Healthcare Trust REIT
This publicly registered non-traded real estate investment trust (non-traded REIT) concentrates on acquiring a diversified portfolio of healthcare real estate that includes medical office buildings and senior housing. Formerly known as American Realty Capital Healthcare Trust II, Inc. (ARC Healthcare Trust II), Healthcare Trust Inc. is no longer open to new investors.
This non-traded REIT’s primary offering went into effect in February 2013. After $2.2B in investor equity was raised, Healthcare Trust closed this offering in November 2014. In December 2017, affiliate American Realty Capital Healthcare Trust III, a publicly registered non-traded REIT, sold its assets to Healthcare Trust for $120M.
Unfortunately, brokerage firms and their registered representatives that sold Healthcare Trust REIT to customers may have allegedly misrepresented and downplayed its risks. Since its initial offering, Healthcare Trust share prices have shown a steep decline.
Our non-traded REIT lawyers are investigating claims of losses involving Healthcare Trust, Inc. You may have grounds for a Financial Industry Regulatory Authority (FINRA) arbitration claim to pursue damages. Contact us today at Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com).Non-Traded REIT Shows a Decline in NAV and Secondary Market Price
In an April 2022 filing with the US Securities of Exchange Commission (SEC), Healthcare Trust’s Board contended in its latest valuation that the net asset value (NAV) was around $14.50 to $15/share. This is a clear decline from the original share price of $25/share, which had been dropping in recent years.
The secondary market site, Central Trade & Transfer, reported that Healthcare Trust shares had recently sold for $5/share. (HTI shares have also reportedly been available for as low as $1.50/share.) This could spell a loss of 80% or more for many investors.Healthcare Trust REIT Was Risky for Investors From the Start
With a limited operating history, Healthcare Trust REIT was initially presented as an emerging growth company. It was always a risky proposition and not suitable for most retail customers, inexperienced investors, conservative investors, and retirees.Risks Involving Healthcare Trust
Some of the risks involving this non-traded REIT included:
- Lack of public market for shares of its common stock. This likely meant indefinite illiquidity for investors.
- Offered materials by sponsor AR Global noted that the offering price had been determined “ arbitrarily.” This could mean that the investment’s actual value might be “substantially less” than what was paid.
- Conflicts of interest purportedly existed between HTI investors, sponsors, dealer managers, affiliates, and others. This included the fact that AR Global was the sponsor of several other publicly offered programs. Such tensions could have led to decisions that were not always in shareholders’ best interests.
- Brokerage firms and dealer managers received 10% in commissions or upfront fees on each investment made by a customer. When added to the other fees and offering costs made by AR Global, less than 87% of investors’ money was used to invest in properties.
If your brokerage firm recommended Healthcare Trust REIT to you and you subsequently suffered investment losses, speak with a seasoned securities lawyer right away. Your broker may have even concentrated your account with this risky, illiquid investment.
Due diligence failures could be a factor, and your broker-dealer may even have neglected to determine whether Healthcare REIT was unsuitable for you before suggesting that you buy. Your financial firm may have also failed to supervise your broker and their activities in your account.Seasoned Healthcare Trust REIT Lawyers
SSEK Law Firm has represented thousands of investors against broker-dealers and financial advisors. Through FINRA arbitration, mediation, and litigation, we have recovered millions of dollars for our clients. Our skilled non-traded REIT lawyers are known for fighting for investors while protecting their legal rights and best interests. Throughout the United States, call (800) 259-9010 today or contact us online.