Hospitality Investors Trust Inc. – Updated May 14, 2019 – $8.25/share
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Did you lose money 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 Dispute Resolution claim against the brokerage firm that sold you the investment.
Hospitality Investors Trust Inc. was formerly known as American Realty Capital Hospitality Trust Inc. The publicly registered non-traded real estate investment trust changed its name following its transition to a standalone self-managed REIT.
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 reports. As of the first quarter of 2017, the company’s $2.4 billion portfolio was comprised of 141 properties.
The REIT reportedly suspended distributions in January 2017. The company is not currently offering a redemption plan to shareholders.
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.
According to Central Trade & Transfer, a secondary market for private placements, shares of Hospitality Investors Trust Inc. are currently listed for just $8.25/share as of May 1, 2019. 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.
Update on May 14, 2019
According to recent SEC filings, the board of Hospitality Investors Trust has approved an estimated net asset value (NAV) $9.21 per share for the company’s common stock, as of December 31, 2018.
The updated NAV has decreased 33.6 percent since the previous valuation of $13.87 per share NAV in December 31, 2017.
Unfortunately for investors, this sales price would represent a significant loss on their capital investment, as the original purchase price was $25.00 per share.
Hosptiality Investors Trust Inc.: Suitable for you?
Brokers have an obligation to make investment recommendations that are suitable for their clients. They must consider their risk tolerance, net worth, investment objectives and experience in the market.
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. They are often better suited for sophisticated and institutional investors.
Unfortunately, the high sales commission may provide some brokers with enough incentive to make unsuitable investment recommendations. Brokers earn as much as 15% commission for selling REITs.
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.
The White Law Group continues to investigate potential securities fraud claims involving broker-dealers’ improper recommendations of high-risk non-traded REITs, like Hospitality Investors Trust Inc.
If you suffered losses investing in Hospitality Investors Trust Inc. you may be able to recover your losses. For 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.