Highlands REIT (OTC: HHDS) Losses?

Highlands REIT (OTC: HHDS) Losses?

Soreide Law Group is evaluating potential investor claims against brokers who sold Highlands REIT. Apparently, this “independent, self-advised” REIT has sustained significant volatility and price declines. Particularly, Highlands REIT Inc., which trades on the secondary markets (OTC: HHDS), closed at $.001 on July 16, 2019, which represents a 52-week low, according to MarketWatch. Evidently, this REIT dropped 99% from its 52-week high. Here's more on the struggling REIT:

Highlands REIT Takes On Problematic Non-Core Portfolio

 
Apparently, Highlands REIT, established in 2016, has a portfolio comprised of industrial, office, apartment and retail assets. Apparently, this speculative portfolio is comprised of non-core assets formerly held by its parent company, InvenTrust Properties Corp – a non-traded REIT. Evidently, a Spin-Off Agreement involved InventTrust common stockholders receiving shares of Highlands REIT common stock.
Highlands REIT claimed that the Spin-Off would enable it to concentrate on maximizing the non-core asset portfolio’s value. However, the REIT ultimately took on bad assets. Indeed, the Spin-Off Agreement allowed InvenTrust to wash its hands of any liabilities or losses potentially arising from claims by third parties due to the separation. Some of those problematic non-core assets are obsolete, subject to legal problems, or are in less desirable areas or sub-optimal markets. Because of this, some of Highlands REIT properties lack income-producing potential. It appears that Highlands REIT has not made shareholder distributions since the InvenTrust Spin-Off.

REIT Suitability Concerns

Non-traded REITs are not meant for certain investors including those who are inexperienced, need liquidity or want to invest conservatively. Specifically, investors who hold non-traded REITs may not be able to sell shares quickly enough in volatile market conditions. In some cases, it may not be feasible for investors to liquidate their non-traded REITs at any point.
Also, It is not uncommon for brokers to breeze through their disclosures about risks of REITs like Highlands REIT. Particularly, some brokers could have played up past attractive rates of returns on REITs to induce clients’ purchases. However, they may have done so while failing to disclose risks. Seemingly, this happens because brokers can make more in commissions or fees by selling REITs or other alternative investments. Remember that brokers and advisors must both inform investors of all important investment information, such as market risks and illiquidity risks, and recommend only those investments which match their clients’ investor profiles.

Did Your Broker Or Advisor Inappropriately Sell You Highlands REIT?

 

Incur losses by investing in The Highlands REIT? If you have, contact Soreide Law Group at (888) 760-6552 and speak with experienced counsel about a possible recovery of your investment losses. Soreide Law Group represent clients on a contingency fee basis and advances all costs. The firm has recovered millions of dollars for investors who have suffered losses due to misconduct of brokers and brokerage firms.