In general, the Company engages in the business of providing investment advisory services relating
to the acquisition, management and disposition of real estate and real estate related investments,
which advisory services include: (i) rendering advice with respect to direct and indirect investments
in real estate and real estate related assets; (ii) providing advice regarding the financing and structure
of real estate investments; (iii) rendering advice regarding debt refinancing and/or restructuring in
connection with real estate investments; (iv) providing investment management decisions with
respect to the formation and management of real estate investment trusts; (v) advising clients
regarding purchase and/or sale of mortgages, including ongoing evaluation of investments in and
obligations relating to those mortgages; and (vi) providing cash management services with respect
to clients’ investments, including, but not limited to, investments in bank certificates of deposits,
investment grade commercial paper, and U.S. Treasury securities. In addition, the Company, from
time to time, participates in, either on a principal or agency basis, the formation and sale through
private placements or public offerings of interests in limited partnerships or other entities formed
for the primary purpose of acquiring real estate related investments. To the extent the Company
acts as a principal in connection with such transactions, no interest in any such entity would be sold
to a client without disclosing to such client in writing before the completion of any such transaction
the capacity in which the Company is acting and obtaining the client’s consent to such transaction.
The Company has full discretionary authority with respect to investment decisions, and its advice
with respect to the Funds is tailored according to the investment objectives, guidelines, and
requirements as set forth in each Fund’s respective offering memoranda and advisory agreement.
A mandate of each Fund is to invest primarily in real estate and real estate-related investments.
The Company has been in business since 1986, and has been registered with the SEC as an
investment adviser since 1994. The Company is primarily owned by DRA Holdings LLC. DRA
Advisors, Inc. owns approximately 66.4% of DRA Holdings, LLC. David Luski is a principal
owner of DRA Advisors, Inc. As of December 31, 2018, the Company advised approximately
$10,793,098,653 in regulatory assets under management (“RAUM”) on a discretionary basis for 10
private pooled investment vehicles.
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The Company’s fees are generally negotiable, taking into consideration the nature of the
representation and anticipated investment advisory services for a client. In this regard, the Company
typically charges an asset management fee at an annual rate ranging from 0.6 to 0.9% of the gross
acquisition cost of the assets and securities under management. Clients co-investing with existing
Funds, or investing on a separate account basis, may be subject to alternative and/or reduced fee
structures on a case-by-case basis. The asset management fee is computed and payable quarterly in
arrears, commencing with the calendar quarter in which the first investment is made by a client.
Generally, all fees are deducted directly from client bank accounts.
The Company may charge a capital markets fee of up to 0.5% based on gross proceeds of the sale
or financing of real estate assets, and has charged such fees in the past. Furthermore, the Company
in some transactions is reimbursed for, among other things, organization and offering expenses
incurred by it with respect to any pooled investment vehicles (including limited partnerships and/or
limited liability companies) or other entities sponsored or advised by the Company. Transaction-
based fees may present a conflict of interest in that they may be viewed as giving the Company an
incentive to purchase investments based on the transaction-based compensation received. The
Company has adopted and implemented written compliance policies and procedures that are
designed to address the above conflicts of interest.
As fully described in each Fund’s offering documents, each Fund bears expenses related to its
operations, including, without limitation, organizational costs, normal operating costs and
administrative expenses, and investment-related expenses. Normal operating costs and
administrative expenses may consist of, but may not be limited to, the following: expenses incurred
in connection with obtaining and negotiating any credit facility, monitoring real estate investments
and each Fund’s normal record keeping and reporting, including, but not limited to, entity-level
taxes, travel and other out of pocket expenses incurred by the officers and employees of the
Company’s affiliates in connection with the evaluation, negotiation, acquisition, operation,
maintenance, improvement, leasing or sale of proposed or existing real estate investments, but shall
specifically exclude internal expenses of each Fund GP (defined below), including compensation,
payroll taxes and related employee costs, rent and other overhead expenses of each Fund GP and
its affiliates. Investment and other costs may include, but are not limited to, the following: all
reasonable out of pocket and third party costs and expenses, including travel expenses, incurred in
connection with seeking and negotiating real estate investments and in consummating real estate
investments and custodial fees relating to the holding of real estate investments, the compensation
(including performance-based incentive fees) of joint venture partners and/or third-party operating
partners, appraisers’ costs, the cost of a Fund’s annual audit, and all extraordinary Fund expenses,
including the costs of amendments, if any, to the offering and organizational documents of any
Fund, all costs and expenses of the Members’ Board, and including all costs and expenses, including
attorneys’ fees and litigation costs, incurred in investigating, defending and settling any claim,
investigation, action or proceeding against or involving a Fund or incurred in the protection or
assertion by a Fund of any of its rights.
In addition, the Company may organize special purpose vehicles on behalf of clients for the purpose
of (a) making certain investments, including on a joint-venture basis and/or (b) incentivizing and
compensating operating partners. Each special purpose vehicle may be directly or indirectly and
wholly- or partially-owned by a client. Such special purpose vehicle may provide for a management
fee, development fee, other fees and/or incentive compensation (including carried interest) paid to
such operating partner or a related party of such operating partner. Neither the Company nor its
affiliates will participate directly or indirectly in any such fees or other consideration paid to
operating partners or their related parties.
Certain investment-related and other costs and expenses incurred by the Company on behalf of more
than one client are allocated by the Company among those clients according to methodologies that
the Company believes to be fair and reasonable. The allocation methodology applicable to a
particular cost or expense may be based on a variety of factors, including the investment phase of
each client, the gross or net assets under management of each client, the relative benefit to each
client of the cost or expense in question, the category or weighting of a particular type of Real Estate
Investment (e.g., office, residential, industrial) or other assets held by each client, the number of
investor representatives attending a particular meeting, or a combination of the foregoing.
Additional information on the Company’s expense allocation policy is available to investors upon
request.
If a client terminates the investment management agreement with the Company in the middle of a
billing period the Company will invoice the client for an amount that is pro-rated based on the
number of days that the account was managed.
The foregoing list and description are not exhaustive; Fund investors should review the applicable
offering materials and organizational documents for a more extensive description of the fees and
expenses associated with an investment in any client of the Company.
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In some transactions the Company (or Related Persons described in response to the Other Financial
Industry Activities and Affiliations section in this brochure) receives, if accrued, performance fees
(or specially allocated distributions in respect of equity interests) equal to 15% - 20% of
distributable proceeds in excess of the return to investors of their invested capital plus a “real” (i.e.,
inflation-adjusted) or nominal rate of return thereon of between 7% - 8% per annum. The fact that
the Company may be compensated with performance fees may create an incentive for the Company
to make investments on behalf of clients that are riskier or more speculative than would be the case
in the absence of such compensation. Further, investment advisers have an inherent conflict of
interest to favor clients or accounts that pay more in fees, such as performance fees. The Company
has adopted and implemented written compliance policies and procedures that are designed to
address the above conflicts of interest.
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The Company primarily provides discretionary investment management services to the Funds, as
described above.
The offering documents of each Fund sets forth the eligibility requirements and minimum
subscription amounts for investors in such Fund. The Company usually requires a minimum of
$1,000,000 in assets to establish an account. However, at its discretion, the Company may waive
the minimum amount of assets to establish an account. In some cases the required minimum has
ranged from $75,000 to $250,000.
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Investment Strategy
The Company has employed a value-added investment strategy over the past 32 years. The
Company’s investment philosophy is a conservative one, yet it is adaptive to changing market
conditions. The Company targets investments that offer competitive income returns and the
potential for capital appreciation. Preservation of capital, downside protection and stability of cash
flows underlie the Company’s investment approach.
The Company attempts to capitalize on inefficiencies in real estate markets to acquire high quality
operating assets at discounts to replacement cost. Such inefficiencies can result from i) taking
advantage of sellers’ strategic or financial motivations, ii) investing in markets or properties that
are perceived as out of favor by other investors, iii) leveraging industry relationships with both
private and public joint venture partners to access deals, and iv) utilizing Company’s financial
experience and resources to exploit pricing inefficiencies in complex transactions.
The Company’s dual expertise in both real estate operations and capital market dynamics are
important in the execution of the ownership plan. Value-enhancement strategies to improve an
investment’s potential for capital appreciation may include i) physical improvements to make
properties more marketable and efficient, ii) execution of leasing and operational plans to increase
revenues and minimize expenses, iii) focus on risk management and proactive asset management to
mitigate downside risk, iv) utilization of prudent leverage to enhance returns and optimize capital
structures, and v) opportunistic sale of assets when market conditions are optimal.
Risk of Loss
All investing involves a risk of loss that clients should be prepared to bear. The investment
strategies offered by the Company could lose money over short or long periods of time. Identifying
suitable assets for each client is difficult, and there are no assurances that the Company’s investment
strategies will succeed. The Company cannot give any guarantee that it will achieve Fund
investment objectives or that any Fund will receive a return of its investment.
Investors should ultimately refer to their Fund’s respective offering documents for detailed risk
disclosures that specifically address risks of each Fund’s investment strategies, methods of analysis,
and/or particular types of securities recommended. Below is a summary of potentially material
risks for each significant Company investment strategy used, the methods of analysis used, and/or
the particular type of security recommended.
• Risks of Investing in Real Estate and Real Estate-Related Investments - The Company will
be subject to all the risks inherent in investing in real estate and real estate-related
investments, which risks may be increased if the investment is leveraged. These risks may
include, without limitation, general and local economic and social conditions, neighborhood
values, the supply of, and demand for, properties of the type in which a Fund invests, the
financial resources of tenants, vandalism, vacancies, rent strikes, changes in tax, zoning,
building, environmental and other applicable laws, federal and local rent control laws, real
property tax rates, changes in interest rates and the availability of mortgage funds, any of
which may render the sale of properties difficult or unattractive. Such risks may also cause
fluctuations in occupancy rates, rent schedules and operating expenses, which could
adversely affect the value of real estate and real estate-related investments and materially
reduce the cash flow generated thereby. There can be no assurance of the profitable
operation of any property purchased by a Fund or the repayment of any debt investment
made by a Fund. Accordingly, a Fund’s investment objectives may not be realized. Certain
expenditures associated with real estate equity investment (such as property taxes, utility
costs, debt service, maintenance costs and insurance premiums) tend to increase and are not
generally decreased by events adversely affecting rental revenues. Thus, the cost of
operating a property may exceed the rental income therefrom, and a Fund may have to
advance funds in order to protect an equity investment or forego the payment of interest on
debt investments, or may be required to dispose of investments on disadvantageous terms if
necessary to raise needed funds. Moreover, while a Fund will generally purchase insurance
to cover casualty losses and general liability, such insurance may not be available or may be
available only at prohibitive costs to cover losses from ongoing operations and other risks
such as earthquakes, floods, acts of terrorism or environmental contamination.
• The Company routinely invests in multifamily properties, which subjects a Fund to
particular risks. The Company may invest in multifamily residential properties. A large
number of risk factors may affect the value and successful operation of such properties,
including: physical attributes of the property such as its age, condition, design, appearance,
access to transportation and construction quality; location of the property; ability of
management to provide adequate maintenance and insurance; the types of services or
amenities that the property provides; the property’s reputation; the level of mortgage interest
rates and availability of government incentives, which may encourage tenants to purchase
rather than lease housing; presence of competing properties; the tenant mix, such as the
tenant population being predominantly students or being heavily dependent on workers from
a particular business or personnel from a local industrial unit; adverse local or national
economic conditions, which may limit the amount of rent that may be charged and may
result in a reduction of timely rent payments or a reduction in occupancy levels; state and
local regulations, which may affect the building owner’s ability to increase rent to the level
of market rents for an equivalent apartment; government assistance/rent subsidy programs;
and the inventory of unsold condominium units in the local market that are being rented
until economic conditions in the condominium market improve. If any of such risk factors
are heightened or the conditions associated with such risk factors deteriorate, a Fund’s
investments in multifamily properties may incur losses.
In addition, certain jurisdictions regulate the relationship between an owner and its tenants.
Commonly, these laws require a written lease, good cause for eviction, disclosure of fees
and notification to residents of changed land use, while prohibiting unreasonable rules and
retaliatory evictions.
In addition to U.S. federal, state and/or local regulation of the landlord-tenant relationship,
some counties and/or municipalities impose rent control on apartment buildings. These
ordinances may limit rent increases to fixed percentages, to percentages of increases in the
consumer price index, to increases set or approved by a governmental agency or to increases
determined through mediation or binding arbitration.
• The Company routinely invests in office properties. There are a large number of risk factors
associated with investments in office properties, including the impact of macroeconomic
cycles on the local market and the building’s tenants; the quality of an office building’s
tenants; an economic decline in the businesses operated by the tenants; the physical
attributes of the building in relation to competing buildings (e.g., age, condition, design,
appearance, location, access to transportation and ability to offer certain amenities, such as
sophisticated building systems and/or business infrastructure requirements); the physical
attributes of the building with respect to the technological needs of the tenants, including
the adaptability of the building to changes in the technological needs of the tenants; the
diversity of an office building’s tenants (or reliance on a single or dominant tenant); the
availability of sublease space; the desirability of the area as a business location; the strength,
nature and unemployment rates of the local economy, including labor costs and quality, tax
environment and quality of life for employees; and an adverse change in population, patterns
of telecommuting or sharing of office space and employment growth (which creates demand
for office space). To the extent any of such risk factors are heightened or the conditions
associated with such risk factors deteriorate, a Fund’s investments in office properties may
incur losses.
• The Company routinely invests in retail properties, which subjects a Fund to particular risks.
The value and successful operation of a retail property is sensitive to a number of risk
factors, including, but not limited to: changes in consumer spending patterns, local
competitive conditions (such as the supply of retail space or the existence or construction of
new competitive shopping centers or shopping malls, including, for example, competition
between regional malls and local shopping centers and changing consumer preferences for
upscale outlet malls, big-box discount stores and price clubs); the bankruptcy or distress of
tenants; the availability of sublease space; alternative forms of retailing (such as direct mail,
video shopping networks and internet web sites, which reduce the need for retail space by
retail companies); the safety, convenience and attractiveness of the property to tenants and
their customers or clients; the public perception of the safety of customers at shopping malls
and shopping centers; the need to make major repairs or improvements to satisfy the needs
of major tenants; traffic patterns and access to major thoroughfares; and unemployment rates
in the local economy.
The general strength of retail sales also directly affects retail properties. If retail sales by
tenants in a Fund’s properties were to decline, the rents that are based on a percentage of
revenues may also decline, and tenants may be unable to pay the fixed portion of their rents
or other occupancy costs. The cessation of business by or bankruptcy of a significant tenant
can have a material adverse effect on a retail property, not only because of rent and other
factors specific to such tenant, but also because significant tenants at a retail property play
an important part in generating customer traffic and making a retail property a desirable
location for other tenants at such property.
• The Company routinely invests in industrial properties, which subjects a Fund to particular
risks. Significant factors determining the value of industrial properties are; the location of
the property (including proximity to supply sources and customers and accessibility to rail
lines, major roadways and other distribution channels and transportation routes); the quality
of tenants; a reduced demand for industrial space because of a decline in a particular industry
segment, property becoming functionally obsolete, building design and adaptability,
scarcity of labor sources, changes in access, energy prices, strikes, relocation of highways,
the construction of additional highways or other factors; changes in proximity of supply
sources; the expenses of converting a previously adapted space to general use; and the
location of the property. Concerns about the quality of tenants, particularly major tenants,
are similar in both office properties (as discussed above) and industrial properties, although
industrial properties may more frequently be dependent on a single or a few tenants.
A particular industrial or warehouse property that suited the needs of its original tenant may
be difficult to re-let to another tenant or may become functionally obsolete relative to newer
properties. Also, properties used for many industrial purposes are more prone to
environmental concerns than other property types. Further, because of unique construction
requirements of many industrial properties, many vacant industrial property spaces may not
be easily converted to other uses. Thus, if the operation of an industrial property becomes
unprofitable due to competition, age of the improvements or other factors, the liquidation
value of that industrial property may be substantially less than would be the case if the
property were readily adaptable to other uses.
• The Company routinely invests in Real Estate Investments comprised of properties under
development. Purchasing property prior to completion of development and construction, or
making loans relating to properties under development, is subject to greater risks than the
purchase of properties with operating histories or making loans relating thereto. In
connection with the purchase of or making loans with respect to properties under
development and construction, a Fund will be subject to certain risks, including, without
limitation, the risks of unanticipated delays in, or increases in the cost of, development and
construction as a result of factors beyond the control of a Fund and the Company. These
factors may include, but are not limited to, strikes, adverse weather, material shortages,
building restrictions, clearances, environmental impact studies, solvency of the contractor
or subcontractors and increases in the cost of labor and materials. In addition, the contractor
may not be able to build in conformity with plans and specifications, and the property may
not be rented for the amounts or within the time projected. Additional risks may be incurred
where a Fund makes periodic progress payments or other advances to contractors prior to
completion. The Company may be unable to recover such payments subsequent to any such
contractor’s default. Such factors can result in increased costs of a project and/or delay in
completion and/or loss of anticipated rental revenues and corresponding depletion of a
Fund’s working capital and reserves or loss of a Fund’s investment. Furthermore, the price
paid for a property upon which improvements are to be constructed or completed must of
necessity be based upon projections of rental income and expenses or of the fair market
value of the property upon completion of construction. Whether the property will operate
at such projected income and expense levels or achieve such projected fair market value
cannot be determined in most cases until after completion of construction and a number of
months of actual operation. To alleviate concentration risks, the offering documents of each
Fund generally require the Members’ Board to consent to any Real Estate Investment in a
property to be developed that is not substantially pre-leased (a “Development Asset”) that
would result in greater than twenty percent (20%) of the client’s aggregate available capital
being invested in Development Assets.
The risks described above are not a complete list of all risks associated with the described
investment strategy. Investors should refer to Fund offering documents for a more complete
description of the risks involved in a Fund investment.
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The Company and its employees have not been involved in any legal or disciplinary events in the
past 10 years that would be material to a client’s evaluation of the Company or its personnel.
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Several entities that are related persons of the Company are general partners or managing members,
as applicable, in limited partnerships or limited liability companies in which clients are solicited to
invest. The Company performs asset management functions on behalf of each of such limited
partnerships and limited liability companies. The Company and such general partners and
managing members are under common ownership.
The following entities are related persons of the Company that act as the general partners or
managing members, as applicable, of limited partnerships or limited liability companies in which
clients invest: Manageco CARS-G Co-Investment LLC; Manageco VI LLC; Manageco VII LLC
and Manageco VIII LLC; Manageco VIII-I LLC; Manageco IX LLC; Manageco IX Co-Investment
LLC (collectively, the “Fund GPs”).
The following entities are related persons of the Company that act as the general partners or
managing members, as applicable, of limited partnerships or limited liability companies which hold
direct or indirect interests in real property (collectively, “Real Estate Partnerships”), in certain of
which Real Estate Partnerships the Funds hold interests. David Luski, who is a control person and
an owner of the Company as disclosed in response to Schedule A, is an owner of various percentage
interests in each of the Fund GPs. Paul McEvoy, Brian T. Summers, Andrew E. Peltz, Jean Marie
Apruzzese, David Gray, Janine Roberts, Jason Borreo and Adam Breen who are owners of the
Company, are also owners of various percentage interests in Manageco CARS-G Co-Investment
LLC, Manageco VI LLC, Manageco VII LLC, Manageco VIII LLC, Manageco VIII-I LLC,
Manageco IX LLC and Manageco IX Co-Investment LLC each of which is a Fund GP.
Valla Brown, who is an owner of the Company, is also the owner of a percentage interest in
Manageco VI LLC, Manageco VII LLC and Manageco VIII LLC, Manageco VIII-I LLC,
Manageco IX LLC and Manageco IX Co-Investment LLC, each of which is a Fund GP.
Matthew Shore, Dean Sickles, who are the owners of the Company, are also owners of a percentage
interest in Manageco VII LLC and Manageco VIII LLC, Manageco VIII-I LLC, Manageco IX LLC
and Manageco IX Co-Investment LLC, each of which is a Fund GP.
Daniel Goldman is an owner of the Company, and is also owner of a percentage interest in
Manageco VIII LLC, Manageco VIII-I LLC, Manageco IX LLC and Manageco IX Co-Investment
LLC, each of which is a Fund GP.
Robert Hyman and Glen Besser who are the owners of the Company, are also owners of a percentage
interest in Manageco IX LLC and Manageco IX Co-Investment LLC, each of which is a Fund GP.
The Company performs investment advisory services on behalf of the Fund GPs in respect of the
Funds and Real Estate Partnerships.
As discussed above, Manageco CARS-G Co-Investment LLC is a related person of the Company.
Manageco CARS-G Co-Investment LLC is the managing member of DRA CARS-G Co-Investment
LLC, for which the limited liability company was established to invest in interests in predominantly
commercial properties. A client of the Company was solicited to invest in DRA CARS-G Co-
Investment LLC. David Luski, Paul McEvoy, Brian T. Summers, Andrew E. Peltz, Jean Marie
Apruzzese, Janine Roberts, David P. Gray, Adam Breen and Jason Borreo, who are owners of the
Company, are owners of various percentage interests in Manageco CARS-G Co-Investment LLC.
As discussed above, Manageco VI LLC is a related person of the Company. Manageco VI LLC is
the managing member of DRA Growth and Income Fund VI LLC, for which the limited liability
company was established to invest in interests in predominantly commercial properties. A client of
the Company was solicited to invest in DRA Growth and Income Fund VI LLC. David Luski, Paul
McEvoy, Brian T. Summers, Andrew E. Peltz, Jean Marie Apruzzese, Janine Roberts, David P.
Gray, Adam Breen, Jason Borreo and Valla Brown, who are owners of the Company, are owners
of the various percentage interests in Manageco VI LLC.
As discussed above, Manageco VII LLC is a related person of the Company. Manageco VII LLC
is the managing member of DRA Growth and Income Fund VII LLC, for which the limited liability
company was established to invest in interests in predominantly commercial properties. A client of
the Company was solicited to invest in DRA Growth and Income Fund VII LLC. David Luski,
Paul McEvoy, Brian T. Summers, Jean Marie Apruzzese, Andrew E. Peltz, Janine Roberts, David
P. Gray, Adam Breen, Jason Borreo, Valla Brown, Matthew Shore and Dean Sickles, who are the
owners of the Company, are owners of the various percentage interests in Manageco VII LLC.
As discussed above, Manageco VIII LLC is a related person of the Company. Manageco VIII LLC
is the managing member of each of DRA Growth and Income Fund VIII LLC and DRA Growth
and Income Fund VIII (A) LLC for which the limited liability companies were established to invest
in interests in predominantly commercial properties. A client of the Company was solicited to
invest in DRA Growth and Income Fund VIII LLC and DRA Growth and Income Fund VIII (A)
LLC. David Luski, Paul McEvoy, Brian T. Summers, Jean Marie Apruzzese, Andrew E. Peltz,
Janine Roberts, David P. Gray, Adam Breen, Jason Borreo, Valla Brown, Matthew Shore, Dean
Sickles and Daniel Goldman, who are the owners of the Company, are owners of the various
percentage interests in Manageco VIII LLC.
As discussed above, Manageco VIII-I LLC is a related person of the Company. Manageco VIII-I
LLC is the managing member of DRA Growth and Income Fund VIII Co-Investment I LLC for
which the limited liability companies were established to invest in interests in predominantly
commercial properties. A client of the Company was solicited to invest in DRA Growth and Income
Fund VIII Co-Investment I LLC. David Luski, Paul McEvoy, Brian T. Summers, Jean Marie
Apruzzese, Andrew E. Peltz, Janine Roberts, David P. Gray, Adam Breen, Jason Borreo, Valla
Brown, Matthew Shore, Dean Sickles and Daniel Goldman, who are the owners of the Company,
are owners of the various percentage interests in Manageco VIII-I LLC.
As discussed above, Manageco IX LLC is a related person of the Company. Manageco IX LLC is
the managing member of DRA Growth and Income Fund IX LLC for which the limited liability
companies were established to invest in interests in predominantly commercial properties. A client
of the Company was solicited to invest in DRA Growth and Income Fund IX LLC. David Luski,
Paul McEvoy, Brian T. Summers, Jean Marie Apruzzese, Andrew E. Peltz, Janine Roberts, David
P. Gray, Adam Breen, Jason Borreo, Valla Brown, Matthew Shore, Dean Sickles, Daniel Goldman,
Robert Hyman and Glen Besser who are the owners of the Company, are owners of the various
percentage interests in Manageco IX LLC.
As discussed above, Manageco IX Co-Investment LLC is a related person of the Company.
Manageco IX Co-Investment LLC is the managing member of DRA Growth and Income Fund IX
Co-Investment LLC for which the limited liability companies were established to invest in interests
in predominantly commercial properties. A client of the Company was solicited to invest in DRA
Growth and Income Fund IX Co-Investment LLC. David Luski, Paul McEvoy, Brian T. Summers,
Jean Marie Apruzzese, Andrew E. Peltz, Janine Roberts, David P. Gray, Adam Breen, Jason Borreo,
Valla Brown, Matthew Shore, Dean Sickles, Daniel Goldman, Robert Hyman and Glen Besser who
are the owners of the Company, are owners of the various percentage interests in Manageco IX Co-
Investment LLC.
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Transactions and Personal Trading
The Company sometimes recommends to various clients investments in transactions in which the
Company or a related person has a financial interest. The terms of such relationship and the
existence of such financial interests are in each instance disclosed to such accounts prior to effecting
the transaction. The Company complies with its disclosure and fiduciary obligations to clients under
the Advisers Act and, where applicable, the Employee Retirement Income Security Act of 1974, as
amended, in connection with its investment activities and recommendations to clients.
All principals, directors and employees of the Company (collectively, “Employees”) are subject to
the provisions contained in the Business Conduct and Ethics Policy chapter of the Company’s
compliance manual (the “Code of Ethics” or the “Code”). The Code outlines policies and
procedures regarding conflicts of interest, standards of conduct, personal investment transactions,
insider trading, handling of material, non-public information and other matters. Employees are
prohibited from participating in any transaction in which there appears to be a conflict between their
personal interests and those of the Company or its clients or from which they derive an improper
personal benefit, directly or indirectly. The Code is designed to instill a culture of compliance
among the Employees by ensuring, among other things, that Employees conduct their investing
activities in accordance with applicable law and in the best interests of the clients. Key components
of the Company’s Code of Ethics are: (i) maintaining a strategic vision designed to ensure that
clients’ interests are placed first and foremost; (ii) identifying risks; (iii) establishing controls; (iv)
documenting transactions and activities of the Employees that fall under the purview of the Code;
and (v) maintaining accountability.
The Code of Ethics contains several restrictions and procedures designed to eliminate conflicts of
interest between the Company, the Employees, and its clients, including: (1) a requirement of the
Employees that they comply with all laws (including antitrust laws); (2) a prohibition of making
gifts or payments to any governmental or elected official or their associates or to improperly
influence anyone who is doing business or may do business in the future with the Company;
(3) restrictions on receiving privileges, favors, gifts, payments, fees, services or special discounts
from a client, tenant, supplier or anyone else who is doing business or is seeking to do business with
the Company; (4) a prohibition of Employees using their position with the Company to obtain unfair
or improper benefit for themselves from other businesses or organizations with which they are
associated; (5) a prohibition of receipt of improper financial benefit by Employees and procedures
designed to eliminate conflicts of interest (or even the appearance of conflicts of interest); (6)
restrictions on Employees regarding investments in real estate or real estate entities and other
business investments; (7) restrictions on outside employment and other business activities,
including service as a director or officer of another organization; (8) restrictions on Employee’s
business conduct in regards to work with tenants and other persons doing business with the
Company, including personal loans to Employees by persons doing business with the Company; (9)
guidance for Employees with respect to political contributions and activities and prohibitions of the
Company making political contributions; (10) a prohibition of any discrimination; (11) a prohibition
of the use of confidential information for financial gain and disclosure of confidential information;
(12) pre-approval of any purchase or sale of assets from the Company; and (13) restrictions on the
purchase from and sale to the Company of assets; and (14) guidance for employees for setting proper
accounting controls.
The Code also prohibits the Employees from trading in certain restricted stocks under any
circumstances. The list of restricted stocks is updated when necessary, but not less than quarterly.
Each Employee is promptly notified of any changes or updates to the list. The Chief Compliance
Officer then monitors any trades by Employees in restricted stocks.
If an employee acts in a manner inconsistent with the Code, the Code provides for disciplinary
action and reports of violation. In addition, the Code provides implementation procedures with
respect to: (1) interpretations and advance approvals; and (2) frequent distributions of the Code to
Employees and periodic statements of compliance from certain Employees.
Monitoring of Employees’ business conduct is handled by the Chief Compliance Officer. Records
of transactions or activities of the employees which fall under the purview of the Code of Ethics are
also maintained by the Chief Compliance Officer.
A summary of the Company’s Code of Ethics will be provided to any client or investor or
prospective client or investor upon written request to: David Gray, c/o DRA Advisors LLC, 220
East 42nd Street, 27th Floor, New York, NY 10017.
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The Company provides advice with respect to the acquisition, management and disposition of real
estate and real estate related investments in private transactions which do not generally involve the
participation of brokers or dealers. The Company generally does not engage in securities trading.
To the extent the Company selects a broker or dealer with respect to securities transactions, each
executing broker or dealer will be selected on the basis of seeking best execution of transactions.
Commissions paid to a broker who supplies research may be higher than to other brokers who do
not provide research. There are no limitations placed by clients on the authority of the Company in
the selection of brokers.
The Company may obtain research information from a number of sources, which may include
brokers. All information will be used for the benefit of all accounts serviced. Direct placement of
orders may be used to direct client transactions to particular brokers.
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David Luski, President, Paul McEvoy, Consultant, Brian T. Summers, Consultant, Jean Marie
Apruzzese, Vice President, Secretary and Chief Operating Officer, Andrew Peltz, Vice President
and Assistant Secretary, David Gray, Chief Compliance Officer, Janine Roberts, Director of
Dispositions, Adam Breen, Director of Acquisitions, Jason Borreo, Director of Portfolio
Management, Valla Brown, Director of Asset Management, Matthew Shore, Director of
Acquisitions, Dean Sickles, Director of Dispositions, Daniel Goldman, Managing Director of
Acquisitions, Robert Hyman Director of Asset Management, Glen Besser Director of Client
Services and Brett Gottlieb, Managing Director of Acquisitions generally review all accounts on a
quarterly and annual basis. The Company’s valuation committee generally performs internal
appraisals of the market value of all clients’ Real Estate Investments on a quarterly basis or as
directed by investors. In addition, the Company intermittently discusses prevailing market
conditions and overall investment characteristics with its clients’ investors.
Client/Investor Reporting
Clients receive regular written reports on their accounts as follows:
1. Periodic purchase and sale advice.
2. Quarterly economic and market analysis.
3. Quarterly performance reports.
4. Annual audited financial statements
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Client assets are held in custody by unaffiliated broker/dealers or banks, all of whom are qualified
custodians, as that term is defined under Rule 206(4)-2 of the Advisers Act (i.e. the “Custody
Rule”). However DRA has access to client assets since it or a related person serves as the managing
member or general partner of each Fund and because of its ability to withdraw its fees directly from
the Funds. To comply with the Custody Rule and to provide meaningful protection to investors, the
Funds are subject to an annual financial statement audit by an independent public account registered
with, and subject to regular inspection by, the Public Company Accounting Oversight Board. The
audited financial statements are prepared in accordance with generally accepted accounting
standards, and are distributed to investors within 120 days of each Fund’s fiscal year end.
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The Company has full discretionary authority to manage the Funds, including authority to make
decisions with respect to which investments are bought and sold. Any limitations on authority are
included in Fund offering documents, advisory agreements, investor side letters, and/or the
Company’s internal compliance policies and procedures.
Side Letters: The Company may, and does routinely, enter into agreements with one or more
investors in its discretion which have the effect of altering or supplementing the terms of the offering
to the specific investor. Any terms contained in such agreements to or with an investor govern with
respect to such investor, notwithstanding the provisions of the Fund’s governing documentation.
Among other things, certain side letters include: (i) co-investment rights and preferences;
(ii) additional notification provisions (e.g. reporting and notices), (iii) modifications reflecting
applicable legal, regulatory, taxation or other obligations (including excuse rights), (iv) designation
of a representative to a Members’ Board, (v) restriction from use of an investor’s name or
(vi) variation of fee and compensation arrangements applicable to an investor, including specific
thresholds for organizational and catch-up costs. Certain side letters include a “most favored
nations” or “MFN” provision that entitles certain investors to examine and/or elect the benefit of
side letter provisions afforded to other investors in a particular Fund. The Company believes that
the side letters in effect with current investors do not materially affect the management of the Funds.
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The Company has never filed for bankruptcy and is not aware of any financial condition that is
expected to affect its ability to manage client accounts.
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Open Brochure from SEC website