According to a recent article from investmentnews.com, investors in the nontraded Behringer Harvard Opportunity REIT I were informed at the end of the year that the estimated value of their investment had decline 46% from last year’s valuation. The value per unit of the Behringer Harvard Opportunity REIT I is now estimated at $4.12 per unit, down from $7.66 a year ago. It joins another Behringer Harvard nontraded REIT, the more than 4.2 billion dollar Behringer Harvard REIT I, with a valuation under $5 per share.
This most recent valuation will likely be troubling to many investors in the nontraded REIT. If you are an investor in the Berhinger Harvard Opportunity REIT I and are wondering if you may have recourse to recover your investment, The White Law Group may be able to assist you in recovering your nontraded REIT damages through the FINRA arbitration process. The Financial Industry Regulatory Authority (FINRA) continues to pay close attention to issues related to non-traded REITs, including how they are sold and valuated.
The White Law Group has represented many investors in non-traded REITs over the past few years in FINRA dispute resolution claims. Issues that have commonly arisen have surrounded their sale and representation to the investing public. In many cases the risks associated with nontraded REIT investments were not adequately represented and investors have often been over concentrated in the investment vehicle. In some cases, these issues can be attributed to the fact that advisors receive relatively high commissions for the sale of nontraded REITs compared to other products. Additionally, it seems common that the illiquid nature of non-traded REITs has not been made clear to some investors.
Brokerage firms have a fiduciary duty to perform due diligence on any investment and to insure that an investment is appropriate in light of the investor’s age, investment experience, and investment objectives. If a broker fails in this responsibility, investors may have an actionable claim to recover their investment losses in a claim through FINRA dispute resolution.
The investmentnews.com notes that the value of the Behringer Harvard Opportunity REIT I has been in decline since its 2009 valuation at $10 per share. President of Behringer Harvard Robert Aisner, the REIT’s manager, has attributed the decline to the shedding of assets. He has been quoted as saying, “…since the REIT is shedding assets, its valuation will go down in the long run.” Industry experts were not shocked by the decline in estimated value. Michael Stubben, president of MTS Research Advisors, was quoted in the investmentnews.com as saying, “It’s a smaller REIT, and in its liquidation phase. It’s been underperforming and struggling throughout its program.”
In the letter that Behringer Harvard sent to investors in the Behringer Harvard Opportunity REIT I, they indicated that the investments decline can be attributed to the steep and unexpected decline in the real estate market. The hope for investors in any nontraded REIT is to receive returns until the investment runs its course and then have the principal or more returned at the end of the program. Aisner told the investment news that that outcome would be difficult for the Behringer Harvard Opportunity REIT I, “The recovery of $10 [per share] will be a real challenge,” he said.
If you are concerned about your investment in the Behringer Harvard Opportuity REIT I or another Behringer Harvard nontraded REIT and would like to speak to a securities attorney about your ability to recover your investment losses through FINRA arbitration please call our Chicago office at 312-238-9650.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.
For more information on The White Law Group, please visit our website at http://www.whitesecuritieslaw.com.
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