If you or someone you love has lost money in a non-traded real estate investment trust (REIT), you may have grounds to pursue a claim to recover your losses.
Meyer Wilson is a nationally recognized law firm dedicated to helping wronged investors recover losses caused by investment fraud and misconduct. Our attorneys have decades of experience representing clients in claims involving REITs against brokerage firms and investment advisers nationwide.
To discuss a non-traded REIT lawsuit, contact us for a FREE consultation.
A real estate investment trust, or REIT, is a corporation, trust, or association that owns and manages real estate. REITs pool the capital of investors to purchase a portfolio of properties – from office buildings and shopping centers to hotels and apartments – which the typical investor might not otherwise be able to purchase individually.
Unlike public REITs traded on an exchange, non-traded REITs don’t have a market and are not traded, which means investors have to wait for the underlying real estate to be sold to get their money back.
This lack of liquidity creates a level of risk that is not suitable for most investors.
FINRA has warned that non-traded REITs are not usually suitable for the average investor – especially senior investors. According to FINRA:
“Non-traded REITs are rarely, if ever, suitable for short-term investors and even long-term investors must be willing to bear the risks of illiquidity.”
Promoters of non-traded REITs say they offer high yields from rental income and that after 7-10 years, property can be sold and investors can get their money back – or even more if the property is sold for profit. Unfortunately, that isn’t always the case.
Some of the reasons why non-traded REITs are a risky investment option:
Watch our video: The Dangers of Non-Traded REITs.
Brokers and investment advisers can rarely justify recommendations to purchase non-traded REITs. Even if a client desires diversification into the real estate sector, client interests are far better served by investing in low cost liquid funds managed by individuals with expertise and incentives to construct diversified portfolios with real estate investments.
Many brokers and advisers who recommend non-traded REITs to retail investors usually do so because of the large selling commissions they earn. Sometimes, brokers and advisers may engage in fraud or misconduct when recommending or selling non-traded REITs to clients, such as misrepresenting the features of risks of the product
Potential claims involving non-traded REITs can include:
Non-traded REITs are complicated and risky investments, even though sales pitches can mislead consumers into thinking they are safer than they really are. In many cases, the only way to recover losses is to pursue a claim against the brokerage firm or adviser that sold it to you
If you purchased a non-traded REIT at the recommendation of a broker or adviser, contact us to speak with an investment loss attorney during a FREE consultation. Meyer Wilson has represented over 1,000 investors nationwide in stockbroker mediation, arbitration, and litigation, and may be able to help you.