Securities Fraud Blog | Find out if your broker is liable for your losses

TAG | Behringer Harvard

Attorney Lars Soreide has recently been contacted by investors who have placed their money in unlisted REITs (Real Estate Investment Trusts), particularly, but not limited to, Behringer Harvard REIT. An unlisted REIT is a real estate investment trust that is not traded on the national stock exchanges. Unlisted, or non-traded, REITS differ from listed REITs in that they are not traded in an open market. Non-traded REITs are sold to investors who hold the product until the end of an investment term.

Behringer Harvard REIT, and other non-traded REITs, have their value set by the  companies which sell them. A listed, or public, REIT is valued daily on the market in which it is traded. A non-traded REIT’s value is determined by the staff of the REIT, or a consultant paid for by the REIT.  This can be seen as a conflict of interest in the standard valuation procedure of a non-traded REIT.

 Allegedly, many customers were not made aware of the restrictions of these products and financial advisors failed to make the true risks of these investments known to retail investors who suffered the losses. Also, the broker’s fees make it very advantageous to the broker at roughly a 15% commission.

If you feel you have been an alleged victim of  Behringer Harvard REIT, or have become of victim of a similar situation with an unlisted REIT, please call a Securities Arbitration Lawyer for a free consultation on how to recover your losses.  To speak with an attorney, call 888-760-6552, or visit www.stockmarketlawsuit.com. Soreide Law Group, PLLC., representing investors nationwide before FINRA  the Financial Industry Regulatory Authority.

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Apr/11

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Are you Invested in REITs?

Soreide Law Group, PLLC,  is currently investigating alleged claims against a number of the following REITs.  If you feel you have lost money with any of the following REITs, please call us, without cost to you, and set up a consultation with a lawyer to pursue your claims.

In an article for eHow.com, Money division, they list the definition for REIT as:

REIT stands for Real Estate Investment Trust. A REIT is a company that, according to the National Association of Real Estate Investment Trusts (NAREIT), invests at least 75 percent of its assets in real estate. You can purchase shares of REITs on stock exchanges just as you do shares of stocks and other securities.

  1. Function

    • REITs are companies that own and, in some cases, provide financing for real estate. In order to qualify as a REIT, the company must invest at least 75 percent of its capital in real estate, and must pay out at least 90 percent of its taxable income to investors each year as dividends. By doing this, shareholders effectively pay the tax on this income, freeing the REIT from the obligation of paying corporate income tax, notes NAREIT.

    History

    • Congress, explains NAREIT, created REITs in 1960 to make real estate investments available to everyday investors without the need to purchase physical property. Before REITs, the only way to dabble in real estate was through direct investments, which, generally, left smaller investors on the sidelines. REITs have grown significantly. NAREIT reports that the total market capitalization for all REITs rose from $90 billion to $200 billion between 2000 and 2010.

    Types

    • Typically, REITs are split into three categories: equity REITs, mortgage REITs and hybrid REITs. Equity REITs, according to NAREIT, own a wide array of income-producing real estate assets. To qualify as an equity REIT, a company must commit to holding and developing its properties as opposed to selling them for profit, making rent its main source of income. Mortgage REITs, for the most part, engage in the business of providing loans to real estate owners, deriving their income from interest on these loans. Hybrid REITs, as the name implies, take part in the activities of both equity and mortgage REITs.

  • Despite the strong historical performance of REITs, according to the eHow.com, Money section, including a 90 percent gain between March 2009 and April 2010, Jeffrey R. Kosnett, a senior editor at Kiplinger’s Personal Finance, sounds a word of caution. Kosnett points to REIT losses of 18 percent and 37 percent in 2007 and 2008, respectively, as evidence that REITs are riskier than conventional wisdom and past gains imply.

- REITS -

American Realty Capital New York Recovery REIT (Reg. D)

Behringer Harvard Multifamily REIT I

Behringer Harvard – Opportunity REIT I, LLC

Behringer Harvard – REIT I, LLC

Cornerstone Growth & Income REIT

Desert Capital REIT

Inland American REIT

Lightstone Value Plus REIT

NETREIT $200 Stock Offering

NNN Apartment REIT, Inc.

NNN – G REIT

Strategic Storage Trust, Inc.

Wells REIT II

Wells Real Estate Funds Timberland REIT

Wells Timberland REIT Updated Review

Western America Blue Jacket REIT

Have you been an alleged victim of  any of these or other REITs? Call a Securities Arbitration Lawyer for a free consultation on how to recover your losses.  To speak with an attorney, call 888-760-6552, or visit www.stockmarketlawsuit.com. Soreide Law Group, PLLC., representing investors nationwide before FINRA  the Financial Industry Regulatory Authority.

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