REIT Category Archives — Page 5 of 5 — Investor Lawyers Blog Published by New York, New York Investor Attorneys

Published on: November 1, 2012

Recovery of Behringer Harvard Opportunity REIT I Losses

Many investors have suffered significant REIT losses as a result of their investment in the Behringer Harvard Opportunity REIT I. The investment’s $10 per share offering price in 2009 fell significantly to an approximate value of $4.12 per share at the end of last year, representing a 58 percent loss. This figure includes the 46 percent drop experienced at the end of 2010, when it was valued at around $7.66 per share.

Recovery of Behringer Harvard Opportunity REIT I Losses

In the period beginning in December 2010 and ending in September 2011, Behringer Harvard Opportunity REIT I’s assets declined to $580 million from $697.6 million. The REIT reported an $83 million net loss.

According to investment fraud lawyers, many investors believed their non-traded REIT’s share price was stable. However, it only appeared stable because the manager reports the par value, which does not necessarily take into account the underlying assets deterioration. Furthermore, typically the initial pricing does not include fees and other expenses, which can result in a loss because these dollars are not actually invested.

Published on: October 31, 2012

Behringer Harvard Multifamily REIT I Loss Recovery

by InvestorLawyers

Stock fraud lawyers are currently investigating claims on behalf of investors who have experienced significant losses as a result of their investment in Behringer Harvard Multifamily REIT I.

Behringer Harvard Multifamily REIT I Loss Recovery

“With an unlisted REIT, it’s generally understood that distributions must be paid to investors before assets are acquired, and therefore, before operating income covers distributions,” says Robert S. Aisner, president and CEO of Behringer Harvard Holdings, Behringer Harvard’s parent company. “Distributions at that phase are largely a return of the investor’s capital.”

However, many stock fraud lawyers would argue that this fact is not “generally understood” by, or explained to, investors by their financial advisor or brokerage firm.

Published on: October 29, 2012

Recovery of Inland Western REIT Losses

by InvestorLawyers

Earlier in October, another claim was filed in an effort to help investors recover REIT losses. This claim was against LPL Financial and its goal is to recover losses sustained in Retail Properties of America, formerly known as Inland Western Real Estate Investment Trust. This claim, which was filed with FINRA, also involves eight other alternative, illiquid investments, and is seeking $1,000,000 in damages.

Recovery of Inland Western REIT Losses

Typically, REITs carry a high commission which motivates brokers to make the recommendation to investors despite the investment’s unsuitability. The commission on a non-traded REIT is often as high as 15 percent. Non-traded REITs carry a relatively high dividend or high interest, making them attractive to retired investors. However, non-traded REITs are inherently risky and illiquid, which limits access of funds to investors. In addition, frequent updates of the investment’s current price are not required of broker-dealers, causing misunderstandings about the financial condition of the investment. Because frequent updates are not required, investors may believe the REIT is doing much better than it actually is.

Reportedly, LPL Financial and its advisor, used an over-concentration of illiquid investments in the client’s portfolio. Furthermore, these investments carried a high level of risk because the securities recommended to the claimant didn’t trade freely. In addition to the Inland Western REIT, the portfolio also consisted of KBS REIT, Inland American REIT, LEAF Fund, Hines REIT, Atlas, ATEL Fund X, PDC 2005A, and ATEL Fund XI