Over the last several years, real estate is one of the hottest investments out there. Everyone wants to take advantage of the rising prices and rents to generate more capital gains and income.
Real estate companies are using this strong growth to raise more money to build their holdings and portfolios. One of the ways that they get access to capital is by forming a real estate investment trust (REIT). These are places where investors pool their money together to receive consistent income and returns. They let the professionals do all of the day-to-day managing of the real estate and collect the dividends and capital appreciation.
The Securities and Exchange Commission set rules regarding the formation and classification of REITS including:
- 90% of all income must be sent out to investors in the form of dividends.
- 95% of its income must be from real estate sources, to include any interest and dividends.
- 75% of all its holdings must be invested in real estate or in cash.
- 25% of the holdings can be in securities such as stocks, bonds, or a taxable REIT subsidiary.
These are the basic standards that all REITs must follow to be listed under this classification.
Why Choose Our Real Estate Investment Loss Lawyer?
Our REIT Loss Lawyer Can Help You Explore Your Options
REITs can be a confusing investment. You rely on the advice of your investment professionals to help you to understand the risks and rewards. Non-publicly traded REITs are very speculative. If your broker does not disclose the risks and consider your investment objectives, risks, income, and net worth, they are breaking suitability guidelines. Situations like this are when you need to call the real estate investment trust loss attorneys at 800.931.8452.
Investing in REITs can be speculative, and you can’t put your life savings at risk. We are the best at identifying REIT fraud and have a 99% success rate. Our goal is to investigate what happened and hold those responsible accountable for their actions.
The Wolper Law Firm is an authority in investment loss. We know the law, and our team of REIT fraud lawyers has over 30 years of combined experience working in the securities industry. We know what to look for and how the law applies to your case. Call us today at 800.931.8452 if you need a REIT loss lawyer.
A Publicly Traded REIT vs. a Non-Traded REIT
REITs can be publically traded on stock exchanges such as the NYSE or NASDAQ. These REITs are more transparent, and you can easily buy or sell them.
Other REITS are not publically traded. These are referred to as non-traded REITS. Non-traded REITs are less liquid, and you don’t know what is going on with the company or its real estate holdings. These investments make it harder for you to get your money when you need it. The REIT can also suspend the dividend payouts without notice.
You don’t know about the possible risks of investing in this area of real estate. Stockbrokers and financial advisers like to sell nontraded REITs. They receive commissions as high as 7% and don’t tell you about the risks. Many times, their firm is underwriting non-traded REITs and they push their brokers and advisers to promote these products to their customers. These investments are a breach of their fiduciary responsibilities to look at your risk tolerance, income, and net worth before making a recommendation.
Our Real Estate Investment Trust Loss Attorney Can Help
If you own non-traded REITs and can’t get access to your money, contact the REIT loss lawyers at the Wolper Law Firm. We will go after the brokerage firm, the broker, or the financial advisor that sold you these REITs. These investments have to be suitable for you and they are intended for high-net-worth individuals who understand the risks. We are the best real estate investment trust loss lawyers and know what to do to help you to get your money back.
The current state of the real estate market increases the losses you could face in publicly traded REITs. These markets go through boom and bust cycles. This means that you could face significant losses even when you can sell your REIT. Times like these are when you want to call the REIT loss lawyers. We know how to evaluate these investments and what happened to your money.
Call us today at 800.931.8452 and get your free, no-obligation consultation.
REIT Loss Attorneys Answer Common Questions
Following are questions and general answers regarding REITs that our REIT loss lawyers commonly address.
You face many different risks, including the loss of principal and income, illiquidity, and complex tax challenges.
The only way to liquidate private REITs is through the company. Periodically, there are windows where you can sell your shares, but this requires filling out a lot of paperwork.
The biggest risks of publicly traded REITs are the loss of principal and dividends. These investments track the real estate market. They are subject to fluctuations in areas such as residential rentals, manufacturing, healthcare/medical facilities, retail, and office space.
The dividends you receive from non-public REITs are taxed as ordinary income and with a 3.8% surtax on investment income. Our team can explain these issues better, so that you understand what is happening.
The Wolper Law Firm has extensive experience handling cases involving REITs. If you have lost money investing in REITs, please contact the Wolper Law Firm for a free consultation and case evaluation at 800.931.8452.
An Example of REIT Fraud in Connection With the Sale of Non-Traded REITs
A recent example of fraud in connection with the sale of Non-Traded REITs occurred with American Realty Capital family of Non-Traded REITs, which is a global asset manager with a variety of investment programs, principally consisting of REITs invested in real estate throughout the United States and Europe. Its affiliate, AR Capital, sponsors REITs in a variety of industries, including healthcare, retail shopping centers and commercial properties. AR Capital was founded by Nicholas Schorsch, the disgraced real estate asset manager who recently agreed to pay fines of more than $60 million in connection with the REITs sponsored by AR Capital. In addition, Schorsch, his publicly traded REITs (known as Vereit), and their accounting firm, paid an additional $1 billion to settle a class action regarding, among other things, manipulation of company financials. (See https://www.investmentnews.com/article/20190909/FREE/190909943/nicholas-schorschs-former-flagship-reit-settles-with-investors-for-1).
Financial advisors continued to sell American Realty Capital without disclosure of the underlying misconduct by the issuer. Many of the American Realty Capital products suspended dividends and declined substantially in principal value.
Contact Our Real Estate Investment Trust Loss Lawyer at the Wolper Law Firm Today
Our Experience Makes the Difference
Contact us to work with some of the best attorneys for investigating and pursuing those firms that sold you REITs. Our team has the experience working in the securities industry and as trial attorneys. This makes us skilled professionals at what we do. Call us today at 800.931.8452 for help.
Attorney Matthew Wolper
Matt Wolper is a trial lawyer who focuses exclusively on securities litigation and arbitration. Mr. Wolper has handled hundreds of securities matters nationwide before the Financial Industry Regulatory Authority (FINRA), American Arbitration Association (“AAA”), JAMS, and in state and federal court. Mr. Wolper has handled and tried cases involving complex financial products and strategies ranging from traditional stocks and bonds to options, margin and other securities-based lending products, closed/open-end mutual funds, structured products, hedge funds, and penny stocks.
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