, TX<br>**Equity Investment:** $4,000,000<br>**Business Plan:** Acquire and renovate a garden-style apartment community.<br>**Investment Type:** Joint Venture Equity<br>**Acquisition Date:** 9/9/2020<br>**Asset Management Update:** Property occupancy increased 2% quarter over quarter, ending Q4 at 96% occupied. As of December 2022, the real estate company renovated 53 units. Of those 53 units, 52 have been leased and have achieved an average premium of $167/month, or 19% over prior rents. The real estate company has completed exterior capex work, including landscaping, parking lot repairs, parking lot restriping, trip hazard repairs, laundry room improvements and fitness center improvements. The real estate company plans to improve the fans, lighting, and air conditioning for the fitness center as well as playground and private yard improvements in the coming quarters. The property averaged 92% rent collection for Q4 2022. | THE ORION<br>![](form1-u_005.jpg)<br>**Location**: Orion Township, MI<br>**Equity Investment:** $5,000,000<br>**Business Plan:** Acquire and renovate a garden-style apartment community.<br>**Investment Type:** Joint Venture Equity<br>**Acquisition Date:** 3/23/2021<br>**Asset Management Update:** Property occupancy decreased 3% quarter over quarter, ending Q4 at 93% occupancy. As of December 2022, 90 of the 200 units have been renovated since acquisition. Of those 90 units, 89 have been leased and have achieved an average premium of $336/month, or 22% over prior rents. Exterior improvements continue to progress as the clubhouse remodel, BBQ area, new exterior paint, new signage, new dog park, and parking lot projects have been completed. Improvements to the playground area are underway. Based on current bids, exterior improvements are expected to be completed below budget. The property averaged 94% rent collection for Q4 2022. |

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|:---|:---|
| LOTUS VILLAGE<br>![](form1-u_006.jpg)<br>**Location**: Austin, TX<br>**Equity Investment:** $2,500,000<br>**Business Plan:** Acquire and renovate a low-rise apartment community.<br>**Investment Type:** Joint Venture Equity<br>**Acquisition Date:** 6/25/2021<br>**Asset Management Update:** Property occupancy increased 1% quarter over quarter, ending Q4 at 95% occupancy. As of December 2022, 54 of the 222 units have been renovated since acquisition. Of those 54 units, 46 have been leased and have achieved an average premium of $359/month, or 28% over prior rents. The real estate company has completed capex work, including fitness center renovations, pool repairs, signage enhancement, BBQ area updates, dog park updates, landscaping, and garage repairs. Exterior repairs are underway, including gutter repairs and exterior lighting. The property averaged 83% rent collection for Q4 2022. | SHERWOOD OAKS<br>![](form1-u_007.jpg)<br>**Location**: Riverview, FL<br>**Equity Investment:** $4,200,000<br>**Business Plan:** Acquire and renovate a garden-style apartment community.<br>**Investment Type:** Joint Venture Equity<br>**Acquisition Date:** 11/30/2021<br>**Asset Management Update:** Property occupancy increased 3% quarter over quarter, ending Q4 at 95% occupancy. The capital improvements budget includes exterior work as the prior owner previously renovated all unit interiors. Exterior renovations continue to progress with the dog park, pool, parking lot, wastewater facility, fitness center, and outdoor amenities completed. Other improvements have commenced, including improvements to the landscaping and lighting. The property averaged 97% rent collection for Q4 2022. |

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INVESTMENT ACTIVITY

DISTRIBUTIONS

RealtyMogul Apartment Growth REIT has declared distributions for 20 consecutive quarters. The board of directors authorized a distribution for each month of the fourth quarter of 2022 on September 29, 2022. Exclusive of special distributions, distributions have been paid on a quarterly basis since January 1, 2018 and equate to approximately 4.5% on an annualized basis based upon the then current per share purchase price.

NET ASSET VALUE (NAV)

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| | |
|:---|:---|
| PRICE PER SHARE (AS OF 1/10/23)<sup>\*</sup> | NAV PER SHARE (AS OF 12/31/22) |
| $11.18 | $11.18 |

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\*Our offering price per share equals our most recently announced NAV per share and will be adjusted at the beginning of every fiscal quarter (or as soon as commercially reasonable thereafter). On January 10, 2023, we announced that our NAV per share is $11.18, as of December 31, 2022. Accordingly, effective January 10, 2023, the offering price per share is $11.18. The price per share pursuant to our distribution reinvestment plan will equal our most recently announced NAV per share and any repurchases of shares made pursuant to our share repurchase program will be made at the most recent NAV per share (less any applicable discounts, as set forth in our offering circular).

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 stockholder would obtain if he, she or it tried to sell his, her or its shares or (iii) the amount per share stockholders would receive if we liquidated our assets and distributed the proceeds after paying all our expenses and liabilities.

*Copyright© 2022 RM Adviser, LLC, All rights reserved.*

**Previous Updates**

Please follow the below links to access updates from the prior four quarters. Historical quarterly updates can also be found on the SEC EDGAR website.

[Q3 2022 Shareholder Letter](https://www.sec.gov/Archives/edgar/data/1699573/000149315222033597/form1-u.htm)

[Q2 2022 Shareholder Letter](https://www.sec.gov/Archives/edgar/data/1699573/000149315222023359/form1-u.htm)

[Q1 2022 Shareholder Letter](https://www.sec.gov/Archives/edgar/data/1699573/000149315222015371/form1-ua.htm)

[Q4 2021 Shareholder Letter](https://www.sec.gov/Archives/edgar/data/1699573/000149315222006200/form1-u.htm)

As always, please feel free to contact us at info@realtymogul.com or call directly with any questions you may have.

Sincerely,

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| | |
|:---|:---|
| */s/ Jilliene Helman* | */s/ Eric Levy* |
| Jilliene Helman | Eric Levy |
| CEO, RM Adviser, LLC | Vice President, Portfolio Manager, RM Adviser, LLC |

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***<u>Forward-Looking Statements</u>***

*This Current Report on Form 1-U contains forward-looking statements within the meaning of the federal securities laws. The words "believe," "estimate," "expect," "anticipate," "intend," "plan," "seek," "may," "continue," "could," "might," "potential," "predict," "should," "will," "would," and similar expressions or statements regarding future periods or the negative of these terms are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results, to differ materially from any predictions of future results, performance or achievements that we express or imply in this Current Report on Form 1-U.*

**SIGNATURES**

Pursuant to the requirements of Regulation A, the issuer has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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| | |
|:---|:---|
| **REALTYMOGUL APARTMENT GROWTH REIT, INC.** | **REALTYMOGUL APARTMENT GROWTH REIT, INC.** |
| By: | */s/ Jilliene Helman* |
| Name: | Jilliene Helman |
| Title: | Chief Executive Officer and President |
| By: | */s/ Eric Levy* |
| Name: | Eric Levy |
| Title: | Vice President, Portfolio Manager, RM Adviser, LLC |
| Date: | March 3, 2023 |

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