REIT's

Valuations of Unlisted Real Estate Investment Trusts and Direct Participation Programs – Boca Raton, Florida REIT and DPP FINRA Arbitration and Litigation Attorney

Published on: October 23, 2014 | By Russell L. Forkey, P.A.

SEC Order Approving FINRA Rule Change Relative to How Member Firms are Required to Calculate the Value of Unlisted Real Estate Investment Trusts and Direct-Participation Programs:

The Sec has approved FINRA’s plan to overhaul how member firms calculate the value of unlised real estate investment trusts (“REITs”) and direct-participation programs (“DPPs”). Under the new rules – specifically FINRA Rule 2310 – the firms will be required to include on customer account statements a per-share estimated value for any unlisted REIT and DPP securities that they have reason to believe is reliable.

Firms also will need to make new disclsoures about the nature of the investment, including that they are not traded on a public securities exchange and that the price that the investor receives may be less than the estimated per-shre value.

Private Equity – Private Investment – Private Security – Florida Fraud, Misrepresentation and Mismanagement FINRA Arbitration and Litigation Attorney

Published on: September 25, 2013 | By Russell L. Forkey, P.A.

Private Equity, Private Placement and Private Investment – South Florida Fraud, Misrepresentation and Mismanagement State and Federal Litigation and FINRA Arbitration Attorney:

The Securities and Exchange Commission recently charged the former president of a purported private equity real estate firm based in San Bernardino, Calif., with defrauding nearly 500 investors who purchased promissory notes under the false premise that they were secured by specific properties or other collateral.

The SEC alleges that Larry Polhill used his company American Pacific Financial Corporation (APFC) to buy and sell real estate and distressed assets, and he offered investors the opportunity to invest in the company through unregistered notes that would yield them interest payments of 5 to 17 percent per year. However, the collateral that Polhill and APFC claimed made the investments secure was often non-existent or otherwise impaired. The properties underlying the investments were sometimes even sold without notice to investors. When APFC eventually filed for bankruptcy, it named the investors as unsecured creditors who were owed nearly $160 million. None of Polhill’s investment offerings were registered with the SEC.

Gregg D. Caplitz and Onsite Strategic Management – Boca Raton, Florida Investment Advisor Fraud and Mismanagement Litigation and FINRA Arbitration Attorney

Published on: March 19, 2013 | By Russell L. Forkey, P.A.

Securities and Exchange Commission v. Gregg D. Caplitz, et al., Civil Action No. 1:13-cv-10612-MLW (D.Mass.)

SEC OBTAINS ASSET FREEZE AGAINST MASSACHUSETTS-BASED INVESTMENT ADVISER STEALING MONEY FROM CLIENTS

The Securities and Exchange Commission recently announced an asset freeze against a Massachusetts-based investment adviser charged with stealing money from clients who were given the false impression they were investing in a hedge fund.

Tax Shelter – South Florida Attorney

Published on: June 23, 2012 | By Russell L. Forkey, P.A.

What is a “tax shelter” and what is an “abusive” tax shelter?

This post is designed to provide the reader with general information concerning tax shelters as a concept and what constitutes an abusive tax shelter. Please keep in mind that this information is being provided for informational purposes only and is not designed to be complete in all material respects. Thus, it should not be relied upon as providing legal or investment advice. If you have any questions concerning this post or its contents, you should seek a qualified professional.

Tax Shelter:

Investing in REITS and Special Tax Considerations

Published on: December 31, 2011 | By Russell L. Forkey, P.A.

How to invest in a REIT:

As with any investment, you should take into account your own financial situation, consult your financial adviser, and perform thorough research before making any investment decisions concerning REITs. You can review a REIT’s disclosure filings, including annual and quarterly reports and any offering prospectus at sec.gov. You can invest in a publicly traded REIT, which is listed on a major stock exchange, by purchasing shares through a broker (as you would other publicly traded securities). Generally, you can purchase the common stock, preferred stock, or debt securities of a publicly traded REIT. You can purchase shares of a non-traded REIT through a broker that has been engaged to participate in the non-traded REIT’s offering. You can also purchase shares in a REIT mutual fund (either an index fund or actively managed fund) or REIT exchange-traded fund.

Special Tax Considerations:

Non-Traded REITs – Some Factors To Consider!

Published on: December 31, 2011 | By Russell L. Forkey, P.A.

When considering whether or not to invest in a non-traded REIT, there are a number of factors to consider. Some of these are:

(a). Lack of Liquidity: Non-traded REITs are illiquid investments; they generally cannot be sold readily on the open market. If you need to sell an asset to raise money quickly, you may not be able to do so with shares of a non-traded REIT. Although non-traded REITs usually offer share redemption programs, these are typically subject to significant limitations and may be discontinued at the discretion of the company. Investors may have to wait to receive a return of their capital until the company decides to engage in a transaction such as the listing of the shares on an exchange or a liquidation of the company’s assets. The timing of these liquidity events is at the discretion of the company, and may be more than 10 years after the investment is made.

(b). Share Value Transparency: While the market price of a publicly traded REIT is readily accessible, it can be difficult to determine the value of a share of a non-traded REIT. Because non-traded REITs are not traded on an exchange there is no market price available. Non-traded REITs typically do not provide an estimate of their value per share until 18 months after their offering closes, but this may be years after you have made your investment. As a result, you may not be able to assess the value of your non-traded REIT investment for a significant time period and may not be able to assess the volatility of your investment.

Publicly Traded REITs vs. Non-Traded REITs – Some Differences

Published on: December 31, 2011 | By Russell L. Forkey, P.A.

Many REITs (whether equity or mortgage) are registered with the SEC and are publicly traded on a stock exchange. These are known as publicly traded REITs. In addition, there are REITs that are registered with the SEC, but are not publicly traded. These are known as non-traded REITs (also known as non-exchange traded REITs).

The purpose of this post is to provide the reader with certain general information and comments relative thereto. Please keep in mind that this information is being provided for educational purposes only and is not designed to be complete in all material respects. Thus, it should not be relied upon as providing legal or investment advice. In you have any questions relative to the subject matter here, you should contact a qualified professional.

There are significant differences between publicly traded and non-traded REITs. The specific differences are beyond this parameters of this post. However, a few examples are:

REITs – What are the Three Categories of REITs?

Published on: December 30, 2011 | By Russell L. Forkey, P.A.

Real Estate Investment Trusts (REITs) have been around for a number of years. However, they have some unique risk – reward features that every investor should be aware of. Consequently, we have provided a series of posts, with this being the third, which provide information concerning these types of investments. Because of the fact that this post is being provided for informational and/or educational purposes only, it is not designed to be complete in all material respects. Thus, it should not be relied upon as legal or investment advice. If you have any questions about REITs, you should contacted a qualified professional.

Three Categories of REITs: Equity, Mortgage, and Hybrid:

REITs generally fall into three categories: equity REITs, mortgage REITs, and hybrid REITs. Most REITs are equity REITs. Equity REITs typically own and operate income-producing real estate. Mortgage REITs, on the other hand, provide money to real estate owners and operators either directly in the form of mortgages or other types of real estate loans, or indirectly through the acquisition of mortgage-backed securities. Mortgage REITs tend to be more leveraged (that is, they use a lot of borrowed capital) than equity REITs. In addition, many mortgage REITs manage their interest rate and credit risks through the use of derivatives and other hedging techniques. You should understand the risks of these strategies before deciding to invest in these types of REITs. Hybrid REITs generally are companies that use the investment strategies of both equity REITs and mortgage REITs.

REITs – What Qualifies a Company as a REIT?

Published on: December 30, 2011 | By Russell L. Forkey, P.A.

Real Estate Investment Trusts (REITs) have been around for a number of years. However, they have some unique risk – reward features that every investor should be aware of. Consequently, we have provided a series of posts, with this being the second, which provide information concerning these types of investments. Because of the fact that this post is being provided for informational and/or educational purposes only, it is not designed to be complete in all material respects. Thus, it should not be relied upon as legal or investment advice. If you have any questions about REITs, you should contacted a qualified professional.

How to Qualify as a REIT?

To qualify as a REIT, a company must have the bulk of its assets and income connected to real estate investment and must distribute at least 90 percent of its taxable income to shareholders annually in the form of dividends. A company that qualifies as a REIT is allowed to deduct from its corporate taxable income all of the dividends that it pays out to its shareholders. Because of this special tax treatment, most REITs pay out at least 100 percent of their taxable income to their shareholders and, therefore, owe no corporate tax.

REITs – What Every Investor Should Know!

Published on: December 30, 2011 | By Russell L. Forkey, P.A.

Real Estate Investment Trusts (REITs) have been around for a number of years. However, they have some uniquie risk – reward features that every investor should be aware. Consequently, we have provided a series of posts, which provide information concerning these types of investments. Because of the fact that this information is being provided for informational and/or educational purposes only, it is not designed to be complete in all material respects. Thus, it should not be relied upon as legal or investment advice. If you have any questions about REITs, you should contacted a qualified professional.

Specifically, REITs have been around for more than fifty years. Congress established REITs in 1960 to allow individual investors to invest in large-scale, income-producing real estate. REITs provide a way for individual investors to earn a share of the income produced through commercial real estate ownership – without actually having to go out and buy commercial real estate.

What is a REIT?