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Our experts frequently write blog posts about the findings of the research we are conducting.

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Displaying 41-50 out of 73 results for "REIT".

SLCG Research: Priority Senior Secured Income Fund

(Oct 2013)

In our experience, retail investors are being sold increasingly obscure and non-conventional investments. An investment that raised our eyebrows recently is the Priority Senior Secured Income (PSSI) Fund. The PSSI Fund is the first regulated investment company that invests primarily in leveraged loans and collateralized loan obligation (CLO) tranches lower in their capital structures.

Unlike the mutual funds with which most retail investors are familiar, PSSI Fund investors are not able to...

Five Broker-Dealers Ordered to Pay over $10 Million in Restitution for Non-Traded REIT Sales

(Sep 2013)

Back in May, Massachusetts securities regulators ordered five independent broker-dealers to pay over $6 million in fines and restitution for improperly selling non-traded REITs. It also settled separately with another broker-dealer, LPL Financial, for an additional $2.5 million. Just yesterday, Secretary of the Commonwealth William Galvin announced an additional settlement with the same five broker-dealers for an additional $10.75 million in additional restitution for improper sales of...

Update on Inland American Non-Traded REIT

(Aug 2013)

Inland American Real Estate Trust, the largest non-traded real estate investment trust (REIT), has been the subject of intense scrutiny. In many ways, the criticism of Inland American has been representative of the issues endemic to non-traded REITs generally, such as poor dividend coverage, conflicts of interest, excessive payments to affiliates, stale or poorly updated share prices, and other issues we have discussed on this blog and in our research work . While these issues have been...

IRS Could Put a Halt to REIT Conversions

(Jun 2013)

We've talked a lot about real estate investment trusts (REITs) before. In the US, REITs are companies that invest at least 75% of their assets in real estate, pay out almost all of their annual income in dividends, but also pay little or no corporate income tax. As we've discussed before, many companies have tried to qualify for the REIT designation to reduce their tax liabilities, even if their business is only peripherally related to real estate.¹ This 'REIT conversion boom' has been...

Risks of Mortgage REITs

(May 2013)

Instead of investing in real estate property directly like equity real estate investment trusts (REITs) do, mortgage REITs borrow in the repo markets and invest in mortgage backed securities (MBS) -- mostly residential MBS issued by Fannie Mae, Freddie Mac, and Ginnie Mae. The current environment of low interest rates has kept the borrowing costs low for mortgage REITs, facilitating their outstanding growth. The figure shows the market capitalization for all listed mortgage REITs and the...

Massachusetts Fines Five Brokerage Firms for Sale of Non-Traded REITs

(May 2013)

Secretary of the Commonwealth of Massachusetts William Galvin, who has previously come out swinging on behalf of investors in both warehoused CLOs as well as leveraged and inverse ETFs, announced yesterday that the state has settled with five independent brokerage firms regarding improper sales of non-traded REITs. Non-traded REITs are pooled real estate investments that have become notorious for high fees, lack of liquidity, and numerous potential conflicts of interest, as we detail in our...

New FINRA Guidelines for Non-Traded and Private REITs

(May 2013)

In recent months, FINRA has been investigating how non-traded and private real estate investment trusts (REITs) are presented to retail investors. Last week, FINRA alerted broker-dealers that they had uncovered "deficiencies" in how these investments are sold, and issued Regulatory Notice 13-18 "to provide guidance to firms on communications with the public concerning unlisted real estate investment programs, including unlisted real estate investment trusts (REITs) and unlisted direct...

Valuations of Non-Traded REITs

(May 2013)

Earlier this week, the Investment Program Association (IPA) presented their guidelines for the valuation of publicly registered non-listed REITs. According to the IPA, these guidelines are supposed to "enhance the independence of the valuation process" and "enhance the quality of valuation disclosures to the investing public." For a discussion of the guidelines, see Brian Louis's recent story on Bloomberg.com.

Non-traded REITs -- real estate investment trusts that are registered with the SEC...

Why So Many REITs?

(Apr 2013)

Real estate investment trusts (or REITs) have been all over the news recently. The value of many traded REITs has increased dramatically as the US housing market has recovered (see, for example, Vanguard's REIT ETF VNQ which is currently trading at or above pre-crisis levels). Many mortgage REITs have been making headlines for their rapid growth and potentially adverse effects on the financial system. And of course, non-traded REITs continue to see criticism for reasons we've highlighted...

SEC Litigation Releases: Week in Review - March 15th, 2013

(Mar 2013)

Court Orders Former Prudential Securities Broker to Pay Over $763,000 Related to Deceptive Mutual Fund Market Timing Practices
March 13, 2013, (Litigation Release No. 22643)
A final judgment was entered against Frederick J. O'Meally, a former registered representative of broker-dealer Prudential Securities Inc, for allegedly using "deceptive practices to evade blocks by mutual fund companies on his market timing trading." The judgment orders O'Meally to pay over $763,000 in disgorgement,...

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