May 30, 2019
Andrea Petersen
Chief Executive Officer
School of Whales Commercial Real Estate Equity Fund, LLC
2900 SW 28th Terrace, Suite 202
Miami, FL 33133
Re: School of Whales Commercial Real Estate Equity Fund, LLC
Offering Statement on Form 1-A
Filed May 3, 2019
File No. 024-10995
Dear Ms. Petersen:
We have reviewed your offering statement and have the following
comments. In some of
our comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Please respond to this letter by amending your offering statement and
providing the
requested information. If you do not believe our comments apply to your facts
and
circumstances or do not believe an amendment is appropriate, please tell us why
in your
response. After reviewing any amendment to your offering statement and the
information you
provide in response to these comments, we may have additional comments.
Form 1-A
Cover Page
1. We note your disclosure on page 12 that your offering is a blind-pool
offering.
Accordingly, as applicable, please provide the disclosure required by
Industry Guide 5 or
tell us why such disclosure is not appropriate. For example only, please
provide the
disclosure related to compensation in accordance with Item 4 of Guide 5
and include prior
performance disclosure and tables in accordance with Item 8 of Guide 5,
as applicable.
Please refer to Release No. 33-6900 (June 17, 1991), Securities Act Forms
Compliance
and Disclosure Interpretation 128.06, Item 7(c) of Part II of Form 1-A,
and CF Disclosure
Guidance Topic No. 6.
2. Please be advised that you are responsible for analyzing the
applicability of the tender
offer rules to your share repurchase program. We urge you to consider all
the elements of
your share repurchase program in determining whether the program is
consistent with
relief granted by the Division of Corporation Finance in prior no action
letters. See, for
Andrea Petersen
FirstNameWhales Commercial Real Estate Equity Fund, LLC
School of LastNameAndrea Petersen
Comapany NameSchool of Whales Commercial Real Estate Equity Fund, LLC
May 30, 2019
May 30, 2019 Page 2
Page 2
FirstName LastName
example, T REIT Inc. (Letter dated June 4, 2001) and Wells Real Estate
Investment Trust
II, Inc. (Letter dated December 3, 2003). To the extent you have
questions as to whether
the program is entirely consistent with the relief previously granted
by the Division of
Corporation Finance, you may contact the Division's Office of Mergers
and Acquisitions
at 202-551-3440.
3. We note that you may conduct a share repurchase program during the
offering period.
Please be advised that you are responsible for analyzing the
applicability of Regulation M
to your share repurchase program. We urge you to consider all the
elements of your share
repurchase program in determining whether the program is consistent
with the class relief
granted by the Division of Market Regulation in the class exemptive
letter granted Alston
& Bird LLP dated October 22, 2007. To the extent you have questions as
to whether the
program is entirely consistent with that class exemption you may
contact the Division of
Trading and Markets at 202-551-5777.
4. We note your disclosure that the requirement to arbitrate does not
apply to claims under
the federal securities laws and the rules and regulations promulgated
thereunder. Please
ensure that your governing documents clearly state this as well. For
example only, please
revise section 13 of your operating agreement.
5. Please revise your cover page to state that you are not an investment
company and
investors will not have the protections provided under the Investment
Company Act of
1940.
Our ability to make distributions to our Members ..., page 18
6. We note your disclosure that you intend to pay an annualized 8% return
to your members.
Please provide an analysis detailing your reasonable basis for such
returns or remove such
statements. As part of your analysis, please include how you
considered that you are a
blind pool and have no operations.
Management's Discussion and Analysis of Financial Condition, page 28
7. Please revise here and in the business section to more specifically
describe your plan of
operation, including detailed milestones, the anticipated time frame
for beginning and
completing each milestone, and the categories of expenditures for your
anticipated
operations. Please discuss the likely alternatives for satisfying your
capital needs in light
of your working capital deficiency.
Policies with Respect to Certain Transactions
Conflicts of Interest, page 31
8. We note your disclosure that your manager has other investment
opportunities and funds.
Please disclose the number of other entities that have similar
investment objectives and
the amount that these entities have available for investment. We
further note the
Andrea Petersen
School of Whales Commercial Real Estate Equity Fund, LLC
May 30, 2019
Page 3
disclosure on page 6 that it is possible you will acquire properties
from affiliates. Please
clarify if you have any arrangements in place to acquire properties
from affiliates and
explain how you determined to acquire these properties "at a price of
no more than fifteen
percent (15%) above the valuation price."
We will consider qualifying your offering statement at your request. If
a participant in
your offering is required to clear its compensation arrangements with FINRA,
please have
FINRA advise us that it has no objections to the compensation arrangements
prior to
qualification.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff. We also remind you that, following qualification of your
Form 1-A, Rule 257
of Regulation A requires you to file periodic and current reports, including a
Form 1-K which
will be due within 120 calendar days after the end of the fiscal year covered
by the report.
You may contact Babette Cooper at 202-551-3396 or Wilson Lee at
202-551-3468 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Stacie Gorman at 202-551-3585 or Jennifer Gowetski at 202-551-3401 with
any other
questions.
Sincerely,
FirstName LastNameAndrea Petersen
Division of Corporation
Finance
Comapany NameSchool of Whales Commercial Real Estate Equity Fund, LLC
Office of Real Estate and
May 30, 2019 Page 3 Commodities
FirstName LastName