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Did You Lose Money Investing in CNL Healthcare Properties?

Posted on Monday, March 1st, 2021 at 7:47 pm    

CNL Healthcare Properties

Did you lose money investing in CNL Healthcare Properties? Erez Law is investigating brokers across the country who recommended their clients invest in CNL Healthcare Properties, a non-traded real estate investment trust (REIT) that seeks to provide income and growth by investing in senior housing and healthcare markets. The company closed to new investors on Sept. 30, 2015.

In February 2021, CNL Healthcare Properties sent a letter to shareholders informing them that Comrit Investments 1 LP, a Tel Aviv-based investment fund, launched a tender offer to purchase up to 8.8 million shares of CNL Healthcare Properties Inc. at $3.66 per share, down by about two-thirds from an original offering price of $10 per share. 

As of December 2018, CNL Healthcare Properties’ previous estimated NAV per share was updated to $7.99 following a special distribution of $2.00 per share to shareholders in May 2019. In January 2021, the company announced that it plans to declare a new NAV in March 2021.

According to public records, CNL Healthcare Properties reported seven coronavirus (COVID 19)-related resident fatalities across all of its senior housing communities, of which there are 71, as well as 34 confirmed cases in 11 properties in 9 different states. 

Non-traded REITs offer high sales commissions and due diligence fees to brokers, which is perhaps one incentive for brokers to recommend these unsuitable investments to their clients. Additionally, non-traded REITs such as CNL Healthcare Properties offer tremendous risks to investors due to their lack of regulatory oversight, specially unsophisticated investors who do not understand the inherent risks associated with investments of this type. 

Pursuant to FINRA Rules, member firms are responsible for supervising a broker’s activities during the time the broker is registered with the firm. Therefore, brokerage firms across the country may be liable for investment or other losses suffered by its customers.

Erez Law represents investors in the United States for claims against brokers and brokerage firms for wrongdoing. If and have experienced investment losses, please call us at 888-840-1571 or complete our contact form for a free consultation. Erez Law is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies on a contingency fee basis.