Our Law Firm is investigating securities arbitration claims against full-service brokerage firms who sold Cornerstone Core Properties Real Estate Investment Trust (“Cornerstone REIT”), including the sponsor of the REIT, Pacific Cornerstone Capital, Inc. In March 2012, Cornerstone REIT investors received a letter advising them that the share price of the REIT dropped from $8.00 to $2.25, representing a decline of about 72%. As a result, Cornerstone REIT investors have sustained significant economic damages. Klayman & Toskes, PA has significant experience in representing investors who sustained losses or have money locked up in REITs, and anticipates filing numerous arbitration claims on behalf of investors who sustained losses in Cornerstone REIT.
Cornerstone REIT is a non-traded, illiquid investment, and accordingly it was not suitable for all investors. Under Rules established by the Financial Industry Regulatory Authority (“FINRA”), brokerage firms have an obligation to make only suitable recommendations and to fully disclose all risks associated with a recommended product, including the fact that REITs are illiquid products. Moreover, brokerage firms have a duty to conduct a reasonable investigation of the issuer and the securities they recommend before approving them for sale to their customers.
In October of 2011, FINRA issued a new Investor Alert called Public Non-Traded REITs-Perform a Careful Review Before Investing to help investors understand the benefits, risks, features and fees of these investments. While investors may find non-traded REITs appealing due to the potential opportunity for capital appreciation and the allure of a robust distribution, investors should also realize that the periodic distributions that help make non-traded REITs so appealing can, in some cases, be heavily subsidized by borrowed funds and include a return of investor principal. Additionally, early redemption of shares is often very limited, and fees associated with the sale of these products can be high and erode total return.
Investors who purchased Cornerstone Core Properties REIT can contact K&T to explore their legal rights and options. The attorneys at K&T are dedicated to pursuing claims on behalf of investors who have suffered significant losses. K&T, an experienced, qualified and nationally recognized securities litigation law firm, practices exclusively in the field of securities arbitration and litigation. It continues its representation of investors throughout the world in securities arbitration and litigation matters against major Wall Street brokerage firms.
If you are an investor of Cornerstone Core Properties REIT, please contact our firm.