Tender Offer Price Indicates Losses for Inland REIT Investors

The White Law Group continues to investigate FINRA arbitration claims involving brokerage firms who may have unsuitably recommended Inland Real Estate Income Trust (Inland REIT) to investors.  If you have suffered Inland Real Estate Income Trust losses, the securities attorneys at The White Law Group may be able to help you.  

Comrit Investments 1 LP, a Tel Aviv-based investment fund reportedly extended an offer to purchase up to 1,850,000 shares of Inland REIT common stock for $11.21 per share.  

Inland Real Estate Income Trust Inc., a publicly registered, non-traded real estate investment trust, recently estimated that its net asset value is $19.86 per share as of December 31, 2022, according to a filing on March 6, 2023. This may signafy losses for investors as the company conducted a 1-for-2.5 reverse stock split in 2018, resulting in a final offering price of $25.00 per share. Shares were originally sold for $10 per share.   

LODAS Markets, a secondary market for non-traded investments, previously sold shares of Inland for $14.15 per share. 

Net Asset Value and Secondary Prices are Declining for Inland REIT 

This is not the first time Comrit has offered to purchase shares of Inland REIT. According to filings with the SEC, Comrit Investments 1 LP previously extended a tender offer to purchase shares of the REIT on October 31, 2022 for $12.51 per share.  According to the 8K filing on March 4, 2022, the Board approved $20.20 as the estimated per share net asset value of the Company’s common stock as of December 31, 2021.  Share repurchases by the compnay were reportedly $16.16 per share (80% of $20.20).  See: Inland Real Estate Income Trust Lowers Net Asset Value (NAV)

Inland Real Estate Income Trust Investment Loss Recovery  

In 2021 Inland REIT shareholders approved eleven charter amendment proposals to align the REIT’s charter with those of publicly-traded REITs. The company noted at the time that the proposed amendments would allow greater flexibility in pursuing liquidity for stockholders, including a potential listing on a national securities exchange.   

In 2020, the REIT suspended distributions and rescinded the first quarter distribution that was expected to be paid on June 1, 2020 to stockholders. The company also suspended its distribution reinvestment plan and share repurchase plan after uncertainty surrounding the COVID-19 global pandemic.  

Unfortunately, financial advisors/brokerage firms that sell non-traded REITs such as Inland Real Estate Income Trust, sometimes understate or misrepresent the risks and liquidity problems. 

High commissions could be a motivating factor for unscrupulous financial advisors to sell the REIT.  The total commissions and expenses make it difficult for non-traded REITs to perform in line with the market. 

Due Diligence 

Brokerage firms have a duty to their clients and are required by FINRA rules to disclose all the risks of an investment. Brokers must only recommend an investment if it 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.  

FINRA Arbitration Attorneys 

FINRA, the self-regulator that oversees brokers and brokerage firms, operates the largest dispute resolution forum in the securities industry.  In fact, FINRA Dispute Resolution is the forum for almost all disputes between investors, firms and brokers.   

Brokerage firms typically have a “Arbitration Provision” on the forms you sign on the day you open your account – often in fine print. This provision provides that if you have a dispute over your account, you agree to arbitrate your dispute before either FINRA or one of the exchanges, like the NYSE. 

Fortunately, FINRA arbitration is usually faster and less costly than court litigation. Most arbitration panels are comprised of 3 members. At the final hearing, after your case is presented and after the defense has presented their case, the arbitration panel will make a determination if you are entitled to any recovery, and if so, how much. Many securities cases end with a settlement. 

If you invested in Inland Real Estate Income Trust and would like to discuss your recovery options, please call the FINRA Arbitration 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, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Seattle, Washington.  

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