Hayworth Tanglewood

Houston multifamily. Crew/KHCA leftover-IB. Bought 30 Jun 2022 for $105.5 million. Capital Square webinar target with Vintage, Walk, and One on 4th.

Offering

The PSA is dated 11 Apr 2022 (exhibit). Seller TDC Tanglewood Real Estate Owner, L.L.C.; buyer Versity Invest. Purchase price $105,500,000. DST formed 31 May 2022. Trust Agreement 29 Jun 2022. Closed 30 Jun 2022 at that same price.

The PPM is dated 7 Jul 2022, a week after close. Sponsor named: Versity Invest. WealthForge is the exclusive managing BD. Load 9.30%. Acquisition fee $4,747,500 to the sponsor. Maximum Offering Amount $76,767,365, matching Form D. The VIP Bonds circular later lists up to $77,578,947. Occupancy about 92% as of 27 Jun 2022 (PPM); the circular says about 81% as of 30 Jun 2023.

First mortgage $48,000,000 from TC Debt Opportunities, LLC. 5.25%. Seven years from 30 Jun 2022 with a one-year extension option (1% fee). Interest-only the first four years, then 30-year amortization. The circular uses the same coupon and principal and does not name the lender; it dates the loan through 30 Jun 2029 and interest-only through 31 Jul 2026. PPM is the named-lender record.

Same-day master lease: DST to Hayworth Tanglewood LeaseCo. Original term 7 years 3 months, then three five-year autos unless the tenant opts out. Base Rent is the note payments, paid to the lender. Year-1 Stated Rent $3,070,695. Bonus Rent is 50% of total operating income above the year-1 threshold $9,148,179. Book & Ladder exclusive PM at 2.5% of Monthly Gross Revenues. Tanya Muro signed both sides of the PMA.

PPM exit: the Signatory Trustee may sell or run a 721: cash at independent appraisal or OP units. The trustee canvasses investors and is not bound. No investor vote on a sale.

Form D listed no first sale and no Item 12 recipients. The PPM still names WealthForge as exclusive managing BD.

Bridge

The IB complaint puts the capital contribution at $58,959,026.60: bridge lender $50,089,148.27 plus EquityCo $8,869,878.33. The PPM states the $50.09 million slice. Complaint fn 3 says the EquityCo slice cannot be returned until the bridge lender is fully repaid. The 15 Jan 2026 opinion recites “over $58 million.” Default on the revolving facility, including a loan unrelated to Hayworth, may require Hayworth syndication proceeds to pay that facility. The revolving mezz is named Crayhill in the circular. The complaint defines the bridge lender as Knights Hill Ireland II DAC and KHCA Funding LLC. Allegations as to how the money was later used.

Same-day 30 Jun 2022 side letter (complaint Exhibit D): LeaseCo pays excess revenue and the disposition / financing / construction fees to Hayworth Tanglewood IB until Full Redemption. KHCA Funding LLC, as administrative and collateral agent, and the lenders are express third-party beneficiaries. $100,000 working-capital withhold if no event of default.

As of 30 Jun 2023 the circular says 33.32% of interests remained. Sponsor disclosure. The IB complaint alleges redemption over three to six months; about $37.7 million of about $77.9 million sold; about $20.1 million of allocated net proceeds paid to the bridge lender; about $17.6 million sold without a matching redemption, so the IB still holds no less than 60%; and that selling interests without redeeming the IB created more beneficial interests than the PPM contemplated. PPM offering $76,767,365; circular up to $77,578,947; complaint about $77.9 million. Listed about 8 May 2025 at $88 million; the complaint alleges at least three best-and-final offers as of filing.

Litigation

Stay denied 15 Jan 2026 in C.A. 2025-0748-SEM; defense counsel later withdrew. The IB seeks a declaration it retains no less than 60%, a constructive trust over the DST, and an injunction against distributing sale proceeds. Allegations. Opinion names the NY KHCA action as the parallel $56 million bridge-lender case.