April 4, 2018 Comments (0) Blog, Current Investigations

Healthcare Trust Inc. Decreases Net Asset Value (NAV)

Healthcare Trust
(Last Updated On: April 4, 2018)

Healthcare Trust Inc. Board also approves decrease in distributions

The White Law Group continues to investigate potential claims involving broker dealers who may have unsuitably recommended Healthcare Trust Inc. to investors.

Healthcare Trust is a publicly registered non-traded real estate investment trust sponsored by AR Global. The REIT invests in multi-tenant medical office buildings. The company’s primary offering went effective in February 2013 and closed in November 2014 after raising $2.2 billion in investor equity.

Last month we told you that Healthcare Trust, Inc. commenced a self-tender offer for up to 2,000,000 shares at a price of $13.15 per share, in response to a third party tender offer from MacKenzie Capital Management, LP  to purchase up to 2,000,000 at a price of $12.11 per share in cash.

Now, the board of Healthcare Trust has approved a decrease of 5.6 percent in net asset value per share from $21.45/share to of $20.25/share of the company’s common stock as of December 31, 2017.

Shares of Healthcare Trust Inc. were originally sold for $25.00 each.

Additionally, the company recently lowered its annual distribution rate from $1.45 to $0.85 per share. In approving the $20.25 NAV per share, the independent directors reportedly considered the negative effect of previously paying distributions that exceeded cash flows from operations would be significantly less in future following the recent distribution rate decrease.

The Risks of Investing in Non-traded REITs

The trouble with non-traded REITs, like Healthcare Trust Inc., is they often lack liquidity. Investors looking to sell these investments often have difficulty finding a buyer, and if they are able to find one can suffer significant losses on the sale.

Non-traded REITs are complex and inherently risky products. Compared to traditional investments, such as stocks, bonds and mutual funds, REITs are significantly more complex and often better suited for sophisticated and institutional investors.

Another problem often associated with REIT recommendations is the high sales commissions brokers typically earn for selling REITs – as high as 15%.

Brokers have an obligation to make investment recommendations that are consistent with their clients risk tolerance, net worth, investment objectives and experience in the market. Unfortunately, in many cases, the high sales commission may provide some brokers with enough incentive to make unsuitable investment recommendations.

If a broker dealers fails to perform adequate due diligence on a recommended investment, and losses are incurred, they may be held responsible in a FINRA arbitration claim.

If you suffered losses investing in Healthcare Trust Inc. or another non-traded REIT the securities attorneys at The White Law Group may be able to help you. For 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 White Law Group, visit www.whitesecuritieslaw.com.

 

 

 

 

error: Content is protected !!