Written by The White Law Group• November 15, 2023• 6:04 pm• Blog, Investment Loss Recovery

Investor Alert: Vineyard Pearland DST

Did your broker recommend investing in Vineyard Pearland DST?

The White Law Group continues to investigate potential securities claims involving broker dealers who may have unsuitably recommended Vineyard Pearland DST to investors.

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Are you concerned about your investment in Vineyard Pearland DST? If so, the securities attorneys at The White Law Group may be able to help you by filing a FINRA Dispute Resolution claim against the brokerage firm that sold you the investment.

Valeo Groupe Americas is an affiliate of Valeo Groupe, which offers multinational interests in both senior and student niche housing markets, according to its website.

The company reportedly filed a form D to raise capital from investors for the offering Vineyard Pearland DST. The total offering amount was purportedly $21,000,000.

The Risks of Investing in 1031 DSTs

1031 DSTs are not appropriate for all investors, as they come with a few disadvantages, compared to owning a property outright. 1031 DSTs cannot raise new capital, leaving investors holding the bag if expensive repairs are needed. The investors also have no control over the property, or the ability to make decisions about the property. While the sponsor may welcome feedback from the investor, they don’t allow any actions to be taken by said investor.

Additionally, 1031 DSTs are illiquid, and it can often be difficult to find a buyer when the investor is ready to sell.

Potential Lawsuits to Recovery Financial Losses

The White Law Group is investigating the liability that FINRA registered brokerage firms may have for improperly recommending Vineyard Pearland DST to investors.

Despite the risks of investing in 1031 DSTs, brokerage firms continue to push this type of investment because of the high commissions associated with their sale and creation.

Fortunately, FINRA does provide for an arbitration forum for investors to resolve disputes if a broker or brokerage firm makes anunsuitable investment recommendation or fails to adequately disclose the risks associated with an investment. It is possible that they could be found liable for investment losses in a FINRA arbitration claim.

Class Action vs. Individual FINRA Arbitration Lawsuit

You may wonder whether a large class action lawsuit is a better litigation option than an individual FINRA arbitration case. The answer depends on many factors, but typically if the loss sustained is large (say larger than $100,000), an individual arbitration claim is likely a better option. Class actions as a recovery option are more appropriate for grouping large numbers of individuals who have small claims – too small to generally pursue individually.