Moody National REIT II Losses?

Did You Suffer Losses By Investing In Moody National REIT II?

Soreide Law Group is investigating potential investor lawsuits against financial advisors or securities brokers who may have sold or recommended investments in Moody National REIT II Inc. Namely, in August 2021, the Board of Directors of this non-traded REIT suspended the valuation of its shares. Because of this, investors are wondering what their shares are worth. Not only that, but the issuer has reportedly received one or more tender offers for the purchase of shares at a fraction of the price that many investors purchased them at. Here’s more about Moody National REIT II, including what you could do if you sustained losses.

What Is Moody National REIT II?

Moody National REIT II Inc., a non-traded real estate investment trust (non-traded REIT) based in the United States since  July 2014, invests mainly in hotels and other real estate. Financial advisors and securities brokers have reportedly sold shares of the REIT, receiving substantial fees (potentially as much as 10 percent sales commissions).

What Has Happened Recently To The REIT?

First of all, in August 2021, Moody’s Board of Directors decided that it would not present a valuation of its shares. In a Form 8-K that Moody filed in September 2021, CEO Brett C. Moody revealed that many investors have asked about when distributions would be made from the REIT, and when the share repurchase program would resume.
Notably, Mr. Moody mentioned that before making distributions or resuming the share repurchase program, the REIT would have to pay back senior lenders based on applicable loan modification agreements. The CEO mentioned the REIT’s need for a credit facility to do this.
In the secondary market, shares of Moody National REIT II have reportedly been going for as little as $10 per share as of March 2021. Supposedly, the REIT also received a tender offer in May 2020 for $5.00 per share. It appears that some investors paid as much as $25.00 per share.

Risks Relating To Moody National REIT II

Since Moody National REIT Inc. shares are not on a public exchange, there is no primary market for trading. Notably, investors seeking to redeem their shares may not be able to, especially if the issuer suspends or terminates its share repurchase program.
Some securities brokers and financial advisors choose to present real estate investment trusts as investments that can generate high income. However, these investments can be very speculative and contain a number of serious risks. Even greater risks are associated with non-traded REITs given illiquidity concerns. Critically, issuers of non-traded REITS don’t guarantee that you can easily sell or redeem shares. In fact, issuers can suspend distributions for certain reasons, leaving investors in a tough position.
And like other investments, there is no guarantee that the REIT achieves its objectives. Critically, with Moody National REIT being tailored to the hotel industry, it has obviously been harmed by COVID-19, which continues to affect hotel occupancy rates.
There is also the possibility that financial advisors or securities brokers made unsuitable or misrepresented recommendations, or committed other sales practice violations, concerning purchases of Moody National REIT II shares. If you sustained losses due to your advisor’s misconduct, then you could potentially bring a claim or lawsuit against them to recover those losses.

Suffered Losses By Investing In This REIT?

Did you experience losses by investing in Moody National REIT II because of your financial advisor or securities broker? If so, contact Soreide Law Group at (888) 760-6552 and speak with an experienced securities lawyer concerning a possible recovery of your investment losses. Soreide Law Group represents clients on a contingency fee basis and advances all costs. The law firm has recovered compensation for many investors in the US who have been wronged by securities brokers and financial advisors.