Recovery of Investment Losses in Hospitality Investors Trust Inc.
Have you suffered losses investing in Hospitality Investors Trust Inc. at the recommendation of your broker? If so, The White Law Group may be able to help you recover your losses by filing a FINRA Arbitration claim against the brokerage firm that sold you the investment.
American Realty Capital Hospitality Trust Inc., a publicly registered non-traded real estate investment trust, changed its name to Hospitality Investors Trust Inc. following its transition to a standalone self-managed REIT.
Hospitality Investors Trust focuses on acquiring stable, institutional quality select-service lodging properties in North America branded by premium national hotel brands. The REIT’s offering went effective in January 2014 and suspended sales activities in November 2015 after raising $911 million in investor equity, according to Summit Investment Research. As of the first quarter of 2017, the company’s $2.4 billion portfolio was comprised of 141 properties.
Hospitality Investors Trust suspended distributions in January 2017 and does not expect to pay any distributions this year. The company is not currently offering a redemption plan to shareholders.
According to Central Trade & Transfer, a secondary market website, shares of Hospitality Investors Trust Inc. are currently listed for just $10.50 per share. Unfortunately for many investors, it appears that the secondary market price would represent a significant loss on their initial capital investment, as the original offering price was $25.00 per share.
Non-traded REITs are Risky.
The White Law Group is investigating potential securities fraud claims involving broker-dealers’ improper recommendations of high-risk non-traded REIT investments, like Hospitality Investors Trust Inc.
Real estate investment trusts (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.
In addition, brokers earn high sales 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.
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.
The high risks, non-traded REITs, like Hospitality Investors Trust Inc. often 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.
Broker dealers are required to perform adequate due diligence on any investment they recommend and to ensure that all recommendations are suitable for the investor. Firms that fail to do so, may be held responsible for any losses in a FINRA arbitration claim.
If you suffered losses investing in Hospitality Investors Trust, Inc. 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.