Investor Lawyers Blog
Inland American REIT has changed its name to Inventrust Properties Corp. In addition, the Company’s SEC fillings report a recent tender offer of $2.00 per unit from Mackenzie Realty. The $2.00 a share tender offer represents a sharp dropoff from Inland American’s initial offering price of $10.00 a share.
Inland American is an enormous company- the largest of the giant non-traded REITS. The Company had raised a total of approximately $8.0 billion of gross offering proceeds as of December 31, 2008.
Inland American is a non-traded REIT, meaning that its shares are not listed on a national securities exchange. However, sales of shares in non-traded REITs, which file periodic reports with the Securities Exchange Commission as do listed companies, are not limited to accredited investors and shares are sold to the general public through brokers.
Non-traded real estate investment trusts (REITs) are highly risky products that pose a significant risk that the investor will lose some or all of his initial investment. Non-traded REITs are not listed on a national securities exchange, limiting investors’ ability to sell them after the initial purchase. Such illiquid and risky investments are often better suited for sophisticated and institutional investors, rather than retail investors such as retirees who do not wish to have their money tied up for years, or risk losing a significant portion of their investment.
Brokers and financial advisors are required to make investment recommendations that are consistent with their clients’ risk tolerance, net worth, investment objectives and experience in the market. However, due to the high sales commissions brokers typically earn for selling REITs – as high as 15%- brokers can be tempted to make “one size fits all” recommendations to investors in order to reap commissions. Brokerage firms are required by FINRA rules to supervise brokers and investment advisors- even those who work in independent branch offices- to ensure that the brokers make only suitable recommendations.
If you have suffered significant losses as a result of unsuitable recommedations of REITs or other non-conventional investments by a stockbroker or financial advisor, you may have a valid securities arbitration claim. To find out more about your legal rights and options, contact an investor rights attorney at Law Office of Christopher J. Gray, P.C. at (866) 966-9598 or newcases@investorlawyers.net for a no-cost, confidential consultation.