Mackenzie Realty Capital – Tender offer – Summit Healthcare REIT
Did you lose money investing in Summit Healthcare REIT at the recommendation of your financial advisor? The White Law Group continues to investigate broker dealers who may have unsuitably recommended high risk REITs like Summit Healthcare REIT to investors.
According to a recent tender offer from Mackenzie Realty Capital, “Summit Healthcare REIT has given no indication when it might liquidate and its charter does not require it to do so by a specified date.”
Summit Healthcare REIT has not paid distributions since 2011 and the stock repurchase program was suspended as of December 31, 2010. The company has not said if, or when, distributions or redemptions will resume. Mackenzie is currently offering $1.42/share for Summit Healthcare REIT.
Investment Losses – Non-traded REITs
The trouble with non-traded REITs is that they lack liquidity and are inherently risky. Compared to traditional investments, such as stocks, bonds and mutual funds, non-traded REITs are more complex and are better suited for investors that can afford to risk the total losses of their investment.
Unfortunately, the high sales commissions associated with non-traded REITs often provides some broker dealers with enough incentive to overlook suitability requirements. Brokers often earn extremely high sales commission selling non-traded REITs, sometimes as high as 15%.
Investors looking to sell a private placement investment often have difficulty finding a buyer, and can suffer significant losses on the sale.
Brokers are required to perform adequate due diligence on any investment they recommend. They must ensure that all recommendations are suitable for the investor and are in line with the clients risk tolerance, age, net worth, and investment experience.
If a brokerage firm makes unsuitable investment recommendations or fails to disclose the risks associated with an investment they may be liable for investment losses through FINRA arbitration.
FINRA operates the largest securities dispute resolution forum in the United States, and has extensive experience in providing a fair, efficient and effective venue to handle a securities-related dispute.
Have you suffered losses investing in Summit Healthcare REIT? If so, The White Law Group may be able to help you. For a free consultation with a securities attorney, please contact The White Law Group at (888) 637-5510.
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, visit www.WhiteSecuritiesLaw.com.