FC Grand Rapids MI Investors DST – Investor Alert

FC Grand Rapids MI Investors DST: Investigating Claims

The White Law Group is investigating potential securities claims involving FC Grand Rapids MI Investors DST, a Delaware Statutory Trust (DST) formed in 2020 and sponsored by Net Lease Capital Advisors, Inc. According to a Form D filed with the SEC, the offering sought to raise approximately $24 million through the sale of beneficial interests in the trust.

Multiple brokerage firms reportedly sold the investment to retail investors, including:

• Lighthouse Capital Group, LLC
• Great Point Capital LLC
• Growth Capital Services, Inc.
• Cabin Securities, Inc.
• Whitehall-Parker Securities, Inc.
• TCFG Wealth Management, LLC
• Colorado Financial Service Corporation
• Willow Cove Investment Group, Inc.
• Arkadios Capital
• Dempsey Lord Smith, LLC

The filing indicates that at least 27 investors purchased interests, with commissions exceeding $200,000 paid to selling agents.

While DSTs are often marketed as suitable for 1031 exchanges and passive income opportunities, these investments can carry substantial risks. They are generally illiquid, highly speculative, and not appropriate for many retail investors—particularly those needing access to capital or seeking lower-risk investments.

Risks of DST Investments

• Illiquidity – There is no public market for DST interests. Investors may be unable to sell their shares if they need access to cash.
• High fees and commissions – As noted in the filing, commissions and fees can significantly reduce investor returns.
• Concentration risk – Many DSTs invest in a single property or a small portfolio, which increases the risk of loss if that asset underperforms.
• Market and tenant risks – Cash flow often depends on a small number of tenants. Defaults or vacancies can drastically reduce distributions.

Broker Due Diligence & FINRA Arbitration

Broker-dealers have a duty to perform adequate due diligence before recommending securities such as FC Grand Rapids MI Investors DST. They must also ensure that investments are suitable given the client’s risk tolerance, investment objectives, and financial situation.

If a financial advisor misrepresented the risks of a DST, or recommended the investment without a reasonable basis, the brokerage firm may be liable for losses.

Investors may be able to pursue claims through FINRA arbitration rather than filing a class action. FINRA arbitration is typically a faster and more cost-effective forum to resolve disputes between investors and their brokerage firms.

Frequently Asked Questions

1. What is a Delaware Statutory Trust (DST)?
A DST is a legal structure that allows multiple investors to own fractional interests in real estate. DSTs are often used for 1031 exchange transactions, but they carry risks such as illiquidity and lack of transparency.

2. Can I recover losses from a DST investment?
Possibly. If your financial advisor recommended a DST without properly explaining the risks, or if the investment was unsuitable for your portfolio, you may have a claim against the brokerage firm.

3. What is the process for recovering my losses?
Most claims are pursued through FINRA arbitration. The process begins with filing a statement of claim, followed by discovery, hearings, and ultimately a decision by a panel of arbitrators.

The White Law Group – Nationwide Securities Fraud Attorneys

If you are concerned about your investment in FC Grand Rapids MI Investors DST, the securities attorneys at The White Law Group may be able to help. We have recovered millions of dollars on behalf of investors through FINRA arbitration against brokerage firms that improperly recommended risky, illiquid investments like DSTs.

For a free consultation with a securities attorney, please call (888) 637-5510.