Securities Investigation – Carter Validus Mission Critical REIT Losses
Are you concerned about Carter Validus Mission Critical REIT losses? If so, the securities attorneys at The White Law Group may be able to help your recover your losses by filing a FINRA claim against the brokerage firm that sold you the investment.
Carter Validus Mission Critical REIT is a non-traded REIT that invests in net leased data center and healthcare assets, according to its website. The company’s offering, declared effective in December 2010, reportedly closed in June 2014.
As we told you in May, the REIT’s board of directors has suspended the company’s share repurchase program (SRP) for the rest of the year. This may be unfortunate news for investors wanting to get out of this investment.
Now, more bad news for investors, the company has lowered its estimated net asset value of $5.33 per share, as of June 30, 2018.
Alternative investments such as Carter Validus Mission Critical REIT are illiquid. Investors looking to sell alternative investments often have difficulty finding a buyer, and can suffer significant losses on the sale.
Currently, CFX Trading, a secondary market for non-traded REITs, is listing shares of Carter Validus Mission Critical REIT for just $4.00 per share. This may represent a significant loss on investors’ capital investment, as the original purchase price was $10.00 per share.
Update on April 12, 2019
According to reports today, Carter Validus Mission Critical REIT Inc. (CVMC REIT I) and Carter Validus Mission Critical REIT II Inc. have entered into a definitive agreement to merge in a stock and cash transaction, creating an entity valued at approximately $3.2 billion.
The transaction is expected to close in the second half of 2019, with the approval of CVMC REIT I stockholders.
The combined company will retain the name Carter Validus Mission Critical REIT II Inc. and will own 146 healthcare and data center properties in 33 states, totaling approximately 8.4 million square feet of space, according to reports.
Under the new agreement, CVMC REIT I stockholders will reportedly receive $1.00 per share in cash and 4681 shares of CVMC REIT II Class A common stock for each share of CVMC REIT I common stock owned.
CVMC REIT I declared an estimated net asset value of $5.33 per share, as of June 30, 2018, according to SEC filings. The company’s previously declared NAV per share was $9.26. Shares were originally sold for $10.00 each.
Update on April 23, 2019
Mackenzie Realty Capital has just extended an unsolicited tender offer to purchase shares of Carter Validus REIT for just $3.16/share.
According to Mackenzie, the merger is subject to closing conditions and “its consummation cannot be assured. Even if approved, however, there can be no guarantee that the merger will close in a timely manner, or at all, and does not provide full cash-out to Carter stockholders.”
Further, the repurchase program is now reportedly limited to requests in connection with the death, qualifying disability, or involuntary exigent circumstances of a stockholder. Also, Carter Validus II could be similarly limited, making it difficult for investors to sell any or all their shares in the repurchase program.
Recovery of Carter Validus Mission Critical REIT Losses
The White Law Group is investigating potential claims against the broker dealers that sold high risk non-traded REITs, like Carter Validus Mission Critical REIT, to unsuspecting investors.
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. Recommendations should be appropriate in light of the investor’s age, risk tolerance, net worth, and investment experience.
Broker dealers that fail to adequately disclose risks or make unsuitable investment recommendations can be held liable for investment losses in a FINRA arbitration claim.
If you are concerned about Carter Validus Mission Critical REIT losses 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. To learn more about The White Law Group visit www.whitesecuritieslaw.com.