According to SEC records, another Cornerstone REIT has undergone a name change. Cornerstone Core Properties REIT is now called Summit Healthcare REIT. This is the REIT’s second name change.The REIT began as a property fund originally named Cornerstone Realty Fund until it qualified as a non-traded REIT in 2005.
Sentio Healthcare Properties is the other Cornerstone REIT that has undergone several name changes. The REIT formerly went by the names Cornerstone Growth & Income REIT, Cornerstone Healthcare Plus REIT, and Cornerstone Institutional Growth REIT.
SEC records state that the purpose of the name change was to better reflect the company’s focus on investment in healthcare real estate. However, the past performance of the REITs could very well have influenced the need to change names.
The Sentio REIT was originally sold to investors at $8 per share, but was valued at a meager $2.25 in 2012. Unfortunately for many investors, Cornerstone REITs did not turn out to be as profitable of an investment as they were led to believe.
The trouble with non-traded REITs is that they lack liquidity and are inherently risky. Compared to traditional investments, such as stocks, bonds and mutual funds, REITs are considerably more complex securities products, making them better suited for sophisticated and institutional investors.
Broker dealers that sell REITs are required to perform adequate due diligence on investment 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. Firms that fail to do so, may be held responsible for any losses.
Unfortunately, the high sales commissions associated with REITs often provides some broker dealers with enough incentive to overlook suitability requirements (broker dealers earn extremely high sales commission for selling REITs, sometimes as high as 15%).
If you have invested in the Summit Healthcare REIT, Sentio Healthcare Properties, or another Cornerstone Fund, and would like to speak to a securities attorney about the potential to recover your investment losses, please call The White Law Group at 312-238-9650.
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Vero Beach, Florida.
For more information on The White Law Group, please visit our website at www.whitesecuritieslaw.com.