Hartman vREIT XXI: Secondary Price Suggests Losses for Investors
The White Law Group continues to investigate potential securities claims involving broker dealers who may have unsuitably recommended Hartman vREIT XXI Inc. to its clients.
Hartman is in the business of acquiring, owning, managing, and leasing commercial office, retail, light industrial and warehouse properties located in Texas, according to its website.
According to Central Trade and Transfer, a secondary market for non-traded REITs, Hartman vREIT XXI was recently listed to sale for $5.30 per share. This may indicate losses for investors as the company says that the current NAV is $10.23 per share.
According to filings in November, the boards of and Hartman vREIT XXI and an affiliated non-traded REIT Hartman Short Term Income Properties XX inc. reportedly voted to merge Hartman XX into Hartman vREIT XXI, with Hartman vREIT XXI as the surviving entity. A separate merger closed in October 2020 involving three Hartman REITs, where Hartman Short Term Income Properties XX Inc. (Hartman XX) was the surviving entity.
How Does a Merger Affect Shareholders?
These mergers may cause much confusion for investors, who are left wondering what their investment is really worth.
Companies often merge as part of a strategic effort to boost shareholder value, often by creating new business lines and/or gaining greater market share. However, the economic environment at the time of the merger, size of the companies and management of the merger process all play a part in future returns for shareholders.
Shareholders may experience a significant loss of voting power, and while the spike in trading volume tends to inflate share prices, if economic conditions are not favorable at the time of the merger, shareholders may see significant losses.
Non-Traded REITs are High-risk Investments
Non-traded REITs are complex and high-risk investments for several reasons. First, the investment itself is unsuitably risky because it is dependent on the overall health of specific sectors of the economy.
Second, non-traded REITs are generally illiquid, severely limiting the investor’s ability to access funds should the need arise.
Further, they are often less regulated than other types of investments (i.e., mutual funds, stocks, etc.) and generally pay a higher sales commissions and fees than these other products.
If you suffered losses investing in a Hartman vREIT XXI or another Hartman REIT you may be able to recover your losses through FINRA arbitration. 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.
The firm represents investors in FINRA arbitration claims throughout the country. For more information on the firm, visit https://www.whitesecuritieslaw.com.