Investigating Potential Claims in ARC New York City REIT
Are you concerned about your investment losses in ARC New York City REIT? If so, The White Law Group may be able to help you by filing a FINRA arbitration claim against the brokerage firm that sold you the investment.
American Realty Capital New York City REIT invests in properties located in the five boroughs of New York City, with a focus on Manhattan. The company closed its initial public offering in May 2015 and had raised a total of $764 million in investor equity, as of March 31, 2016. The company owns six properties valued at $785 million
Shares were originally sold for $25.00 each. In October 2016, the company’s board approved an estimated net asset value of $21.25 per share.
ARC New York City REIT has amended their share repurchase plans, effective July 14th.
The company will only repurchase shares following the death or qualifying disability of stockholders that purchased shares of common stock or received their shares through noncash transactions. The move is intended to preserve capital that can be used to purchase additional assets and increase distribution coverage.
Risks of Investing in Non-traded REITs
The White Law Group continues to investigate claims on behalf of investors that purchased investments such as ARC New York City REIT and other non-traded REITs. Specifically, the firm is investigating the liability that brokerage firms may have for improperly selling these high-risk, illiquid investments
Non-traded REITs are not sold on the public market, therefore they lack liquidity. This prevents shares from being sold quickly and forces investors to search for a secondary market that is often very limited. The secondary market price is almost always significantly below the purchase price.
Many brokerage firms target investors that were retired or near retirement, often emphasizing the potential income the REIT may provide.
Unfortunately, some brokerage firms failed to disclose that it is not uncommon for REITs to borrow money in order to make distributions. In addition, distributions are often merely a return of principle. REITs are complex high risk products that are not suitable for most investors.
Brokerage firms have a fiduciary duty to its clients to perform adequate due diligence on an investment prior to recommending it for sale. They must ensure that any investment recommended is appropriate in light of the investor’s age, investment experience, net worth, and investment objectives. Given what is now known about non-traded REITs, it is clear that certain of the brokerage firms that sold this investment failed in its fiduciary duty to its clients.
If you suffered losses as a result of your purchase of ARC New York City REIT or another AR Global offering please call the securities attorneys of The White Law Group at 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 Franklin, Tennessee.
For more information on the firm, please visit https://www.whitesecuritieslaw.com.