April 6, 2017 Comments (0) Blog

Two Lightstone REITs Terminate Offerings

Lightstone REITs
(Last Updated On: April 6, 2017)

Recovery of Investment Losses in Lightstone REITs

Have you suffered investment losses in Lightstone REITs? If so, The White Law Group may be able to help you recover your losses by filing a FINRA Dispute Resolution claim against the brokerage firm that sold you the investment.

Lightstone Value Plus REIT III invested in hotels, as well as in other types of properties and real estate related assets. The REIT, which currently owns a portfolio of nine properties, commenced its $300 million offering in July 2014 and has raised $124 million, as of February 2017.

Lightstone Real Estate Income Trust was declared effective in February 2015 and has raised approximately $73 million, as of February 2017. The company holds a 22.5 percent interest in a 281-unit multifamily property in Tiburon, California in which it invested $20 million.

Lightstone Terminates Public Offerings

The boards of Lightstone Real Estate Income Trust and Lightstone Value Plus Real Estate Investment Trust III terminated their respective initial public offerings, according to filings with the Securities and Exchange Commission. The companies did not disclose the reason for the terminations.

Subscriptions as of March 31, 2017 will be processed until April 13, 2017, and the REITs’ distribution reinvestment programs share repurchase plans will remain in effect.

Both Lightstone REITs terminated their dealer manager agreements with Orchard Securities, and neither will incur any penalties or payments for the early termination.

Lightstone REIT terminated its loan agreement with its sponsor, The Lightstone Group, where the sponsor committed to invest $36 million, or 12 percent of the $300 million maximum offering.

Lightstone Value Plus Real Estate Investment Trust III terminated its contribution agreement with Lightstone SLP III LLC, a special limited partner that also agreed to invest $36 million into the $300 million REIT.

The Problem with Non-traded REITs

Non-traded REITs, like Lightstone REITs, involve a much greater degree of risk compared to traditional investments, such as stocks, bonds or mutual funds. These types of investments are more complex, lack liquidity and therefore better suited for sophisticated and institutional investors.

Broker dealers are required to perform adequate due diligence on any investment they recommend and to ensure that all recommendations are suitable for the investor in light of the investor’s age, risk tolerance, net worth, and investment experience.

If a brokerage firm makes unsuitable investment recommendations or fails to adequately disclose the risks associated with an investment they may be liable for investment losses.

To determine whether you may be able to recover investment losses incurred as a result of your purchase of  Lightstone REITs, please contact The White Law Group at (888) 637-5510 for a free consultation.

The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida. For more information on the firm, visit www.WhiteSecuritiesLaw.com.