Avatar REIT I LLC: Help for Investors
The White Law Group is investigating potential securities lawsuits involving broker dealers who may have improperly recommended Avatar REIT I LLC to investors.
Foreclosure Lawsuit
According to South Florida Biz Journals, a 38-unit apartment complex in Opa-locka, Miami-Dade County, is reportedly facing a $3.7 million foreclosure lawsuit filed by Avatar REIT I LLC against Orengo Investments LLC and a guarantor. The property, located at 1219–1241 Sharazad Blvd., was reportedly purchased in 2022 for $5.8 million with a mortgage that initially had a 9.99% interest rate, later adjusting to over 12% due to rising SOFR rates.
The borrowers reportedly defaulted in October 2023, and the lender is seeking to recover the principal, interest, and fees, according to the article. This is reportedly the second foreclosure lawsuit involving these parties; another was filed in November 2023 over a separate 24-unit property in Opa-locka.
REG D Private Placements: High Risk Investments
Avatar REIT I LLC reportedly filed a form D to raise capital from investors in 2021, according to SEC filings.
Private placement investments carry significant risks, including:
- Illiquidity: These investments are long-term and difficult to sell.
- High Fees & Commissions: Brokers and advisors may earn more than 9% in commissions and fees, which can impact investor returns.
- Potential for Loss of Principal: Market volatility or poor performance can lead to substantial losses.
- Limited Investor Control: Management decisions are made by a trustee, restricting investor influence.
- Tax Implications: If regulatory requirements are not met, potential tax benefits could be at risk.
While some private placement investments may make periodic distributions, some may not make any at all. Another problem is the high fees and commissions that brokers and financial advisors may receive for the sale of a private placement investment– sometimes close to 10% of the client’s total investment.
Avatar REIT I LLC: Suitable for you?
Under the “Regulation Best Interest” standard, broker-dealers are obligated to perform due diligence when evaluating any investment. If your financial advisor fails to perform due diligence on an investment before recommending it to you, they could be held liable for investment losses.
If your advisor unsuitably recommended a private placement investment and you lost money, the securities attorneys at The White Law Group may be able to help you. You may be able to recover losses by filing a FINRA Arbitration lawsuit against the brokerage firm that sold you the investment.
Lawsuit Options: FINRA Arbitration vs. Class Action
Investors considering legal action may wonder whether a class action lawsuit or an individual FINRA arbitration claim is the better option. Typically:
- FINRA Arbitration is often more suitable for investors with losses exceeding $100,000.
- Class Action Lawsuits are usually pursued when numerous investors have small claims that are impractical to litigate individually.
FINRA Lawsuits
If you are concerned about investment losses in Avatar REIT I LLC, you may have recovery options. If you want to learn more about your legal options, please contact the securities attorneys of The White Law Group at 888-637-5510 for a free consultation.
The White Law Group, LLC is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Seattle, Washington.
Last modified: May 1, 2025
