The White Law Group, LLC, a South Florida securities fraud, broker fraud, securities arbitration, investor protection and Chapter 7 bankruptcy law firm based in Boca Raton, Florida.

Posts tagged ‘REIT fraud attorney’

Recovery of Columbia Property Trust Losses

Have you suffered losses in Columbia Property Trust?  If so, the securities attorneys of The White Law Group may be able to help you recover your losses through a FINRA arbitration claim.

According to its website, Columbia Property Trust is an investment management company with a $5+ billion portfolio comprising of more than 60 Class-A office properties in key markets nationwide.  Columbia Property Trust was founded in Norcross, Georgia, a suburb of Atlanta, under the former name Wells REIT II, Inc.

Based on reports, it appears that the share price of Columbia Property Trust (Wells REIT II) has declined by 30% or more.  The White Law Group is investigating the liability that brokerage firms may have for selling Columbia Property Trust.

Brokerage firms have a fiduciary duty to perform adequate due diligence on any investment before offering it for sale to their clients.  Additionally, broker-dealers must evaluate the investor’s age, investment objectives, investment experience, and net worth in order to determine whether a specific investment recommendation is suitable.  Given the performance of Columbia Property Trust and how non-traded REITs are often sold as low risk, income producing investments, it appears that the firms that sold this investment may be liable for the resulting loss.

If you invested in Columbia Property Trust (Wells REIT II) and would like to discuss your litigation options, please call the securities attorneys of The White Law Group at 312/238-9650 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 Boca Raton, Florida.  For more information on the firm, visit http://www.whitesecuritieslaw.com.

Update on Thompson National Properties Investigation

According to Investment News one of the reportable events is “related to the REIT making prepayments of acquisition and financing fees to its adviser, TNP Strategic Retail Advisors LLC, which is controlled by Mr. Thompson.” It appears that McGaldrey identified the finincial discrepancy, but still failed to report the event to the SEC.

The TNP REIT has experienced numerous difficulties that appear to stem from co-chief executive and chairman of the board, Tony Thompson. As reported in our earlier post (here), Mr. Thompson is under investigation by the Financial Industry Regulatory Authority (FINRA) for allegedly failing to produce a “privileged log” requested by FINRA.

The White Group continues to follow the TNP and Tony Thompson investigation on behalf of investors. It appears that investors in TNP REIT and TNP 12 percent notes may have suffered substantial losses and The White Law Group is investigating the liability that brokerage firms that sold TNP 12 Percent Notes and TNP REIT may have for failure to perform adequate due diligence on these offerings.

TNP Strategic Retail Trust cuts dividend.

According to a recent SEC filing, because of loan compliance issues with its lenders, TNP Strategic Retail Trust Inc. will not pay a dividend in the first quarter of 2013 and may not pay any type of distribution for 2013.

Based on reports, short-term liquidity issues, including an accelerated maturity date of loans, lender fees and the cost of potential litigation with lenders, are the cause of the cut in distributions for the REIT, which has $272 million in assets.

The SEC filing also stated that one of the REIT’s lenders, Torchlight Investors LLC, is blocking the REIT from naming a new adviser, Glenborough LLC.

This news comes shortly after Tony Thompson, the head of TNP Strategic Retail Trust and Thompson National Properties, sent a note to brokerage firms promoting the REITs strong outlook.  Specifically, Mr. Thompson apparently stated that its net asset value was 6% higher than its share price (Such a discrepancy between a REIT’s selling price and its Net Asset Value, or NAV, could be dilutive to shareholders and provide brokers with a strong sales pitch).

The White Law Group continues to investigate the liability that brokers-dealers may have for making unsuitable investment recommendation and misrepresenting the risks of non-traded REITs like TNP Strategic Trust.

Broker-dealers have a fiduciary duty to perform adequate due diligence on any investment. The Financial Industry Regulator Authority (FINRA) requires that broker-dealer fully disclose all the risk in any investment when making recommendations, and ensure that the investment is suitable given their clients age, risk tolerance, financial objectives, net worth, and investment experience.

If you feel that your broker-dealer misrepresented TNP Strategic Retail Trust or another investment offering with Thompson National Properties, the securities attorneys of The White Law Group may be able to help you recover your losses through FINRA Arbitration. For a free consultation please call The White Law Group at 312-238-9650.

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

To learn more about The White Law Group, visit http://www.whitesecuritieslaw.com

Update on Securities Fraud Investigation Involving TNP Strategic Retail Trust and Thompson National Properties Investments

Have you suffered investment losses in TNP Strategic Retail Trust or a Thompson National Properties investment? If so, the following information may be of assistance to you.

TNP Strategic Retail Trust, Inc is a non-traded REIT sponsored by Thompson National Properties, LLC and launched in 2008. According to their website, TNP Strategic Retail Trust primarily invests in income producing retail properties throughout the Western United States, and in real estate assets such as mortgages, mezzanine, bridge, and other commercial real estate loans. “TNP Strategic Retail Trust has acquired 21 shopping centers in 14 states containing approximately 2.2 million square feet at an overall purchase price of more than $290 million since November 2009.” As of January 11, 2013, the REIT has issued 10,944,230 shares of common stock from the initial public offering of 100 million common shares.

The TNP Strategic Retail Trust is organized as an UPREIT and operates through an operating partnership, TNP Strategic Retail Operating Partnership, LP.  According to the prospectus, the advisory company, TNP Strategic Retail Advisor, LLC, selects investments for the REIT based on specific investment objectives and criteria approved by the board of directors.

The term UPREIT is short for Umbrella Partnership Real Estate Investment Trust. The UPREIT structure allows owners of commercial real estate property to form a REIT by combining the properties from existing limited partnerships.  By transferring property to the operating partnership, as opposed to selling directly to the REIT, property owners exchange the property for limited partnerships units and are able to put off capital gains taxes.

According to TNP Strategic Retail Trust’s website, the “UPREIT structure gives us an advantage in acquiring desired properties from persons who may not otherwise sell their properties because of unfavorable tax results.”

However, many concerns have been raised about the future of TNP Strategic Retail Trust as a result of several major changes the REIT has gone through in 2013.

January alone was an active month for TNP Strategic Retail Trust. According to SEC Filings, the REIT announced that they “may not be in compliance with certain provisions related to two secured loans totaling approximately $67.2 million.”  As a result of the loan default the redemption program was suspended, and distributions were reduced to quarterly payments as opposed to monthly payments. In addition, the REIT is actively negotiating with Glenborough, LLC to become their new advisor.

February 7, 2013 marked the end of TNP Strategic Retail Trust initial offering with 88,966,650.25 common shares unsold. Since then, TNP has withdrawn a proposed follow-on public offering of $900 million in common stock due to current market conditions.

According to TNP Strategic Retail Trust’s website, as of November 9, 2012, the board of directors estimated the value of common stock at $10.60. Unfortunately, it is unlikely that investors would be able to sell their shares for the estimated value because of the lack of a secondary market. The prospectus notes that “You should not rely on the estimated value per share as being an accurate measure of the current value of our shares of common stock or in making an investment decision.”

Some of the risk factors discussed in the prospectus are listed below:

• “We may incur debt exceeding 75% of the cost of our assets in certain circumstances.”
• “There is no trading market for shares of our common stock and we are not required to effectuate a liquidity event by a certain date. As a result, it will be difficult for you to sell your shares of common stock and, if you are able to sell your shares, you are likely to sell them at a substantial discount.
• “You may be more likely to sustain a loss on your investment because our sponsor does not have as strong an economic incentive to avoid losses as does a sponsor who has made significant equity investments in its company.”
• “All of our cash distributions to date have been made from proceeds from this offering. Distributions are not guaranteed, may fluctuate, and may constitute a return of capital or taxable gain from the sale or exchange of property.”
• “To date, all of our cash distributions paid have been made from offering proceeds and constituted a return of capital.”

The lack of liquidity and secondary market are inherent problems of non-traded REITs.  Despite the numerous risks many broker-dealer may have misrepresented TNP Strategic Retail Trust to clients.

Non-traded REIT’s offer extremely high sales commission to broker-dealers. TNP offers 7% sales commission, which is 3 to 4 times higher than more tradition investments sold on stock exchange.  This higher commission may explain broker-dealers motive for recommending this investment to unsuitable investors.

The White Law Group continues to investigate the liability that brokers-dealers may have for making unsuitable investment recommendation and misrepresenting the risks of non-traded REITs like TNP Strategic Trust.

Broker-dealers have a fiduciary duty to perform adequate due diligence on any investment. The Financial Industry Regulator Authority (FINRA) requires that broker-dealer fully disclose all the risk in any investment when making recommendations, and ensure that the investment is suitable given their clients age, risk tolerance, financial objectives, net worth, and investment experience.

If you feel that your broker-dealer misrepresented TNP Strategic Retail Trust or another investment offering with Thompson National Properties, the securities attorneys of The White Law Group may be able to help you recover your losses through FINRA Arbitration. For a free consultation please call The White Law Group at 312-238-9650.

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

To learn more about The White Law Group, visit http://www.whitesecuritieslaw.com

More Problems for Inland American?

According to reports, Inland American Real Estate Trust recently announced that some investors are alleging the REIT’s management failed in its fiduciary responsibility, resulting in false valuations and excess fees being paid to the REIT’s business manager.

In its annual report, the REIT stated that two separate groups of shareholders are raising similar claims as those announced in a Securities and Exchange Commission investigation. Last year, the REIT stated that the SEC had launched a fact-finding investigation to determine whether there had been violations regarding the REIT’s management fees, transactions with affiliates and distributions to investors.  Now it appears that certain shareholders are asking Inland American to investigate similar claims.

According to an Investment News report, the first group of shareholders alleges that Inland American’s management “falsely reported the value of our common stock until 2010, caused us to purchase shares of our common stock from stockholders in excess of their value, and disguised returns of capital paid to stockholders as REIT income, resulting in the payment of fees to the business manager to which it was not entitled.”

The same article states that the Inland American board has formed a special litigation committee to investigate the demands of the stockholders.

Inland American is one of several large nontraded REITs that were sold to investors during the real estate bubble at $10 per share but have suffered dramatic drops in valuations since then. At the end of last year, the REIT said its estimated per share value was $6.93 per share, down from $7.22 per share at the end of 2011.

The White Law Group continues to investigate potential FINRA arbitration claims involving Inland American REIT.  Brokerage firms have a fiduciary duty to their clients to perform due diligence on any investment prior to offering it for sale to their clients.  Broker-dealers also are obligated to ensure that any recommendations they make are appropriate in light of the investor’s age, investment experience, net worth, and investment objectives.  Based on the information now known about Inland American, it appears that the firm’s that recommended Inland American REIT to their clients may have done so improperly.

If you believe that you have suffered losses as a result of your investment in Inland American REIT, please call the securities attorneys of The White Law Group at 312/238-9650 for a free consultation.

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

For more information on The White Law Group, visit http://www.whitesecuritieslaw.com.