National investor fraud law firm, KlaymanToskes (“KT”), announces an investigation on behalf of investors in Hospitality Investors Trust (“HIT REIT”), formerly known as American Realty Trust, following the filing for Chapter 11 Bankruptcy Protection in the United States Bankruptcy Court for the District of Delaware (Case No. 21-10831). Hospitality Investors Trust is classified as a Non-Traded Real Estate Investment Trust (“REIT”) that was touted as offering current income to investors with a conservative to moderate risk tolerance. Non-Traded REITs tend to have high expenses and fees, along with limited liquidity which make this type of investment unsuitable for most investors.
Non-Traded REITs, such as Hospitality Investors Trust, are inherently more risky than traditional fixed income investments, due to the high level of commissions, fees, and leverage associated with the capital structure. According to securities attorney, Lawrence L. Klayman, “Non-traded REITS are subject to risks that are not easily understood by investors who lack the sophistication to determine the nature of the risks associated with the strategy.” Failure to fully disclose all relevant facts, including the risks and expenses, related to investments may be a cause of action in a Financial Industry Regulatory Authority (“FINRA”) securities arbitration claim.
The sole purpose of this release is to investigate investment advice provided by full-service brokerage firms related to Non-traded REITs, such as Hospitality Investor Trust for investors with income investment objectives and a conservative or moderate risk tolerance. Investors with losses in excess of $250,000 from concentrated investments in non-traded REITs at full-service brokerage firms who have information related to the handling of their investment portfolios are encouraged to contact Lawrence L. Klayman, Esq., at (561) 542-5131, and download our Special Investor Report.