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<TITLE>Form 8-K</TITLE>
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 <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="margin-top:4pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>UNITED STATES </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>SECURITIES AND EXCHANGE COMMISSION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>WASHINGTON, D.C. 20549 </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>FORM 8-K
</B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>CURRENT REPORT </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Pursuant
to Section&nbsp;13 or 15(d) </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>of the Securities Exchange Act of 1934 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Date of Report (Date of earliest event reported): November&nbsp;15, 2013 </B></P>
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<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:24pt; font-family:Times New Roman" ALIGN="center"><B>CNL GROWTH PROPERTIES, INC. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(Exact Name of Registrant as Specified in its Charter) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
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<TD VALIGN="top" ALIGN="center"><B>Maryland</B></TD>
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<TD VALIGN="top" ALIGN="center"><B>000-54686</B></TD>
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<TD VALIGN="top" ALIGN="center"><B>26-3859644</B></TD></TR>
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<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(State or Other Jurisdiction</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>of Incorporation)</B></P></TD>
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<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Commission</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>File Number)</B></P></TD>
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<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(IRS Employer</B></P>
<P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Identification No.)</B></P></TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>450 South Orange Avenue </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Orlando, Florida 32801 </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>(Address of Principal Executive Offices; Zip Code) </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Registrant&#146;s telephone number, including area code: (407) 650-1000 </B></P>
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<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the
following provisions: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top">Pre-commencement communications pursuant to Rule 13e-4 (c)&nbsp;under the Exchange Act (17 CFR 240.13e-4(c)) </TD></TR></TABLE> <P STYLE="font-size:10pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="10%" VALIGN="top" ALIGN="left"><B>Item&nbsp;1.01</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Entry Into A Material Definitive Agreement </B></TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>City Walk Development Project, Roswell, Georgia
</I></B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">On November&nbsp;15, 2013, CNL Growth Properties, Inc. (&#147;us,&#148; &#147;we,&#148; &#147;our,&#148; or the
&#147;Company&#148;), through a subsidiary of our operating partnership, GGT City Walk Holdings, LLC (the &#147;CGP JV Partner&#148;), entered into a limited liability company agreement, more fully described below (the &#147;JV Agreement&#148;),
with LMI City Walk Investor, LLC (the&nbsp;&#147;LMI JV Partner&#148;), an affiliate of Lennar Corporation (&#147;Lennar&#148;), for the purpose of forming a joint venture, GGT LMI City Walk GA, LLC, a Delaware limited liability company (the
&#147;Joint Venture&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">On November&nbsp;15, 2013, the Joint Venture acquired a fee simple interest in an approximately 10.7-acre
parcel of land, located in Roswell, Fulton County, Georgia, an affluent and growing northern suburb of Atlanta (the &#147;Property&#148;) from Roswell Commons Group, L.P., (the &#147;Seller&#148;), by assignment from LMI Multifamily Communities,
LLC, an affiliate of Lennar (&#147;LMI&#148;) of that certain sales contract dated effective January&nbsp;10, 2013, as amended. Prior to its acquisition, the location had been rezoned and granted site plan approval to demolish existing structures.
The Joint Venture will develop, construct and operate on the Property a 320-unit &#147;Class A&#148; multifamily residential community, consisting of five three-story residential buildings, and featuring a club room, community pool, fitness center,
and business center, among its amenities (the&nbsp;&#147;Project&#148;). The Project will be known as &#147;City Walk&#148; (hereinafter, &#147;Roswell City Walk&#148;). Neither we, LMI, nor Lennar is affiliated with the Seller. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">The purchase price for the Property was approximately $8.1&nbsp;million. The total projected budget for the Project including the purchase
price of the land, demolition and construction costs and other development costs, is approximately $46.4&nbsp;million. The purchase price and related acquisition closing costs, along with certain expenses, fees and pre-development costs incurred by
LMI JV Partner, were funded by the Joint Venture from the capital contributions of the CGP JV Partner and the LMI JV Partner. The balance of the development and construction costs of the Project will be funded with a construction loan in the
approximate amount of $32.5&nbsp;million from Regions Bank, as described below in Item&nbsp;2.03 of this Current Report. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">LMI JV Partner
has agreed to serve as the developer of the Project under the terms of a development agreement dated November&nbsp;15, 2013 (the &#147;Development Agreement&#148;), pursuant to which the LMI JV Partner and Lennar, as guarantor, have provided the
Joint Venture with a construction cost overrun guaranty. Under the Development Agreement, the LMI JV Partner will receive a development fee equal to 3% of the final Project budget, payable in equal monthly installments during the development of the
Project. LMICS, LLC, a Lennar affiliate, will serve as the general contractor of the Project (the &#147;Contractor&#148;), under the terms of an AIA standard form of agreement between owner and contractor dated November&nbsp;15, 2013
(the&nbsp;&#147;Construction Contract&#148;). The Contractor has agreed to construct and deliver the Project for a total of approximately $29.7&nbsp;million, which amount includes a general contractor&#146;s fee equal to 4% of the cost of the work.
The construction fee is payable in monthly installments over the construction period. Commencement of the Project is planned for December&nbsp;2013, and the Contractor is required to achieve substantial completion not later than 18 months from the
date of commencement, subject to certain excusable delays. We anticipate that the Project should achieve substantial completion in the second quarter of 2015. The first $285,000 of any construction cost savings shall revert 100% to the Contractor,
and thereafter, any further cost savings will revert 75% to the Joint Venture and 25% to the Contractor. The Development Agreement and the Construction Contract each contain customary representations, warranties, insurance, indemnification, events
of default, termination, dispute resolution, and other customary provisions. It is currently expected the leasing and management of Roswell City Walk will be provided by an affiliate of Lennar. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">Pursuant to the JV Agreement, the CGP JV Partner agreed to fund an initial capital contribution of up to a maximum of approximately
$10.4&nbsp;million for a 75% interest in the Joint Venture, and the LMI JV Partner agreed to fund an initial capital contribution of up to a maximum of approximately $3.5&nbsp;million for a 25% interest in the Joint Venture. Under certain
circumstances, the members of the Joint Venture may be required to contribute additional capital to the Joint Venture. We, through the CGP JV Partner, are the managing member of the Joint Venture. However, we have delegated to the LMI JV Partner the
authority to manage certain of the day-to-day operations of the Joint Venture, subject to our approval of certain major decisions that require the consent of both members, and further subject to our right to terminate such delegation of authority,
with or without cause, as determined in the JV&nbsp;Agreement. In the event of the removal the LMI JV Partner as the operating partner for cause, the LMI&nbsp;JV Partner will cease to have any rights to approve or consent to any matters under the JV
Agreement. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">1 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">Generally, under the terms of the JV Agreement, operating cash flow will be distributed to the
CGP&nbsp;JV&nbsp;Partner and to the LMI JV Partner on a <I>pro rata</I> basis in accordance with their respective percentage interests in the Joint Venture. Upon the occurrence of a major capital event, such as a sale of the Property or refinancing
of the Construction Loan, proceeds will be distributed <I>pro rata</I> until accrued and unpaid minimum cumulative operating returns on capital equal to 10.5% per annum are achieved and invested capital is returned. Thereafter the LMI JV Partner may
receive a disproportionately higher share of remaining proceeds at varying percentages based on our having received certain minimum threshold returns. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">The JV Agreement also provides that at any time after two years following the completion of the Project, the CGP JV Partner may cause the
marketing and sale or other transfer of the Property, in which event, the LMI&nbsp;JV&nbsp;Partner may elect to agree to such marketing and sale or to purchase the CGP&nbsp;JV&nbsp;Partner&#146;s interest for a price based on the proposed sale
price. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">Founded in 1954, Lennar is a Miami-based homebuilding company with a current market capitalization of over $7 billion. LMI was
founded in 2011 as an initiative to combine the financial strength of Lennar, currently the third-largest homebuilder in the United States, with the onset of increasingly favorable apartment fundamentals nationwide. We are not affiliated with
Lennar, LMI, the LMI JV Partner or any of their other affiliates; and this Project is our first development venture with Lennar. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">The
information appearing in Item&nbsp;2.03 of this Current Report is incorporated by reference herein and made a part of this Item&nbsp;1.01. </P> <P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="10%" VALIGN="top" ALIGN="left"><B>Item&nbsp;2.03</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of Registrant </B></TD></TR></TABLE>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><I>City Walk Development Project - Financing </I></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">On November&nbsp;15, 2013, the Joint Venture entered into a construction loan agreement and promissory note with Regions Bank (the
&#147;Lender&#148;). Pursuant to the loan agreement, the promissory note, deed to secure the debt, and the other documents evidencing and securing the Loan (the &#147;Loan Documents&#148;) the Lender will fund up to approximately $32.5&nbsp;million
of the development and construction costs of the Project, subject to certain loan-to-value ratio and loan-to-costs ratio limits (the &#147;Construction Loan&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">During the 36-month initial term, the Construction Loan will accrue interest at the variable interest rate per annum of 2.20% above the
one-month LIBOR rate (the &#147;LIBOR Rate&#148;). The interest rate is subject to adjustment monthly, with adjustments becoming effective on the first business day of each calendar month, based on the latest one-month LIBOR rate as published in the
&#147;Money Rates&#148; column of The Wall Street Journal two days prior to the adjustment determination. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">Accrued interest on the
Construction Loan is due and payable monthly commencing December&nbsp;1, 2013, with all accrued and unpaid interest due at maturity. The outstanding principal balance of the Construction Loan is due and payable in a single payment at maturity. The
Construction Loan has an initial term of three years, with two additional 12-month extensions, each subject to prior notice, satisfaction of certain debt service coverage ratios, and other conditions, and the payment of a loan extension fee of 0.25%
for each extension, based on the then outstanding unpaid principal balance of the Construction Loan. In the event that the Joint Venture exercises an extension option, monthly payments of principal and accrued interest will be required, based on a
30-year repayment amortization schedule or 29-year repayment amortization schedule for second extension option, and an assumed interest rate of 6.0%. In the event of two extensions of the initial term, the estimated outstanding principal balance of
the Construction Loan would be approximately $31.7&nbsp;million at maturity. The Construction Loan may be prepaid at any time without fee, penalty or premium, with notice and all applicable payments. In the event of a default, the Construction Loan
will bear interest at the then current rate plus 5%, such amount not to exceed the highest rate authorized by applicable law. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">The Loan
Documents require the commencement of the Project within 60 days of the closing date, and the completion of construction by August&nbsp;15, 2015, subject to delays for certain unforeseeable events. The Loan Documents contain affirmative, negative
and financial covenants, agreements, representations, warranties, borrowing conditions, and events of default customary for development projects such as the Project. Affiliates of </P>
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Lennar have provided absolute, irrevocable and unconditional completion, and loss guaranties to the Lender. The Joint Venture and an affiliate of Lennar have provided the Lender with an
environmental indemnity. The Construction Loan is secured under a deed to secure debt by the Property and all improvements to be constructed thereon and an assignment of rents, and a letter of credit in the amount of approximately $2.4&nbsp;million
issued by Citibank, N.A. and naming Lender as the sole beneficiary. </P> <P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="10%" VALIGN="top" ALIGN="left"><B>Item&nbsp;9.01</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Financial Statements and Exhibits. </B></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><B>(d)</B></TD>
<TD ALIGN="left" VALIGN="top"><B>Exhibits. </B></TD></TR></TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" NOWRAP>10.1</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top">Purchase and Sale Agreement by and between Roswell Commons Group, L.P., as Seller and Lennar Multifamily Investors, LLC, as Purchaser, dated January&nbsp;10, 2013, and amendments thereto.</TD></TR>
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<TD VALIGN="top" NOWRAP>10.2</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top">Assignment and Assumption of Purchase and Sale Agreement by and between Lennar Multifamily Communities, LLC and GGT LMI City Walk GA, LLC, dated November 15, 2013.</TD></TR>
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<TD VALIGN="top" NOWRAP>10.3</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top">Limited Liability Company Agreement of GGT LMI City Walk GA, LLC, dated November 15, 2013.</TD></TR>
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<TD VALIGN="top" NOWRAP>10.4</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top">Construction Loan Agreement between Regions Bank and GGT LMI City Walk GA, LLC, dated November 15, 2013.</TD></TR>
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<TD VALIGN="top" NOWRAP>10.5</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top">Promissory Note in the original principal amount of $32,473,428, by GGT LMI City Walk GA, LLC in&nbsp;favor of Regions Bank, dated November 15, 2013.</TD></TR>
</TABLE> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Cautionary Note Regarding Forward-Looking Statements </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Statements contained herein that are not statements of historical or current fact may constitute &#147;forward-looking statements&#148; within the meaning of
the Federal Private Securities Litigation Reform Act of 1995. The Company intends that such forward-looking statements be subject to the safe harbor created by Section&nbsp;21E of the Securities Exchange Act of 1934, as amended. Forward-looking
statements are statements that do not relate strictly to historical or current facts, but reflect management&#146;s current understandings, intentions, beliefs, plans, expectations, assumptions and/or predictions regarding the future of the
Company&#146;s business and its performance, the economy, and other future conditions and forecasts of future events, and circumstances. Forward-looking statements are typically identified by words such as &#147;believes,&#148; &#147;expects,&#148;
&#147;anticipates,&#148; &#147;intends,&#148; &#147;estimates,&#148; &#147;plans,&#148; &#147;continues,&#148; &#147;pro forma,&#148; &#147;may,&#148; &#147;will,&#148; &#147;seeks,&#148; &#147;should&#148; and &#147;could,&#148; and words and terms
of similar substance in connection with discussions of future operating or financial performance, business strategy and portfolios, projected growth prospects, cash flows, costs and financing needs, legal proceedings, amount and timing of
anticipated future distributions, estimated per share net asset value of the Company&#146;s common stock, and/or other matters. The Company&#146;s forward-looking statements are not guarantees of future performance. While the Company&#146;s
management believes its forward-looking statements are reasonable, such statements are inherently susceptible to uncertainty and changes in circumstances. As with any projection or forecast, forward-looking statements are necessarily dependent on
assumptions, data and/or methods that may be incorrect or imprecise, and may not be realized. The Company&#146;s forward-looking statements are based on management&#146;s current expectations and a variety of risks, uncertainties and other factors,
many of which are beyond the Company&#146;s ability to control or accurately predict. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the Company&#146;s actual
results could differ materially from those set forth in the forward-looking statements due to a variety of risks, uncertainties and other factors. Given these uncertainties, the Company cautions you not to place undue reliance on such statements.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Important factors that could cause the Company&#146;s actual results to vary materially from those expressed or implied in its forward-looking statements
include, but are not limited to, government regulation, economic, strategic, political and social conditions, and the following: risks associated with the Company&#146;s investment strategy; a worsening economic environment in the U.S. or globally,
including financial market fluctuations; risks associated with real estate markets, including declining real estate values; risks associated with the limited amount of proceeds raised in the Company&#146;s offering of its Shares, including the
limited number of investments made; the Company&#146;s failure to obtain, renew or extend necessary financing or to access the debt or equity markets; the use of debt to finance the Company&#146;s business activities, including refinancing and
interest rate risk and the Company&#146;s failure to </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">3 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
comply with debt covenants; the Company&#146;s inability to identify and close on suitable investments; failure to successfully manage growth or integrate acquired properties and operations; the
Company&#146;s inability to make necessary improvements to properties on a timely or cost-efficient basis; risks related to property expansions and renovations; risks related to development projects or acquired property value-add conversions, if
applicable, including construction delays, cost overruns, the Company&#146;s inability to obtain necessary permits, and/or public opposition to these activities; competition for properties and/or tenants; defaults on or non-renewal of leases by
tenants; failure to lease properties on favorable terms or at all; the impact of current and future environmental, zoning and other governmental regulations affecting the Company&#146;s properties; the impact of changes in accounting rules; the
impact of regulations requiring periodic valuation of the Company on a per share basis; inaccuracies of the Company&#146;s accounting estimates; unknown liabilities of acquired properties or liabilities caused by property managers or operators;
material adverse actions or omissions by any joint venture partners; consequences of the Company&#146;s net operating losses; increases in operating costs and other expenses; uninsured losses or losses in excess of the Company&#146;s insurance
coverage; the impact of outstanding and/or potential litigation; risks associated with the Company&#146;s tax structuring; failure to qualify for and maintain the Company&#146;s qualification as a REIT for federal income tax purposes; and the
Company&#146;s inability to protect its intellectual property and the value of its brand. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">For further information regarding risks and uncertainties
associated with the Company&#146;s business, and important factors that could cause the Company&#146;s actual results to vary materially from those expressed or implied in its forward-looking statements, please refer to the factors listed and
described under &#147;Management&#146;s Discussion and Analysis of Financial Condition and Results of Operations&#148; and the &#147;Risk Factors&#148; sections of the Company&#146;s documents filed from time to time with the U.S. Securities and
Exchange Commission, including, but not limited to, the Company&#146;s quarterly reports on Form 10-Q, and the Company&#146;s annual report on Form 10-K, copies of which may be obtained from the Company&#146;s website at
http://www.CNLGrowthProperties.com. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">All written and oral forward-looking statements attributable to the Company or persons acting on its behalf are
qualified in their entirety by this cautionary note. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to, and expressly disclaims any obligation to, publicly release the results of
any revisions to its forward-looking statements to reflect new information, changed assumptions, the occurrence of unanticipated subsequent events or circumstances, or changes to future operating results over time, except as otherwise required by
law. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">4 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>SIGNATURES </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top">Date: November&nbsp;21, 2013</TD>
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<TD VALIGN="bottom"><B>CNL GROWTH PROPERTIES, INC.</B></TD></TR>
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<TD VALIGN="bottom">a Maryland corporation</TD></TR>
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<TD VALIGN="bottom">By:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Scott C. Hall</P></TD></TR>
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<TD VALIGN="bottom"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Scott C. Hall</P> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman">Senior Vice President of
Operations</P></TD></TR>
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Form 8-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant
to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 15, 2013
CNL GROWTH PROPERTIES, INC.
(Exact Name of Registrant as Specified in its Charter)
Maryland
000-54686
26-3859644
(State or Other Jurisdiction
of Incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)
450 South Orange Avenue
Orlando, Florida 32801
(Address of Principal Executive Offices; Zip Code)
Registrant's telephone number, including area code: (407) 650-1000
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01
Entry Into A Material Definitive Agreement
City Walk Development Project, Roswell, Georgia
On November 15, 2013, CNL Growth Properties, Inc. ("us," "we," "our," or the
"Company"), through a subsidiary of our operating partnership, GGT City Walk Holdings, LLC (the "CGP JV Partner"), entered into a limited liability company agreement, more fully described below (the "JV Agreement"),
with LMI City Walk Investor, LLC (the "LMI JV Partner"), an affiliate of Lennar Corporation ("Lennar"), for the purpose of forming a joint venture, GGT LMI City Walk GA, LLC, a Delaware limited liability company (the
"Joint Venture").
On November 15, 2013, the Joint Venture acquired a fee simple interest in an approximately 10.7-acre
parcel of land, located in Roswell, Fulton County, Georgia, an affluent and growing northern suburb of Atlanta (the "Property") from Roswell Commons Group, L.P., (the "Seller"), by assignment from LMI Multifamily Communities,
LLC, an affiliate of Lennar ("LMI") of that certain sales contract dated effective January 10, 2013, as amended. Prior to its acquisition, the location had been rezoned and granted site plan approval to demolish existing structures.
The Joint Venture will develop, construct and operate on the Property a 320-unit "Class A" multifamily residential community, consisting of five three-story residential buildings, and featuring a club room, community pool, fitness center,
and business center, among its amenities (the "Project"). The Project will be known as "City Walk" (hereinafter, "Roswell City Walk"). Neither we, LMI, nor Lennar is affiliated with the Seller.
The purchase price for the Property was approximately $8.1 million. The total projected budget for the Project including the purchase
price of the land, demolition and construction costs and other development costs, is approximately $46.4 million. The purchase price and related acquisition closing costs, along with certain expenses, fees and pre-development costs incurred by
LMI JV Partner, were funded by the Joint Venture from the capital contributions of the CGP JV Partner and the LMI JV Partner. The balance of the development and construction costs of the Project will be funded with a construction loan in the
approximate amount of $32.5 million from Regions Bank, as described below in Item 2.03 of this Current Report.
LMI JV Partner
has agreed to serve as the developer of the Project under the terms of a development agreement dated November 15, 2013 (the "Development Agreement"), pursuant to which the LMI JV Partner and Lennar, as guarantor, have provided the
Joint Venture with a construction cost overrun guaranty. Under the Development Agreement, the LMI JV Partner will receive a development fee equal to 3% of the final Project budget, payable in equal monthly installments during the development of the
Project. LMICS, LLC, a Lennar affiliate, will serve as the general contractor of the Project (the "Contractor"), under the terms of an AIA standard form of agreement between owner and contractor dated November 15, 2013
(the "Construction Contract"). The Contractor has agreed to construct and deliver the Project for a total of approximately $29.7 million, which amount includes a general contractor's fee equal to 4% of the cost of the work.
The construction fee is payable in monthly installments over the construction period. Commencement of the Project is planned for December 2013, and the Contractor is required to achieve substantial completion not later than 18 months from the
date of commencement, subject to certain excusable delays. We anticipate that the Project should achieve substantial completion in the second quarter of 2015. The first $285,000 of any construction cost savings shall revert 100% to the Contractor,
and thereafter, any further cost savings will revert 75% to the Joint Venture and 25% to the Contractor. The Development Agreement and the Construction Contract each contain customary representations, warranties, insurance, indemnification, events
of default, termination, dispute resolution, and other customary provisions. It is currently expected the leasing and management of Roswell City Walk will be provided by an affiliate of Lennar.
Pursuant to the JV Agreement, the CGP JV Partner agreed to fund an initial capital contribution of up to a maximum of approximately
$10.4 million for a 75% interest in the Joint Venture, and the LMI JV Partner agreed to fund an initial capital contribution of up to a maximum of approximately $3.5 million for a 25% interest in the Joint Venture. Under certain
circumstances, the members of the Joint Venture may be required to contribute additional capital to the Joint Venture. We, through the CGP JV Partner, are the managing member of the Joint Venture. However, we have delegated to the LMI JV Partner the
authority to manage certain of the day-to-day operations of the Joint Venture, subject to our approval of certain major decisions that require the consent of both members, and further subject to our right to terminate such delegation of authority,
with or without cause, as determined in the JV Agreement. In the event of the removal the LMI JV Partner as the operating partner for cause, the LMI JV Partner will cease to have any rights to approve or consent to any matters under the JV
Agreement.
1
Generally, under the terms of the JV Agreement, operating cash flow will be distributed to the
CGP JV Partner and to the LMI JV Partner on a
pro rata
basis in accordance with their respective percentage interests in the Joint Venture. Upon the occurrence of a major capital event, such as a sale of the Property or refinancing
of the Construction Loan, proceeds will be distributed
pro rata
until accrued and unpaid minimum cumulative operating returns on capital equal to 10.5% per annum are achieved and invested capital is returned. Thereafter the LMI JV Partner may
receive a disproportionately higher share of remaining proceeds at varying percentages based on our having received certain minimum threshold returns.
The JV Agreement also provides that at any time after two years following the completion of the Project, the CGP JV Partner may cause the
marketing and sale or other transfer of the Property, in which event, the LMI JV Partner may elect to agree to such marketing and sale or to purchase the CGP JV Partner's interest for a price based on the proposed sale
price.
Founded in 1954, Lennar is a Miami-based homebuilding company with a current market capitalization of over $7 billion. LMI was
founded in 2011 as an initiative to combine the financial strength of Lennar, currently the third-largest homebuilder in the United States, with the onset of increasingly favorable apartment fundamentals nationwide. We are not affiliated with
Lennar, LMI, the LMI JV Partner or any of their other affiliates; and this Project is our first development venture with Lennar.
The
information appearing in Item 2.03 of this Current Report is incorporated by reference herein and made a part of this Item 1.01.
Item 2.03
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of Registrant
City Walk Development Project - Financing
On November 15, 2013, the Joint Venture entered into a construction loan agreement and promissory note with Regions Bank (the
"Lender"). Pursuant to the loan agreement, the promissory note, deed to secure the debt, and the other documents evidencing and securing the Loan (the "Loan Documents") the Lender will fund up to approximately $32.5 million
of the development and construction costs of the Project, subject to certain loan-to-value ratio and loan-to-costs ratio limits (the "Construction Loan").
During the 36-month initial term, the Construction Loan will accrue interest at the variable interest rate per annum of 2.20% above the
one-month LIBOR rate (the "LIBOR Rate"). The interest rate is subject to adjustment monthly, with adjustments becoming effective on the first business day of each calendar month, based on the latest one-month LIBOR rate as published in the
"Money Rates" column of The Wall Street Journal two days prior to the adjustment determination.
Accrued interest on the
Construction Loan is due and payable monthly commencing December 1, 2013, with all accrued and unpaid interest due at maturity. The outstanding principal balance of the Construction Loan is due and payable in a single payment at maturity. The
Construction Loan has an initial term of three years, with two additional 12-month extensions, each subject to prior notice, satisfaction of certain debt service coverage ratios, and other conditions, and the payment of a loan extension fee of 0.25%
for each extension, based on the then outstanding unpaid principal balance of the Construction Loan. In the event that the Joint Venture exercises an extension option, monthly payments of principal and accrued interest will be required, based on a
30-year repayment amortization schedule or 29-year repayment amortization schedule for second extension option, and an assumed interest rate of 6.0%. In the event of two extensions of the initial term, the estimated outstanding principal balance of
the Construction Loan would be approximately $31.7 million at maturity. The Construction Loan may be prepaid at any time without fee, penalty or premium, with notice and all applicable payments. In the event of a default, the Construction Loan
will bear interest at the then current rate plus 5%, such amount not to exceed the highest rate authorized by applicable law.
The Loan
Documents require the commencement of the Project within 60 days of the closing date, and the completion of construction by August 15, 2015, subject to delays for certain unforeseeable events. The Loan Documents contain affirmative, negative
and financial covenants, agreements, representations, warranties, borrowing conditions, and events of default customary for development projects such as the Project. Affiliates of
2
Lennar have provided absolute, irrevocable and unconditional completion, and loss guaranties to the Lender. The Joint Venture and an affiliate of Lennar have provided the Lender with an
environmental indemnity. The Construction Loan is secured under a deed to secure debt by the Property and all improvements to be constructed thereon and an assignment of rents, and a letter of credit in the amount of approximately $2.4 million
issued by Citibank, N.A. and naming Lender as the sole beneficiary.
Item 9.01
Financial Statements and Exhibits.
(d)
Exhibits.
10.1
Purchase and Sale Agreement by and between Roswell Commons Group, L.P., as Seller and Lennar Multifamily Investors, LLC, as Purchaser, dated January 10, 2013, and amendments thereto.
10.2
Assignment and Assumption of Purchase and Sale Agreement by and between Lennar Multifamily Communities, LLC and GGT LMI City Walk GA, LLC, dated November 15, 2013.
10.3
Limited Liability Company Agreement of GGT LMI City Walk GA, LLC, dated November 15, 2013.
10.4
Construction Loan Agreement between Regions Bank and GGT LMI City Walk GA, LLC, dated November 15, 2013.
10.5
Promissory Note in the original principal amount of $32,473,428, by GGT LMI City Walk GA, LLC in favor of Regions Bank, dated November 15, 2013.
Cautionary Note Regarding Forward-Looking Statements
Statements contained herein that are not statements of historical or current fact may constitute "forward-looking statements" within the meaning of
the Federal Private Securities Litigation Reform Act of 1995. The Company intends that such forward-looking statements be subject to the safe harbor created by Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking
statements are statements that do not relate strictly to historical or current facts, but reflect management's current understandings, intentions, beliefs, plans, expectations, assumptions and/or predictions regarding the future of the
Company's business and its performance, the economy, and other future conditions and forecasts of future events, and circumstances. Forward-looking statements are typically identified by words such as "believes," "expects,"
"anticipates," "intends," "estimates," "plans," "continues," "pro forma," "may," "will," "seeks," "should" and "could," and words and terms
of similar substance in connection with discussions of future operating or financial performance, business strategy and portfolios, projected growth prospects, cash flows, costs and financing needs, legal proceedings, amount and timing of
anticipated future distributions, estimated per share net asset value of the Company's common stock, and/or other matters. The Company's forward-looking statements are not guarantees of future performance. While the Company's
management believes its forward-looking statements are reasonable, such statements are inherently susceptible to uncertainty and changes in circumstances. As with any projection or forecast, forward-looking statements are necessarily dependent on
assumptions, data and/or methods that may be incorrect or imprecise, and may not be realized. The Company's forward-looking statements are based on management's current expectations and a variety of risks, uncertainties and other factors,
many of which are beyond the Company's ability to control or accurately predict. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, the Company's actual
results could differ materially from those set forth in the forward-looking statements due to a variety of risks, uncertainties and other factors. Given these uncertainties, the Company cautions you not to place undue reliance on such statements.
Important factors that could cause the Company's actual results to vary materially from those expressed or implied in its forward-looking statements
include, but are not limited to, government regulation, economic, strategic, political and social conditions, and the following: risks associated with the Company's investment strategy; a worsening economic environment in the U.S. or globally,
including financial market fluctuations; risks associated with real estate markets, including declining real estate values; risks associated with the limited amount of proceeds raised in the Company's offering of its Shares, including the
limited number of investments made; the Company's failure to obtain, renew or extend necessary financing or to access the debt or equity markets; the use of debt to finance the Company's business activities, including refinancing and
interest rate risk and the Company's failure to
3
comply with debt covenants; the Company's inability to identify and close on suitable investments; failure to successfully manage growth or integrate acquired properties and operations; the
Company's inability to make necessary improvements to properties on a timely or cost-efficient basis; risks related to property expansions and renovations; risks related to development projects or acquired property value-add conversions, if
applicable, including construction delays, cost overruns, the Company's inability to obtain necessary permits, and/or public opposition to these activities; competition for properties and/or tenants; defaults on or non-renewal of leases by
tenants; failure to lease properties on favorable terms or at all; the impact of current and future environmental, zoning and other governmental regulations affecting the Company's properties; the impact of changes in accounting rules; the
impact of regulations requiring periodic valuation of the Company on a per share basis; inaccuracies of the Company's accounting estimates; unknown liabilities of acquired properties or liabilities caused by property managers or operators;
material adverse actions or omissions by any joint venture partners; consequences of the Company's net operating losses; increases in operating costs and other expenses; uninsured losses or losses in excess of the Company's insurance
coverage; the impact of outstanding and/or potential litigation; risks associated with the Company's tax structuring; failure to qualify for and maintain the Company's qualification as a REIT for federal income tax purposes; and the
Company's inability to protect its intellectual property and the value of its brand.
For further information regarding risks and uncertainties
associated with the Company's business, and important factors that could cause the Company's actual results to vary materially from those expressed or implied in its forward-looking statements, please refer to the factors listed and
described under "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the "Risk Factors" sections of the Company's documents filed from time to time with the U.S. Securities and
Exchange Commission, including, but not limited to, the Company's quarterly reports on Form 10-Q, and the Company's annual report on Form 10-K, copies of which may be obtained from the Company's website at
http://www.CNLGrowthProperties.com.
All written and oral forward-looking statements attributable to the Company or persons acting on its behalf are
qualified in their entirety by this cautionary note. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to, and expressly disclaims any obligation to, publicly release the results of
any revisions to its forward-looking statements to reflect new information, changed assumptions, the occurrence of unanticipated subsequent events or circumstances, or changes to future operating results over time, except as otherwise required by
law.
4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Date: November 21, 2013
CNL GROWTH PROPERTIES, INC.
a Maryland corporation
By:
/s/ Scott C. Hall
Scott C. Hall
Senior Vice President of
Operations