National investment loss lawyers KlaymanToskes continues its investigation of major wall street brokerage firms and brokers/financial advisors that recommended to their customers Blackstone Real Estate Income Trust (“BREIT”). Recently the company announced that it received redemption requests totaling $4.5 billion for the month of April, but only paid out $1.3 Billion.
In its Notice to Stockholders dated May 1st, the company reported that it fulfilled a mere 29% of withdrawal requests from investors in April, which is equal to 2% of BREIT’s NAV. This marks Blackstone’s six consecutive month of limiting redemptions for investors. Blackstone has limited investor withdrawals six times since November 2022.
KlaymanToskes previously reported the company’s announcement that it redeemed less than 15 percent of investors’ requested withdrawals in March, which reached $4.5 billion and saw an increase from February’s $3.9 billion in requests. In January 2023, withdrawal requests hit their peak at $5.3 billion, causing the stock of Blackstone, Inc. (NYSE: BX) to drop nearly 10 percent.
According to BREIT’s letter to stockholders, its “Share Repurchase Plan (the “Repurchase Plan”) has allowed for repurchases up to 2% of net asset value (“NAV”) in any month and 5% of NAV in a calendar quarter.” The company states that its SRP was designed this way to “prevent a liquidity mismatch and maximize long-term shareholder value.”
KlaymanToskes’ investigation notes issues of increased borrowing costs that could result in Blackstone potentially suspending repurchase requests altogether. In our opinion, due to the increased turmoil in the U.S. and global financial markets, including bank failures such as SVB and First Republic, investors should remain careful and attentive to the risks of investing with commercial real estate developers and in non-traded REITs.
Brokerage firms and financial professionals that recommended investments in Blackstone Real Estate Investment Trust (BREIT) may be liable for any investment losses incurred by their customers. In the event of a misrepresentation or omission of material facts resulting in losses suffered by the investor, the brokerage firm may be liable for a breach of fiduciary duty.
Brokerage firms have a duty to ensure that their customers are not concentrated in any one product or sector. In addition, brokers and their firms also have a responsibility to provide diversification and risk-management strategies.
KlaymanToskes believes that a Financial Industry Regulatory Authority (“FINRA”) securities arbitration claim may be the best solution to recover investment losses. FINRA arbitration occurs with increased speed and efficiency over court proceedings and is often a more cost-effective process for investors.
If you suffered investment losses in Blackstone Real Estate Income Trust (BREIT) due to the unsuitable investment advice of a full-service brokerage/advisory firm and/or a registered broker/investment advisor, contact attorney Lawrence L. Klayman at (888) 997-9956 or lklayman@klaymantoskes.com for a free consultation to discuss recovery options.
Our firm offers legal services on a contingency fee basis, meaning we do not collect attorney’s fees unless we are able to obtain a financial recovery for you.
KlaymanToskes is a leading national securities law firm which practices exclusively in the field of securities arbitration on behalf of retail and institutional investors throughout the world in large and complex securities matters. The firm has recovered over $250 million in FINRA arbitrations and over $350 million in other securities litigation matters. KlaymanToskes has office locations in California, Florida, New York, and Puerto Rico.
KlaymanToskes, P.A.
Lawrence L. Klayman, Esq.
888-997-9956
lklayman@klaymantoskes.com
www.klaymantoskes.com