Inland American REITs Unsuitable For Some Investors
Sales of Inland American REITs have produced a firestorm of financial headaches for investors, many of whom were sold on the products based on inappropriate recommendations from broker/dealers. Investments such as the Inland American Real Estate Trust and the Inland Western Retail Real Estate Trust are non-traded, or unlisted, REITs – financial products that have come under increasingly scrutiny lately because of the potential risks they may carry.
Non-traded REITs are not listed on a stock exchange, and investor redemptions are usually limited to a specified time frame. Most important, non-traded REITs can be pricey to get into, with fees as high as 15%.
In conversations with several investors, Maddox Hargett & Caruso has learned that many individuals who invested in non-traded REITs, including the Inland American Real Estate Trust and the Inland Western Retail Real Estate Trust, were ill-informed by their broker/dealer of the high fees, illiquidity and other risks tied to the products. If you suffered investment losses in either of these REITs or another non-traded REIT, contact us to tell your story.
February 26th, 2010 at 9:56 am
My investment adviser put me in Inland REIT without explaining the risk associated with this type of investment. I have to confess that I was in the voulnable as a new investor. It was a life insurance proceed from my husbands death. As she explained that shares were easy to liquidate. Thank goodness it was small portion of my investment, but I have no access to my cash at this point. Do you have any suggestions? I received the offer to buy the shares at deeply discounted price, but I am tempted to take the offer to just get out of this.
May 28th, 2010 at 9:40 am
My investment adviser put everything into Inland American. I was completely unaware that this was a very high risk investment, I was sold on it being safe and liquid. Now, I have nearly no income, and am about to lose everything.
Right before the REIT was frozen, my adviser conveniently retired and shut down his corporartion. I am desperate!
June 11th, 2010 at 2:54 pm
My mother passed away very recently and we learned that her banker advised her to purchase Inland American, now we have no where to turn. . .
July 17th, 2010 at 9:24 pm
My Broker, with Contempory Pensions Incorporated, suggest this REIT and at no time did he explain the risks associated with this investment. I now hold upwards of $55,000 in this REIT and I understand it has no liquidity until they (The Board) makes a decision on when the funds can be redeemed. This was further not explained by my financial adviser.
September 24th, 2010 at 12:18 pm
i have over 6000 shares of inland american reit my financial advisor got me into this because it was considered safe i was told the share price is $10.00 a share since it is not publicly traded the price does not change, paid a dividend of 6.5% which also does not change, and shares can be sold back to inland after 3 years. all of this has turned out to be not true. no byback, divdend now 5% share price to go down signifancly any time now
December 14th, 2010 at 8:39 pm
I am in the same situation as Fred and Rich. I had $55,000 in my Inland American Fund and was told that is was a safe investemnt and that I would earn more interest on it than I would in the bank. I beleive my fund has now been revalued at $44,000.
For anyone interested I would also recommend people to stay away from Pacific Life. My father and I opened an annuity with them and my father passed in 2008. I was the beneficiary on his account and his only heir. He left a Will stating this. A Judge in Oklahoma named Tom Lucas granted a court order and cashed out the fund. The money ended up in the hands of my fathers EX wife and she divorced him in 1999. I suppose nobody can be trusted. Our legal system is a complete joke.
December 20th, 2010 at 4:12 pm
My husband and I are in the same boat as everybody else. We had money that we wanted to invest from an inheritance that was special and dear and we wanted to make sure it was relatively going to do some work for us. At the strong advice of our broker/advisor, we diversified with the REIT investment. Now, our money has been held captive unless we take the HUGE decrease amount per share. We have found out that our advisor made the best decisions for HER, not US and I hope she can sleep at night. Unfortunately, it would cost us more money to prosecute her. I hope what goes around, comes around!
March 22nd, 2011 at 4:44 pm
I can relate…my Ameriprise financial advisor at the time put me in an Inland Western Retail REIT within my IRA. I have since transfered my IRA to a new advisor, but am now dealing with new administration charges ($250/year) and transation fees ($100 per transaction) for having the non-standard assets in my account because of the new compliance requirements and associated costs. I would take a huge lose to liquidate the REIT on the secondary market, have not redemptions options, and will create a taxable event to transfer registration to a new account that doesn’t charge all the fees. How can any of this be legal? I am furious.
May 25th, 2011 at 10:47 am
LIke the other comments, I wonder how advisors can make these irresponsible recommendations. Ameriprise advisers seem to have pushed this pretty hard and a number of folks are going to lose a bunch. Retirement is a few more years away now.
July 10th, 2011 at 8:50 pm
Same as other comments, I trusted my ameriprise adviser to invest some of my money into a safe account however we never discussed what a reitt investment trust was to my disgust he was looking out for me I tried to unload this reitt a yr.ago and should have done it as I took a loss in Nov 2010 now I worry what is on the horizon as it seems if I want to dump this reitt it will probably cost me half of the amount I have now but guess what I will at least get half of what I got and not loose more as I am retired and this one hurts I want to dump this junk any suggestions.
Bill