NorthStar Real Estate Income Trust Securities Investigation

Nov. 28, 2017 11:18 AM ET
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Securities attorney

Contributor Since 2011

The White Law Group is a national securities fraud, securities arbitration, investor protection and securities regulatory/compliance law firm with offices in Chicago, Illinois and Vero Beach, Florida. We pride ourselves on providing quality legal services to our clients and handle securities fraud cases throughout the country. Many of our clients have lost a significant portion of their net worth as the result of the negligence of their financial professional. As such, we believe that part of our role as attorney is to offer a supportive environment for our clients and to provide advice and support as we attempt to recover these investment losses. Dedicated to the representation of investors in claims against their financial professional or brokerage firm, The White Law Group has the expertise to help investors defrauded in securities, investment and financial business transactions. For more information about The White Law Group call our Chicago office at 312-238-9650 or visit us on the web at http://www.whitesecuritieslaw.com.

Summary

  • NorthStar Recommends Shareholders Reject Mackenzie's Tender offer.
  • The REIT Suspends Share Repurchase Program.
  • Colony NorthStar to merge with NorthStar and NorthStar II.

The White Law Group is investigating potential claims involving broker-dealers who may have unsuitably recommended NorthStar Real Estate Income Trust to their clients.

NorthStar Real Estate Income Trust reportedly just sent a letter to shareholders recommending that they reject an unsolicited tender offer from MacKenzie Capital Management.

The offer is seeking to purchase up to 2.5 million shares of the REIT for just $5.86 each. The original offering price was $10.00 share.

NorthStar Real Estate Income Trust is a publicly registered non-traded REIT. It invests in real estate debt, select equity and securities investments predominantly in the United States.

The net asset value per share of NorthStar Real Estate Income Trust is $9.92 as of December 31, 2016, according to SEC filings. The board said that Mackenzie’s offer “is an opportunistic attempt to purchase shares at a discounted price.”

Colony NorthStar Inc., the REIT’s sponsor, recently announced plans to merge with NorthStar Real Estate Income Trust and affiliated non-traded REIT NorthStar Real Estate Income Trust II.

The merger is espected to close in late 2017 or early 2018 once approved by shareholders. The new entity will be a commercial real estate credit REIT named Colony NorthStar Credit Real Estate with approximately $5.5 billion in assets and $3.4 billion in equity value. According to MacKenzie, it plans to vote any shares it owns in favor of the merger.

NorthStar Real Estate Income Trust previously suspended its share repurchase program in connection with the pending merger.

The White Law Group has handled a number of claims involving non-traded real estate investment trusts (REITs) including NorthStar.

In those claims, the firm has alleged, among other things, that REITs were:

(1) high-risk and unsuitable for our clients given their financial needs and investment objectives

(2) that the risks of the investment were not fully disclosed to them

(3) that the brokerage firms that sold the investments failed to follow FINRA rules to perform adequate due diligence.

Non-Traded REITs are complex products that involve a significant degree of risk. These investments are unsuitable for many investors. Brokerage firms may be liable for losses if they overlooked suitability requirements or failed to disclose the risk when recommending NorthStar Real Estate Income Trust to clients.

If you lost money investing in NorthStar Real Estate Income Trust, or another REIT, please call The White Law Group at 1-888-637-5510 for a free consultation. It may be possible to recover your losses through a FINRA arbitration claim against the brokerage firm that sold you the investment.

The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida. For more information on The White Law Group, please visit www.whitesecuritieslaw.com.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Recommended For You

Comments

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.