February 13, 2017 Comments (0) Blog

First Capital Real Estate Trust Inc. Latest News

First Capital Real Estate Trust Inc.

Concerned about investment losses in First Capital Real Estate Trust Inc.?

Have you suffered losses investing in First Capital Real Estate Trust Inc.? If so, The White Law Group may be able to help you. It’s possible to recover your losses by filing a FINRA Resolution claim against the brokerage firm that sold you the investment.

According to their website, First Capital Real Estate Trust Inc. is a privately held commercial and residential real estate finance firm that was organized in 2003. The company is actively involved in real estate acquisition, land development, residential and commercial construction, and retail operations. First Capital has three strategic components to its business. First Capital sponsors a public, nontraded Real Estate Investment Trust, and owns the external advisor to that REIT, and has private holdings including development projects, and retail and operating companies.

First Capital Real Estate Trust Inc. Update

On February 9, 2017, First Capital Real Estate Trust Inc. announced that a subsidiary entity had received a notice of default and election to sell under deed of trust dated January 31, 2017, on a $20.0 million loan from Copia Lending, LLC (the Lender) on 23 parcels of land located in Sacramento, California.

The Lender has notified First Capital that $42.0 million is due on the T9 loan.  First Capital noted that a sale of the T9 Property is not permitted until approximately 90 days from the January 31, 2017 record date of the notice of default.

First Capital has been working with the Lender since December 31, 2015, the original maturity date of the loan, to resolve the default and avoid foreclosure.  First Capital had previously announced, on December 6, 2016, that the T9 Property would be included in an interest contribution agreement with Presidential Realty Corporation (Presidential).

The interest contribution agreement anticipated that the contribution of the T9 Property would occur on or before March 16, 2017, and that Presidential would assume 66% of the liabilities related to the T9 Property.  First Capital noted they continue to work with Presidential and other potential sources of funding to address the notice of default.

This could be more bad news for investors. As we told you in October, First Capital Real Estate Trust Inc. announced plans to suspend monthly distributions.  First Capital Real Estate Trust Inc. reported the suspension which was effective in November, was necessary to protect cash reserves.  Then in November, Investment News reported that First Capital Real Estate Trust Inc. was failing to pay employees on time. They have missed filing financial statements with the SEC for more than a year.

Non-Traded REITs are risky.

Compared to traditional investments, such as stocks, bonds and mutual funds, non-traded REITS, are considerably more complex.  REITs involve a high degree of risk. Unfortunately, many investors are unaware of the risks and liquidity problems with REITs such as First Capital Real Estate Trust, Inc.

The White Law Group has represented numerous investors in claims against the brokerage firm that recommended non-traded REITs to its investors.

Broker dealers are required to perform adequate due diligence on any investment they recommend. They must insure that all recommendations are suitable for the investor. Recommendations should be in line with the investor’s age, risk tolerance, net worth, and investment experience.

If brokerage firms  fail to adequately disclose risks or make unsuitable investment recommendations can be held liable for investment losses.

If you have invested in First Capital Real Estate Trust Inc. and would like to speak to a securities attorney about the potential to recover your investment losses, please call The White Law Group at 1-888-637-5510 for a free consultation.

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, visit www.whitesecuritieslaw.com.