Hines Global Income Trust, Decrease in NAV

Hines Global Income Trust: Non-traded REIT Investigation

The White Law Group continues to investigate FINRA arbitration claims involving non-traded REITs such as Hines Global Income Trust.

Unfortunately for investors it appears that many financial advisors/brokerage firms that sold non-traded REITs such as Hines Global Income Trust, may have understated or misrepresented the risks and liquidity problems.

Hines Global Income Trust Inc., a monthly NAV REIT, reported a total NAV decline of 0.25% month-over-month as of the end of January. The total NAV dropped from $2.63 billion at the end of 2023 to $2.62 billion.

The monthly NAV per share, which includes various share classes (Class T, Class S, Class D, Class I, and Class AX/JX), also decreased by 0.5% from $10.07 per share on December 31, 2023, to $10.02 per share on January 31, 2024.

Impact on Commercial Real Estate

The non-traded REIT, formerly known as Hines Global REIT II, Inc., was incorporated in Maryland on July 31, 2013, to invest in a diversified portfolio of quality commercial real estate properties and other real estate investments and also to  invest in real-estate related securities, according to its website.

In 2020 we reported that the REIT had seen a decline in Net Asset Value  of its common stock from $10.71 per share to $9.71 per share as of April 30, 2020. According to the company, the NAV per share “does not include any liability for distribution and stockholder servicing fees that may become payable after April 30, 2020, since these fees may not ultimately be paid in certain circumstances…”

Hines Global further noted in the filings that the Coronavirus (COVID-19) pandemic has had, and is expected to continue to have, an adverse impact on global commercial activity and has contributed to significant volatility in financial markets and it may be difficult to predict “the long term impact it will have on commercial real estate markets and our investments, it presents material uncertainty and risk with respect to the current and future performance and value of our investments.”  

Monthly NAV REIT- Hines Global Income REIT

A monthly NAV (Net Asset Value) REIT is a non-traded real estate investment trust that calculates its net asset value on a monthly basis. Net asset value is a measure of the value of the REIT’s assets minus its liabilities, divided by the total number of shares outstanding.

This calculation gives investors an indication of the underlying value of the REIT’s assets per share.

Monthly NAV REITs are subject to fluctuations in real estate market conditions, including changes in property values, rental income, and occupancy rates. Economic downturns or adverse developments in specific real estate sectors can negatively impact the NAV of the REIT.

Unlike publicly traded stocks, shares of monthly NAV REITs may have limited liquidity. Investors may not be able to buy or sell shares quickly, especially during periods of market volatility or when there is a lack of demand for the REIT’s shares. This lack of liquidity could result in difficulty selling shares at desired price.

The accuracy of the NAV calculation depends on the valuation of the REIT’s underlying assets and liabilities. Errors in valuation methodologies or inaccurate reporting of property values could result in misrepresentation of the REIT’s true financial health. Investors rely on the NAV to assess the value of their investments, so any discrepancies or inaccuracies could lead to financial losses or investor dissatisfaction.

Broker Due Diligence

Prior to making recommendations to an individual investor, brokerage firms are required by the Financial Industry Regulatory Authority (FINRA) to disclose all the risks of an investment. Recommendations should only be made if the investment is suitable for an individual investor given their age, investment objections, investment experience and risk tolerance.

Brokerage firms that do not perform adequate due diligence on an investment and/or make unsuitable recommendations can be held accountable for investment losses through FINRA arbitration.

Free Consultation with a Securities Attorney

If you are concerned about your investment in Hines Global Income Trust, you may be able to file a complaint against your brokerage firm. Please call the securities attorneys of The White Law Group at 888-637-5510 for a free consultation.

The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Seattle, Washington.

For more information on The White Law Group, visit https://whitesecuritieslaw.com.