There is also evidence of acquisition financing. Real-estate data compiled from public mortgage records associates Red Sea Grove Holdings LLC with approximately $4.0 million of financing dated May 27, 2026 from Arixa Enhanced Income Fund Holdings in connection with the 1835 E. Don Carlos property. The same source associates the issuer with ownership of the property and reports a $6.2 million consideration figure, close to the $6.15 million public-record sale price shown by Redfin, Realtor.com and Compass. Because lender-intelligence databases aggregate county records and may simplify legal-document details, investors should verify the exact original principal balance, maturity, rate, extension options and recourse provisions from the recorded deed of trust or loan documents.
If approximately $4 million of debt financed a $6.15 million purchase, the acquisition debt would represent roughly 65% of purchase price before considering additional financing or subsequent capital expenditures. That back-of-the-envelope ratio is useful context but is not a substitute for the project's actual closing statement or current debt schedule.
RENTAL OPERATIONS AND REAL-WORLD PROPERTY VERIFICATION
The property has an unusually strong real-world operating footprint for a newly formed Form D issuer. RedSeaGrove.com is a dedicated property website rather than merely a capital-raising page. It advertises a pool, courtyard and BBQ area, renovated interiors, assigned parking, individual HVAC, onsite laundry and updated appliances, and provides the exact property location at 1835 E. Don Carlos in Tempe. The site also displays rental availability and resident-facing contact information.
Independent rental channels corroborate ongoing leasing activity. ForRent lists Red Sea Grove at the same address, identifies 39 units, three stories and a 1972 construction date, while a September 10, 2026 Craigslist advertisement promoted a one-bedroom apartment at $1,199 per month, described the community as under new management and referenced renovations, parking, laundry and the pool. Rental advertisements can change quickly and do not demonstrate occupancy or profitability, but they provide current evidence that the underlying property is actively being marketed to tenants rather than existing only in fundraising documents.
One point deserves careful treatment for investors reviewing sponsor projections. The official apartment site displayed one-bedroom units at approximately $950 and $1,050 at the time indexed, while the September Craigslist advertisement listed another one-bedroom unit at $1,199 and offered one month free. Different units, renovation packages, timing and concessions can explain these figures, so they are not necessarily contradictory. They do, however, illustrate why underwriting should rely on an actual current rent roll, effective rents after concessions and trailing collections rather than headline asking rents alone.
REGULATION D STRUCTURE AND THE IMPORTANT INVESTOR-COUNT ANOMALY
Red Sea Grove claims Rule 506(b), not Rule 506(c). The distinction is material. Rule 506(b) offerings generally cannot use unrestricted general solicitation and can include accredited investors plus, subject to the rule's requirements, a limited number of sophisticated non-accredited investors. The Red Sea Grove Form D specifically checks the field indicating securities "have been or may be sold" to non-accredited investors.
The way Item 14 is completed deserves independent scrutiny. Both the original filing and amended filing show "35" in the portion associated with non-accredited investors, while the total number of investors already invested is entered as zero. In March, when Item 7 also said the first sale had not yet occurred and $0 was sold, zero total investors was logically consistent with the offering's pre-sale status. But the September amendment reports the full $3,186,123 sold while still reporting zero total investors. That creates an internal inconsistency between Item 13 and Item 14 in the amended filing.
FilingDossier does not infer from this alone that 35 non-accredited investors actually invested, nor does it infer that no investors existed. The form's fields simply do not reconcile as filed. The appropriate investor-diligence response is to ask for clarification from the issuer and, if material, review an updated Form D, capitalization table or closing schedule. This is precisely the sort of detail that can disappear when a research page merely copies the headline offering amount.
A second distinction is the minimum investment. SEC Form D reports $50,000 as the minimum accepted from any outside investor, while Gorilla Wealth Group's marketing page displays a $25,000 minimum for Red Sea Grove. That could reflect a permitted sponsor exception, a co-investment structure, later commercial terms, a feeder arrangement or simply differences between marketing and the Form D disclosure. Public information reviewed here does not establish which explanation applies. Investors should rely on the actual subscription agreement and offering memorandum governing their investment rather than assuming either public figure applies universally.
MARKET POSITION, STRATEGY AND RETURN ASSUMPTIONS
The sponsor's investment case rests partly on location. Red Sea Grove sits in Tempe in the Phoenix metropolitan area, approximately two miles from Arizona State University according to investment marketing. Access to ASU, employment centers, light rail, Downtown Tempe and Phoenix Sky Harbor can support a relatively deep renter pool, but those locational strengths do not guarantee rental growth. Phoenix-area multifamily performance can be affected by new apartment supply, concessions, migration, wage growth, mortgage rates and investor capitalization rates.
The planned value creation appears to combine existing occupancy with renovations rather than relying entirely on lease-up from zero. Gorilla Wealth Group describes the project as stabilized and identifies light value-add interior renovations. At the same time, current rental advertising uses incentives such as a free month, which means investors should focus on effective collected rents rather than asking rents. A property can simultaneously be occupied and still experience concession pressure during renovation or repositioning.
The target 1.77x equity multiple over a projected 2–4 year hold means the investment thesis depends substantially on eventual sale or refinancing economics in addition to interim cash flow. A shorter hold generally makes the project more sensitive to the terminal capitalization rate because there is less time for income growth to offset unfavorable changes in asset pricing. Investors should examine the acquisition cap rate, stabilized net operating income, exit cap-rate assumption, rent-growth assumption and refinance assumptions used to generate the advertised 15.75% IRR.
A cost-segregation strategy is also advertised as a potential investor benefit. Cost segregation can accelerate depreciation deductions for qualifying components of real estate, but actual tax consequences vary by investor and applicable tax rules. It should not be treated as additional property operating income, and investors should distinguish tax benefits from economic returns.
SPONSOR EXPERIENCE, THIRD-PARTY VISIBILITY AND REPUTATION
Caleb Johnson has a traceable public history in multifamily investing predating Red Sea Grove. Red Sea Capital Group's official biography states that he began entrepreneurship at 18, participated in multifamily investments in Arizona, New Mexico and Oklahoma and founded Red Sea Capital in 2022. A 2023 Michael Blank podcast identified him at age 25 as having built a roughly $9 million real-estate portfolio consisting of 117 units. By November 2025, another industry podcast presented him as owning or managing more than 1,200 multifamily units across four states. These claims demonstrate sustained public involvement in the asset class, but investors should distinguish gross units in which a sponsor has some ownership or management role from wholly owned assets or audited assets under management.
Red Sea Grove also appears in an outside co-investment platform operated by SparkRental, which describes it as a Red Sea Capital value-add multifamily investment in Tempe and cites the same 15.75% projected IRR and a planned 2–4 year sale window. This supports the existence of third-party distribution or co-investment interest in the transaction, although it still does not independently validate the financial projections.
The reviewed evidence did not surface an SEC enforcement action specifically naming Red Sea Grove Holdings, LLC in connection with this offering. That statement should be understood narrowly: a web and SEC search is not equivalent to a complete litigation, arbitration, bankruptcy, county-court, state-regulatory and background investigation of every sponsor affiliate or individual. Investors conducting institutional diligence should search those sources separately and should not interpret the absence of a readily located SEC enforcement result as a blanket clean-bill-of-health conclusion.
STRENGTHS VS RISKS
Red Sea Grove has several unusually strong verification characteristics for a single-asset private real-estate offering. There is a named Arizona issuer; a specific manager entity; a named executive officer; an SEC CIK and File Number; both an original and amended Form D; an identifiable 39-unit property; public evidence of the May 2026 acquisition; a dedicated tenant-facing website; active rental listings; sponsor history; third-party investment materials; and evidence of property-level debt. Collectively, these data points make it possible to reconstruct much of the transaction without relying exclusively on the offering's marketing deck.
The principal risks are economic rather than basic identity risk. The property was purchased at approximately $6.15 million and reportedly carries significant acquisition financing, while the strategy includes approximately $1.15 million of planned improvements. Investors therefore face renovation execution, leasing and concession pressure, interest expense, refinancing risk and the possibility that Phoenix/Tempe multifamily valuations move adversely before the planned 2–4 year exit. A 1972-vintage building also warrants detailed diligence on roofing, plumbing, HVAC, electrical systems, sewer lines, structural components, insurance history and deferred maintenance because unexpected capital needs can reduce distributions.
There is also sponsor and vehicle concentration. This is a single identifiable apartment property rather than a broadly diversified nationwide fund. That makes underwriting easier to understand, but it means adverse events at one address can directly affect the investment. Investors should know whether insurance adequately covers casualty and liability exposure, what reserves have been funded, whether lender covenants restrict distributions and what happens if renovation spending exceeds the stated capital budget.
Two disclosure issues warrant direct questions before investment or secondary evaluation. First, the September Form D reports the entire offering sold but zero total investors, despite also containing the number 35 in the non-accredited-investor field. Second, the SEC-reported $50,000 minimum differs from the $25,000 minimum displayed by one investment-marketing source. Neither discrepancy proves misconduct, but both are concrete items that can and should be reconciled through primary transaction documents.
FINAL ASSESSMENT
Red Sea Grove Holdings, LLC is a particularly useful example of why Form D analysis should extend beyond simply asking whether an SEC filing exists. Here, the filing can be tied to a specific property, transaction, manager and operating sponsor. The March 20, 2026 initial filing announced a $2.860685 million Rule 506(b) equity offering before the first sale. The underlying Tempe apartment property subsequently sold on May 27 for approximately $6.15 million. On September 15, the issuer amended its Form D, increased the reported offering to $3.186123 million and reported the entire amount sold. Those dates and figures form a coherent transaction timeline that materially strengthens independent verification of the project.
At the same time, SEC filing status should not be used as shorthand for investment quality. The SEC explicitly states on Form D that it has not necessarily reviewed the filing for accuracy or completeness. Red Sea Grove's projected 15.75% IRR, 1.77x equity multiple and other deal economics come from investment marketing, not an SEC assessment. Actual results will depend on property operations, renovation execution, debt service, rent collections, market cap rates and the eventual exit.
The strongest next-stage diligence would therefore focus on obtaining the complete private-placement memorandum, operating agreement and subscription agreement; confirming the final capitalization table; explaining the Form D investor-count fields; reconciling the $25,000 versus $50,000 minimum; reviewing the May 2026 closing statement and recorded debt; obtaining the current rent roll and trailing-12-month operating statement; examining the $1.15 million CapEx budget; identifying property-management and construction counterparties; reviewing sponsor co-investment and promote terms; and testing the projected returns under higher exit cap rates, lower rent growth and longer hold periods.
Red Sea Grove has a verifiable SEC filing and a verifiable underlying property. Form D nevertheless remains a notice of an exempt securities offering—not SEC approval, certification, endorsement or a guarantee that the investment will achieve its targeted return.
SEC SNAPSHOT
SEC File Number: 021-577148
EIN: 41-4650450
Issuer Type: Arizona Limited Liability Company
Year Organized: 2026
SEC Business Address: 8825 N 23rd Ave., Suite 100 Phoenix, Arizona 85021
Issuer Phone: 480-463-0943
Manager: Red Sea Grove MGR, LLC
SEC Related Person: Valeria Johnson
Role: Executive Officer / Member-Manager Acting on behalf of Red Sea Grove MGR, LLC
INITIAL FORM D: Filed: March 20, 2026 Accession: 0001099910-26-000127 Exemption: Regulation D Rule 506(b) Security Type: Equity Initial Offering Amount: $2,860,685 Remaining: $2,860,685
LATEST FORM D/A: Filed: September 15, 2026 Accession: 0001099910-26-000266 Film No.: 261381700 Effectiveness Date: September 15, 2026 Exemption: Regulation D Rule 506(b) Security Type: Equity Amended Offering Amount: $3,186,123 Amount Sold: $3,186,123 Remaining: $0 Sales Commissions Reported: $0 Finder Fees Reported: $0 Minimum Investment Reported to SEC: $50,000
FORM D DATA FLAG: Latest filing reports $3,186,123 sold but reports 0 total investors in Item 14 while the non-accredited-investor section contains "35." The public filing fields should be clarified with the issuer rather than independently reinterpreted.
UNDERLYING PROPERTY: Red Sea Grove Apartments 1835 E. Don Carlos Avenue Tempe, Arizona 85281
Property Type: Multifamily apartments
Units: 39
Stories: 3
Year Built: 1972
2026 Acquisition Date: May 27, 2026
Public-Record Acquisition Price: Approximately $6,150,000
Approximate Acquisition Price Per Unit: Approximately $157,700
Reported Property-Level Financing: Approximately $4.0 million mortgage associated with the May 27, 2026 acquisition in public-record-derived lender data; exact current terms should be verified from primary loan documents.
SPONSOR / OPERATING AFFILIATION: Red Sea Capital Group
Founder / CEO Publicly Associated With Sponsor: Caleb Johnson
Red Sea Capital Founded: 2022 according to sponsor biography
STRATEGY: Stabilized value-add multifamily Interior renovations Carport improvements In-unit washer/dryer installations Operational repositioning Potential cost-segregation tax strategy Targeted 2–4 year hold
PLANNED CAPEX: Approximately $1.15 million according to investment marketing
TARGET RETURNS: 15.75% projected IRR 1.77x projected equity multiple These are underwriting targets, not guaranteed or realized returns.
MARKETING MINIMUM: $25,000 displayed by Gorilla Wealth Group
SEC FORM D MINIMUM: $50,000
MINIMUM-INVESTMENT DISCREPANCY: Requires transaction-level clarification.
WEBSITE PENETRATION: SEC issuer confirmed — YES SEC manager relationship confirmed — YES Dedicated property website confirmed — YES Physical property confirmed — YES Property address match confirmed — YES 39-unit count independently corroborated — YES 2026 acquisition independently corroborated — YES Sponsor / Red Sea Capital relationship supported — YES Active tenant marketing confirmed — YES Debt evidence located — YES Exact loan terms publicly verified — PARTIAL Auditor publicly identified — NOT LOCATED Fund administrator publicly identified — NOT LOCATED Custodian publicly identified — NOT LOCATED Fund counsel publicly identified — NOT LOCATED
CORE INVESTOR RISKS: Single-property concentration Renovation and construction-budget risk 1972-vintage building / deferred-maintenance risk Tenant turnover and leasing concessions Phoenix/Tempe apartment supply Rent-growth assumptions Interest-rate and refinancing risk Property-level leverage Exit capitalization-rate expansion Illiquidity Sponsor/key-person dependence Affiliate/manager structure Projected-return risk Tax-benefit assumptions Form D investor-count inconsistency $25K versus $50K disclosed minimum discrepancy
PRIMARY EVIDENCE REVIEWED: U.S. SEC EDGAR — Red Sea Grove Holdings, LLC Form D, March 20, 2026 U.S. SEC EDGAR — Red Sea Grove Holdings, LLC Form D/A, September 15, 2026 Red Sea Grove official apartment website Red Sea Capital Group official website and management biography Public property sale records for 1835 E. Don Carlos Avenue Current rental-market listings Third-party investment materials from Gorilla Wealth Group SparkRental co-investment disclosure Public-record-derived lender and ownership data Independent multifamily transaction and sponsor-profile sources