Greeley Flats DST Lawsuit – Investigating Investor Complaints

Greeley Flats DST: Lawsuit Help for Investors

Have you suffered investment losses in Greeley Flats DST? The securities attorneys at The White Law Group are investigating potential FINRA arbitration claims involving brokerage firms that may have unsuitably recommended this high-risk DST investment to clients.

Greeley Flats DST Lawsuit & Complaints

Greeley Flats DST, sponsored by Nelson Partners LLC, filed a Form D with the SEC in 2018 to raise capital for a real estate offering. The total amount sold was reportedly $10,961,579. In light of the DST’s financial troubles, investors are now filing complaints and exploring their legal options through FINRA arbitration claims. The White Law Group is actively reviewing potential Greeley Flats DST lawsuits on behalf of affected investors.

Nelson Partners Default & Receivership

According to the Reporter Herald, a Weld County District Court placed the University Flats student housing property in receivership due to loan defaults by Nelson Partners LLC. The 262-bed complex in Greeley, Colorado, was reportedly 90% leased but still failed to meet debt obligations. Lawsuits filed against Nelson Partners alleged over $10 million in loan defaults and unpaid mechanic’s liens totaling $338,624. Additional reports cite sanitation issues and unpaid utility bills at the property.

Greeley Flats Chapter 11 Bankruptcy

On April 3, 2024, Greeley Flats DST filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Colorado (Case No. 24-11573). This filing may further complicate recovery for investors, many of whom are retirees seeking stable income through 1031 exchange investments.

Risk Factors of 1031 DST Investments

Delaware Statutory Trusts (DSTs) are often marketed as tax-deferred investment opportunities for 1031 exchanges, but they carry significant risks:

• Illiquidity – There is no public market for resale.
• Loss of Property Value – Real estate values can decline over time.
• Foreclosure Risk – Financed properties face the possibility of foreclosure.
• Suspension of Cash Flow – Loss of tenants or property damage may reduce income.
• Fees and Expenses – High upfront fees may offset tax deferral benefits.
• Tax Complications – Unexpected IRS rulings could result in sudden tax liabilities.

Securities Fraud Investigation: Brokerage Firm Liability

The White Law Group is investigating whether financial advisors and broker-dealers failed to perform adequate due diligence before recommending Greeley Flats DST to investors. Many DSTs pay high commissions, which may incentivize brokers to overlook the investment’s risks and recommend them to clients for whom they are unsuitable.

Fortunately, investors may be able to recover their losses through a FINRA arbitration claim. These claims can hold firms accountable for unsuitable recommendations, failure to disclose material risks, or lack of proper due diligence.

Free Consultation – Greeley Flats DST Complaints

If you are concerned about your investment losses in Greeley Flats DST, call The White Law Group at 888-637-5510 for a free, confidential consultation. We are a national securities fraud and investor protection firm with offices in Chicago, Illinois and Seattle, Washington.

About The White Law Group

We represent investors nationwide in FINRA arbitration claims involving unsuitable DST investments, fraud, and broker misconduct.

Frequently Asked Questions about Greeley Flats DST Lawsuits

1. What is the difference between a Greeley Flats DST lawsuit and a FINRA arbitration claim?

A traditional lawsuit takes place in state or federal court and can take years to resolve. In contrast, a FINRA arbitration is a faster, more streamlined process specifically for resolving disputes between investors and brokerage firms. Most claims involving unsuitable DST recommendations are pursued through FINRA arbitration, not class actions.

2. Can I recover my losses from Greeley Flats DST if my broker failed to perform proper due diligence?

Yes. If your financial advisor failed to conduct adequate due diligence before recommending this DST, or if they did not properly disclose the risks, you may be eligible to recover losses through a FINRA arbitration claim. Brokerage firms have a duty to vet investments and ensure suitability for each client.

3. Why are Greeley Flats DST complaints on the rise?

Many investors are now filing complaints due to the investment’s financial distress, including bankruptcy and loan defaults. These complaints often allege that Greeley Flats DST was misrepresented as a safe 1031 exchange option, when in fact it carried high risks and illiquidity. High sales commissions may have incentivized some brokers to recommend it regardless of client suitability.