Healthcare Trust, Inc. Investors May Have Arbitration Claims to Recover Investment Losses
Giarrusso Law Group LLC continues to investigate potential claims investors may have against financial advisors who recommended Healthcare Trust, Inc. (HTI, or Healthcare Trust), a non-traded real estate investment trust (REIT). Attorney Michael Giarrusso is currently representing aggrieved non-traded REIT investors and is interested in speaking with HTI investors who purchased their shares on a broker’s recommendation. Investors may be able to file securities arbitration claims before the Financial Industry Regulatory Authority (FINRA) to recover their losses, provided the investment recommendation lacked a reasonable basis, or if the investor was otherwise misled into making the investment.
HTI, sponsored by AR Global and incorporated in 2012 as a Maryland REIT, “invests in healthcare real estate, focusing on seniors housing properties and medical office buildings located in the United States.” HTI’s public offering closed in 2014 after having raised approximately $2.2 billion in investor equity. As of March 31, 2021, HTI owned 190 properties located in 31 states, comprised of 9.3 million rentable square feet.
As we have previously discussed, HTI is a publicly registered non-traded REIT that has been recommended by financial advisors to retail investors nationwide. As a non-traded REIT, Healthcare Trust presents significant costs and risks making it a potentially unsuitable investment. For example, HTI has charged investors selling commissions and a dealer manager fee of up to 10 percent of its gross offering proceeds, in addition to other organizational and offering expenses of as much as 1.5 percent on gross offering proceeds. Such high fees and commissions add up quickly and act as an immediate drag on investment performance.
As a non-traded REIT, HTI’s most recent 2020 annual report (10-K filed March 30, 2021) addresses some of the risk factors associated with investing in a non-traded REIT like Healthcare Trust: “No public market currently exists, or may ever exist, for shares of our common stock and our shares are, and may continue to be, illiquid.” Further, in light of the illiquid nature of an investment in HTI, uninformed retail investors may come to find out too late that the valuation assigned their illiquid investment in Healthcare Trust (net-asset-value, or NAV) may not accurately reflect a true valuation of the REIT’s underlying assets at a given time. As disclosed in HTI’s 2020 annual report: “The Estimated Per-Share NAV of our common stock is based upon subjective judgments, assumptions and opinions about future events, and may not reflect the amount that our stockholders might receive for their shares.”
The attorneys at Giarrusso Law Group LLC have considerable experience in bringing claims on behalf of investors in non-traded REITs such as Healthcare Trust, as well as other complex and illiquid financial products. Investors may pursue a securities arbitration claim before FINRA to recover their HTI investment losses. Investors who wish to discuss a possible claim may contact us at (201) 771-1115 or info@gialawgroup.com for a no-cost, confidential consultation.