May 9, 2017 Comments (0) Current Investigations

Benefit Street Partners Realty Trust Tender Offer

Benefit Street Partners Realty Trust
(Last Updated On: May 9, 2017)

Recovery of Investment Losses in Benefit Street Partners Realty Trust

Have you suffered losses investing in Benefit Street Partners Realty Trust? If so, The White Law Group may be able to help you recover your losses by filing a FINRA Resolution claim against the brokerage firm that sold you the investment.

Benefit Street Partners Realty Trust is a publicly registered non-traded real estate investment trust formerly known as Realty Finance Trust. The REIT appointed Benefit Street Partners as its new advisor at the end of September 2016, replacing AR Global Investments – formerly AR Capital.

Benefit Street Partners Realty Trust focuses on commercial real estate debt investments secured by income-producing properties and targets loans and securities – diversified by duration, geographic location, property type, ownership, and tenancy.

The REIT began operations in November 2012 and raised $786 million in investor equity prior to closing the offering in January 2016. As of September 30, 2016, the company’s portfolio consisted of 73 loans and 7 CMBS investments.

Mackenzie Capital Completes Tender offer for Benefit Street Partners Realty Trust

According to various reports, MacKenzie Realty Capital Inc., a non-traded business development company, purchased 11,805 shares of Benefit Street Partners Realty Trust Inc. for $12.05 each in its latest tender offer. MacKenzie paid approximately $142,000 for the shares and now owns less than .04 percent of the total outstanding shares.

Unfortunately for many investors, it appears that the tender offer price would represent a significant loss on their initial capital investment. This is unfortunate news for investors as the original purchase price per share was $25.

Benefit Street Partners Realty Trust urged its stockholders to reject the tender offer, stating that the tender offer is well below the estimated net asset value per share of $20.05 that was approved in November 2016.

Additionally, the REIT stated that January 2017 it paid an average of $19.23 for nearly 473,806 shares repurchased from its stockholders.

Risks of REITs

real estate investment trust (REIT) is a company that owns, and in most cases, operates income-producing real estate. REITs own many types of commercial real estate, ranging from office and apartment buildings to warehouses, hospitals, shopping centers, hotels and even timberlands. Some REITs also engage in financing real estate. The REIT structure was designed to provide a real estate investment structure similar to the structure mutual funds provide for investment in stocks.

REITs are complex and high risk investments that are really only suitable for sophisticated investors.

It is the duty of the brokerage firm to perform due diligence on any investment. They must ensure that the investment is suitable for a particular investor in light of that investor’s age, investment objectives, income, net worth, and investment experience.  Given the current risk of devaluation of these REITs, such investments are likely only suitable for wealthy and/or sophisticated investors.

The White Law Group is investigating potential securities fraud claims involving broker-dealers’ improper recommendation that some investors purchase REITs like Benefit Street Partners Realty Trust. Brokerage firms that sell such products are required to perform adequate due diligence on the investments.  They must ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable in light of the client’s age, net worth, investment experience, and investment objectives.

If you suffered losses investing in Benefit Street Partners Realty Trust and would like a free consultation with a securities attorney, please call The White Law Group at 888-637-5510.

The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.

For more information on the firm, visit http://www.whitesecuritieslaw.com.

 

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