April 27, 2018 Comments (0) Blog, Current Investigations

Griffin Capital Essential Asset REIT – Third Party Tender Offer

Griffin Capital Essential Asset REIT

The White Law Group continues to investigate potential securities fraud claims involving broker-dealers’ improper recommendation of high-risk non-traded REIT investments, like Griffin Capital Essential Asset REIT.

According to Mackenzie Capital Management, the company has recently extended a tender offer to purchase shares of Griffin Capital Essential Asset REIT $7.24 per Share. According to the offer, Griffin’s Share Redemption Program reached its annual limit of 5% in September 2017. Additionally, the REIT estimates that it shares are worth $10.04 per share, but there is no currently established trading market for these shares at that price.

The offer from Mackenzie also states that Griffin Capital’s board is beginning “to consider the appropriate timing for a liquidity event…” but there is no guarantee about if or when this will happen.

The Problem with Non-traded REITs

Many investors are not fully aware of the problems and risks associated with Real estate investment trusts (REITs) before purchasing them. This includes lack of 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.

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.

Brokers typically earn high commissions for selling REITs – as high as 15%. Unfortunately, in many cases, the high sales commission may provide some brokers with enough incentive to make unsuitable investment recommendations.

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.

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. Firms that fail to do so, may be held responsible for any losses in a FINRA arbitration claim.

FINRA operates the largest securities dispute resolution forum in the United States, and has extensive experience in providing a fair, efficient and effective venue to handle a securities-related dispute.

Free Consultation

If you suffered losses investing in Griffin Capital Essential Asset REIT 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 White Law Group, visit www.whitesecuritieslaw.com.